Changes like the ones we’re seeing in group benefit lines at the moment have a huge effect on agencies. The ones that have failed to react to the changes, or waited for the Supreme Court decision to think about it, are now at a significant disadvantage. Those agencies are likely to lose both clients and revenue to better prepared agencies and Health Insurance Exchanges, with a knock-on effect that could negatively impact the sale of the business. In some extreme cases, the lack of action may force them to sell up early and lose out on potential earnings.
Health Care Reform may be a special case. Few insurance industry changes will be as broad as these. That doesn’t mean we can’t learn lessons from this situation. As an agency owner, the way you react to changes will have a big impact on the business’ success. There are a few steps you can take to ensure you’re not taken by surprise the next time there’s a change in the industry.
Stay Informed
Both the simplest and most difficult piece of advice is to keep your eyes open. Make sure you’re regularly talking to peers and reading up on industry trends. You’re probably doing some of this already. You need to know the industry to provide an effective service. The difference here is to make sure you’re looking beyond your agency’s location and your current client needs. If you don’t take a broad view of the industry as a whole, something could creep up on you.
Don’t Ignore
It’s also important that you keep an open mind when you hear about potential changes. We’ve heard stories of agencies that assumed the Supreme Court would strike down the Affordable Care Act, so they didn’t plan for it. Those are the agencies currently suffering. You can’t afford to say ‘That will never happen.’ It’s better to be prepared and not need the information than need it when you’re totally unprepared.
Research
When you do hear about potential changes, you need to research them from top to bottom. The more informed you are, the better the service you can provide to your clients. By planning for insurance industry changes, you can become an authority and achieve a competitive advantage. If you don’t research properly, you wind up playing catch-up.
Tell Your Clients Everything
Don’t hold back any of the information from your clients. Even if the potential changes are bad news, share it with your clients and tell them how you can help. Clients value honesty and reliability above every other factor. You will lose their trust if you fail to provide important information.
Over-Promise, Then Deliver
The way you present the new information to clients will also be vital. You need to put their mind at ease and let them know that you will be able to guide them through the changes. You may be unsure of the practical details of the changes; the current uncertainty surrounding exchanges has caused some confusion. Your clients need to know that they can rely on you; so you need to exude the confidence that shows you will be ready when the time comes. Then you need to deliver on that promise.
Your insurance agency will go through industry changes which will possess challenges along the way. Download our whitepaper and find out how each challenge affects the long-term value of your agency.
