If any of you follow our content you will see that we are pretty vocal on how to avoid a remarket. Just to be clear, I am still very adamant we avoid client dictated remarkets. As we spread our renewal review call program, AppX Retention, we have found an area that we feel we need to bring to people’s attention: the avoidable mid-term cancellation.
You need to call people at renewal — there is absolutely no doubt about that. However, there are some things that can happen in personal lines in the middle of a term that are causing concerns. Tracking this for a few months, we are seeing a dramatic increase in vehicle change cancellations one month after the change.
Yes, one month. Here is the challenge: people call in to add the new vehicle, and they want to get in the new car. They say yes or have no reaction to the rate increase. However, they drain some savings, the car payment is probably a bit more than they bargained for, and the easiest thing to reduce is their insurance.
Now you know if you have ever purchased a vehicle that everything is about getting the car people like within their ideal budget. However, once you drive a car with a moonroof, who can go back? The car salesman and the financing team are looking to make deals, and also they participate in major butt kissing. Everyone is making the customer feel like a million bucks; basically everyone else is trying to make a deal.
Then the client calls in about insurance. Now, speaking from personal experience, the call comes into an agency, and the person handling the vehicle swap treats it like a transaction. In many instances the agent doesn’t even congratulate them. So we go from being treated like royalty to being tossed in a transaction.
In insurance we get insurance brain. That means when we see someone increasing their insurance $250 by adding a newer vehicle, we are immune. We do it all the time, however, the client gets frustrated and discouraged. They add the vehicle and then go shopping — without telling us. We need a system in place to follow up after the vehicle gets replaced to lock in that client.
Here is the other time when remarketing is 100% necessary: when a family adds on a youthful driver. Now this is more of a courtesy check for the family. They may not actually move, and you may not recommend they move companies. BUT the act of you taking those extra steps to lock in an account is the point and the plan. People want to know that you are working for them and on their behalf. Checking the market is showing the mom of a youthful driver that you are working to make her life easier.
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