Table of Contents
Part One
Welcome!
Some Orientation Goals
What You Can Expect
What You’ll Be Asked to Contribute
What Does the Future Hold?
How Your Mentor Can Help
5
5
8
8
9
Insurance Agency Basics
Agency Authority and Binding
Regulation and Licensing of Agents
Different Types of Agencies
People Who Work in Agencies
13
13
14
14
Part Two
Getting the HR Chores Behind You
HR Checklist
Getting Aquainted With Your Colleagues
Getting Comfortable in Your Surroundings
Your Workspace
Obtaining Your License
18
19
20
20
28
Part Three
Understanding Insurance
The History of Insurance
How Insurance is Sold to the Public
Steps in the Sales Process
What is ACORD?
18
35
00
00
Underwriting – Decisions, Decisions
Where Do the Premiums Go?
Government Rules for Underwriting
Insurance Services Provided to Customers
Understanding the Claims Process
Understanding Personal Insurance
Understanding Commercial Insurance
Understanding Insurance Premiums
Employee Orientation
18
00
00
00
00
00
00
Page 2
Part Four
Agency Workflows and Procedures
Meeting Customers Needs
Keeping Promises
Fufilling Responsibilities to the Company and Agency
Sales Opportunities
00
00
00
00
Part Five
Considering the Right Coverage for the Customer
Seeing the Big Picture
Where Does the Customer Need Coverage
Other Sources of Customer Information
Putting the Pieces Together
Learning Risk Management
18
00
00
00
00
Part Six
Customer Service Issues and Techniques
It’s Not All About Price
Who is Your Customer?
Beware the Cycle of Death
Everyone is in Customer Service
How Do Customers Touch Your Agency?
Outstanding Customer Service is More that Just Being Nice
18
101
000
000
000
000
Part Seven
Introduction to Error & Omissions
How to Avoid E&O
018
Part Eight
Development Planning
Professional Development Resouces
Employee Orientation
018
Page 3
Part One
Welcome!
Congratulations on your decision to join the insurance agency! You
are about to begin a fascinating and rewarding journey. In your
position, you will play an important role in helping this organization
serve hundreds or even thousands of people and businesses. It won’t
take long for you to be amazed at the impact you can have on the
lives of people in your community.
To get you fully integrated into your new
business family, we will be using the
framework of this orientation guide to help.
Although there are many things we hope
to accomplish, following are a few goals
for this introductory period
in the agency.
Employee Orientation
Page 4
Some Orientation Goals
1. We want you to become comfortably familiar with your agency’s surroundings, equipment, office
policies and procedures.
2. We hope that the human resources chores related to your new employment are completed quickly
and smoothly.
3. We want you to become thoroughly acquainted with the purpose and general activities of your
independent insurance agency.
4. We will work to make the encouragement, advice, and lessons offered by your mentor helpful in
reducing your training time.
5. We want you to get to know others in the agency personally and hope you will let them know you.
6. We will teach you about the variety of resources available for your self-education.
7. We want you to use your educational resources to better understand customer exposures, insurance
policies, computer system capabilities, customer service and sales techniques, and the professional
standards of your agency.
8. We expect you to acquire the knowledge necessary for you to easily pass any required license
examination.
9. We hope you will discover what opportunities your new job can mean to your career, your income,
your personal growth, your sense of security, or to other goals you might have in life.
What You Can Expect
• You’ll be part of a business family with a long history, common goals, and lasting ties.
While there are agencies that are relatively new in business, most have many years, if not decades,
of experience serving the needs of your community. There are several agencies in New Mexico that
can trace their roots back a hundred years or more. In fact, the state organization to which your
agency belongs, the Independent Insurance Agents of New Mexico, was formed in 1934. Successful
perpetuation of the agency from one generation to the next, whether within or outside of the owner’s
family, has long been a priority and a source of pride for agents.
You will find that agencies all across New Mexico and United States share common values and business goals. At the heart of the independent agency system is the principle that the customer comes
first. Agents search for the best insurance protection from a variety of insurance companies all while
working to customize the policies to meet specific customer needs and expectations. In addition,
agents serve as the customer’s advocate at claims time, helping assure the response of the
Employee Orientation
Page 5
company is prompt and appropriate. This advocacy coupled with the ability to shop and customize
coverage is the primary advantage independent agents bring to the insurance transaction. These
traits also happen to be the aspects of service most highly valued by American consumers. To learn
more how independent agents use these values in a national advertising campaign you might visit
the website http://www.trustedchoice.com/.
The insurance industry is well known as a tight community of friendly competitors. Over the years,
you will hopefully come to appreciate, learn from, and respect the professionalism and personal
qualities of those you meet in our industry who work for others. There are a number of professional
organizations you will be exposed to that can provide opportunities for you to meet these people.
• You’ll be considered a “professional” in the business world.
Like it or not, the importance of the licensed insurance agent’s job over the years has led the public,
and often the courts, to consider them professionals. That status can be quite rewarding during your
career, but it also carries with it responsibilities that you’ll learn about and hopefully grow to
appreciate.
• You’ll learn how insurance companies operate, make money, and serve customers.
Insurance companies need to know a lot of information about their policyholders in order to properly
price the policy they provide. In the process of communicating that information to them, you as the
agent will also learn a great deal about the company. Over time, you will come to understand what
is important to an insurance company, how they determine the right premium, and what things help
or hurt their efforts to make profits and keep customers.
• You’ll learn a great deal about your customers, their activities, and their assets.
If you end up working in personal lines, you will quickly discover that a lot of confidential information
about your customers will cross your desk, phone line, or computer screen. That shared information
represents the trust those individuals and the agency is placing in you. If you work with commercial
customers, you will deal with even more confidential information, but you’ll also find yourself being
slowly educated about a wide variety of industries and businesses. Your knowledge of their
operations and products will only make you a better insurance professional and a more important
part of your customers’ business plans.
• You’ll learn legal principles that govern the resolution of disputes in our society as well as
how to read and interpret contracts important to the financial survival of a business or a
family.
Insurance is for those unfortunate times in life when a customer has lost something
of value in an accident, or they are being accused of causing a loss or injury to
others. Sometimes these claims and accusations end up in the courthouse where
a wide body of law and various legal principles that vary from state to state are
used to find a just conclusion. Over time, your understanding of these legal
principles will help you advise your customers in how to best protect themselves
with insurance
or other risk management techniques.
Employee
Orientation
Page 6
• You can enjoy a secure employment future, if you work hard and learn what
you need to know.
Working for an independent insurance agency is about as close as most people can
come to having a recession proof job. Those who study, grow, and work hard are
constantly in demand almost everywhere. However long you give this profession your
best, you’ll have an opportunity to contribute. People will always need insurance and
there is no better person to help them than an independent agent.
Exercise: 5 minutes
Write down at least three other expectations you have for your new job?
(These and other assignments and exercises can be discussed with your mentor.)
1.
2.
3.
Employee Orientation
Page 7
What You’ll Be Asked to Contribute
• Your best effort to serve customers
Insurance agencies are basically sales organizations, but with a unique feature: service after the
sale is critical. Along with the policy, agents promise to be there for their customers when they need
them – when they have a question, need to file a claim, need additional coverage, or make a
change. Surveys consistently show that customers happy with the service provided by their
insurance agent are far more likely to stick with that agent year after year. Your commitment to
providing a high level of service both during and after the sale is what will make the agency
successful.
• Your natural talents and abilities
The agency you now work for undoubtedly looked carefully at your background, your education,
and experience before offering you the job, but they were considering your personal attributes as
well. Because relationships with customers and insurance companies are so important, the way
you communicate, your smile, your enthusiasm, and the way you meet people or greet them on the
phone are all important.
You also have intellectual abilities you will need to call upon in your new responsibilities. There
are many details about policies, procedures, and systems you will need to learn. You will be
asked to think, examine, research, and share what you’ve learned with others on the agency
staff. They need your brainpower at work in the agency.
• Your creativity
Most independent insurance agencies are relatively small businesses and need to be flexible to
meet the challenges of the marketplace. While there are important procedures and rules that you
must follow in your job, there will be many opportunities for you to offer a creative solution to a
problem or a new sales idea or approach. Don’t be afraid to offer your suggestions once you’ve
figured out your other responsibilities.
• A caring attitude
Insurance is about people and what they can lose if things go badly. As their agent, you and your
co-workers should be prepared to respond to their crisis with understanding, empathy, respect,
and a prompt response. Most of your customers don’t understand the intricacies of insurance and
the claims handling process. They will need your support to work through it and your assistance
when they have questions or meet obstacles.
What Does The Future Hold?
A career in insurance can take many paths, but each path is paved with education. The education you
receive both inside and outside the agency combined with your experience will equip you to do more
and more. Each step will build your confidence and ability to contribute more to the organization and
Employee Orientation
Page 8
reach your personal or professional goals.
Every agency is different, with varying job descriptions and responsibilities.
The timeline for your development will depend upon the plan you and your mentor or supervisor agree
will be best for you, your personal goals and the goals of the agency. If at first you feel a bit
overwhelmed with information, relax. Generally, people new to the agency business take a year or so
before they feel really comfortable in their jobs.
A common mistake you will want to avoid is looking too far down the road before meeting the
challenges you face today. With each task or procedure you master, you improve your business skills.
With each insurance subject with which you become familiar, you build maturity to advise your
customers properly. With each successful sale and renewal, you gain the confidence needed to see
the agency grow and prosper. Take your time. Grow into your position.
How Your Mentor Can Help
The person serving as your mentor may be your direct supervisor, an agency owner, or another
experienced employee of the agency. They can make a tremendous difference in the speed of
your orientation to the agency and the time required for you to make concrete contributions to
the organization. While each mentor will take their own unique approach in working with you,
recognize that they benefit by using a structured process of orientation to save time.
Below are several suggestions to make your interaction time with your mentor more valuable and
enjoyable.
1. Listen - Your mentor is available to guide your understanding of principles, products, and
practices of the insurance agency. Take advantage of the experiences and insights they share
with you.
Employee Orientation
Page 9
2. Ask - Your mentor will likely have to fill in the blanks when you have questions or concerns
that aren’t answered elsewhere in this guide or in your educational resources.
3. Use Time Wisely - Your mentor is in all likelihood working a job with a full load, so be
considerate of their time, as they are with yours. They may have customers waiting for their
attention. Whenever you can find an answer or solve a problem yourself, try to do it without
their assistance. But remember, if you are wasting your time, you are putting off the day
when your work will make a significant contribution to the agency. If you have set times to
meet, do your best to be prompt, and stick to the schedule you both have agreed to. However,
should you feel your discussions and meetings need more time, don’t be afraid to suggest
more frequent or longer meetings or meetings at a more flexible time of day.
4. Stay On Topic - If you have an agenda for your meetings with your mentor, help them by
staying on topic as much as possible. Save your social conversations for more casual occasions
during the day. Stick to business as much as you can.
5. Do Things Well - If there are assignments for you to complete during the orientation process,
do your best to finish them as instructed. They were designed to help you better understand
your responsibilities and will be called on later in your orientation, your formal training, or
on the job. If you are a fast worker and find yourself finishing assignments quickly, ask your
mentor what additional exercises, reading, or research you can do to enhance your orientation further.
Employee Orientation
Page 10
Assignment: 30 minutes–1 hou
In your next meeting with your mentor, write down some notes about their responses
to the following questions.
1. How often do you think we should meet together?
2. Do you have a schedule in mind?
3. What do you hope to accomplish when we meet?
4. At what other times should I come to you with questions or concerns?
5. Are there others in the agency I should go to for assistance?
Under what circumstances?
Thinking about mentor meetings
Have daily meeting
• to get questions answered
• to get mentor insights and suggestions
• to get instructions and directions
• to discuss what you are learning
Have weekly meetings
• to track your progress
• to plan for the following week
• to identify unmet needs in your training
Employee Orientation
Page 11
Representing More Than One Insurance Company
An independent insurance agency is sales organization that may be large or small, family owned and
operated or part of a large financial services corporation. What every independent agency has in
common however is that they represent or provide access to multiple insurance companies. The
companies represented may differ in number and type from one agency to another based upon
customer profiles, agency expertise, or agency location. The agency has a contract with each company
in which ownership of customer information and renewal rights is granted to the agency. The contract
also stipulates in what ways the agency can act on behalf of the company, commission rates paid for
various types of insurance, and terms outlining the handling of premiums.
The company that ends up writing the insurance for a particular customer is the choice of the agent,
and the customer. The choice of company could be determined by the coverage available, price,
services provided to the customer, financial stability, or other factors. The agent is thus positioned to
look after the best interests of the customer.
Sometimes an agency may need to place insurance for a customer with a company with whom they do
not have a contract. In these cases, the agency will place the insurance policy through another agency
who does have a contract with that company.
Employee Orientation
Page 12
Agency Authority and Binding
The agent or the agency (if a corporation or partnership) has a contract of representation with an
insurance company that grants them authority to bind coverage under that company for a customer, up
to stipulated limits. The agent’s binder, which could be verbal or written, is a legal agreement to put an
insurance policy into place beginning at a given time. The ability to bind coverage in this way provides
both the customer and the agent the flexibility to put the insurance the customer needs into effect at the
most appropriate time. The actual paper copy of the insurance policy is created when the agent notifies
the company of the binder either in writing or as part of their computer system.
Most agents are very careful about the binders they provide to customers. Typically, the agent will
either check with the company first to see if the customer is acceptable then bind after they have been
given approval, or the agent has learned through experience what the insurance company will and
won’t write.
The agent that is party to the contract with the insurance company often has delegated the authority
granted to them to others in the agency. Those persons who are carrying out those delegated duties
of soliciting, servicing, selling, and binding insurance need to have the license required by state law.
Regulation and Licensing of Agents
In New Mexico, the government organization that regulates insurance is the Insurance Division of the
Public Regulatory Commission. The law that governs is called the Insurance Code and its enforcement
is overseen by the Superintendent of Insurance. Any person that performs duties of an insurance
agent or holds themselves to be an agent must be licensed. In general, this includes such things as:




Soliciting applications on behalf of an insurance company
Collecting premiums
Giving advice on insurance coverage
Receiving or delivering an insurance policy.
The New Mexico Insurance Code allows the choice of different types of licenses (agent, broker, or
solicitor), and your agency manager will know what type of license you may be required to obtain, if
any. To be eligible for an insurance license, an individual must:





Be at least 18 years of age
Pass any examination required for licensing
Be competent, trustworthy and financially responsible
Be appointed by an authorized insurer or employed as a solicitor by a licensed agent
Comply with other applicable requirements such as a positive background check
Agencies organized as partnerships or corporations must also have a license to sell insurance.
More information on their licensing requirements is available on the IIANM website
(www.iianm.org).
Employee Orientation
Page 13
Different Types of Agencies
Insurance agencies can differ in as many ways as the people who own or work for them. Independent
agencies as a rule sell property and casualty insurance. For those new to the business that means
insurance for buildings and contents that can be lost or damaged due to natural or man-made causes
(the “property” part), or insurance for businesses or individuals who are accused by others of causing
injury, death, or damage (the “casualty” part). Some agencies sell insurance to businesses (this is
called commercial insurance), while others sell to individuals and families (this is called personal
insurance). Most agencies sell some of both.
In addition to property and casualty insurance, agents may sell life or health insurance to individuals,
families, or businesses. Some agencies also sell investment products like IRA’s and annuities.
Agencies that are relatively large often will group the sales and service of commercial, personal, or life
and health insurance into departments for efficiency. This allows the people in that department to
specialize their knowledge and skill to the benefit of the customer and the agency. Smaller agencies
may have staff members that handle all kinds of insurance. While smaller agencies face a big
challenge in staying on top of the policies, rules, and company information about multiple lines of
insurance, they have the advantage of being able to serve practically any customer.
People Who Work in Agencies
There are many jobs and roles in an insurance agency. If the agency is relatively small, individuals
wear many hats. In larger agencies, responsibilities are assigned to various staff members. Some of
the types of jobs and titles used in an insurance agency might include: In your next meeting with your
mentor, write down some notes about their responses to the following questions.
Principal
A person who has an ownership interest in the agency who often is also involved in sales
Producer
A person whose primary responsibility involves the solicitation and sale of insurance to the public
Customer Service Representative (CSR)
A person (also sometimes known as a customer service manager, or account service representative)
who provides the day-to-day service and support to customers of the agency after the sale; this person
often works closely with producers in securing new customers
Marketing Manager
A person whose primary responsibility is communicating with insurance companies regarding the
insurability and pricing of insurance for agency customers
Claims Manager
A person responsible for taking claims reports from customers, reporting the claim to the insurance
company, and providing needed assistance until the claim is closed
Employee Orientation
Page 14
Accounting Manager
A person responsible for managing the many financial accounts an agency has with insurance
companies
Human Resources Manager
A person responsible for administration duties related to the agency’s employee pay and benefit plans
Office Manager
A person who is responsible for a variety of agency management duties.
Assignment: 1 hour xxxx
1. During your next meeting, discuss the following questions with your mentor.
With how many companies does the agency have a representation contract? (List them.)
•
What are some typical limitations our companies place on our binding authority?
•
How do we keep track of binders we’ve done for customers?
•
When will I be expected to have my insurance license?
•
What type of license will I be getting?
(Part Two of your orientation guide will discuss preparing to take the license exam.)
2. Review a staff roster with your mentor, identify the titles of the people in your agency and
discuss the responsibilities of each.
Employee Orientation
Page 15
Congratulations, you’ve begun your orientation process well. After you complete the
following checklist, you’re ready for Part Two.
Part One
Orientation Checklist
Listed your personal expectations for your new job
Discussed your meeting and orientation schedule with your mentor
Identified the key people in the agency you can go to for assistance
Listed the companies that the agency represents
Identified the type of license you will need
Reviewed the staff roster
Employee Orientation
Page 16
Part Two
It’s time for you to begin getting settled in and oriented to your new business surroundings. You’ve
gotten to know your mentor, at least initially, but there are more people you probably need to meet. You
may have some human resources chores that need to be completed. You need a place to sit, a phone,
computer access, and someone to tell you where you can get a good chili dog for lunch. Okay, so
maybe not a chili dog, but you may need help locating area restaurants or shops. In addition, you
should begin to think about managing your time at work to get the most out of each day. So in the
interest of making good use of your time, let’s get started.
Getting the Human Resources
Chores Behind You
There are many state and federal regulations that govern employment. If you haven’t already, you’ll
need to work with the agency staff to get these out of the way. Your employer no doubt also has their
own policies and procedures with which you should become familiar. The following assignment should
help guide you through these additional chores.
Assignment:
1. At your next orientation meeting with your mentor, agree on a schedule for meeting with the
person in your organization responsible for human resources.
2. At that appointment, review the following checklist of items that may need to be addressed.
3. Ask questions you might have.
Employee Orientation
Page 17
HR Checklist
W-4 Employee’s Withholding Allowance Form
This form provides your employer with the information they need to calculate the correct amount of
federal taxes to withhold from your paycheck.
I-9 Employment Eligibility Verification Form
Federal law requires all employers (other than casual employment by individuals) to complete an I-9
form within three days of employment. This process verifies that employment is not being provided
to an unauthorized alien. Documents that you need to show your employer might include your social
security card and driver’s license.
Office policies and procedures
Your employer may wish you to acknowledge various policies the agency has in place regarding
the employer-employee relationship. These might include receipt of an employee handbook or
company personnel policy. They also may have a drug abuse policy that needs acknowledgement.
Confidentiality or Conflict of Interest agreements
Because insurance agencies possess many kinds of confidential information about customers, your
organization may have requirements that you will promise to protect that information. In addition,
your agency may wish you to disclose any business relationships you have that could conflict with
your responsibilities at the agency.
Office access (keys)
You may or may not need after-hours access to the office. If you need a key, make sure you
understand any alarm or security services that might be in place.
Parking
It’s surprising how big a deal parking spaces can be to many people. “Where exactly should I park?”
and “What should I do if that spot is taken?” would be good questions on this topic.
Remember, if your office is in an urban area you may need an access card or code to get into the lot
or garage.
Direct Deposit forms, Timesheets, vacation request forms, personal leave requests, etc.
Employee benefit programs enrollment
These could include a retirement savings plan, health insurance, life insurance, disability, dental, or
other insurance plans. If there is a handbook or written description of these, ask for a copy.
Employee Orientation
Page 18
Getting Acquainted With Your Colleagues
Meeting people and getting to know them are two very different things. It’s easy to smile and shake
hands with others on your first day, but learning people’s names, where they work, and what they do
can be a big challenge. Before you can make meaningful contributions to the agency you will have to
take some time to get to know your colleagues.
Assignment: 1 – 2 hours
1. Using a blank sheet of paper and a pencil, draw a map of your office, floor or
department area, leaving enough room for you to write in the name and phone
extension number of each person. Hint: Someone in the agency may already have
a layout of the office for you to use. Ask your mentor. If possible, leave small
spaces in each area of your map with enough room to write in a short description
of each person’s job responsibilities (example: commercial, personal, claims, new
customers), whatever will help you remember what they do.
2. After agreeing with your mentor on the best time to complete this assignment,
conduct interviews with each person occupying a space on your office map. In
addition to capturing the information suggested above, try to get to know
something about each person (how long they’ve worked there, what they did
before they joined the organization, what they enjoy most about their job, etc.).
Getting Comfortable in Your Surroundings
The Essentials
Every person needs to know where they can find the essentials.
Restrooms
Copiers
Fire escape
Printers
Vending machines
Local restaurants, burger joint, deli, pizza place
Coffee machine / shop
Closest drug store, convenience store, Wal-Mart,
Break room / Lunch room
grocery store
Employee Orientation
Page 19
Your Workspace
If you haven’t already been shown to your workspace, your office manager, supervisor, or mentor will
soon introduce you to your desk, chair, and office space. Everyone has their own way of getting settled
into their office. Some like to get very organized early, while others let the flow of work over the first
few days or weeks determine the best system for them. The main thing is to get comfortable - with the
chair, the placement of the phone, the computer screen and keyboard. No employer wants their
employee to be in an awkward or uncomfortable position all day. If your phone needs to be on the left
rather than the right, move it. If you don’t know how to adjust the chair, get some help.
If you discover that you’ve been assigned what obviously is the left over office furniture, don’t despair.
It’s natural that the new person gets what is available at the time. Instead, think of your office furniture
and space as a symbol directly related to your time with and contributions to the organization. You’ve
just begun, so give your new boss and yourself some time to work out these kinds of arrangements.
However, if your desk or chair is so worn that it risks injury to you or others, let your mentor know.
The Phone
Even with advances in computer technology, the telephone remains a critical work tool in independent
insurance agencies today. It is still the primary way the agency communicates with customers and
insurance companies. Skill in using it not only affects the efficiency of your work but also the level of
customer service you can provide.
Things you need to learn regarding the phone system include:

Extension numbers for yourself and the rest of the office

Back-line phone numbers for direct access (if available)

Fax numbers (office or individual)

How to set up (and change) your voice mail greeting

How to access voice mail messages (including saving and deleting)

How to transfer or forward calls (including voice mail messages)

How to put customers on hold

How to dial out

How to mute a call or put it on speaker How to use speed dial numbers (if available)

How to record conversations (if available)

How to access voice mail through email (if available)
Later in your orientation, you will be introduced to some common sense techniques for using the
phone to deliver quality customer service. In the meantime, try to become familiar with the
capabilities of your system. If there is a booklet, cheat sheet, or set of instructions for the system,
ask for a copy.
Employee Orientation
Page 20
Exercise: 30 minutes
1. Ask a nearby employee or two if they will help you practice using the phone to:
•
•
•
Put an incoming call on hold
Transfer a call to another extension
Access your voice mail messages
2. Using the phone system, call your mentor to ask if there are any required elements
that you should include in your voice mail greeting. (Example: “Coverage cannot be
bound via voice mail.”) Make notes regarding their instructions
The Computer
No doubt you’ve had some experience using personal computers,
either in a prior job, at school, or at home. Most independent
insurance agencies today are highly dependent upon their computer
network to capture customer information and to communicate.
Typically, the agency computer system uses internet based programs
such as Internet Explorer, which allows the customer data
management system to connect to insurance company computers.
Before you begin using a desktop computer or your agency’s automation system, you’ll need
information on access and procedures.
Assignment: 1 hour
1. With your mentor, make an appointment to have your computer system administrator
guide you in the set up of your computer workstation.
2. With your agency administrator, review the following checklist, making notes and
gathering handouts as needed.
3. From this point forward, your orientation guide will provide information about and links
to websites that you can use as educational resources.
Employee Orientation
Page 21
Computer Network Orientation Checklist
Your network login ID __________________ Password _______________
Start up and shut down procedures and policies
Agency computer use policies
• email
• usage by others
• access to other servers (Yahoo Mail, etc.)
• remote access
• rights, permissions, and organization (common drives, dept. drives,
personal drives)
• unauthorized downloads
Customizing the workstation desktop
• icons
• screensavers
• power modes
Email
• your address
• address books
• introduction to email client (Outlook, Lotus, etc.)
Standard office programs (Microsoft Office, Lotus Notes, etc.)
Internet access
• browser
• favorites (company websites, resources, IIANM.org, etc.)
Agency automation system access
• passwords
• connectivity with companies
Password policies
• protection
• changes
• organization suggestions for multiple required passwords
Printer access and direction
Scanner use
Network faxing
Employee Orientation
Page 22
Website Resources to Use During Orientation
Hopefully, you are now acquainted with and have access to a computer. From this point forward,
your orientation guide will reference websites that can supply you with information you may find
helpful.
www.IIANM.org
Mentioned earlier in your guide, the IIANM website contains a great deal of information you will want to
read during your orientation and afterward. The IIANM website comes in versions for the public and for
IIANM members. If your agency is a member of the Independent Insurance Agents of New Mexico,
then all employees of the agency can have access to the members-only section of web-site, but
registration is required with your individual IIANM member log-in user ID and password. Ask your
mentor for your log-in codes, or call IIANM at 1-800-621-3978 for assistance.
Employee Orientation
Page 23
Agency Automation System
Most insurance agencies today use some type of specialized software system designed with the
independent agent in mind. These systems can be relatively simple or incredibly capable and complex.
These computer programs are developed, sold, and supported by different vendors. Any one software
company may have a variety of programs with different capabilities or purposes that are known by
different names.
Some of the functions of your agency automation system may include:
Client information files
Policy rating
Email
Accounting
Report generation
Electronic filing of documents, sound files, or email
How much expertise you will need in operating the automation systems will depend upon your job in the
agency and the agencies operating procedures. If you will be working on the system daily, inputting
customer information, rating policies, documenting conversations, then you will need to know a great
deal. If your responsibilities are out of the office more than in, you should be guided by your mentor or
office manager on the level of expertise you should develop.
Most agency automation systems come with tutorial programs that can help get you acquainted with
the functioning and capabilities of the system. Your next assignment in the part of your orientation will
use that computer program to get you acquainted with the system.
Assignment: 1 hour or more
1. Agree with your mentor on a time when you can explore a tutorial for your agency’s
automation system, as well as the depth of understanding you should work to achieve
at this time.
2. At your computer, explore the tutorial to the extent you and your mentor agree is
appropriate.
3. Schedule some time for you to observe others using the automation system in your
office.
Making the Most of Each Day
As was mentioned in Part One of your orientation guide, working for an independent insurance agency
Employee Orientation
Page 24
provides tremendous job security for those willing to give the job their best. The reason for this is the
great volume of work that needs to be done to properly protect and serve the agency’s customers. The
work required presents a challenge because time cannot afford to be wasted. With that in mind,
employees should strive to make the most of every day.
Prioritizing Your Work
Setting priorities is a challenge everyone must face in their personal and business affairs. The
challenge is distinguishing the important from the unimportant, and the urgent from the less-thanurgent.
How should we define “important”? One way of looking at it is if it deserves your attention, it’s
important. In the end, you and your mentor will need to agree on your priorities. Questions you might
want to ask yourself in prioritizing your tasks include:
•
Does it help reach a goal?
•
If I don’t do it, am I violating a core value? (Such as the agency’s commitment to customer
service)
•
Will doing this interfere with an even more important task that needs attention?
•
If I don’t do it, can I live with the expected consequences?
What’s “urgent” then? When something is demanding your attention, it’s urgent. Unfortunately, many
things that are urgent simply aren’t very important. They can rob you of time needed for more
important tasks, unless they are managed. That said, some urgent tasks, like a ringing telephone, must
be handled immediately for you to know if it’s important. Other tasks however, like some new email
messages you will receive, or a co-worker stopping to share a joke, are not important enough to spend
much time on at all.
The goal is to prioritize tasks in the following order.
First:
Important and Urgent
Next:
Important but Not Urgent
Maybe: Urgent but Not Important
Never: Unimportant and Not Urgent
Employee Orientation
Page 25
Planning and Scheduling Priorities
After you identify what deserves your attention, you need to plan how and when you will give it that
attention. That may mean right now, but usually it won’t. You will want to select the right time, allowing
a proper amount of time, that you will devote to the task. You will want to consider whether each task
can be done without help from others, or if you will need to coordinate with the schedule of others.
For example, the schedule below indicates broad categories of tasks grouped together in time blocks. A
simple structure may provide enough organization to help the employee stay accountable for
completing tasks. However, some jobs may require more or less specificity and structure.
Time
Thursday
8
Suspense items
9
Policy change requests
10
Meeting
11
12
1
Lunch
New Customer letters
2
3
Email responses and
phone calls
4
Employee Orientation
Page 26
Common Time Management Errors
Below are some types of mistakes people make in managing their time. As you read them, consider
how each of these could be avoided during your work day.
1. Not assigning a specific time to do a task
2. Setting aside the wrong time to do the task
3. Underestimating the time required for the task
4. The wrong person is performing the task
5. The task is too complex
6. Don’t remember to do the task
7. Work area is disorganized
8. Goals and priorities are not set
9. Perfectionism
10. Poor handling of interruptions
Time Management Tools
Your agency will likely have systems and procedures for tracking tasks to be completed. These
procedures are critical to ensuring quotes and policies are delivered to customers as promised. You
will need to incorporate these into your time management system. Beyond those however, you will
likely have the opportunity to develop a system of managing how you use time (both for work and for
personal items) each day and track your progress toward completion of goals.
Some commonly used time management systems include software programs probably available on
your computer (such as in your agency’s automation system, as in Outlook or Lotus Notes). These can
be effective tools for tracking your “To-Do’s” and scheduling your days, weeks and months. Other tools
include organizers that are portable or desk calendars. Whatever system or tool you prefer, use it
unless your mentor instructs you to use something else. Failure to organize your work and schedule
you time is an invitation to failure.
Employee Orientation
Page 27
Obtaining Your License
You will recall that we introduced the requirements for licensing of insurance agents in Part One of
your orientation guide. The following information should help you in preparing to apply for your license
and take the required examination.
License Applications
The New Mexico Insurance Division has contracted Prometric Inc. to conduct licensing exams in New
Mexico. Prometric provides computerized testing throughout its multistate network. Test centers in New
Mexico are located in Albuquerque, Farmington, Las Cruces, Roswell, and Santa Fe. The exams are
available in English and Spanish:
Before you can test, you must complete the following steps with Prometric:
• Complete and submit the license application, along with any other required paperwork, registration
form, and all fees to Prometric’s New Mexico Processing Center. All fees are payable to Prometric and
can be combined into one check/money order. All forms can be found online at
www.nmprc.state.nm.us/als.htm, and click on “Forms and Applications” along the left column.
• Once you have received approval, contact Prometric to schedule an appointment to take your exam.
Exams can be scheduled via internet at www.prometric.com or by phone at 800- 813-6737.
Prometric New Mexico Processing Center
2538 Camino Entrada, Suite 204
Santa Fe, NM 87505
Phone: 888-717-2557
Fax: 888-717-2558
To be an Agent: (Appointed by an insurance company) You will need these forms:
• Exam Registration Form (To register to take the exam)
• Licensing Application Form (Form 210)
• Agent Appointment Form (Form 204) - Optional
To be a Solicitor: (Appointed by a licensed insurance agent) You will need these forms:
• Exam Registration Form (To register to take the exam)
• Licensing Application Form (Form 210)
• Solicitor Appointment Form (Form 214)
Assignment: 30 minutes
At your next orientation meeting with your mentor, discuss your time management strategy including:
Tools to use for scheduling your time and tracking tasks that need attention
Establishing priorities
Best times of day for certain tasks
What to do when you sense you are overwhelmed, over your head, or under utilized
Employee Orientation
Page 28
Once you have mailed your forms, it can take 2 to 3 weeks to get an exam approval notice from
Prometric. Once approved, exam fees are valid for 90 days and license application fees for 180 days
after receipt. If your registrations and/or applications expire, new applications are required together with
applicable exam and license fees.
Other helpful materials can be found at www.prometric.com.
Preparing for the Licensing Exam
Every person who has to take the license exam faces the same challenge: determining the best way to
prepare.
The Independent Insurance Agents of New Mexico offers a variety of study materials including study
books, simulated exams and classroom exam prep classes.
Call 800-621-3978 or visit www.iianm.org and click on education for more information.
Congratulations, you’ve completed Part Two. After you complete the following checklist,
you’re ready for Part Three.
Employee Orientation
Page 29
Part Two
Orientation Checklist
Completed your HR checklist
Interviewed other agency employees
Practiced the basics of your agency phone system
Completed your computer network orientation checklist
Registered as a member on the IIANM website
Taken the Quick tour of the IIANM website
Explored the tutorial for your agency’s automation system
Ordered materials for your license exam preparation, and/or signed up
Employee Orientation
Page 30
Part Three
Understanding Insurance
The next step in your orientation is to get you acquainted with some of the details of the insurance
business. You probably have some experience with insurance as a consumer. If you own an
automobile or home you’ve no doubt purchased insurance. You may have made a claim on a policy,
either yours or someone else’s and seen the claims process at work. This is the extent of what most
consumers know about insurance. You will be learning far more.
This part of your Guide will help you understand:
•
What insurance really is and why it’s important
•
How insurance is sold to the public
•
How insurance companies decide who to insure
•
The insurance services that are provided to customers
•
How claims are handled by insurance companies
•
What an insurance policy is
•
How insurance works for individuals and families
•
How insurance works for businesses
•
How premiums for insurance are determined
•
How the insurance industry constantly changes, yet seems to stay the same
We have recommended to your agency that they provide you with a book that will help you through this
part of your orientation. The book, How Insurance Works, is an easy to read, but very thorough
introduction to the insurance business that we hope you enjoy. Exercises are included in this guide that
contain instructions for readings, suggestions for note-taking, and recommendations for discussing
what you’ve learned with your mentor.
Employee Orientation
Page 31
Assignment:
Ask your mentor if you will be using How Insurance Works during your orientation. If so, ask them to help you get a
copy. (Copies can be purchased at IIANM.)
If your mentor chooses not to use the suggested book for this part of your orientation, you can use outlines included
in this part of the Guide to structure your discussions with others in your agency to understand some of the basics of
the insurance business. You will find instructions in each section that should help you ask questions that will help
you learn.
A word about balancing agency work and your orientation
Your agency may need your immediate help in getting work done. They may need you answering
phones, processing paperwork, or other tasks – NOW. If so, that’s fine, but it doesn’t have to derail
your orientation. If you can’t devote much time each day or week to the formal orientation activities
suggested in this Guide, then discuss your schedule with your mentor, agreeing on the best times to
devote to reading and completing orientation assignments. Don’t forget to manage your time. Use a
calendar. Schedule orientation activities. Plan.
The History of Insurance
Not everyone can agree on exactly when or how insurance originally
started, but some of the stories are interesting. Probably the most widely
held view places the birth of what we understand to be modern insurance
th
in a small coffee house in London, England in the late 17 century. At this
coffee house, owned by Edward Lloyd, ship’s captains, merchants, and
rich men would gather to share news regarding shipping and to coordinate
a process that would become formal insurance.
The loss of a ship at sea to pirates or weather was a huge financial blow,
not only to the ship owner, but also to the owner of the cargo aboard.
These men who met at Lloyd’s developed a method where they would
agree to share in each others’ financial loss of a ship. Each party wanting
to participate would agree to pay for a selected percentage of the loss, if
any, and in exchange received the same percentage of the money
(premium) paid by the party wanting the insurance for taking the risk.
This process that started in a coffee house continues today at Lloyd’s of London, probably the best
known insurer in the world. Their coffee house insurance also gave us a title for an important job in the
industry, underwriter. Each opportunity to participate in this risk sharing enterprise began with a
posting on the wall, called a slip. Those wanting to join in wrote their name and the percentage they
were in for under the description of the ship’s voyage on the slip. If you joined in, you were an
underwriter.
Employee Orientation
Page 32
Another story, also in London, says that a very smart man who was hired by the government to figure
out why some people died during a cholera epidemic (apparently common at the time) and others
didn’t, provided the beginnings of life and health insurance. This gentleman’s answer, that it depended
on how close the part of town you lived in was to certain bodies of water, led him to begin guessing how
many people were likely to die and where during the next outbreak. As morbid as it sounds, his
guesses were pretty accurate. Besides providing the proof that a better sewer system was needed in
London, he discovered that he if he had enough information, he could guess how many people would
die in a given year in a town, a county, or the whole country. His calculations, valuable to tax collectors
apparently, became known as mortality tables, which are still calculated and used today to set
premiums for life insurance.
As an interesting aside, life insurance at the start was primarily a game that gamblers played, betting on
the lives of others. Of course, this created all sorts of mischief. You can’t have folks knocking off others
to collect on a bet. But that problem created a principle that remains to this day – you have to have a
real interest in the life of someone, or an ownership type of interest in property, in order to buy the
insurance.
Other histories of insurance discuss how owners of cargo barges on the Yellow River in China agreed
to share in losses centuries before Lloyd’s coffee house existed. Some other accounts place early
insurance in France, or in Scandinavia. It really doesn’t matter, except as an illustration that what
insurance people do has been important to businesses and individuals for a very long time, and still is
today.
Exercise: 1 – 2 hours
In your copy of How Insurance Works, the first chapter “What Is Insurance?” describes some of
terms and principles that are important in understanding insurance. Schedule some time to
read Chapter 1, making notes in response to the questions that follow for later discussion with
your mentor.
If you don’t have a copy of How Insurance Works, then use the questions below as a research
outline and agree with your mentor on who in your office could help you with the answers.
Employee Orientation
Page 33
What is Insurance?
(Chapter 1 -How Insurance Works)
1
What are some common risks of loss that people and businesses want to transfer to insurers?
2
Describe how the principle of sharing works to make insurance possible.
3
Describe the difference between property insurance and liability insurance?
4
Contrast the benefits of health insurance policies with benefits provided by disability insurance.
5
Write a short script you could use to explain the purpose of life insurance to a friend or family
member.
6
What are some ways that society benefits from insurance?
Employee Orientation
Page 34
How Insurance Is Sold To the Public
Since insurance is consistently needed by individuals, families and businesses, it becomes a cyclical
process that repeats each year. Insurance professionals work to make this insurance cycle as positive
for the customer as they can in order to keep that customer coming back year after year. The graph
below illustrates simply the yearly life cycle of most insurance policies. The cycle begins when the
insurance is put into place with an insurance company. This section of Part Three will introduce you to
the insurance
sale.
JARGON ALERT!
If you haven’t already noticed, the insurance industry uses lot of jargon. Words thrown around
regarding the insurance sale might include:
issued, produced, sold, placed, bound, procured, ceded or brokered.
As you will eventually learn, each of these terms means something importantly specific, but are thrown
about by veterans in the business in ways that can be confusing to a newcomer.
If someone around you at the office uses an unusual term or turn of phrase you suspect is industry
jargon, don’t be afraid to ask what they mean. (Everyone else had to when they were new.) Caution:
There is no formal lexicon for the industry. Some people will use the same terms to describe very
different things.
Employee Orientation
Page 35
Steps in the Sales Process
Employee Orientation
Page 36
Exercise: 1 – 2 hours
In your copy of How Insurance Works, the second chapter “How Is Insurance Sold?” describes
some terms, people, and practices involved in the sale of insurance.
Schedule some time to read Chapter 2, making notes in response to the questions that follow
for later discussion with your mentor.
If you don’t have a copy of How Insurance Works, then use the questions below as a
research outline and agree with your mentor on who in your office could help you with the
answers.
How Is Insurance Sold? (Chapter 2 – How Insurance Works)
1. What characteristics must insurance producers have in order to convince customers to purchase
insurance from them?
2. What people are typically involved in the initial insurance sale, and what is their part in the process?
3. What is the purpose of an insurance application?
4. In addition to applications, what else might be included in a submission sent to the insurance
company?
5. What is a binder?
6. Complete the following sentences.
 An ____________ ________ is an independent business owner who has a contract to sell
insurance for only one insurance company (or several related companies).

_______________ are representatives of the insurance buyer.

An employee of an insurance company who sells insurance to the public for that insurance
company only is called a _________ ___________.

An ________________ __________ sells insurance for several unrelated insurance companies.
7. Contrast how an insurance company using a direct marketing system obtains customers versus an
independent agent.
Employee Orientation
Page 37
Assignment: 30 minutes
1. Ask your mentor, or a co-worker, to view a typical completed application used in a recent sale, either hard copy or
electronic.
2. Review the application, and note at least three pieces of information on the application of which you are uncertain
of its purpose or meaning.
3. Ask your mentor, or someone designated by your mentor, to explain the purpose for including that information on
the application.
What is ACORD?
You may have already heard other people mention ACORD forms. ACORD is the name of a non-profit
insurance association headquartered in New York whose purpose is to facilitate the use of standards in
the insurance industry. The organization’s forms (ACORD forms) are the standard for a large
percentage of the property and casualty business and are used by almost every independent insurance
agency. There are ACORD claims forms, application forms, binder forms, certificate forms, and on and
on. Your agency’s computer system probably has the capability of creating and filling in ACORD forms
using the data you have on your customers already, eliminating the need to fill in forms using a
separate system.
If your agency doesn’t already have access to ACORD forms online, consider signing up with
ACORD at acord.com. Some websites provide free access to ACORD forms, simplyeasieracordforms.com being one example.
Employee Orientation
Page 38
Underwriting – Decisions, Decisions
Do you remember in our discussion of the history of insurance where the term “underwriter” came
from? Back at Lloyd’s coffee house, the person who made the decision to join in the risk of insuring
the voyage was called the underwriter. Today, underwriters are still the people who make the
decisions on whether or not to write the insurance for an individual or a business, but now there are
many more tools they use, and people they depend on.
The average consumer usually has a very limited understanding of underwriting, where the premiums
they pay go, or how an insurance company makes money. In this section of the guide, you will learn
some of the things that guide an underwriter’s decision-making. Companies make money by selecting
customers who have a low likelihood of having losses, and by charging a premium that is appropriate
for the risk the company is taking; in other words charging more than the company will need to pay for
claims. But there’s more; insurance companies also have overhead they must cover before they realize
a profit.
Generally, a percentage of each dollar collected in premiums will fall into one of the categories
shown in the box below. Specific amounts will differ from one insurance company to another based
on various factors.
Where Do the Premiums Go?
Employee Orientation
Page 39
Underwriting: Part Math, Part Art
Good underwriting decisions come from a mixture of skills applied to a specific prospective customer.
At the most basic level, underwriting is a numbers game based upon the statistical probability of one
person, or one business having a particular type of loss (a fire, auto accident, etc.) during the policy
year. If there is one thing insurance companies are good at, it’s collecting data about customers and
their losses. Over many years, the statistical data shows certain groups of people and businesses will
have losses at a predictable rate. Averages of those losses tell the insurance company how much to
charge the typical person or business in the group. At that premium level, they should make money in
the long run. But that’s not the end of the matter in most cases. Since every insurance company wants
to make money in the short run as well as the long run, they apply some art to the process.
Underwriters learn over time and through experience that some customers of a particular group are
better or worse than the others. They learn specifics about their property or their operations. They look
into their finances. They even give weight to a prospects reputation and character. As the eyes and
ears for much of what the underwriter knows about prospects, agents are critical to a correct
understanding the prospect and a good decision about the availability and price of the insurance.
Exercise: 1 – 2 hours
In your copy of How Insurance Works, the third chapter “What Is Underwriting?” describes how some
insurance companies decide who they wish to insure and how much they want to charge in premium.
Schedule some time to read Chapter 3, making notes in response to the questions that follow for later
discussion with your mentor.
If you don’t have a copy of How Insurance Works, then use the questions as a research outline and
agree with your mentor on who in your office could help you with the answers.
Employee Orientation
Page 40
What Is Underwriting?
(Chapter 3 – How Insurance Works)
1. Describe what is meant by “adverse selection” in insurance.
2. Loss Ratio = _____________ / ________________
Expense Ratio = _____________ / ________________
Combined Ratio = _____________ + ________________
3. Describe some things an underwriter could learn from a loss control survey report.
4. What is meant by “underwriting authority”?
5. What are some things an underwriter can do when analyzing the submission, other than adjust the
price, to make the proposal acceptable to the company and attractive to the customer?
Employee Orientation
Page 41
JARGON ALERT! – (RISK)
Earlier in Part Three of your Guide we discussed underwriters assuming the risk of the insurance buyer
suffering a loss. In exchange for the premium, the risks of financial loss specified in the policy are
transferred from the insured to the insurance company. Those risks could be many things; such as a
risk of fire, a risk of an automobile accident, or a risk of an employee getting hurt on the job.
The word “risk” is often used in another way that can confuse someone new to the insurance
business. In addition to using “risk” as a noun to describe a chance of loss, it is also used as a
personal pronoun for a business or even an individual. An underwriter or agent may call a person with
a bad driving record, “a poor risk”. Be prepared for statements like, “I had the loss control
representative go out and take a look at the risk, and they had several recommendations.” In this
example, “risk” probably means the prospect being considered for insurance.
How about an absurd example to illustrate the use of the word? An underwriter might consider the “risk”
(the chance of financial loss for the company) that a “risk” (the insured) presents because of the “risk”
(the chance of having an accident) their operation represents to the public. Weird, isn’t it?
Government Rules for Underwriting
As a society we decide that certain business practices need to regulated to ensure a basic level of
fairness for the public. Since insurance touches practically everyone, the criteria used by insurance
companies in selecting customers and pricing their insurance is regulated by the New Mexico
Department of Insurance. Some rules are obvious in their application, such as the anti-discrimination
rules that prohibit underwriting based on race or religion. Discerning the point behind other rules may
be harder.
Assignment: 30 minutes
In preparation for the next section, ask your mentor to direct you to where you can view a copy of a
recently developed proposal for either a commercial lines, personal lines, or life and health customer.
Read over the proposal, noting any interesting or hard to grasp aspects of the proposal for later discussion
with your mentor.
1. What information about your agency was included?
2. Did it include a summary of premiums? Was it at the beginning or back of the proposal?
3. Did the proposal have any disclaimers in it? If so, is it a standard disclaimer used with all the agency’s
customers? If not, what standards for disclaimers does the agency use?
Employee Orientation
Page 42
Insurance Services Provided to Customers
Developing a Proposal
Once the agent has collected the
Once you receive insurance quotes from insurance company
underwriters for the various kinds of insurance needed by the prospect,
it’s time to evaluate and communicate those to the prospect. An
insurance proposal should do several things:

Outline the premiums for the insurance in a way that is easy to
see and understand

Present the coverage provided by the various policies in an accurate and understandable way

Outline the premium and payment options clearly

Compare proposed insurance protection to prior policies

Describe the obligations of the prospect to put coverage into effect

Outline the services available to the customer after purchase

Communicate the personality and style of your agency
Your job responsibilities may or may not involve creation and presentation of proposals to
customers, but if they do, you may want to note some of the following proposal components often
used by agents to communicate effectively with the prospect.
1. Executive summaries present a vision of the prospect in protecting themselves from risk and
review the agency’s proposals to solve problems of the prospect.
2. Premium and coverage summaries outline the recommended policies, the limits of coverage, and
premiums.
3. Explanations of coverage recommendations made by the agent, outline limitations in what the
policies will do in the event of a loss, the financial ratings of the insurance companies, as well as
recommendations to reduce the chance of claims occurring.
4. Appendices may be included that contain additional information about the agency or the insurance
companies.
Exercise: 1 - 2 hours
In your copy of How Insurance Works, the fourth chapter “How Is Insurance Service Provided?”
describes how insurance companies and agencies work together to obtain, change, and renew policies
for the customer.
Schedule some time to read Chapter 4, making notes in response to the questions that follow for
later discussion with your mentor.
If you don’t have a copy of How Insurance Works, then use the questions as a research outline and
agree with your mentor on who in your office could help you with the answers.
Employee Orientation
Page 43
How Is Insurance Service Provided?
(Chapter 4 – How Insurance Works)
1
What are some individual skills that are important for an individual to possess when presenting
a proposal to a customer?
2
What are policy endorsements?
3
What’s the difference between a “producer or agency billed” policy and a “direct bill” policy?
What are the advantages to the customer and agency of each?
4
What kind of change in an insurance policy could mean a change in the premium?
5
What are some types of loss control procedures an insurance company might provide to a
commercial customer to reduce their chances of suffering a loss?
6
What concerns might an underwriter have when considering renewing the insurance for a
customer?
7
What goals might an agency producer have as he or she approaches the renewal of an
important customer’s insurance?
8
What does a premium auditor do?
Employee Orientation
Page 44
Would You Like Paper or Plastic?
Computers have changed seemingly everything in the business world, including insurance. No longer
are pre-printed forms necessarily used by insurance companies in creating an insurance policy.
Instead, computer programs digitally assemble a policy from different data files sending them to a
printer where often they are automatically assembled, stuffed, and mailed to customers.
Some insurance companies and agencies have the capability of delivering a policy in an electronic form
to customers, rather than on paper. Some send an email with the policy attached, while others may
send a CD containing the policies and other documents related to the insurance. It’s worth noting that
a scanned or electronic contract is no less valid or enforceable by the courts than a paper copy. Many
customers may prefer an electronic file for storage and access purposes. They can always print the
policy, or parts of it, as needed.
Avoiding Mistakes in Communication
Insurance agencies are frequently accused of communicating incorrectly or incompletely at the time
when a proposal is presented to a customer. Sometimes they are accused of failing to follow through
on promise they made. If the customer, or someone else, can show that they suffered financially
because of these mistakes, they can collect damages from the agency in court. These types of claims,
called Errors and Omissions (E&O), need to be avoided as much as possible.
Understanding the Claims Process
If they’re unlucky, your customers will actually get to use the insurance they purchased. For many
people, filing a claim is a scary process full of questions, suspicions, and unknowns. A well informed
agent can relieve many customer anxieties by educating them about the process, building realistic
expectations regarding adjuster contact, and timelines for resolving the claim
Agency Assistance
Many insurance agencies have designated persons responsible for communicating with customers
about the claims process. This person will usually keep contact information for initial reports of claims
with the various insurance companies used by the agency. They also will track claims that have been
filed to completion, following up with adjusters when necessary, and assisting customers with
communications and required paperwork.
Our agency claims specialist is _________________________. Phone extension: _____
Employee Orientation
Page 45
The Adjuster’s Job
People who work for insurance companies to settle customer claims are called ‘adjusters’. Being an
insurance adjuster can be tough. Practically every “customer” an adjuster talks to is upset to some
degree because of what has happened to them. Their car, or home, or health has been damaged. The
financial future of their family or business hangs in the balance, depending upon the outcome of the
claim. They often have been conditioned by television commercials for law firms to not trust adjusters.
They’ve heard horror stories from friends, often been given very bad advice, and are generally ready for
a fight.
At the end of the day, an adjuster’s job is to pay what the company owes. If the claim involves
property of a customer of the insurance company, then the policy contract says what they owe for
damage to that property (their car, their house, their stuff, or their commercial building, for example).
If the claim involves someone who was injured by an insured of the company, then it means making
a best guess at how things would likely turn out in court if it came to that. Sometimes uncertainty
forces the adjuster to work out a compromise.
In almost every claim however, the adjuster needs information from various parties before anyone
starts writing checks. That information gathering process can take awhile to complete. The agent can
help a great deal in that process by helping the claimant understand what may be needed and why.
In some cases your customer may ask about a “public adjuster.” These are adjusters who work for
the claimant, instead of the insurance company. They charge a percentage of the claims payment for
helping resolve the claim. Generally, the assistance of a public adjuster isn’t necessary if the
company adjuster does his/her job properly.
What’s It Worth?
If a person making a claim has suffered property damage, they naturally want to know how much
money they should expect to get for the loss from the insurance company. The method used to
determine a specific claims payment for property damage is based upon the language of the policy, and
sometimes by what courts have ruled in past lawsuits. The specific method used is considered the
“valuation” method or technique. Some ways that property is “valued” in an insurance claim include:
1. Actual cash value – traditionally defined as replacement cost minus depreciation, (which can get
tricky).
2. Replacement cost – this technique is usually defined in the policy as the cost to replace what was
lost with property of “like kind and quality.” Replacement cost also typically means the cost to repair
if the property wasn’t totally lost. If the person making the claim isn’t the insured on the policy (for
example someone the insured hit in an auto accident), then different rules apply.
Employee Orientation
Page 46
3. Agreed amount – this technique is the most confusing because of non-standard lingo used in the
industry. What’s meant here is that the insurance company and the insured agree at the beginning
of the policy on how much will be paid by the company if the property is destroyed. It’s typically
used on property items that need an expert’s appraisal anyway (such as antique autos, expensive
jewelry items, fur coats) to know what it’s worth.
The jargon problem arises because other terms are used to mean the same thing – agreed value,
appraised value, or stated value. When in doubt about what a policy is promising to pay, you will
have to read the policy section describing valuation. To view an example, have your mentor give
you a copy of a typical policy.
Exercise: 1 – 2 hours
In your copy of How Insurance Works, the fifth chapter “How Are Claims Handled?” describes how
insurance companies investigate and pay claims.
Schedule some time to read Chapter 5, making notes in response to the questions that follow for later
discussion with your mentor.
If you don’t have a copy of How Insurance Works, then use the questions below as a research outline and
agree with your mentor on who in your office could help you with the answers.
Employee Orientation
Page 47
How Are Claims Handled?
(Chapter 5 – How Insurance Works)
1. Under what circumstances might an insurance agent suggest a customer not turn in a property
damage claim?
2. What two types of adjusters are used by insurance companies?
3. After the adjuster verifies that coverage is in effect, an investigation can begin. What kinds of things
will the adjuster be looking for in his investigation?
4. What is subrogation?
5. A ________ __________ is the insurance company’s best current estimate of the total dollar
amount that will be paid in the future for an accident that has already occurred.
Assignment: 30 minutes – 1 hour
If you have a person in your office responsible for the claims process, schedule a time to sit with them and review
the Claims Handling Evaluation Tool that follows. If no one person handles claims in your office, ask your mentor if
you could work with more experienced staff to complete the evaluation tool. Entries for each aspect of the claims
handling process should help you and others educate your customers about what they can expect during the claims
process.
Employee Orientation
Page 48
Claims Handling Evaluation Tool
Employee Orientation
Page 49
Understanding an Insurance Policy
There are many kinds of insurance policies covering all sorts of risks, but luckily they all have very
similar characteristics. Insurance policies are typically standardized for ease of interpretation by
customers, the insurance companies, and the courts. Like any business that has been around
awhile, traditions developed, partly from habit, but also because the original reason for doing it that
way made sense.
An insurance policy is a promise made by one party to another party in exchange for money. It’s only
logical for that contract to contain some key pieces of information. Below is a brief chart that describes
some of the elements of the insurance company’s promise and the name of the section of the policy
where it would typically be found. The names of the various sections of the policy come from historical
insurance lingo which you’ll pick up over time.
Employee Orientation
Page 50
Exercise: 1 - 2 hours
In your copy of How Insurance Works, the sixth chapter “What is Found in an Insurance Policy?” describes
how insurance policies are constructed.
Schedule some time to read Chapter 6, making notes in response to the questions below for later discussion
with your mentor.
If you don’t have a copy of How Insurance Works, or for a helpful exercise, ask your mentor for a copy of an
insurance policy that your agency has sold to a customer. You may want to start with something simple like a
Homeowners or Personal Auto Policy. It might relate more to your experience. Take the policy, read it
through lightly looking at each section of the policy. Make note of the following.
•
How many pages are in the policy?
•
How many distinct sections did you notice in the policy? (Hint: look for bold headers in larger fonts)
•
How many exclusions were in the policy? How many definitions? How many conditions?
Next, use the questions below as a research outline and agree with your mentor on who in your office could
help you with the answers.
Employee Orientation
Page 51
What is Found in an Insurance Policy?
(Chapter 6 – How Insurance Works)
1. What section of the policy usually is found at the very front of the policy?
2. What is the difference between the terms ‘damage’ and ‘damages’ in an insurance policy?
3. What are some ways someone reading a policy can quickly determine if a word or phrase is defined
in the definition section of the policy?
4.
What are three typical conditions found in most insurance policies?
5. Can you give two reasons why exclusions might be included in an insurance policy?
6.
Why does an auto policy typically list the Vehicle Identification Number for each vehicle?
7.
Insurance policies usually use the words “we” and “you” in the standard language. Who is who?
8.
An exclusion found in a policy might restrict a promise made by the insuring company, instead of
eliminating it outright. What would be a restriction that might be found in policy?
Employee Orientation
Page 52
Understanding Personal Insurance
The more you learn about insurance, the more you’ll see how the various policies fit together to take
care of whatever customers are worried about happening to themselves or their family members.
Consider this worry list of a typical individual or family:
•
My house burns down
•
I have an auto accident, hurt some people and smash my car
•
I have an auto accident, and I’m hurt by someone else, and my car is smashed
•
Someone steals my stuff
•
I drop my wedding ring down the shower drain
•
My lake house is flooded during the monster storm
•
An angry parent sues after my little leaguer beans their kid in the head
•
My spouse dies suddenly and my income isn’t enough to pay the mortgage
There are personal insurance policies that respond to each of the disasters in above list. Some
policies can respond to multiple types of losses.
Personal insurance (or as it’s commonly called, “personal lines”) is designed to be packaged together
more simply and neatly than commercial insurance. Most families face life circumstances that aren’t all
that different from other families. The following chart lists some different types of policies in personal
insurance with a brief description of what they insure against.
Employee Orientation
Page 53
Employee Orientation
Page 54
Exercise: 1 - 2 hours
In your copy of How Insurance Works, the seventh chapter “What is Personal Insurance?” describes the need
for insurance, and the policies that can respond to those needs, of typical individuals or families.
Schedule some time to read Chapter 7, making notes in response to the questions below for later discussion
with your mentor.
If you don’t have a copy of How Insurance Works, ask your mentor for copies of several types of personal
insurance policies that your agency has sold to customers. Have the policies handy as you review the
questions. If you can’t answer the question, agree with your mentor on who in your office could help you with
the answers.
What is Personal Insurance?
(Chapter 7 – How Insurance Works)
1. The liability insuring agreement of an auto policy promises to pay amounts for which the
insured is legally responsible for what kinds of losses.
2. In a personal auto policy, what does “collision” mean?
3. What is the name of a coverage found in the personal auto policy that would pay to reimburse
occupants of the car for medical bills?
Employee Orientation
Page 55
4. What in the world does “uninsured motorist” coverage do?
5. Would a ‘homeowners policy’ cover damage to any other buildings, besides the house? For
example, what if a fire burned down both the house and the storage shed in the back?
6. Does the ‘homeowners policy’ provide any protection if personal property is not in the house
or on the grounds of the house?
7. Is flood damage covered by the ‘homeowners policy’? What about on the auto policy?
8. Name at least three types of losses that are excluded on typical ‘homeowners policy’?
9. What is the difference between an “all risk” policy and a “named peril” policy?
10. Is the amount someone paid for a house the same as the replacement cost of a house?
11. What does “Loss of Use” mean?
12. How much liability insurance should someone purchase?
(Sorry, trick question: The answer is always ‘more’.)
Employee Orientation
Page 56
Agency Service to Personal Insurance Customers
Most insurance agencies don’t receive as many requests from personal insurance customers to change
their coverage, or to ask questions, as they might from a commercial customer. But that doesn’t mean
that your communications and actions for them are not as important. In fact, they can be vitally
important. Of all customers, they usually have the least understanding of what they’ve purchased or
how it will work in a real life situation.
You should make it a goal to understand the coverage you are selling, whether personal or commercial
lines, very well. You will benefit from practicing ways of describing what various policies do for the
customer, including important things they won’t do. Then, you will be communicating clearly about the
promises the insurance company is making. A customer who misunderstood the agent, often ends up
being an angry customer.
Assignment: 1 hour
Ask your mentor which members of the staff you should ask to help you with the following.
Ask at least two people who are experienced in personal insurance to describe for you the purpose and any
important limitations of any two of the following coverages provided in personal insurance policies. Makes notes for
your use later.
Personal Auto Policy
• Personal Injury Protection
• Uninsured / Underinsured Motorist
• Other Than Collision
Homeowners Policy
• Property Off Premises
• Mold Coverage
• Loss of Use
• Flood Insurance
Employee Orientation
Page 57
Understanding Commercial Insurance
Businesses have many more exposures to loss than most families, with more types of property
susceptible to damage in more locations, more serious liabilities arising from everyday activities, and
the possibility of injury to employees. Some business exposures are illustrated below.
Property Exposures
• Buildings
• Personal Property
• Personal Property of Others
• Machinery and Equipment
• Owned Autos and Trailers
• Technology systems
• Lost income
These property exposures are
usually related closely to the
insured’s business premises, but
many may be off premises, as
well. Each can be exposed to a
wide variety of risks.
Liability Exposures to the Public

Arising from the insured’s premises
The insured’s place of business presents many potential dangers for the public, from slipping and
falling on a slick floor, to falling objects, to dangerous equipment.

Arising from the insured’s products
Products liability is a major source of concern for manufacturers. For some businesses, their products
coverage is the most expensive insurance they purchase.

Arising from the insured’s off-site work
This exposure is probably easiest to see in the work done by a construction
crew building a building. Most people can imagine how members of the public
could be injured while the construction is in process.

Arising from the insured’s completed work
Imagine if the mechanic didn’t put everything back on your car they way it
belonged and it caused an accident.

Arising from autos, boats, or aircraft
Generally, the owners of vehicles, watercraft, and aircraft can be held legally
responsible for their safe operation, including following the laws and regulations
regarding their maintenance and use. These represent a serious and
continuous exposure for many businesses.

Arising from the work done by independent contractors for the insured
Just because an insured hires someone else to do work for them, doesn’t necessarily mean they are
free from potential liability for injury to others. This is called vicarious liability.
Employee Orientation
Page 58
Jargon Alert:
We used some words in the discussion of exposures above that aren’t normally used in the
insurance business, in other words we avoided the jargon. Here’s the jargon you missed:
•
When we refer to the off-site work of a business, meaning those things they are doing away
from their normal or home location, we use the insurance term “operations” to describe it. (Example:
A company hired to dig ditches for the city to lay a water line isn’t digging on their own property, so
those are their operations.)
•
When a business finishes its operations (construction, lawn maintenance, ditch digging, etc.)
and they leave, turning it over to the rightful owners, and some defect in their workmanship causes
injury or damage, the loss is said to arise from their “completed operations.”
Several commercial policies use these words in important ways you’ll learn about later.
Employee Orientation
Page 59
Liability Exposures to Employees
• Due to physical injuries and occupational diseases
Employees injured on the job are given special legal
rights in every state in the United States, but those
rights differ from state to state. In most cases, an
employee who gets hurt while working is eligible to
have all their medical bills related to the injury paid,
and also to receive cash compensation for lost
wages. Employers buy workers’ compensation
insurance to cover this exposure. If they do, the employee can’t sue the employer for the injury,
even if it was the employers fault. If they don’t buy the insurance, they could be sued directly by the
employee.
• Because of mishandling employee benefits
Although some employers may not recognize it, they can be held responsible for errors or
misjudgments they make in handling employee benefits of practically any kind. From health
insurance to retirement plans, employers can be liable for financial damages suffered by employees
from the loss of those benefits if regulations are not followed.
• Arising from other employer actions or practices
The best illustrations of this exposure are claims and suits arising from unlawful discrimination during
hiring or when making disciplinary decisions or in cases of sexual harassment.
Employee Orientation
Page 60
Matching Exposures to Policies
Employee Orientation
Page 61
Exercise: 3+ hours
In your copy of How Insurance Works, the eighth and ninth chapters titled “What is Commercial Insurance?”
describe the insurance policies that respond to the needs of a variety of businesses.
Schedule some time to read Chapters 8 and 9, making notes in response to the questions below for later
discussion with your mentor.
If you don’t have a copy of How Insurance Works, ask your mentor for copies of several types of commercial
insurance policies that your agency has sold to customers. Have the policies handy as you review the
questions follow. If you can’t answer the question, agree with your mentor on who in your office could help
you with the answers.
Employee Orientation
Page 62
What is Commercial Insurance?
(Chapters 8 and 9 – How Insurance Works)
1. What are three common types of business ownership that are usually indicated on the declarations
page of a commercial policy?
2. Describe at least three specific types of numerical information an agent might need to properly write
the commercial insurance for a business.
3. What is depreciation, and why is important to consider?
4. What does a coinsurance clause encourage an insured to do?
5. List at least five categories of business property that would be considered “personal property” or
“contents” of the business.
6. What is an advantage of having a “reporting” form property policy?
Employee Orientation
Page 63
7. What is a typical “self insured retention” on a commercial umbrella policy?
8. What kind of business might need “bailees” insurance?
9. What do we call the insurance policies that are specially designed to insure computer systems?
10. What kind of insurance policy does a business need to protect themselves from theft by their
own employees?
Employee Orientation
Page 64
Understanding Insurance Premiums
Premiums are the one thing every insurance consumer understands, or
at least they think they do. Unfortunately, they don’t see the relationship
of premiums to their own success in life or in business, or to issues
affecting society or the economy generally. Many compare the cost of
the insurance they are being charged this year to last and are either
happy or dissatisfied based upon that alone.
As we saw earlier in your guide, insurance premiums at the most basic
level are set to pay for the cost of claims and expenses of the insurance
company, with some left over (hopefully) for profits. When you dig a bit
deeper, you discover that premiums are built upon rates (dollar amounts)
per some common factor of the risk being insured. The rates are
multiplied by the base or perhaps several bases to develop a premium.
Common rate bases:
•
Value of the property
•
Payroll
•
Sales
•
Square footage
•
Location (town, county, etc.)
•
Cost new
Employee Orientation
Page 65
Learning How to Rate? You Must Be Kidding
Computer technology has made calculating a premium fairly easy for insurance companies and agents
today, but unfortunately depending upon on a computer has left many in the business with a poor
understanding of how policies are rated to develop the premium shown on the policy. That in turn
makes it harder to explain to customers why their premium is what it is.
As you complete the next assignment, you will begin to understand better how insurance premiums are
developed. Hopefully, that knowledge will help you understand some of the procedures you follow in
your agency when you working on new business or a renewal.
Exercise: 1-2 hours
In your copy of How Insurance Works, the tenth chapter “How Are Premiums Determined?” describes
techniques in developing premiums for various kinds of insurance policies.
Schedule some time to read Chapter 10, making notes in response to the questions below for later discussion
with your mentor.
If you don’t have a copy of How Insurance Works, ask your mentor who could show you how a policy is rated,
either manually, or on the computer system. To learn some of the key terms used when rating policies, review
the questions below with co-workers or your mentor for the answers.
Employee Orientation
Page 66
How Are Premiums Determined?
(Chapters 10 – How Insurance Works)
1. What do you call the rating system where similar insureds are given the same rate because they
represent the same category of risk?
2. What are three things that a basis or exposure unit needs to be for an insurance company to use it
in determining a premium?
3. What does ISO stand for?
4. List at least five things that are used to determine an auto insurance premium?
5. What are two major factors used in determining a rate for a homeowners policy?
6. What is the premium basis for workers’ compensation insurance?
7. What does an experience modifier do to a premium?
Employee Orientation
Page 67
Understanding the Changing Nature of Insurance
The one thing about insurance that always stays the same is change. The state changes the laws. The
Department of Insurance changes the rules. The insurance companies are either charging premiums
that are higher or lower than the year before. The forms used to insure your customers change their
language to cover more or fewer risks. And on and on it goes.
If you make a career in this business, you will need to adjust to the changes the environment presents
and learn what those changes mean to you, your agency, and your customers. You will need to attend
classes to learn what’s new, attend meetings, and educate yourself with reading, lots of reading.
Below are a few links to resources that can help keep you up to date on many of the changes
affecting the insurance industry.
Resource Websites
www.IIANM.org
IIANM Online Learn Center
Virtual University
http://www.nmprc.state.nm.us/id.htm
www.insurancejournal.com
Exercise: 1 hour
In your copy of How Insurance Works, the eleventh and final chapter “Insurance in a Changing World” will help
you understand the ways in which the insurance industry changes.
Schedule some time to read Chapter 11.
At your next meeting with your mentor, discuss some ways you can make sure you stay on top of the
changes that are affecting your agency and your customers.
Employee Orientation
Page 68
Part Three
Orientation Checklist
Listed your personal expectations for your new job
Discussed your meeting and orientation schedule with your mentor
Identified the key people in the agency you can go to for assistance
Listed the companies that the agency represents
Identified the type of license you will need
Reviewed the staff roster
Employee Orientation
Page 69
PART FOUR
Agency Workflows and Procedures
Every agency needs workflows and procedures that are based upon their philosophy, goals, personnel,
and organizational structure. The philosophy of your agency is undoubtedly driving customer service
methods used by staff. The goals of the organization may be the reason attention is given to particular
types of insurance instead of others. The desire to reach revenue targets may be influencing the skills
the agency looks for in employees. Those employees and their individual traits affect who does what
work and from what office or department.
Since, no two agencies are exactly alike, operating with different philosophies, goals, and people,
each will have unique procedures designed for them. That difference may be great or small, but it
will hope to accomplish several things.
•
Make certain that customer needs are being met
•
Ensure that agency promises are kept
•
Fulfill responsibilities to the insurance company and others
•
Take advantage of sales opportunities
•
Work in a timely and efficient manner
Keeping these goals in mind can help you understand why certain procedures in your agency are in
place. Knowing the ‘why’ can build your understanding of how various workflows and your staff
members work together.
Some exercises included in this part of the guide suggest you practice using the agency’s automation
system with these goals in mind. Other assignments may ask you to view another in your office
correctly performing some of the procedures applicable to your operations.
Employee Orientation
Page 70
Meeting Customer Needs
An agency can only meet their customer’s needs if they are communicating effectively and accurately,
gathering information needed to analyze risks and properly requesting coverage from the insurance
company.
How do we communicate with customers?
1. Phone
The telephone is the principle way agencies communicate with most of their customers and
guidelines for using the phone well can help create a customer service oriented operation. Some
sample phone use guidelines or procedures an agency might have in place follow.
Sample Phone Use Guidelines

Every phone encounter with customers or prospects will be pleasant and productive.

Every phone encounter should be treated as a sales opportunity.

Calls should be answered on the first ring if possible, and never more than the third ring.

Every call should be answered, “ABC Insurance, this is Cindy speaking, how may I help you?”

Phone calls for staff already on another call should be given the option of being helped by another
staff member, holding, or having their phone call returned.

All messages should be relayed using an open automation system activity to the correct staff
person.

Callers placed on hold should be reassured every 30 seconds that they haven’t been forgotten.

All calls should be returned as soon as possible and always before the end of the day.

A review of the action diary should be done before you respond to a customer or company
representative.

If there is a coverage or technical question you are unable to answer, strive to get the answer from
another employee or the agency manager before ending the call.

A system record of every call related to policies, accounts, quotes, proposals, or underwriting
guideline will be kept with other like records.

Do not conclude a call until both you and the customer or company person agree on a clear
understanding of what needs to be done and by whom.

Keep calls as brief as possible.
Employee Orientation
Page 71
2. Fax
Although declining in usage, fax machines are still a component in some agency communications
with customers. Although procedures for dealing with incoming fax messages will differ from agency
to agency some simple guidelines usually apply. Some of these could include:

All incoming faxes are reviewed by a designated person for delivery (if using a central fax
machine), or by the individual when received directly.

Each fax is acted on upon immediately.

All confirmations or declinations of coverage are responded to.

Written confirmation of declinations are sent as follow up.
3. Voice Mail
Some agencies leave their voice mail system on, even at times when the office is closed, while
others will leave only an out-going greeting for after-hours calls. It’s important that callers
understand that a voice mail message does not represent an agreement to place or bind coverage.
Although voice mail can be a convenient way to share information, it can be easily misunderstood.
You should attempt to receive few voice mail messages, instead speaking to customers directly or
having another staff member help them at the time of their call.
4. Email
Communicating with customers via email continues to grow in acceptance and importance. While
guidelines for sorting, reading, and responding to email messages will no doubt evolve as customer
preferences change over time, there are some simple principles that will still apply.

Email messages must be checked on a regular daily schedule.

Priority messages must be handled immediately.

Emails that relate to a specific customer or prospect should be stored in the agency
management system, as should your response.
5. Producer Visits
Effective face-to-face communication with a customer during a sales or service visit requires a high
degree of skill and lots of practice. Many styles of communication come into play during a visit as
each person’s personality and background are different. At minimum, the goal during these
opportunities is help the prospect or customer understand and be understood.
Employee Orientation
Page 72
6. Correspondence
There are times when the most appropriate or efficient way to communicate with a customer or
prospect is with a letter. Most agencies develop standard form letters on topics that for errors and
omissions loss control purposes demand written documentation of the communication of a message.
Assignment: 1–2 hours
Ask your mentor if your agency has written procedures for communicating with customers and obtain a copy if so.
After reading your agency’s procedures, ask your mentor or supervisor any questions you have.
Next, agree with your mentor on a good time for you to observe other staff members demonstrating the
communication techniques below. (It may not be necessary for you to observe some techniques based upon your
responsibilities.) You should try to observe those persons who have the most experience and skill in each area to
better learn the proper techniques for following your agency’s procedures.
Answering phone calls
Responding to a fax message
Responding to a voice mail message
Handling an email message
Visiting a customer or prospect in person
Accessing and sending agency form letters to customers
Employee Orientation
Page 73
What do we do with gathered customer information?
Before the agency can begin to shop for insurance, or put a policy into effect, information gathered
during the communication process must be recorded in the agency management system and placed
into applications or submissions that will go to insurance company underwriters.
There are many specific types of information that might be called for in your automation system:
names, addresses, contact information, locations, descriptions and more. Your system may require
codes be entered regarding the type of customer or type of insurance needed. Only through
observation and practice can you become acquainted with and master these input tasks.
There are other ways that customer information is used. Applications need to be completed;
submissions to insurance companies may require schedules. Spreadsheets or numerical summaries
may be useful in understanding the account. Additionally, narratives about the customer or prospect
may contain key pieces of information the underwriter will need to consider.
Exercise: 1 hour
Agree with your mentor on a good time to:

Observe others placing customer information into your agency automation system (if you haven’t already)
making notes of specific tricks or requirements of your system

Practice putting information into the system yourself through a practice program or live, and have your
mentor or another more experienced employee check your work for accuracy.
Your mentor may wish you to practice this input process several times. Agree on a schedule for building your
skills at a pace consistent with your agreed upon goals.
Employee Orientation
Page 74
Keeping Promises
The agent’s obligation
Think of all of the promises insurance agencies make:
•
To contact customers with information
•
To secure a specific type of insurance for a customer
•
To renew insurance policies
•
To make changes to policies
•
To cancel policies
•
To file claims
•
To issue certificates of insurance
•
To issue auto ID cards
•
To send copies of policies
•
To send premiums to the insurance company
•
To pay commissions to producers or other agencies
It’s vital that each of these promises be kept for an agency to prosper and succeed. Many of these
promises, if broken, will likely get the agent and the agency sued for making an error or omission, or
for breach of contract.
The policies and procedures put into place in your agency are designed not just to provide quality
customer service, but also to ensure that promises made are recorded, tracked, and kept by various
parties. Many of the entries you will make into the agency’s automation system are there to trigger
action, follow up, or make a payment. Accuracy and consistency are critical.
Keeping your eyes on the forest
As you may have seen while completing Part Three of your guide, there are many tasks involved in
securing coverage from insurance companies. The chore of completing applications or creating
submissions on a commercial prospect can get fairly complicated. At this stage of your orientation, try
to not get too bogged down in the many details that take a long to time to master, but instead focus on
understanding the need for the various input procedures and processes in your agency. Look for
where the information flows, to whom, and how. See how your agency’s systems and procedures help
it keep promises. Ask questions. Ask ‘why?’ a lot. This will make later work assignments easier for you
to complete when you’ve seen the big picture and know why each step is important to the agency’s
success.
Employee Orientation
Page 75
Agree with your mentor on a time when you can observe others in your office completing the following
tasks or processes. If your agency has written procedures for any of these, obtain a copy and make
necessary notes for discussion with your mentor later. If appropriate, take some time to practice each
process yourself under the supervision of an experienced employee.
Submitting an application/submission (electronically or hard copy ) to an insurance company
Processing the renewal of a policy (either in personal or commercial lines)
Processing a change to a policy
Processing a policy cancellation (ask what a “LPR” is and why it’s needed)
Submitting a claim report
Issuing a certificate of insurance
Issuing an auto ID card
Sending or transmitting a policy to a customer
Processing a customer’s premiums (new, renewal, additional, or return) including coding
commissions payable to a producer or another agency
Processing a commercial policy audit received from the insurance company
Employee Orientation
Page 76
Fulfilling Responsibilities to the Company and Agency
Underwriting guidelines
The amount of authority granted to an insurance agent by companies varies by company, by type of
policy, by type of customer, and other criteria. Automation, particularly in personal lines (application
through the company website) has made this authority grant from the insurer irrelevant in some cases.
But still today, insurance agencies have the legal authority to place insurance for customers with
insurance companies with a binder.
With that authority comes the responsibility to stay within it, so it’s important that agency employees
understand the limits. They need to know how much insurance they can bind, for whom, for what kinds
of policies, and under what circumstances. If they inadvertently exceed the authority given to them by
the insurance company, and a loss occurs, the agency and the agent can be sued for breach of
contract.
The limitations on the authority given to the agent are understandable.
Insurance companies usually have their own limits on how much risk that
can or are willing to assume. There are limits to their own authority under
the license granted to them by the insurance department of the state.
They may also want to consider certain types of risks on a case by case
basis and are unwilling to trust the agent to make decisions for them.
Today, most prospects are submitted to the insurance company by the agency long before the
coverage is actually needed, so authority isn’t an issue very often. But sometimes, a customer has a
new exposure that needs insurance, or there is a crisis where coverage is needed immediately. These
are when knowledge of the agency’s authority can be vital.
Employee Orientation
Page 77
Example:
Agency Binding Authority
Company: External Fire Ins. Co.
Employee Orientation
Page 78
Company underwriting tools
Insurance companies use a variety of underwriting tools to help them determine which customers are
acceptable or how much premium they should charge. Agents are frequently required to use these
tools before they write a policy with the company.
1. Insurance scoring
This controversial topic, more commonly called “credit scoring” by the public, is a technique for
determining the chance of a customer filing a claim by examining several variables connected
with their financial past in conjunction with their actual claims history. It is used primarily in
personal lines, but is also used by some insurers to underwrite small commercial applicants.
Each insurance company uses its own factors and variables in determining the “score” for the
customer, and usually is an automatic feature built into their website rating system.
Insurance agents have no real control over whether credit scoring is used by a specific
company, but they may have obligations that have been placed upon them to notify customers
of their rights. (IIANM has a NM specific consumer brochure available for agencies to give to
customers.)
2. Property valuation systems
Since many property policies, including most homeowners policies, promise to pay to replace a
building should it be destroyed, knowing the construction cost for that property is an important
part of setting the limit of insurance. Since the limit of insurance is the primary variable in
determining the premium for the policy, insurance companies use ‘estimator’ programs to help
determine the value of the property.
These computer programs allow the agent to input a variety of characteristics of the property
such as square footage, construction type, roof type, number of rooms, the age of the building,
and whether or not there are special features such as a garage or a deck. The software then
calculates an estimate of how much it would cost to rebuild.
3. Dun and Bradstreet reports
Dun and Bradstreet is a company that maintains the world’s largest database on businesses.
Insurance agencies and companies often order these reports to help them understand the
history, operations, and financial condition of prospects. Some insurance companies may
require a report be ordered before a quote will be considered.
4. Limitations of coverage and documentation
An important aspect of sales in insurance is helping the customer understand what the policies
they have purchased won’t pay for, as well as what they will. Thus many agencies have
procedures and guidelines for communicating these limitations to the customer.
Customers may be notified during a phone call, in person during a visit, by email, mail, or in
language included in a quote or proposal. These notifications are an important part of giving
Employee Orientation
Page 79
them realistic expectations about what is covered in their policy.
Some types of insurance coverage (Personal Injury Protection and Uninsured Motorist on an
automobile policy) require a written rejection by law. For other policies, a written rejection from
the insured is protection for the agency.
Coverage Rejection Example:
I understand and acknowledge that a Flood insurance policy has been offered to
me and that I have decided not to purchase the coverage at this time. The
financial impact of not having this important coverage has been explained to me
and I realize that my rejection of this option may result in a denial of claims in
the future.
_______________________________________
Customer Signature
Employee Orientation
___________________
Date
Page 80
Sales Opportunities
The best independent insurance agencies work hard to maintain a sales culture in the organization.
Policies and procedures are put into place in order to encourage sales growth and profitability.
Some of the policies could include:
1. Sales meetings
Many agencies regularly meet with the staff to discuss the best techniques for making more sales to
prospects and additional sales to existing customers. In these meetings, success stories are shared
and celebrated, methods found successful in the past are explained and encouraged, and unsuccessful
efforts are evaluated. Specific prospects may also be discussed with opportunities for individuals to
share their personal connections with key decision makers or other information about the prospect that
might be helpful to approaching them regarding their insurance purchases.
2. Goals and campaigns
Your agency may have sales goals for individuals and departments where targets for sales growth are
set and incentives are offered to employees. The types of incentives vary by agency, but often include
additional pay or non-cash awards. Sometimes agencies organize campaigns the sale emphasis of a
particular type of policy over a period of weeks or months.
3. Reports
Reports on the progress toward goals may be run on a routine basis to gauge the success of
individuals and teams. Sometimes these are used as part of the evaluation process. A common
measurement of success in agencies is revenue (or commissions from sales) per employee. This
indicator, often tracked by type of policy, is an important reason for proper coding in your automation
system. With good data, the agency can track their contact with prospects and evaluate the activities
that turn into sales.
:
Assignment:
At your next meeting with you mentor, ask about the things the agency is doing to foster a sales culture
and what you can do in your job to contribute.
Efficiency and Timeliness
Finally, insurance agencies put procedures in place to improve or maintain the efficiency of operations.
These may include rules or guidelines on the length of breaks, lunch, or personal phone calls. Your
agency may have guidelines on tracking and correcting backlogs of work that may accumulate and
handling today’s work today.
Discuss with your mentor the procedures the agency may have in place to make efficient use
time and maintain efficiency.
Employee Orientation
Page 81
Part Four
Orientation Checklist
I’m comfortable in my understanding of
our agency’s procedures regarding…
Phone use
Faxing
Voice mail
Email
Form letters
Putting information regarding customers into the automation system
Submitting an application to the company
Processing a renewal
Making a change to a policy
Processing a cancellation
Issuing a certificate
Issuing auto ID cards
Sending policies to customers
Processing premiums
Processing a commercial audit
Staying within the agency’s binding authority
Using required underwriting tools
Disclaimers and rejections of coverage
Building and maintaining a strong sales culture
Efficiency and backlogs
Employee Orientation
Page 82
PART FIVE
Considering the Right Coverage for the Customer
Many customers believe they know what coverage they need when they first contact you.



They need a homeowners policy before the mortgagee will let them buy that new home.
They are buying a car, and the dealership demands proof of insurance before sealing
the deal.
Their current insurance is about to run out, and they are hurriedly shopping around to
see if they can get a better deal.
While the ultimate decision on obtaining coverage is up to the customer, if you act as a mere ordertaker you will be denying them the professional counsel and relationship that sets you apart from being
just another insurance agent. Customers need to be able to count on you to help them make difficult
decisions concerning their coverage. In a nutshell, it is your job to offer customer’s the coverage they
need, not just the coverage they want. Failure to do so will result in significant gaps in your customer’s
coverage, significant dollars lost to you and your agency, and a significant increase in your errors and
omissions exposure.
Determining those needs is not simple. It takes practice, diligence, and patience. It takes superior
product knowledge and the ability to ask the right questions. Most of all, it takes the ability to put the
total insurance protection needs of the customer above making the single, easy sale.
In the following section, we will discuss methods that will help you determine the overall coverage
program that is right for the customer. You will learn the importance of asking questions that require the
customer to reveal valuable information they may not believe is relevant but you know could represent
a significant gap in coverage.
Knowing what types of insurance and services your agency provides is essential if you are to move
beyond merely “filling the customer’s order” to offering trusted advice on addressing all their coverage
needs. Depending upon your agency’s offerings, there may be times when you identify a need for a
customer for which you personally do not have the proper product or service. A truly trusted advisor will
not ignore the need, but offer the customer alternative methods for meeting it. This may even mean
referring the customer to other providers.
Exercise: 30 min.
Ask your mentor how you should address situations where a customer has clear needs you and/or the
agency is unable to meet. Are there established procedures for referring the customer to others within
the agency?
Employee Orientation
Page 83
Seeing the Big Picture
The Big Picture is the customer’s overall needs for coverage and protection. Sometimes even the
customer is unaware of these total needs, since they are often used to buying insurance one policy at a
time, and only when necessary. One of the most valuable services you may offer to a customer may be
that, for the first time, they will understand not only how extensive their coverage needs may be. In
addition, they will begin to understand how the various policies and services you offer, if properly
implemented and coordinated as part of an overall program and not just a bunch of individual policies,
are irreplaceable in meeting those needs.
Let’s walk through the types of information you will need if you wish to go beyond selling a single policy
at a time to offering your customers a complete solution to their coverage needs.
What are the customer’s insurance protection needs?
Identifying the needs of the customer begins with finding out exactly what
the customer needs coverage for.





Do they own a home?
Do they drive a car?
Do they operate a business?
Do they have a family?
Are they trying to satisfy a lease?
Sometimes the customer will have an idea of the coverage they need.
Most times they will not. Consider the following phone call:
CUSTOMER: “I need a quote for a homeowner’s insurance policy”
(Assumes that’s all he needs).
YOU: “Okay, sir. I can do that for you. Who will be living in the home?”
CUSTOMER: “Myself, my wife, and our 2 children.”
In this example, simply asking the question of who will be living in the home revealed that the customer
has two children. You know that liability risk is much higher for families with children and limits in the
standard homeowner’s policy may not be sufficient. Similarly, you know that there are children who will
need to be provided for if one of the parents dies. By simply asking the question, you were able to help
determine this customer’s need for life insurance and a personal umbrella policy – something he may
have never heard of because no one ever told him he needed it.
This example is simple; it only took one very basic question to determine a need. Certainly determining
the full spectrum of what a customer needs can be much more complicated, but it all starts with a single
step or a few simple questions.
For example:

Do you have a family?

Do you own or rent your home?

Do you have vehicles?
Employee Orientation
Page 84

Do you own a business? If yes, what kind? Is it located in your home?

Does your business have vehicles?

Does anyone else in your house drive?
The answers to these very basic questions will reveal a tremendous amount of information about this
customer’s needs: life insurance; a homeowners/renters policy; personal umbrella; personal auto
policy; coverage for resident relatives or older children; and possibly others, including various
commercial insurance policies.
Exercise: 1 – 2 hours
You meet a guy named Ed Smith at the rotary luncheon. The only thing he knows about insurance is
that (a) he’s not satisfied with his current agent, and (b) you are an insurance agent. The only thing you
know about him is that he’s “in the drywall business.”
What you do NOT know about Ed is that he owns the drywall business and has for many years. His
business has 10 employees and 2 trucks. He owns two homes, one in town and one at the lake. He
owns 3 vehicles - two family cars and a large pickup that pulls his boat to the lake. He is married and
has 2 children, one teenager living at home and one away at college.
Ed obviously has considerable insurance needs. How many basic questions would it take you to
uncover these needs?
Talk to your mentor about practicing asking simple questions to uncover customer needs. Since
customers are often very time constrained, work with your mentor and others in your agency to learn
how to successfully gather the most key information with the fewest number of questions.
Employee Orientation
Page 85
Where does the customer need coverage?
You cannot determine what type of coverage the customer needs
without also determining where the coverage is needed. If every one of
your customers kept everything they owned inside their home and never
left the house your job would be simple. Unfortunately, outside of
hermits and movies, it is doubtful such customers exist.
A commercial customer may own a business that has jobsites all over
the world. They may move millions of dollars of property and materials
from site to site on a daily basis. Personal lines customers move their
property as well as themselves from place to place. They have multiple
locations, homes in other states, property stored on and off premises,
vehicles that travel across the country and hobbies that take them all
over the world. They may have a child who takes half the house with them to college.
Question: With so many possibilities, how can you even begin to determine where a customer needs
coverage?
Answer: Ask the right questions.
You must advise your client that coverage can change depending on where they are, where they go,
who and what they take with them and why. Insurance policies are clear in determining where coverage
is applicable and where it is not. Only with some idea of possible changes in location of covered people
or property will you know what type of policy they may need. If they first understand their fluctuations
may affect their coverage, you will be in a better position to advise them how and what they can do
about it.
Assignment: 1 – 2 hours
1. Ask your mentor for copies of a homeowners, commercial property, commercial liability, and inland
marine policy, if possible. Review the sections on where coverage is applicable, including coverage
territories and insured premises. Look for differences.
2. Write down possible questions you could ask your customer to help determine where coverage might
be needed.
3. Review your questions with your mentor for improvements and additional possibilities.
Employee Orientation
Page 86
Who does the customer need coverage for?
Any efforts you make in determining what or where the right coverage
may be of little use if you do not determine WHO the coverage is for.
Specifically, who has coverage under the policy? Who needs coverage?
Once the question is asked and the need determined, you must again
turn to the policy for the answer. An insurance policy will specifically
define who is an insured under that policy, and that definition will differ
depending on specific policy written. Also, remember ‘who’ is not always
an individual person – it could be a business, group of people or another
entity. For example, a homeowner’s policy may include the named
insured, spouse, and resident relatives as insureds under the policy. A
commercial policy typically includes employees as insureds.
The definition of who is an insured also serves in determining who is
not. Customers may assume certain people and their actions are
covered under a policy when they may not be.
Assignment: 1 – 2 hours
1. Ask your mentor for copies of a personal auto, homeowners, commercial property, and commercial
liability policy, if possible. Review the definition of who is an insured found in each and look for
differences.
2. Write down possible questions you could ask the customer in determining who needs coverage.
3. Review these questions with your mentor. Ask for improvements and additional possibilities.
Employee Orientation
Page 87
Other sources of customer information
We’ve talked a lot about asking questions. While that may seem a bit intimidating and possibly
awkward at first, the good news is that experience is the great equalizer. The more often you talk to
customers, the better you will get at determining their needs.
But don’t think that offering a comprehensive overall protection plan to customers necessarily requires
sitting with a customer for hours, asking so many questions that it becomes more of an interrogation
than a conversation! Perhaps that fear lies at the heart of why some agency folks never take the step to
go beyond simple order taking – they don’t want to seem too pushy or demanding of the customer’s
time.
Putting aside for the moment that any complete and thorough offering of professional advice and
service is going to take more time than just taking an order, there are other sources available beyond
questioning customers that can prove to be gold mines of key coverage and protection information.
Here are a few examples:
Your insurance carriers
Insurance Companies offer
extremely valuable resources to
agents, such as websites
packed with information.
Review your carriers’ marketing
materials, manuals, checklists,
forms, and applications.
And a conversation with an
underwriter is a great place to
discover what coverages and
solutions other accounts similar
to your customer have needed
and requested in the past.
Your agency
Many agencies are packed full of resources: applications, forms, and coverage checklists all provide
valuable insight into the types of information needed, plus reminding you of possibilities you may have
overlooked. Review the files of agency customers with similar needs and exposures for ideas on
information sources.
Employee Orientation
Page 88
Industry specific print/online resources
Insurance trade journals are a great place to find information on determining a customer’s needs. There
are also tremendous resources available online from the websites of various trade groups and other
industry experts. One such resource is the Virtual University, a member benefit from the Independent
Insurance Agents and Brokers of America and the New Mexico Association (access from
www.iianm.org). They also have member .
Information databases
Your customer’s business may have a website describing their operations and locations. The county
property appraiser’s website may have information on a customer’s property. And companies like Dunn
and Bradstreet compile statistical data on businesses, such as size, location, earnings, and number of
employees and make it available for a fee.
Assignment: 1 – 2 hours
1. Discuss with your mentor the various resources available to you to help you gather information useful
in determining your customer’s coverage needs.
2. Working with your mentor, make a list of each line of coverage with which you will be working. Next,
collect every standard checklist available to you for each of these lines of coverage. Highlight any
questions on the checklists that you feel do not make sense or don’t apply to that line of coverage.
Discuss these questions with your mentor. Decide which of those questions require an answer direct
from your customer, and which could just as easily be answered by information available from other
sources.
Employee Orientation
Page 89
Putting the Pieces Together
Now we’ve discussed the types of
information you need and offered some
suggestions on how to get that information,
let’s pull the pieces together and see how all
this plays out with your customer.
Make sure the customer understands your intentions.
If your intentions are to write a comprehensive insurance program for this customer, make sure you tell
them this immediately. Let your customer know you have no intention of being a mere salesperson, but
rather are interested in a being the trusted advisor for all their insurance needs. Stress that this
valuable consulting service costs nothing extra, except a little of their time.
This will include asking them about policies they may already have elsewhere. You must have this
information. in determining their current coverage as well as to give you an understanding of what this
customer needs and expects from their insurance program.
If they continue to insist that all that matters to them is the price of your quote for a single policy, you
may want to seriously consider whether or not you wish to pursue the relationship. Check with you
mentor to see what your agency’s position is.
Using their answers to the basic questions, present the
customer with a broad overview of the plan you wish to
discuss with them.
Outline the specific types of policies and services you feel
should be a part of this customer’s insurance program.
Demonstrate how you will work diligently to advise them a
variety of possible solutions, particularly ways to close any
potential gaps in their coverage needs.
Deliver the goods!
This is where you make your money. Telling the customer what you can do for them is one thing. Now
is time to put legs to your words by following through. Here are some tips:
NOTE: As you work through the account development process, it may take a great deal of time and
effort on the customer’s part, as well. Remember that if in the past they have only seen insurance as
purchasing a single policy when needed, they have likely seldom been asked to provide the amount of
information and input you will be requesting to do the job right. Make sure they feel comfortable with the
process and frequently remind them why this process is important.
Employee Orientation
Page 90

Gather the necessary information.

Ask more questions.

Consult other resources.

Complete any necessary applications, including finding any additional information needed to get
adequate offers from your insurance companies.

Develop and review proposed solutions and policies.

Analyze policies to be certain they provide the necessary coverages. Modify or endorse as
necessary.

Prepare a master proposal for the customer. Include all of your recommended products and
services, being sure to show clearly how, as a whole, they go beyond being simply a collection
of policies and represent a comprehensive solution to their previously agreed upon overall
protection needs.

Review with your supervisor to be certain all of the recommendations in your proposal are fully
deliverable, your proposed solutions fit the needs and your details on pricing and coverage are
correct.

Set a time with your customer to deliver and review your master proposal.

Be prepared to answer questions, and make modifications where needed.

Be prepared to enact all the accepted coverages and solutions immediately, including any
paperwork to be signed.
•
Have a list of all confirmations (signatures, payments, other documents) needed from
the customer and don’t leave the appointment without them, or a definite promise to
produce them by a set time in the near future.
•
If the customer decides not to accept any of the proposed coverages or solutions, be
certain to obtain the customer’s initials or signature in the proper places on your
documents (see Part Seven for E&O tips).
Send the proper applications or confirmations to all insurance companies providing a part of the
program.
Employee Orientation
Page 91
Why It All Matters
We’ve discussed the importance of helping your customer determine their coverage needs.
We’ve discussed the importance of asking questions and how to form those questions. But maybe
we’ve overlooked one obvious question: What’s in this for you?
As the poet once said, “Let us count the ways”:
Developing relationships
In the next Part of this Guide we will discuss in greater detail the
importance to you and your agency’s success in developing real,
solid relationships with your customers. For now, let’s just say
developing relationships with your customers means:
•
•
Working with people you care about. This brings meaning
to your work and a sense of fulfillment in your day.
Helping a customer determine the coverage they need,
not just selling them what they want. This is the basis for
you and your agency’s profitability. This is where the real
money is made. This is where the fun and personal
fulfillment is.
Employee Orientation
Page 92
Learning risk management
Simply taking orders and selling policies does nothing to help a
customer evaluate potential risks. While risk management is
somewhat beyond the scope of this Guide, at some point in your
career you will learn a great deal more about this term and its
implication for you and your customers. Effective risk managers:
• Go beyond selling insurance, helping customers determine
potential problems before they happen and provide tools that will
minimize the damage.
• Help customers determine risk factors to measure the potential
impact of gaps that exist in their insurance coverage. The customer is
then in a better position to assign priorities to each gap as to which
are critical and which might reasonably be put aside for later
consideration.
• Are seen not as insurance salespersons, but someone the
customer believes will help them manage their risk. Who do you think the customer considers
more valuable?
Gaining in professionalism from focusing on total account development
Never settle for selling when you can develop the entire account. What’s the difference between the
two?
•
•
•
Agents who simply sell a policy are salespeople. Agents who develop accounts are trusted
advisors.
Agents who have more customers with fewer policies work harder and make less money than
agents who have fewer customers with more polices.
Agents who develop accounts form better relationships with their customers.
Now consider the following facts derived from various studies:
•
•
•
The average personal lines customer has a legitimate need for at least 5 different polices. The
average commercial lines customer has twice that many.
Most agencies write fewer than 2 policies per customer.
Agencies who write 3 or more policies for a single customer have a 95 percent chance of
keeping that customer’s business for more than five years. Agencies writing a single policy for a
customer have a 50 percent chance of keeping that customer’s business for more than five
years.
Think of all the potential service and relationships with customers most agents leave on the table! The
more capable you are of identifying your customer’s coverage gaps, the better you will be at presenting
solutions to fill them. And the better you are at providing solutions and value to your customers, the
longer they will stay (the key to agency profit and success!).
Employee Orientation
Page 93
Limiting your E&O exposure
While we will go into E&O in much greater depth in Part Seven of this Guide,
there is no doubt that the information we have covered in this Part will help you
avoid or minimize your exposure to such claims.
Identifying the proper coverage needed by your customers will help you offer
them solutions to potential coverage issues. Failure to provide professional
advice and recommendations with the customer’s total account needs in mind
represents the greatest risk for leaving coverage gaps that lead to an errors and
omissions claim.
Simply put, agents who take the time to work with the customer in determining
their coverage needs are less likely to make the kind of costly mistake or
oversight that will get them, their agency, or their customer in financial trouble.
Exercise: 1 – 2 hours
1. We’ve discussed the advantages to selling your customers more or all of their policies. Ask your
mentor if your agency has one or more form letters available you can send to your “monoline”
(single policy) customers explaining these advantages to them and asking for a convenient time
to review their current coverages and protections.
2. With your mentor, set a schedule for sending these letters that allows you to respond quickly to
customers who agree to such a review. Also determine what procedures, if any, you will follow
in the future when working with those accounts that never reply or insist they have no interest in
going beyond that single policy with your agency.
In Part Five of the Guide, you’ve seen how to consider the right coverage for your customer, why it’s
important, and the rewards that come with it. We hope this information will help you shed the “order
taker” mindset and become a true trusted advisor to your customers.
Employee Orientation
Page 94
Part Five
Orientation Checklist
The difference between customer wants and needs
Why selling a customer only what they ask for may
be poor service
Using checklists and other techniques to see the “Big Picture” in identifying customer needs
Learning all my agency has to offer a customer, and how to access those products and services
on behalf of my customers
How even simple, basic questions can greatly enhance my ability to fully serve my customer
How gaining an understanding of insurance policy provisions directly translates into better
customer service
The many resources available for learning more about customer needs
Developing comprehensive coverage proposals
The many ways fully serving a customer’s needs is best for customer, agency and you
Employee Orientation
Page 95
PART SIX
Customer Service Issues and Techniques
At the very beginning of your journey through this Orientation Guide, Part One: What You’ll
Be Asked to Contribute included the following paragraph:
Insurance agencies are basically sales organizations, but with a unique feature: service after the sale is
critical. Along with the policy, agents promise to be there for their customers when they need them –
when they have a question, need to file a claim, need additional coverage, or make a change. Surveys
consistently show that customers happy with the service provided by their insurance agent are far
more likely to stick with that agent year after year. Your commitment to providing a high level of service
both during and after the sale is what will make the agency successful.
Now it is time to talk about how to provide that “high level of service.” Ready? Let’s get started.
Employee Orientation
Page 96
It’s not all about price.
Would it surprise you to know that a majority of insurance customers rank “quality of service from
agent” ahead of (or at least nearly equal to), price as a main reason why they buy and from whom?
Exercise: 15 minutes
Are there any stores or service providers among your favorites who clearly do not have the lowest price
available in your area? List several, and for each identify one or more reasons why you are willing to
bypass a lower price elsewhere to patronize these businesses. In reviewing your list, do you see ideas
on how you can offer the kind of customer service that will encourage customers to happily work with
you, even when you do not have the lowest price?
Customer service is clearly a major factor in customer decisions. Plus, when practiced correctly, it is a
rewarding experience for you as well. In insurance, we have an incredible opportunity to do wonderful
things for people. And when we deliver, the level of appreciation expressed is often very uplifting.
Why settle for “okay” when you can go for “WOW!”
Customer service can be delivered on three levels:
1. Meeting Basic Expectations: Good service
•
•
•
Services and features provided are expected, so often are not explicitly requested
If provided, the customer thinks “of course”; if not provided, customer will be dissatisfied
Customer reaction: “Okay, gotta go now.”
2. Satisfying Customer Needs: Better service
•
•
•
Services and features specifically requested by customer
If provided, customer satisfied; if not, customer dissatisfied
Customer reaction: “Thanks, that will do it.”
Employee Orientation
Page 97
3. Exceeding Expectations: Outstanding service
• Services and features provided are unexpected; customers often surprised to receive extras not
specifically requested or not experienced elsewhere
• If provided, customers impressed, even delighted; if not, customer unlikely to notice
• Customer reaction: “WOW!”
You can now see why a mistake made by many is to think customer service is mainly about being nice
or friendly. While customers appreciate a smile or at least a minimum of hassle, that is a basic
expectation. To be truly effective in both pleasing customers and experiencing the rewards for your
agency and career, you must go beyond basics and strive to be truly outstanding. And to be
outstanding requires not just meeting and satisfying customer expectations but exceeding them.
One note before we move on from the above list. The last bullet indicates that if you fail to exceed
expectations while still meeting or satisfying them, the customer is unlikely to notice. This leads many
agency folks to conclude the customer doesn’t care, so why go to the trouble of exceeding
expectations?
Agency and customer studies suggest two key answers to that question.

Delight is the key to Product & Service Differentiation

Do you want your customers to say to their friends “Oh, they are okay, but every insurance
agency is the same. Whichever is easiest and cheapest is what I always say.” Or would you
prefer “These folks are the greatest! I would never go anywhere else, and neither should you!”
Delighted customers are 5 times more likely to buy again than those who are just satisfied.
Since long-term customers are the key to agency profitability, which is the key to agency stability and
providing a great place to work both now and in the future, “delighted” is clearly the way to go!
Employee Orientation
Page 98
Who is your Customer?
Who does your agency “touch”? Who touches
you? “Touch” is a term used to describe the
emotional impact felt or left by people who come
into contact with each other. Practicing
outstanding customer service means knowing
exactly who you touch and how you touch them.
The first step in outstanding customer service is
deciding exactly WHO the customer is.
Exercise: 10 minutes
In the blanks below, list 5 people or groups of people who you consider a customer:
1.
2.
3.
4.
5.
Employee Orientation
Page 99
The first customer service myth you must free yourself from is that customers = clients.
In reality, the opportunity to practice outstanding customer service presents itself in many different
forms on a daily basis. You never know where the next prospect or client may be lurking. Do the
people who may not be current clients or “hot leads” feel the same level of care as those who are?
Have you ever considered any of the following as “customers”?
• Your UPS person. Chances are, if you’re in business, you frequently send or receive packages
through some outlet such as UPS. In all likelihood, the UPS person has a regular route, meaning you
see the same person almost every time. When he comes in to drop off/pick up packages, does he feel
welcome? Is he treated warmly and with respect? Is there a good chance she lives in the same city as
your agency and probably has insurance needs of her own?
•
A person that comes in looking for directions.
•
A person who drops off a coupon for the new restaurant that just opened across the street.
•
All of the people who these “visitors” know that may need help with
their insurance.
It’s easy to bend over backwards for that big account that requires so much
attention or that hot prospect who you just know is going to let you bid this
year. But treating everyone who touches your agency with the same level of
service and respect can offer results you never expected. A few more
thoughts to ponder:
•
Do you know the names of your neighbors? Do you call them by
name when you see them crossing the street or enter their place of
business? Do you know anything about them? Their business,
family, etc.
•
Do you know the names of regular “visitors”? For example, when the cleaning service people or
delivery folks come inside, do you call them by their names or just walk by? Do you know
anything about them?
Someone who has a good experience is likely to recommend you when they get the chance. But
someone who has a bad experience is much more likely to tell everyone they know to avoid you.
This is what we call the cycle of death.
Employee Orientation
Page 100
Beware of the cycle of death!
Research indicates that a satisfied customer may tell five
other people about his experience. A dissatisfied customer
will tell an average of 11 people about his disappointing
experience. But the fallout doesn’t stop there. The same
research found that those eleven people may each tell five
other people about the bad service. That’s 67 people who
might get a bad opinion of your service! And the so-called
cycle of death for your agency begins!
You can see why it is a good practice to start treating
everyone who touches your agency as customers. Even
someone who seems like the unlikeliest prospect could be
a customer.
For example, is the Underwriting Manager from one of your
carriers who comes into town and visits your agency every
quarter a customer?
The answer is yes. The agency has a professional relationship with this person and it is in the best
interest of everyone to make him or her feel welcome. There will undoubtedly be times when this
person may make a decision on a piece of business or a price based solely on the level of customer
service he feels your agency can provide. In like manner, there may be a piece of business with which
he is familiar in the area that needs an agent. Wouldn’t you like for him to send them to you?
Far too many agencies focus their customer service only on their key “bread and butter” clients. They
treat smaller customers and non-customers like a nuisance that is getting in the way of profitable
activity. But what if those key clients are truly the most profitable for the agency – is this still a mistake?
Consider the following:
•
Have you ever had an experience with a business that made you feel like you were
inconveniencing them? For example, have you ever been to a restaurant and had a server who
was obviously not thrilled that you came in 2 minutes before he was ready to take a break?
•
Have you ever stood in line waiting to pay or ask a question, while the service person gabbed
away on the phone or chatted with another person whom they obviously felt was more important
than you?
•
Have you ever been left on hold so long you were sure you had been forgotten?
•
Have you ever sat through endless automated phone menus, evidently designed to guarantee
you will never get to a real person?
How did it make you feel when you were not treated with the respect you thought you deserved? If you
had not become a customer for that business, how likely are you to become one after the way they
treated you? If the occasion arises, how likely are you to tell your friends about your bad experience?
Truly outstanding customer service begins with a customer focused attitude. And a great way to
develop such an attitude is making a habit of catering to the needs of all individuals who touch your
Employee Orientation
Page 101
agency with care and respect; making them feel comfortable and appreciated. Steer clear of the cycle
of death.
Everyone is in customer service
The first step is identifying who your customers are and how you
personally touch them.
Now let’s look at your customer service role as part of the agency.
No matter what your job responsibilities, you are in customer
service. Put yourself in the place of a customer first coming into an
insurance agency. To outsiders, an insurance agency can be an
intimidating place. Think about it: a majority of people walking into or
calling the agency are:
•
Afraid the insurance they need will not be available
•
Anxious that you will sell them something they don’t need.
•
Worried that the insurance they need will be too expensive.
•
Panicked because the insurance they need must be obtained
immediately.
•
Concerned about the insurance they already have.
Do not assume that all customers know exactly what or who they are looking for. Customers don’t see
an agency in departments. They don’t see it as an organization of principals, producers, CSR’s and a
receptionist. They see it as a place they can go to fix a problem. And no one wants to hear “That’s not
my job” or “The service representative that handles your account is out of town for a week.” That’s why
it is the job of everyone in the agency to make a customer who touches the agency feel comfortable.
This doesn’t mean everyone has to answer to every customer’s questions or concerns. It simply means
that there may be times when offering outstanding customer service takes you out of your usual
element, when customers expect you to handle a situation you may not otherwise handle. The way you
conduct yourself during these “outside the norm” activities will determine how that customer feels
“touched” by your agency.
What level of service do your customers expect?
While there are numerous books and studies discussing what customers want, perhaps the easiest way
to find out what your customers want is to ask them. Here are some methods that have proven useful to
other agencies.
•
•
•
Questionnaires
Surveys
Interviews
Employee Orientation
Page 102
Yet, for many agencies the single most effective method was for staff to consider each customer
contact as an opportunity to learn more of what the customer wants, needs and expects. This can be
always asking a question or two about their needs each time you talk with the customer.
An even simpler approach is simply taking note of such wants or needs as they arise in conversation.
For example, while chatting with a customer at renewal time, you ask how her kids are doing, and the
answer is “Oh, we hardly see them anymore since we got those jet skis.” Or another customer, while
discussing a billing issue, comments “Why do these bills always have to come up at the worst time of
the year?” Keep your customer “radar” running at all times, and you will soon discover countless
opportunities arising to be of service.
Exercise: 1 hour
Talk with your mentor about methods your agency uses to learn more about the wants, needs and
expectations of your customers. Also ask what technology tools are available for your use to track the
comments of customers that will help you to provide them continuously improving service in the future.
Meet with the proper person who can teach you the effective use of these tools.
Sometimes you won’t need to ask customer how you are doing in meeting or exceeding their
expectations. Their attitude and body language may say it all without a word passing between you.
Keep your eyes open for clues similar to the following:
•
When you come into contact with them, is their demeanor friendly and confident? Or do they
always seem frustrated, flustered, or cold?
•
Is the tone of their voices usually pleasant or stern?
•
Do they remind you how much they appreciate what you do for them?
•
Are they approachable? Do they make you feel comfortable or do they make you feel like a
nuisance?
•
Do they respond to your communications or completely ignore you?
•
Do they constantly shop around for a better agent?
Employee Orientation
Page 103
How do Customers Touch Your Agency?
There are a few common ways customers touch your agency. From
various sources and studies, here are examples of what customers
expect in these situations.
Personal visits
As we mentioned earlier, the inside of an insurance agency can be an
intimidating site for customers. Remember to treat a customer who
has taken the time to visit your agency personally with the utmost
hospitality and respect. To assure them they are your priority, follow
the following two tips:
•
People don’t like to wait. If they ask for you and you are out of
the office, the receptionist or someone else in the agency
should know who the person is that can help a customer in your absence. Make sure someone
in the office knows you are gone, when you will be back, and, if necessary, get that information
to the customer.
•
A person standing in front of you should be given the priority over someone calling on the
phone. In cases where the phones cannot be avoided, politely ask the permission of the
customer in the office for you to answer the phone.
Upon answering, immediately transfer the call to another person or voice mail and return your attention
to the person in front of you.
Phone
What does the customer expect to happen when they call your agency? The phone is probably the
most common means of communication that agencies have with customers. What do you think
customers “see” when they call your agency?
One additional tip: Customers expect you to answer in a warm, understanding, and helpful tone of
voice. If instead you sound indifferent, miserable, or stressed, is it wrong for the customer to assume
that you resent their call? Can we blame them for being upset by this?
Assignment:
Review the phone tips offered in Part Four of your Orientation Guide. Be certain to practice until each becomes
part of your regular approach to dealing with customer calls.
Voice mail
Part Four also offered some good advice about the proper handling of voice mail. Here are a few
additional tips:
Employee Orientation
Page 104
•
•
•
•
•
People don’t mind leaving one voice mail…ONE! Most people do not enjoy a game of phone
tag, or worse, never having their call returned.
Is your voice mail recording welcoming and thankful for the call? If you say you are “sorry you
missed the call,” do you sound like you mean it or you are reading from a script?
Does your message give the caller any information on when they can expect to hear from you?
Does your message give the caller any other contact information, such as a cell phone number
or email address?
Does your message instruct the caller on how to speak to another person in the agency that can
help them while you are away?
Email, fax, and written correspondence
Not all customer service expectations are determined by personal visits and phone conversation.
Review the many tips in Part Four for working effectively with each of these.
Prepare to answer common customer questions
Regardless of the means of communication, customers will frequently contact agencies with common
questions that everyone in the agency should be able to answer. The customer expects a quick and
concise answer to these questions and if the person with whom they speak is unable to provide one,
they are not likely to call again. Such questions may often include:
o
o
o
o
o
o
o
Where are you located? (or) How do I get to you?
What type of insurance do you sell?
What are your hours of operation and can you be reached after hours?
Can I get a quote?
Do I have to come in, or can you handle everything over the phone?
Can I do any of this on your web site?
Do you really need all that information? No one else has asked for it.
Exercise: 1 hour
Add to these suggested questions any you frequently encounter. Ask others in the agency to review
your list and add their own common customer questions. Once you have compiled your list, review it
with your mentor to discuss suggested answers to each question. Practice these answers with your
mentor or your fellow agency folks until you can comfortably and easily respond to each.
Employee Orientation
Page 105
Handling a claim
One of the most sensitive areas of this industry is handling a claim. Customers dislike claims more than
you do, and a customer’s reaction to a claim may be a direct measurement of how comfortable they are
with your service. If you have made that customer feel important to and welcome in your agency, they
are far more likely to handle the claims process well, regardless of the specific outcome.
While severities of claims differ, a customer’s perception of the claims process is where outstanding
customer service is so important. A claim that may not seem serious to you may seem like the end of
the world to that customer. Your job is to cater to their needs without demeaning them or making their
claim seem less important than others.
The process of handling a claim should be clearly defined by the insurance company who issued the
policy. However, the customer may not know (or care) that there is a difference between you and the
insurance company. In their mind, you are the one who handles the claim, and they are counting on
you walk them through the process.
Outstanding customer service during the claims process is critical. After all, this is the moment for
which they bought the insurance to begin with. In contrast, a lack of outstanding customer service
during a claim is a sure fire way to lose the customer…or worse.
Exercise:
Pretend you are a customer who was just in a car accident. You did what you thought was the right
thing and called your agent. The conversation went like this:
YOU: Yes, I need to report a claim. I’ve been in an accident.
RECEPTIONIST: Okay sir. What’s your agents name, I’ll transfer you.
YOU: I think it’s Bob Smith.
RECEPTIONIST: Bob is out of the office until Friday. Do you know the name of your Service
Representative?
YOU: Who? No. I told you, it’s Bob. I need help.
RECEPTIONIST: Please hold.
CSR: This is Billy Jean.
YOU: I need to report a claim. I’ve been in an accident.
CSR: Sir, which insurance company is your policy with?
YOU: I thought it was with you!
CSR: If you look on your auto ID card we gave you, it will tell you.
YOU: Wait, let me find it. OK, it says ABC Insurance Company.
CSR: Sir, you need to call them directly. The number should be on the card…
And so on, and so on. Is this situation completely unrealistic? Even if the claim were successfully
resolved and paid, do you feel like you received outstanding customer service? Do you think you would
continue doing business with the agency, or take your business elsewhere and tell others about the
experience, inching that agency closer to the cycle of death?
Employee Orientation
Page 106
Exercise:
Before going further, write on a separate sheet of paper ideas of how this claim could have been
handled using outstanding customer service.
Now review the following conversation and see how it compares to your ideas above.
YOU: Yes, I need to report a claim. I’ve been in an accident.
RECEPTIONIST: Oh, no! Is everyone okay?
YOU: I think so.
RECEPTIONIST: Thank goodness. I can help. What is your name, sir?
YOU: Simon Galackowitz.
RECEPTIONIST: Okay, Mr. Galackowitz. I have your account in front of me. I see that Bob Smith is
your agent. Unfortunately Bob is out of the office but your service representative Billy Jean is here. Hold
on, I’ll transfer you. I’m glad you’re okay.
RECEPTIONIST TO CSR: Billy Jean, Mr. Simon Galackowitz is on the line. He’s had an accident. He
thinks everyone is okay.
CSR TO RECEPTIONIST: Thank you. I’ll take care of it.
CSR: Mr. Galackowitz, are you okay?
YOU: Yes, I’m fine. But I can’t say the same for my car, it’s pretty bad.
CSR: Okay, Mr. Galackowitz. I’ve got your account information in front of me and we’ll
get this taken care of right away.
Notice how the whole demeanor of the second conversation changed right away with the receptionist.
She asked you if you were okay and immediately asked for your name to pull up appropriate
information. Customers expect you to sympathize with them when something has gone wrong. They do
not expect to have to handle the claim all by themselves. In the second conversation, the receptionist
and CSR were there to address your concern and outstanding customer service overshadowed the fact
that the agent you know personally wasn’t there.
In all areas where outstanding customer service is key, the claims handling process may be the most
important. This is when the customer feels most vulnerable and expects you to be there for them. The
claims process is also where the rewards of outstanding customer service are the greatest. A smooth
claim could mean a friend for life.
Outstanding Customer Service Is More Than Just Being Nice.
Outstanding customer service is rewarding emotionally. It appeals to our human sense; the golden rule.
Outstanding customer service can turn business relationships into friendships. It makes work feel more
important and fun. And as we said earlier, it pays
Employee Orientation
Page 107
Assignment: 1 hour
Prior to reading the following section, go to the IIABA.net web site. In the “search” window on the top of
the left side menu, enter “customer service.” Scroll down the search results until you find “Relationships
Are Key to Crushing the Competition.” Click on that link and read the article about the seminar Howard
Candage presented, particularly the difference between “transaction-based” and “relationship-based”
customer service.
We agree with Howard. According to industry studies, the majority of customers want a relationship
with you. They appreciate being able to contact you and get answers to questions from the same
person that has been answering their questions for years. This relationship is important, and it is the
relationship that will determine the key factors in an account’s profitability.
Here are four steps to building profitable customer relationships.
STEP 1 – Establish a good relationship from the first contact.
Simply put, people like doing business with people they like, and first impressions are important.
A customer who believes from the beginning that you are always working in their best interest will stay
with you, even when times get tough. They are more likely to trust you and believe you when you
discuss difficult-to-understand factors such as coverage and premium pricing with them.
STEP 2- Focus on the long term.
Good impressions can be fleeting, but good relationships take time. Your goal for every account is a
solid long-term relationship with every customer. Too many agency folks think short term. Their primary
focus is new business and number of customers, not in building long term relationships. Those folks not
only overlook the increased potential for profitability created by renewing business and increasing the
number of policies provided for each customer, but also the healthier and more pleasant work
environment of dealing with clients rather than one-shot policy buyers.
STEP 3- Relationships come with responsibilities.
Providing outstanding customer service can turn customers into friends. And a good relationship with a
customer will help you learn more about that customer’s needs, making it less likely for a mistake or
oversight to result in an errors and omissions claim. But don’t mistake being friendly with being timid. If
you knew a friend was about to do something leading to potential harm or pain, wouldn’t you feel the
need to warn them? Consider the following situations where an agency person thought being nice was
more important than being responsible:
Example #1: You write the insurance for one of your good friends. You know he has fallen on hard
times and will not be able to afford his renewal. However, because of your personal relationship, you
know he does not want anyone to handle his insurance but you. You sympathize with him and do not
think you will be able to break the news to him that the insurance company is going to cancel his
coverage.
Example #2: One of your customers is a good friend who owns a business. You know he is
understating the values of his business property in order to get cheaper insurance. You also know that
the insurance company will penalize him heavily in the result of a claim due to his underinsurance. You
decide not to tell him this because he is your friend and you know he cannot afford to pay more.
While establishing and maintaining a relationship with a customer may be good for profitability, it is not
an excuse to treat anyone differently or put their account in danger.
Employee Orientation
Page 108
STEP 4 – Enjoy the Ride!
Have you ever heard the expression: “The jobs that pay the most are the ones that don’t feel like
work?”
Great news! All the keys to building profitable relationships are also the keys to enjoying what you do.
And they all originate with outstanding customer service. Establishing and maintaining relationships
with customers makes working for and with them more enjoyable. It increases profitability by helping to
develop customers into long-term accounts and limiting the chances of making financially detrimental
errors. It contributes to the goal of not only writing better business, but keeping better business.
But there’s more. Outstanding customer service enhances your reputation in the community. It keeps
your customers from saying things about you that inch you closer to the cycle of death.
Outstanding Customer Service Techniques
We discussed earlier the concept of “touch.” Your job is to make sure every customer feels as though
they’ve been touched by you in a positive manner. Each of the following represents an opportunity to
“touch” a customer. Just like a game of “tag”, the one with the most positive “touches” wins!
NOTE: Earlier in this section, we encouraged you to learn more about Personalities and
Communications to help you improve your ability to offer outstanding customer service. If you have
already gained a great deal of knowledge in those subjects, feel free to skip over some of the following
tips. If not, these will offer a good place to start while you wait to get into those seminars or courses.
Verbal communication
Customers want you to be friendly and appreciate their situation. They also want you to be
knowledgeable. Being knowledgeable does not mean using big, fancy sounding insurance words or
terms with them (See “Jargon” in Part Three of your Orientation Guide). It does not mean blaming the
government or insurance companies for inflated rates. And it certainly does not mean always having
the answer to every question right away.
•
•
•
•
•
Customers expect you to be professional. Being professional means understanding their
problem and telling them what can be done to remedy it.
ALWAYS greet the customer by name (FYI: asking about their family by name is worth major
bonus points, particularly with grandparents).
When you speak to a customer, do so confidently. Remember, there is a difference between
speaking with confidence and shouting.
Make eye contact when speaking. If possible, avoid sitting across the table from them. The table
will be like a wall or barrier to comfortable communication.
Listen to their concerns intently and sincerely. Chances are the customer is much more
concerned with you listening to their whole story and evaluating it with them than anything else
you may have to say.
Become an artist
Employee Orientation
Page 109
Outstanding customer service means being able to say potentially complicated things in a way the
customer can understand. Insurance policies are complicated; agents must learn to steer clear of
memorizing and quoting policy language. Learn to paint word pictures for customers. For example, the
customer doesn’t care about a peril called “Accidental Discharge Or Overflow Of Water Or Steam.” The
customer cares about how an unprotected pipe could freeze, causing it to burst and flood the
basement.
You must learn to help customers visualize; this is the only way they will ever understand their
insurance and how it applies to them.
Assignment: 30 minutes - 1 hour
Talk to your mentor or principal about the types of claims which their experience has taught them are
more common than others. Visualize the claim happening and how it happens.
This will help you paint pictures for future customers that will help them legitimately understand the
purpose of their insurance. Practice painting such pictures with your friends or family – folks you know
don’t aren’t familiar with insurance technical language – until you feel comfortable with the technique.
Learn to say “I don’t know”
Thinking you know the answer to everything is not just foolish, it’s
risky. Customers will often ask questions to which you may not
know the answer. It is not bad form for you to tell them you do not
know but you will find out and get back to them. The customer will
appreciate the truth much more than a “know-it-all” agent who turns
out to be wrong.
Learning to say “I don’t know, but I will find out” will help broaden
your knowledge. It will encourage you to learn more and become an
expert in your field. It will also greatly reduce the potential for a
costly errors and omissions claim.
Written communication
Customers can tell a great deal from the way you touch them on paper. Letters, faxes, and emails
should be professional and easy to understand. A few tips:
•
Practice email etiquette. Too often, email is seen as a quick alternative to other forms of
communication and is not taken as seriously. Check spelling and grammar before sending.
Make sure you are direct and concise. Avoid typing in all capital letters.
Employee Orientation
Page 110
•
Often, important information that is emailed is not received for one reason or another. If
possible, request a confirmation of receipt be emailed back to you. (Most email providers offer
this option.)
•
Use a message from your email stating that you are/will be out of the office if you do a lot of
business via email. These messages are automatically sent while you are away so customers
don’t wonder why you haven’t responded. Most email providers offer this option.
•
Handwritten communications are always appreciated. However, never assume anyone can
actually read your handwriting. Hand-written communications are great for birthday cards, etc.
However, business communications should always be typed.
Employee Orientation
Page 111
Frequency of communications
How often do you touch your customers? Some customers require
more frequent service than others (i.e. contractors need certificates,
etc.). How about the customers who aren’t always needing services or
having claims? The better you know your customer, the better you will
know how they like to be touched. The important thing is to make the
effort; this will make them feel appreciated and let them know you
value their business. Plan on touching all of your customers at least
once a quarter – the method is up to you. But do it, and do it without
being asked. Unsolicited communications will prove invaluable in
developing relationships with your customers and growing their
accounts. Here are some ideas for those regular touches.
•
Don’t underestimate the power of a note.
•
It could be scribbled in handwriting and say nothing more than
“Just checking in” and signing your name. A note like this sent to a customer every quarter will
go well beyond what they probably experienced before you came along.
•
Remember birthdays, holidays, anniversaries and other important dates in the customer’s life
and acknowledge them. Or just send them a “Thank You” note once in a while, thanking them
for doing business with you. These are such little steps that can mean so much to the customer.
•
Call just to say “what’s up?”
•
At first, customers will panic at the thought of a call from their insurance agent. They will
assume something is wrong or that the price is going up. This is because they have been
trained to think this way; it’s probably how they’ve been treated by every other agent they’ve
ever had.
•
Scheduling a quarterly phone call to ask how they are doing will work wonders for your
relationship. It will also help you stay on top of changes in the account, such as a new child,
home or business concern.
•
Do the same with email.
•
Send an email occasionally just to see how the customer is doing. Don’t send it as part of a
“blast” or “group” mailing; make it personal.
•
“I was in the neighborhood.” A personal visit to the client is a great way to let them know you
care. Just stopping by for a moment and asking how everyone is doing is great way to touch the
customer. This is also a great way to get to know the other people involved in the account, such
as family members and co-workers.
•
However, if you decide to stop in, make sure it is a good time for them to see you. A customer
who is having a lousy day or is insanely busy (such as a restaurant at lunch time) may not react
well to your visit.
Employee Orientation
Page 112
Use tools to keep on track.
As your book of business grows so too will your dependency on tools to help service your accounts.
Buy a calendar, date book, or planner. Program a PDA or use your computer to remind you.
Utilize any tool at your disposal to help make your communication endeavors easier. This is much too
important to overlook.
Exercise: 1 hour
Most agency managements systems are loaded with practical tools for agents to manage accounts and
help with communications. Learn how to use your management system to offer reminders, schedule
follow ups, send emails or letters for you. Sit down with your agency IT person or another who knows
your system’s capabilities to learn how your management system can assist you in providing
outstanding customer service.
Offer general information and feedback
Providing customers with general information about insurance can serve two purposes:
(1) Educate them about insurance, and
(2) Let them know you care about educating them about insurance.
This business is complicated. Some customers may feel the less they know, the better. However, many
customers will appreciate your efforts in helping them learn more about a product that may protect them
in their greatest time of need.
Employee Orientation
Page 113
Exercise: 1 hour
Meet with your mentor and discuss the following possibilities for providing information to your
customers. Is the agency doing any of the following already? If not, would they be good suggestions to
consider? Are there other methods already in place or available for you to make this “touch”?
•
•
•
•
Send a newsletter to clients containing simple ways to control insurance costs, information
about common coverage, and FAQ’s. Keep it short and light. The longer, more complicated and
lifeless the more often it will go straight to the trash. Make it fun!
Add the same types of information to your agency web site, and be sure customers know how to
get there,
Offer classes or seminars to clients about insurance. Offer these services to their employees or
friends. This is a great service that very few agents offer.
Speak to local associations and community service groups about basic insurance needs. These
groups are always looking for speakers and members. This will help to enhance your public
image as well as letting your customers know you are passionate about people understanding
insurance. Let customers know about any such engagements so they may attend.
Outstanding customer service starts with you!
We’ve discussed who is a customer and how they expect to be treated. We’ve discussed why
outstanding customer service is important. Finally, we’ve discussed how to practice outstanding
customer service.
We’ve told you that it will help you turn customer relationships into friendships and make the agency
more profitable. We’ve told you that it will help you retain accounts for longer periods of time.
Outstanding customer service – it all starts with you.
Employee Orientation
Page 114
Part Six
Orientation Checklist
When providing customer service, I now have a better
understanding of:
Why customers choose to do business with one
agency over another
The part played by customer expectations in measuring the adequacy of customer service
The advantages of exceeding expectations, rather than just meeting them
How the term “customer” goes far beyond just those who are buying, or have previously bought,
a policy
Avoiding the “cycle of death”
Many ways in which customers “touch” our agency, and how outstanding customer service
needs to address each
How customer service is more than “just being nice”
Why the true focus of customer service must be on building relationships
Various techniques for providing outstanding customer service
How learning to use our agency management system’s customer service functions can be
utilized in meeting customer service goals
Employee Orientation
Page 115
PART SEVEN
Introduction to Errors and Omissions
Back in Part Three of your Guide, you may remember reading the following paragraph:
“Avoiding Mistakes in Communication”
Insurance agencies are frequently accused of communicating incorrectly or incompletely at the time
when a proposal is presented to a customer. Sometimes they are accused of failing to follow through
on a promise they made. If the customer, or someone else, can show that they suffered financially
because of these mistakes, they can collect damages from the agency in court. These types of claims,
called Errors and Omissions (E&O), need to be avoided as much as possible.
Congratulations – you have covered a lot of ground since you first started. Let’s take the next step and
more fully explore Errors and Omissions (or, as we will call it from now on, “E&O”) and how the
exposure to such claims affects your daily activities in your agency.
What causes E&O?
As described above, the exposure of your agency to an E&O claim is basically created by someone
making a mistake that causes financial harm to a customer. But doesn’t everyone make mistakes?
Sure! And if we were providing a service no one cared about, no one would care to sue us, either. But
when we are providing something as valuable and critical as insurance protection, those mistakes can
really hurt a customer’s financial well-being. So in a way, the threat of an E&O claim is actually a
compliment, proof that our customers count on us to provide professional advice and services to
address their unique insurance protection needs. They know they may suffer real harm if we fail to live
up to that trust.
WARNING! Don’t confuse “providing professional advice and services to address their unique
insurance protection needs” to mean you must be certain to sell each customer a policy that covers
everything. Think about a doctor/patient relationship. First, an outstanding doctor treats each patient as
unique. While a good doctor may not mean any harm if he simply prescribes to everyone the latest and
greatest cure-all pills, an outstanding doctor never assumes everyone has the same problems and will
get better using the same solutions. Prior to making recommendations, the outstanding doctor will ask
the patient questions, being sure to understand or clarify the patient’s responses. Once they feel they
have worked with the patient to uncover that patient’s unique needs, only then will the outstanding
Employee Orientation
Page 116
doctor risk a diagnosis and recommend possible solutions, taking great care to explain what may work
and what may not, along with any possible side effects. And while the patient may hope the doctor can
solve every problem and cure every ill, outstanding doctors (and patients) know that is impossible.
Once the doctor has provided his or her best professional advice, it is up to the patient to decide what
parts to follow and which, if any to ignore due to cost or other considerations. An outstanding doctor
knows their best and highest calling is to advise and assist – they can never take the treatment for the
patient.
So you can see while there is nothing inherently wrong with being a good doctor (or a good insurance
agent) and selling a patient/customer a great product or service, the truly outstanding doctor (and
agent) seeks to understand the customer’s total risk picture and recommend appropriate solutions.
Assignment
Review Parts 3, 4, 5 and 6 of your Orientation Guide. Look for four examples from each of similarities in
how doctors and insurance agencies design processes and procedures for providing outstanding
advice and service to customers. Particularly note how outstanding customer service principles
naturally assist in avoiding misunderstandings or applying improper solutions to the unique needs of a
specific customer. Complete the chart below, and then review with your mentor for specific methods of
applying your findings in your everyday agency role.
Part 3
Example:
Agency Procedure
Completed Application
Similar Doctor’s Procedure
Accurate Prescription
Part 4
Agency Procedure
Similar Doctor’s Procedure
Part 5
Agency Procedure
Similar Doctor’s Procedure
Part 6
Agency Procedure
Similar Doctor’s Procedure
Employee Orientation
Page 117
How to Avoid E&O
Remember E&O means “errors” AND “omissions. To avoid or at least minimize the possibility of an
E&O claim, the focus must be not only on avoiding actual mistakes (errors), but also not overlooking
actions the agency should have taken (omissions). That is why we earlier asked you to review previous
segments of this guide that focused on the best method to address both mistakes and overlooked
opportunities through developing and pursuing proper processes and procedures. Good processes and
procedures, when religiously adhered to and relentlessly followed, address, eliminate or minimize
nearly all of the most common causes of E&O. In fact, at this point we could simply say that if you have
learned and are regularly practicing all of the recommendations from the previous sections of this
guide, you are well on your way to being a top-flight E&O avoider!
However, to give you a better sense of how such claims can arise despite the best intentions of good
agency folks, and to further reaffirm the value of effective processes and procedures, let’s consider the
three major areas from which E&O claims arise, and three rules for avoiding them.
Rule #1: Never make decisions for your customers.
Remember our outstanding doctor? Even as a highly trained professional, doctors know they cannot
make critical decisions for their patients. They can provide advice and counsel as to possible options,
but ultimately each patient is responsible to decide what choices to make, based upon whatever criteria
the patient deems most important. For example, a new drug may have proven quite effective for others
with the patient’s condition, but the extremely high expense may be beyond their willingness to pay. As
a more common example, how many patients have totally understood and agreed with their doctor that
the patient needs to lose weight, but has decided that extra rack of ribs or plate of cookies is just too
good to pass up?
Outstanding customer service and relationships require you to offer professional advice and counsel.
But never make a final decision for any customer as to the coverages and limits to be purchased or the
options to be chosen. Make it clear to each customer that is their responsibility and you have greatly
reduced the chances your agency will be facing an E&O from that customer claiming, for example, that
they wanted the best coverage but you told them not to buy it.
Assignment
1. For the rest of the day (or tomorrow, if it’s already late today), make a list of the times a customer
asks you to make a decision for them.
2. Review your list with coworkers. Ask them to add others to the list that you have not encountered.
3. Review your list with your mentor, looking for patterns. What types of decisions are customers most
likely to ask you to make for them?
4. Ask your mentor what is your best response to each type of request in order to be certain the
customer understands you are willing to offer advice, but cannot make critical decisions for them.
5. Sometimes agencies suffer an E&O claim because a staff member felt awkward or uncomfortable
giving the proper responses to a customer. Practice with your mentor or others until you are
Employee Orientation
Page 118
comfortable you can give the proper response without hesitation. If necessary, work with your mentor to
put the response into your own words, as long as the effectiveness of the response in preventing E&O
is retained.
Rule #2: Never let customers make decisions without knowing the consequences.
Agreeing that the customer will make all the final decisions about coverages and limits does not mean
you just stand aside and let them make potentially major mistakes without at least a warning. Your
willingness and ability to offer professional advice and counsel is the key differentiator between a
customer working with you as an independent agent, and just buying insurance products over the
internet or from an ATM. Buying insurance may seem easy to some, but buying the right insurance now that’s a bit tougher.
Not only is offering such advice the professional thing to do, it’s something your customers expect. Can
you imagine an outstanding doctor recommending a new miracle medication for your headache, only to
have a side effect of that medication put you in the hospital with a heart attack? And when you ask the
doctor about that side effect, his answer is “Oh, yeah, I knew about that but I guess I forgot to mention
it.” Do you think a malpractice claim against that “outstanding” doctor will be far behind?
In the same way, do not feel as if it is a burden on your customer’s time or a question of their
intelligence for you to point out potential pitfalls, but an obligation on your part to offer the best advice
and service possible – and that includes the plusses and minuses of any final choices in coverage and
limits.
Exercise: 1 hour
For each of the following, provide one potential benefit and one potential pitfall your customer should
consider before finalizing their decision.
1. “Gosh, those auto liability limits seem awfully expensive. I think we’ll just take whatever the minimum
is.”
2. “Although my teenage son has his license, he almost never drives our car. Let’s just leave him off the
policy for now rather than pay all that money.”
3. “I’m sure our house wouldn’t cost anywhere near that $325,000 to rebuild as your formula there says.
And besides, the odds are we won’t lose the whole house anyway, right? I think $250,000 will be
plenty.”
4. “I think we’ll just pass on that extra business coverage you mentioned for our homeowners policy. It’s
not like my husband is really making anything, and it’s really more of a hobby than a job.”
5. “I was at a meeting last night and the guy told me just to call my employees independent contractors
and I can drop that expensive workers compensation insurance. And it’s not like we’ve ever had a claim
anyway.”
After completing this exercise, review your answers with your mentor. Add to your list any additional
situations your mentor thinks you are likely to encounter, and what good advice they suggest passing
on to assist your customers in making knowledgeable choices.
Employee Orientation
Page 119
One key to talking with customers about making good choices was also discussed in previous parts of
this guide – communicating effectively. If your advice is misunderstood, the customer may make a
decision based upon what they thought you said. If that decision later proves harmful, despite your
good intentions you may find yourself in the middle of an ugly situation.
There are numerous examples of agents having E&O claims filed against them alleging the agent never
provided the proper advice or counsel. Yet the agent is absolutely certain they did, in fact, provide just
that information. What later comes out of the argument is that the agent, indeed, said what they thought
they did, only to find the customer heard an entirely different message. There can be no winner in such
disputes – even though both parties feel they did nothing wrong, someone is going to suffer for the
mistake and the customer has no doubt that someone should be the agency, not them.
A far too common example of how such misunderstandings arise was cited in Part Three of this guide
under the heading of “jargon.” One of the mistakes agency folks often make is to freely throw around
insurance phrases such as “all risk” or “full coverage” or “replacement cost”, assuming the customer
understands that these insurance terms are subject to certain exclusions and limitations. Wrong!
Customers aren’t trained in insurance definitions, so cannot be faulted for assuming the terms mean
just what they imply:
•
•
•
“All risk” = everything that happens will be covered
“Full coverage” = no deductibles and every item is covered
“Replacement cost” = I will get a new one, no matter what it costs
Misunderstandings about the true insurance meaning of each of these terms, and others, have led to
E&O claims in the past. Try to avoid using such terms without making sure the customer fully
understands their application to the customer’s needs, including any limitations and exclusions that
apply.
Exercise: 1 hour
Look back in this Orientation Guide to Part 3, page 5, and reread the “Jargon Alert”. We identified
above three common insurance terms that are often misunderstood. Talk with your coworkers and
mentor to list below at least five more such terms.
1.
2.
3.
4.
5.
Others?
Be certain you understand what each term means in relationship to insurance coverage, including any
limitations or exclusions that should be explained when using the term with a customer.
Employee Orientation
Page 120
Rule #3: Document everything.
Many times in the past E&O experts have been asked to identify the top ways for an agency to come
out on top of any E&O claim. No matter how long the list, here are the top three most cited solutions, in
order:
1. Document
2. Document
3. Document.
While not approaching the knee-slapping humor level of a Jeff Foxworthy (“If you don’t document, you
just might be a deadneck!”), the experts were making a real and valuable point – as far as the courts
are concerned, in any E&O claim filed against an agency, what isn’t properly documented never
happened.
Some insurance text books explain the key part documentation plays by suggesting that in an E&O
claim situation, the agency begins with two strikes against them:
1. The agency is the professionals and should know better than the insured about any coverage
technicalities that lead to gaps or underpayments
2. The agency has insurance (E&O) to cover these losses, so they can afford to pay better than the
insured.
Baseball fans know that although two strikes puts you behind in the count, you are not out yet. But the
third strike is on the way to the plate, and it goes like this: The insurance agency handles thousands of
transactions, perhaps hundreds per day, for a multitude of customers. The insured is only concerned
with one transaction – his or her coverage. Given these facts, which party is more likely to remember
the transaction in detail: the agency or the customer? For example, what if an insured claims he made
a phone call to the agency requesting a certain coverage be added to his policy, and the E&O claim
arises from that coverage never being added. Is it more likely the insured is wrong about remembering
his single call or that the agency simply lost that call among the hundreds of others it gets every week?
In this example, if the agency cannot prove it has kept proper documentation of all incoming phone
calls, the lack of any notation of the insured’s call makes it highly unlikely that call was made. The court
is understandably going to find the insured more believable and call “strike three”, awarding the insured
the claim. On the other hand, if the agency has such effective and proper procedures for documenting
incoming calls that the court finds it easier to believe the insured never made that call, can you see how
that third strike never crosses the plate and the agency wins the case?
Consider the following actual E&O claims, and how documentation proved the key in whether the
agency was held responsible:
1. An agent deleted theft coverage for a client claiming the insured advised he no longer needed it. A
theft loss occurred for which there was no coverage under the insured’s property policy. The agency file
did not contain sufficient documentation to support the agent’s claim that the insured had indicated he
no longer needed theft coverage. The agency was found liable.
2. The insured alleged that the agent failed to add a mortgagee to a policy, despite being asked. There
was a building fire resulting in a loss of $600,000 and the bank was not included in the payment. The
agent claimed that she was never contacted by the insured and requested to add a mortgagee. Due to
the agency’s records of all contacts with the client, the trial court was able to deduce that no
Employee Orientation
Page 121
conversation ever took place in which the agent was asked to add the mortgagee. The agency was
held not to be liable.
3. The agent wrote all of the client’s insurance, both personal and commercial. When the client was
killed in an automobile accident, his wife began looking through the insurance papers for a life
insurance policy. She was unable to find one and contacted the agent. The agent advised the widow
that he did not write life insurance, despite the fact that he held a valid license to do so. The distraught
widow sued the agent for $1,000,000. The agent did not hold himself out to be a life insurance
salesman, despite holding a valid license, but he recalled discussing the subject of life insurance with
the client several times. The client did not feel it was necessary. However, the agent’s file contained no
documentation to that effect. The client had no other insurance policies and no other agent. The case
went to trial and, without documentation; the E&O carrier was unable to convince the court that the
agent had fully discharged his duties. The agency was found liable.
4. The client faxed a request for commercial fire insurance to the agency. The client suffered fire
damage to the property and the insurance company denied the claim stating that no coverage was in
force on the date of the loss. The client alleged that the agency had failed to place requested coverage
on a commercial structure. Proper documentation in the agency’s files proved that the client had not
requested coverage until after the date of the loss. A fax request from the client, showing the date and
time, and a log of incoming fax transmissions, was introduced into evidence during trial, proving
conclusively that the coverage was requested after the date of the fire. The agency was held not to be
liable.
Notice in each example, the technicalities of the coverage had little or no bearing on the court’s ultimate
decision. In each case, the agency may have done nothing wrong, but it was the ability or inability to
document its actions that led directly to the final verdict.
Assignment
1. Review the agency procedures and processes materials you read about and developed while
working through Part Four of this guide. As you do so, consider each workflow and recordkeeping
requirement not merely for time management, efficiency and providing good service, but also as
creating the documentation that is a key E&O prevention tool. Adds a whole new level of importance to
what may seem like simple everyday tasks, doesn’t it?
2. Talk with your mentor about attending an upcoming E&O class offered by IIANM.
There is much more to learn about Errors and Omissions, but just remember to focus on the three
major rules of E&O avoidance:
• Never make decisions for your customers.
• Never let customers make decisions without knowing the consequences.
• Document everything.
If you do so, you will be well along the path to not only avoiding or minimizing E&O claims against your
agency, but in providing outstanding customer service!
Employee Orientation
Page 122
Part Seven
Orientation Checklist
I’m comfortable in my understanding of our agency’s
procedures regarding…
Phone use
Faxing
Voice mail
Email
Form letters
Putting information regarding customers into the automation system
Submitting an application to the company
Processing a renewal
Making a change to a policy
Processing a cancellation
Issuing a certificate
Sending policies to customers
Processing premiums
Processing a commercial audit
Staying within the agency’s binding authority
Using required underwriting tools
Disclaimers and rejections of coverage
Efficiency and backlogs
Processing endorsements and policy changes
Employee Orientation
Page 123
PART EIGHT
Development Planning
Congratulations!
Welcome to Part Eight of your New Mexico Employee Orientation Guide. You have come a long way
since Part One - “Starting Right”. We hope you are finding your everyday tasks in the agency a bit
easier, the dealing with our business a bit less confusing, the discussions with your mentors and
coworkers enlightening, and your future brightening! And it is that last issue we will address in this final
segment of your initiation into the world of the independent insurance agency.
This orientation guide was designed to get you started, effectively and efficiently, on your personal road
to success in our industry. In the beginning, the steps may have seemed alternately small, then
overwhelming. Yet you are in the process, or have mastered them all, and now is the time to begin
thinking about your next steps. The independent insurance agency system offers you not just a shortterm job, but a true career. Those willing to put in the effort find their daily roles provide not only the
satisfaction of performing real service in meeting the critical needs of their clients, but also offer the
potential for long-term career advancement, increased compensation and growing professional
recognition.
You may have read articles or attended seminars where someone offered the illustration of an iceberg.
The illustration’s point is that less than 10% of an iceberg shows above the surface of the water. In
other words, what the casual observer sees is literally just the “tip of the iceberg.” If you are truly
interested in the iceberg, you need to go beyond that tip and discover the truly impressive depth and
breadth of ice which lies below the surface.
But this is New Mexico, so who cares about icebergs? Let’s use a local illustration and talk for a
moment about oil wells! It’s exactly the same idea. Folks driving by an oil field may see the familiar
drilling rigs or simply an array of valves and piping. But those surface pieces of equipment, however
important, are merely the visual “tip of the iceberg”, because a vast underground storehouse of
potential wealth with depths approaching thousands of feet and stretching for miles lies unseen
beneath the surface.
Yet this unseen wealth was missed by many who should have known better. The first oil field pioneers
often discovered “black gold” sitting on the surface of the ground, collected in pools. When someone
first suggested drilling to see if there were more oil to be found below the surface, some scoffed, saying
it was foolish to go to so much trouble when all the oil they would ever need was just lying there for the
taking. Of course, we know who proved to be the wiser (and the wealthier) in the long run! Those with
the foresight to realize the potential for a wealth of riches lay in going beyond the obvious and easy,
digging just a bit deeper, discovered reservoirs of value beyond their wildest dreams.
Employee Orientation
Page 124
So it is with your career. Right now you are gaining knowledge and growing in experience. Yet, in many
ways, what we have presented to you in these lessons is the equivalent to that early oil just lying in
those surface pools – incredibly valuable, but merely the first layer of the potential wealth available. If
you are willing to do what some aren’t and dig just a little deeper, you will discover there is a nearly
limitless reservoir of options for obtaining valuable ideas and information available. Textbooks,
manuals, classroom seminars, online resources and participation in community and professional
associations are among the many proven sources for personal and professional growth. Let’s take a
brief tour of what each of these sources represent and what each may contribute to your career path.
Professional Development Resources
True professionals recognize that not everything of value is learned in a classroom, or from a book,
tape, CD, online course or involvement in community and professional organizations. Contrary to the
popular saying, it isn’t all gained from experience, either. Rather, it is the combination of the proper
utilization of all these resources and others as they become available, that will help you develop a wellrounded skill set that will serve both you (and your customers) in reaching the highest levels of
achievement.
The following listing of possible resources for your career training and development is not meant to be a
track set in concrete that you must follow. Rather, our intent is to provide you with an insight into the
vast menu of possibilities awaiting you. There are numerous options we have no doubt failed to list –
this is meant to be an overview, not an exhaustive index. And there are many more potentially valuable
resources not yet created that will appear during your career journey. For example, even a few years
ago web-based training was rare and often weak in content. Today educational websites and webcasts
are numerous and increasingly sophisticated in technique and content. Who knows? In yet another few
short years perhaps all the information currently offered in seminars and textbooks will simply be
downloaded to your computer or iPod – complete with CE credits!
The final decisions will be up to you and your mentor. Discuss the optimal mix of resources that will
best help you in reaching your professional development and career achievement goals. And don’t
worry about looking too far down the road at this point. The longest journey begins with but a single
step. Choose a place to start, and know you can always make midcourse corrections later as new
possibilities suggest themselves or your agency career goals evolve.
Classroom Seminars
Traditionally, much of insurance training and education has taken place in a classroom seminar format.
For the majority of folks, this is still the most commonly available and comfortable method. Whether
held in your office or at another location, you gain the opportunity to learn from expert instructors. The
ability to ask questions of the instructors during class or at the breaks is a major plus. You also gain the
chance to network with others attendees who share your agency roles and concerns. If you will take
advantage of the availability of the instructor’s expertise and your fellow attendee’s experience, you will
be far ahead of those who simply sit and listen, waiting for the time to leave.
Conferences and Conventions
Industry conferences and conventions are known for association social events and excellent speakers.
Learning sessions may be the heart of the program and are offered as additional side opportunities for
attendees. They are also excellent opportunities to network with fellow industry folks: agency, carriers
and vendors.
Employee Orientation
Page 125
Online Seminars
Online or web-based seminars are rapidly growing in number and available content. A major plus of
online learning is that you can access it conveniently any time of day or night. If your agency is not
located in an area where there is ready access to adequate numbers of classroom seminars, online can
literally deliver to your desktop a large variety of training and knowledge otherwise unavailable without
the need for travel or extensive time away from your home or office. A potential downside is the loss of
the networking and instructor interaction you gain from classroom seminars, but as the technology
evolves those losses may be overcome or minimized.
Textbooks/Manuals
Of course, there is always the old standby. For hundreds of years, seekers of knowledge have found a
vast resource of wealth and wisdom in written form – and with no need for advanced technology
beyond a source of light and adequate sight. In today’s world where too many folks apparently think “if
you can’t Google it, it doesn’t exist”, building a good library of solid reference materials may be the
edge you need to lead the pack. And although the heading to this section suggests only written
materials, we would include here tapes, CDs or videos. The key is you own them, can access them at
will, and they offer value related to your roles and goals.
Professional Designation Programs
As you progress along your career path, at some point we suggest you consider “killing several birds
with one stone” by pursuing a professional designation related to you role in the agency.
One clear attraction of such programs is the recognition of attaining a professional designation,
evidence to your customers and fellow insurance folks that you have gone above and beyond the
normal levels of commitment in your pursuit of excellence. But meeting the learning requirements of the
designation fulfills many other functions of your professional growth.
For example, here is the description provided for one nationally known insurance designation
specifically designed for agency folks – the Accredited Adviser in Insurance Program offered by the
Insurance Institute of America.
Gain a Competitive Edge.
The Accredited Adviser in Insurance (AAI®) designation program gives you an edge in the increasingly
competitive insurance business. The AAI program is ideal for all agency staff, including producers,
customer service representatives, account managers, and support staff. By completing the program
you will learn practical information you can use right away, including how to:
• increase your commissions
• enhance your knowledge of policies and coverages
• develop more effective sales techniques
• learn the language of underwriters
• improve agency workflows
• serve your customers better
• avoid E&O claims
Plus you can earn continuing education (CE) credits for license renewal. The AAI program, like many
other professional designations, is offered in both classroom, textbook and online formats. Regardless
of the format, one key difference between these programs and simply taking seminars is the
requirement that you pass one or more exams to obtain the designation.
Employee Orientation
Page 126
One caution: each professional designation may have its own requirements that must be met for you to
continue using the designation. These may include continuing education hours, the completion of
certain courses or the payment of certain fees. Be certain you fully understand all the requirements to
both earn and keep a given designation before pursuing the program. One bonus: besides the
recognition, many designation programs also give you a head start towards obtaining further
designations. They accomplish this by making an agreement with the other designation program to
count some or all of the coursework and exams you have already completed towards the requirements
for the new designation.
Completion of the AAI® designation program also gives you credit for one of courses needed to obtain
one of the most advanced insurance industry designations, Chartered Property Casualty Underwriter
(CPCU®).
Professional Insurance Industry Organizations
Becoming involved with your peers is a time-tested way to drill your well deeper into the resources
available for expanding and growing in your career. You will gain knowledge, experience and resources
to turn to in times of confusion or need. Many successful agents and agency folks will tell you the
friends and contacts they made early in their careers by becoming involved in industry groups have
paid off handsomely in both business opportunities and social interaction.
That assistant underwriter you meet today may be the regional vice president somewhere down the
road, and a key decision maker as to what risks that carrier is willing to write for your agency. That
fellow agent or CSR may one day become association president who can help you get involved at a
much higher level as a committee or board member. A fellow committee member may be the person
who tells you of a market for a risk you would otherwise be unable to help. For the time and effort
required, becoming actively involved with a professional group may be the best return on investment of
your career.
Community and Service Organizations
While professional insurance industry organizations offer opportunities
related to becoming more deeply involved with your industry peers,
community and social organizations offer similar benefits in getting
involved with your community and social peers. An insurance agency
is built on people serving people. Active participation in local groups
offers two major people-focused benefits: first, the better you get to
know others, the better you will be able to serve their needs; and
second, the better they get to know you, the more they will trust to
serve their needs.
WARNING: Never make the mistake of some people, particularly those
in sales occupations, who have joined service and community groups
specifically looking for sales opportunities. No group wants to feel it’s being used merely as a baited
field to provide targets for salespeople.
Trust us – it’s been done, and always ends badly. To get the most value from participation in such
groups, choose to join based upon your real interest in the group’s activities and goals.
Employee Orientation
Page 127
Then become active, making it clear your goal is to further the group’s accomplishments, not your own.
Your only business-related goal is to let them get to know you as a person who can be trusted and truly
believes in serving others. As the old saying goes, “folks don’t care how much you know until they know
how much you care.” If you show by your actions and interest you are an individual who truly cares and
can be trusted, when needs arise that can be addressed by your insurance knowledge and expertise,
they will gladly turn to you for servicing their needs, or will refer you to others. And be patient: if they
aren’t buying, they are still watching.
Exercise: 30 minutes
Meet with your mentor and discuss what professional, community or service organizations are available
to you. Choose one that you are sincerely interested in joining. Review with your mentor the time and
commitment membership in the group will require, to be certain your participation won’t impact badly
upon your other agreed upon agency and personal goals and responsibilities. If you have too much on
your plate at the moment, it may be better to wait. Remember, you are not just joining for sales or
symbolic purposes but to be a truly active participant in the group’s activities. Be certain you can meet
that demand while honoring your previous obligations before making a commitment to the new group. If
it is the type of organization that requires a referral or other introduction for membership, ask you
mentor to help you obtain the necessary help.
Where to start
Even when the potential value of further studies is clear, when confronted by such a wide number of
options a natural question is “but where do I start?” Perhaps we can be of assistance. Following are
two basic tracks for furthering your career growth. Why two? To help narrow your options to those that
may prove of most immediate value to you, we are suggesting one track targeted to those in the
agency whose role is primarily to provide service to clients and others. The other track is targeted to
those whose primary agency role is sales. Although both roles include activities of the other, and thus
there will be some duplication of recommendations, consider your primary agency role in choosing
which track will prove most profitable for your personal investment of time and effort.
Rather than assigning specific time frames to the tracks, we are presenting each as a checklist.
Within each checklist are areas labeled Foundational Skills, Intermediate Development and
Designations. For our purposes, each is defined as follows:
•
•
•
Foundational Skills – the basics; not as in easy or simple, but the true foundations upon which a
solid career can be built. Overlook these, and cracks may soon form in even the most
impressive edifice. Generally should be accomplished in your first two years.
Career Development – once the foundations are firm, these subjects represent moving to higher
levels of professionalism and expertise.
Designations – suggested industry designations with content related to your agency role.
Employee Orientation
Page 128
Why a checklist? The checklist allows you to complete the suggestions within each level at your own
pace (as agreed with your mentor), simply checking each off once accomplished. It may be you already
have a few under your belt – better yet, you have a head start!
Prior to beginning a new exercise program, you have likely read something like the following:
“Anyone first starting to workout should always consult their personal physician first to determine what
restrictions, if any, should be placed on their exercise program.” With a slight change in the wording
(but none in the intent), we suggest a similar approach to your career studies. “Anyone first starting to
assemble a professional development track should always first consult their mentor to determine what
restrictions, opportunities, recommendations and resources are available from their agency.”
When you consult your doctor prior to beginning your new exercise program, he or she would likely
recommend a complete physical checkup, with two major goals. First, to uncover any existing
weaknesses you need to address before moving into the new program. Second, to establish a baseline
from which to measure the success or failure of your future efforts in moving towards your goals, rather
than running in place.
Exercise: 2-3 hours
Click here to take the Agency Staff Diagnostic Course at the IIANM Learn Center.
Sign in and complete the course. It will lead you to create a personal “inventory” of your current agency
role requirements compared to your current level of expertise in skill areas required by your role. The
course will then provide you with a list identifying, by priority order, the courses available at the IIANM
Learn Center which are recommended to take you to the next skill level on your career path. Print out
this course recommendation summary and review it with your “doctor” – your mentor - to finalize your
personal study plans and calendar for the upcoming weeks and months. At that time, you can also
determine, for each area of study, which learning options available to you – via online, study materials
or classroom/conference seminars - to complete each step of your plan.
Remember: the following tracks are suggestions only. While each step is highly recommended and
serves a particular purpose, there may be a far wider variety of options available than we are able to
identify in this brief overview. Talk with your mentor now and on a regular basis as you move along your
track, to be certain that at each step you are utilizing the latest and best options for you.
Employee Orientation
Page 129
PROFESSIONAL DEVELOPMENT RESOURCES
www.IIANM.org
IIANM Online Learn Center
Virtual University
http://www.nmprc.state.nm.us/id.htm
www.insurancejournal.com
National Alliance for Insurance Education & Research
American Institute for CPCU and Insurance Institute of America
Independent Insurance Agents and Brokers of America
International Risk Management Institute
National Association of Insurance Women
The American College
The National Underwriter Company
The Rough Notes Company
Agency Management Resource Group
Employee Orientation
Page 130
PROFESSIONAL DEVELOPMENT: SERVICE
Foundational
• Communications
• Personalities
• Dealing with difficult people
• Errors and Omissions
• Ethics
• Customer service
• Time management/goal setting
• Dealing with cultural differences
• Dealing with generational differences
• Cross selling/Account development
• Basic technical insurance coverages related to agency role
• Using technology and programs related to agency role
• Claims processing related to agency role
• Working effectively with company underwriters
• Working with ACORD forms
Career Development
• Intermediate/advanced technical insurance coverages related to agency role
• Risk management analysis related to agency role
• Program in General Insurance (INS)
• Effective public speaking
Designations
• ACSR: Accredited Customer Service Representative
• CISR: Certified Insurance Service Representative
• API: Associate in Personal Insurance
• AIS: Associate in Insurance Services
• AAI: Accredited Adviser in Insurance
• CIC: Certified Insurance Counselor
• CPCU: Chartered Property Casualty Underwriter
• AIAM: Associate in Insurance Account Management
• FSS: Financial Services Specialist
Employee Orientation
Page 131
PROFESSIONAL DEVELOPMENT: SALES
Foundational
• Communications
• Personalities
• Dealing with difficult people
• Errors and Omissions
• Ethics
• Customer service
• Time management/goal setting
• Dealing with cultural differences
• Dealing with generational differences
• Marketing
• Prospecting
• Working with underwriters
• Working with adjusters
• Any insurance company Producer Development Program
• Account development
• Effective Negotiating skills
• Basic technical insurance coverages relevant to sales plan
• Using contact/sales management software
Career Development
• Intermediate/advanced technical insurance coverages related to agency role
• Claims analysis
• Account analysis (understanding customer’s business needs)
• Risk management principles and techniques
• Advanced sales skills
• Effective application of technology to marketing and sales
• Market segmentation and analysis
Designations
• AAI: Accredited Adviser in Insurance
• CIC: Certified Insurance Counselor
• ARM: Associate in Risk Management
• CRM: Certified Risk Manager
• CPCU: Chartered Property Casualty Underwriter
• CRIS: Construction Risk and Insurance Specialist
• AIP: Associate in Insurance Production
• LUTCF: Life Underwriter Training Council Fellow
• CLU: Chartered Life Underwriter
• RHU: Registered Health Underwriter
Employee Orientation
Page 132