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Price IS Not Everything!

Author: Carolyn “Cal” Durland, CPCU
Program Manager and Member Relations, AUGIE Facilitator, ACORD

durland cal 150x150 Price IS Not Everything!Over the last 6 months I’ve been telling my peers that it ‘feels’ like the commodity and price  driven marketing  by our lizard competition (and other direct writers) seems to be subsiding.  Common sense will tell an agent owner that it’s nearly impossible to save a client 15% or more year after year.  Even in the continuing soft market, every consumer has had the opportunity to shop their insurance at least once, some annually.  No matter what a company does, eventually the savings for that client is going to bottom out.  And it’s my feeling that consumers are realizing this and coming back to the reality that a real, local, insurance professional that’s coaching their kid’s sports team, or actively involved in the community, is an entirely viable alternative to the 800 toll-free stranger.  And now that many of us can provide a web-based rating solution, which is arguably more important to the next generation, the $10, $50, or $100 ‘savings’ isn’t as important.

Recently, I received some confirmation to my ‘feelings’!  JD Powers came out with a study on attitudes and habits of the automobile shopper.  The article states that “….price accounts for only 28 percent of overall customer satisfaction with the purchase experience—less important than both policy offerings (29%) and distribution channel (43%).”  It further says “…past service experiences play a considerable role in the purchase decisions of retained customers, and in some cases, may even outweigh the appeal of a lower-priced competitor.”

What’s the moral of the story?  Our future customers DO like to start out the quoting process online.  But they do care about local representation.  So Independent Agents must have a pretty good website (cut the yellow pages and invest it in a web designer!), and they need a consumer rating tool to satisfy that urge to quote online.  Then it’s the IA’s job to write AND keep the business, which most of us are very good at!

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One Comment

  1. I completely agree with this article! We are currently in the process of building a better and more “client oriented” website. I look forward to seeing more articles like this! Keep up the great work!

    Christopher Signore, Agent

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