Henry Ford once said, "You can have it in any color you want, as long as it is black." I was reminded of this famous quote when I was recently discussing insurance education. You can have any class you want as long as it only covers boilerplate language. Then I was again reminded of this quote relative to insurance education while listening to a coverage expert explain policy language. His explanation was great and useless.
Focusing on policy language is useless and counter productive from two perspectives. The first is that until you know what a customer's exposures are, it does not matter what the policy says. Focusing on the policy first commoditizes insurance as much as anything. Industry experts who decry the commoditization of insurance are often people who focus primarily on policy language rather than the customer. By focusing on the policy, we are saying, "Regardless of your needs, your exposures, here's a policy and I hope you want black." The agent may go on to advise, "I know that policy in and out. Do you have any questions?" More often they will say, "Here is a policy and I can get it for a cheaper price."
This approach also creates massive, if unstated, assumptions that make the consumer feel small. The assumption is, "I already know what you need so I am not going to ask you any questions about what you need."
The purpose of insurance is to provide coverage for people's assets that are at risk of being lost or damaged whether through a direct peril or a liability. Furthermore, these assets cannot otherwise be more efficiently protected other than through proactive risk management. In other words, proactive risk management is the first choice and insurance is the second choice. Most often agents lead with insurance without identifying each client's unique needs and exposures.
The conversation really should begin with, "Tell me about your home/company/family." The conversation should be based on an exposure checklist because most insureds, even really large commercial clients, do not immediately understand all their exposures. Step two then should be to find a policy or policies that address that specific client's exposures. The boilerplate industry policy is not the right solution a lot of the time. Better policies often exist.
The second reason the traditional approach is backwards is because it is a carrier centric sales approach. "Here is what I have to sell from the carriers I represent. I hope you want black." A far better approach is to figure out what a client needs and then figure out which policies fit best, even if it means combining policies or using surplus lines. I know many agents think this is what they do, but they don't. I have conducted far too many E&O audits and due diligence assignments to believe this is what most agents do. It definitely is what agents think they do, but the facts of the audits do not support their beliefs. A serious disconnect exists and I am not 100% sure why, but I think it is because most people in the industry do not understand exposures or how to identify exposures.
These traditional sales and education methods have grown together and truly are analogous to substance abuse co-dependencies. The question is this: Do you want to stand out as a leader in providing your clients what they truly need? I can advise you that my clients who do, and will do the hard work, outsell almost every agency in the country. Their E&O exposures, all else being equal, are smaller too.
I hear many people say they’d love that kind of success, but actually taking the time to talk to customers and learn their exposures, well, "Who has time for that?" The winners. Another common comment I get is, "Actually learning different policies, and then matching client needs, that is a ton of work. Isn't there some easier way?" Not for winners. Cutting corners is for losers.
Bobby Knight is credited, though I've been told he did not originate it, with one of my favorite quotes, "Everyone has the will to win. Few have the will to prepare to win."
I've polled many ex-collegiate athletes who are now in the insurance industry. I've asked them how many hours they prepared to win when playing athletics in college vs. actual game times. The ratios vary but let's use 10 hours of preparation for each game hour. How many hours do producers spend truly learning coverages? Required CE might be 24 hours per year or one hour of learning for 10 hours of playing, the exact opposite. Most of the preparation that producers undertake, if there is any, is for sales training. Selling something if it is not what the client needs and is wrong for them increases your or your agency's E&O exposures!
Winners have the will to prepare to win. Agents who want to truly protect their clients first learn what the clients' needs are and then find the policy that fits them. My clients who have the will to prepare to win, including learning how to solve their clients' exposure issues, have so much more success than the producers I see when auditing agencies. The differences are night and day.
Because I saw so many E&O claims created by producers who had no idea what they were doing, even accredited producers, I created the most innovative education program available that puts clients first and forces account managers and producers to learn different forms at a deep, but efficient level. After four years, the results speak for themselves. The program absolutely separates the winners from the losers because we get people who think they want to learn, but when they must show they are willing to put in the time to learn (only about one hour per week), they don't do it.
If you are interested in joining the winners' club and willing to do the work, check out Three Dimensional Training® at: https://www.burandeducation.com/three-dimensional-training. Contact me if you are ready to embark on the journey that will give your career more purpose and if history is indicative, much larger paychecks.
NOTE: The information provided herein is intended for educational and informational purposes only and it represents only the views of the authors. It is not a recommendation that a particular course of action be followed. Burand Insurance Education, Burand & Associates, LLC and Chris Burand assume, and will have, no responsibility for liability or damage which may result from the use of any of this information.