It’s getting more expensive to buy auto insurance in the United States, a fact that could push consumers to compare quotes and jump ship in search of a better deal. That’s good news for agents working through cold calling their aged auto insurance leads because when prices rise, consumers get in the mood to shop.
Auto Insurance Costs Are up 7.5%
The U.S. Bureau of Labor Statistics just put out its latest Consumer Price Index report. Overall, prices are up year over year by 2.5%. So it’s no surprise that there’s also been an increase in car insurance premiums.
But it is somewhat surprising how much they’re up — 7.5% from just a year ago in January 2016. In real dollars, this is a change from $1,194 annual premium in 2011 to $1,323 today for the industry’s average customer (a 30-year-old single male with a good driving record and standard coverage).
Some state’s rates are even higher. In 2016, the typical annual premium in Michigan and Delaware was over $2,000. Oklahoma, Kentucky, and Texas were close behind.
Competition Is on the Rise
Bloomberg reports that Travelers Insurance is “one of the last big shoes to drop,” announcing it was raising its premiums at the first of the year. According to the same story, Allstate and Geico have reportedly been inching up their rates since 2015. Bloomberg says this is pushing startups and venture capital investors into the online insurance marketplace.
These two factors, higher premiums, and new carriers, is going to affect auto insurance leads, and in particular, aged auto insurance leads. Folks who thought about shopping around in September, but didn’t follow through, may finally have the incentive to get serious.
They may first look to some of the startup options, like Metromile, a mileage-based insurance startup. But many traditional carriers offer discounts for usage-based insurance (UBI) through Internet of Things connectivity, too. Just a few months ago, I wrote about this new technology that’s reshaping the industry and the opportunity it could give you to help your customers save on costs. But that’s just the beginning of the conversation.
Opportunity Is There for the Taking
In fact, there are lots of ways this development could be good for you and your leads. An auto insurance agent’s job the next few months should be to closely investigate this opportunity. Can your current clients benefit from a coverage review? Are your backburner leads ripe for a new nurturing campaign? Or is it time to buy a fresh batch of aged leads?
When it’s time to start cold calling prospects, keep these facts in mind:
Remember that not all leads are experts on the insurance marketplace, much less, the latest industry pricing and carrier changes. Use your position as an agent to educate your leads on what they need to know. Use drip email campaigns, lead magnet forms, or micro sites to target web leads. For cold calling leads, have those call scripts ready to go.
Ask the Right Questions
On the phone, remember that a big part of the job is asking the right questions to move a prospect towards a sale. When it comes to auto leads that may be overinsured, underinsured, or paying too much, you want to know so you can help. Frame your questions appropriately.
Target the Right Needs
Lastly, target the needs of your leads. All the basics apply: ask open-ended questions, let them do most of the talking, and listen carefully. When you understand their needs, you can move them towards the sale.
This is a really good opportunity for those old leads sitting on your backburner and for adding aged leads to your business. Stay informed, think about your strategy, and get ready to make the most of this opportunity.
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