Reasons people cancel their insurance
All this week we’re honing in on how you can boost retention by reducing insurance cancellations. In order to do that, we really need to have a thorough understanding of the reasons people cancel their insurance. If your insurance agency needs help tracking reasons people cancel their insurance, you’re not alone. Many agencies we work with don’t have a full handle on this data. But the truth is, when you understand the reasons people cancel their insurance, you can ultimately reduce cancellations.
“You can’t address it if you don’t know about it, and that’s a huge strategy we all need to embrace.”
Here are some ways you can keep track of the reasons people cancel their insurance:
1. See if it’s accessible in your management system
There’s good news and bad news when it comes to many commonly used management systems: some make it easy to track the reasons people are leaving, while others do not. Take a look at your system and check its capabilities for tracking cancellation reasons. But also keep in mind that a big issue is typically the fact that if a policy is downloaded, it tends to wipe out that cancellation reason.
2. Know how to categorize your cancellations
This is where some agencies can get fired up, and we love to see that, because it means agencies care about their data. If two of your insured clients get married and join policies, are you categorizing that as a cancelation? What if there’s an exchange, for example, someone switches from renting to buying? Having codes for these situations can help you properly sort through the data. If you need help figuring out these codes, you don’t need to reinvent the wheel. We have you covered with our Agency Process Packs.
3. Take steps to get the data
Actually collecting the data about the reasons people cancel their insurance might require a little extra legwork, especially at first. You need to contact clients to find out, and not all of them may respond. Here’s our advice: instead of having their account manager call them, send the client a survey instead, with an incentive. The client may have a tough time being candid with the account manager, especially if the account manager was the problem. But if you send them an online survey with a $5 gift card to a coffee shop, you’re much more likely to get a response. That’s good money to spend to get accurate information about why someone’s leaving.
The bottom line is that in order to address why your clients are canceling, you need to have a thorough understanding of the reasons why they’re leaving. A few small steps can go a long way at helping you boost your retention in the long run.
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