In industries like property and casualty insurance, ethics and compliance play a huge role in how companies want to set up their incentive programs. Mark Herbert’s most recent article, exclusive to National Underwriter Property & Casualty 360, explores how insurance brokerages can structure KPI based incentives to drive sales, while building trust with clients.
Property and casualty insurance brokerages face a bit of a dilemma. Of course, they want to increase sales. But the long-term value of their brand is rooted in their ability to act as trusted advisors to their clients, and being too salesy can jeopardize that relationship. It’s important to balance increasing sales and legitimately looking out for their clients’ best interests. Doing so requires incentivizing the right KPIs.
Potential Differences in the Goals of Agents and Brokers
Since insurance agents are paid by commission, they already have financial motivation to chase short-term results. This can result in behavior that’s damaging for brokerages in the long-term:
- Trying to push add-on policies that don’t feel relevant or valuable to the client.
- Focusing on new leads instead of consistently following-up with existing clients.
- Not taking the time to learn the ins-and-outs of policies that aren’t their ‘go-to’ sales.
KPI based incentives can be used to motivate insurance agents to look at the bigger picture and focus on other types of behavior that will result in sustainable, long-term sales growth by building trust with clients and offering better service.
Types of KPI Based Incentives Brokerages Should Use to Align these Goals
In the article, Mark Herbert identifies several KPIs insurance brokerage can incentivize to align the goals of individual agents with the goals of the brokerage.
- Using Incentives to Build Better Product Knowledge: Assigning reward points for performance on interactive quizzes can motivate insurance agents to improve their knowledge of the policies you offer. This, in turn, will allow them to better advise and educate your prospects on the policies that are right for them, ultimately leading to more sales .
- Creating Incentives that Improve Area Coverage: Segmenting your area into different verticals based on territory, organization, or other categories lets you effectively assign points for lead generation or client follow-up. Assigning specific point values to prioritize certain behaviors or parts of your area ensures that your insurance agents are motivated to work together to provide quality follow-up for existing accounts and to maximize area coverage .
- Offering Incentives for Upholding Company Values: Another strategy some of our clients use is to offer point certificates or online recognition for demonstrating company values. They know that their company values are aligned with their long-term goals and inspiring agents to live out those values will result in long-term growth.
Additional Resources for Insurance Sales Incentives
If you’re interested in learning more about KPI based incentives insurance companies can use, make sure to check out some of these articles and blogs: