As an agent, you probably have several current and potential clients who could really benefit from having an umbrella policy, but do not have one. By simply spending a bit more time focusing on educating the consumer and promoting umbrella policies, your agency could begin seeing a significant increase in revenue.
There was once a widespread perception that clients didn’t need umbrella policies unless they were very affluent. However, some who we would consider middle-class could also benefit from these arrangements. Some examples include: rental property owners, parents with teenage children (those who are beginning drivers or who have terrible driving records), owners of luxury cars or those with large mortgage payments. In other words, those who are vulnerable to a loss would appreciate spending a few extra dollars for this peace of mind.
Understand that most consumers want to lower their premiums, so simply offering them another policy to pay for is not the most effective strategy. However, when you educate the consumer about what they may leave themselves exposed to by not having an umbrella, many will find themselves very open to a cost-manageable solution. For example, an at-fault accident resulting in multi-million dollar litigation can prove itself financially devastating without appropriate coverage.
So, how do you find clients who need an umbrella policy, and how do you convince them of the need? The following are a few simple, yet effective, strategies.
- Ask Everybody: Ask every new client if they want an umbrella policy. This will give you an opportunity to share the reasons the policy would be beneficial, including exposing potential risks the client may not have considered before. It sounds too simple to work, but unless you start the discussion, you’ll never know whether the client is open to the idea.
- Target Existing Clients: Look through your book of business for every client currently carrying 250/500 limits (300 for homeowners). Reach out to these customers, explaining how an umbrella policy may benefit them. You may be able to easily identify any changes in lifestyle or need through this informal conversation.
- Target Rental Property Owners: Landlords are often surprised to find themselves entangled in disputes started by their tenants. For example: a tenant whose pet injures someone may find themselves in “hot water” legally; however, if they do not have insurance, the frustrated litigant may seek damages directly from the property owner. This makes landlords a great target market.
- Advertise in Affluent Areas: If your agency is located in or near an affluent area, you will want to educate those consumers regarding their potential need for an umbrella policy. Write an article for the local community newspaper or magazine, write about it in your agency’s monthly newsletter, publish a blog post, and don’t overlook the power of direct mail. After all, we all want the peace of mind that comes with knowing what’s dear to us, including our families, is fully protected.