Do you agree? Customers do not like inconsistencies

[meytai]

Price is a major deciding factor for many customers. But i've had many customers with Bristol West, Progressive who renew term after term.. their rates are NOT the most affordable out there.. but they are consistently the same.. these are the customers i never hear from. Lately Progressive has had some uprates.. and it's caused problems.. and these customers are now shopping again. If there is no change.. i've experienced customers stick/stay and don't shop. But when a company makes a change.. they F&(*@# it up.

[FFA]

That would be correct. People do not like change.

Bristol West is now owned by Farmers. Get ready for a whole lot of change. They can not seem to figure out when they have a good thing going.

[d's insurance store]

In the personal lines market, I believe you are correct for the most part. A bill that is the same or less than the prior bill in a 'normal' market is often all one needs to make a renewal payment. But, in the current economic environment, many are more inclined to spend the time to shop or ask that their policy be remarketed by an agent to see if there are better deals to be found.

In the personal lines market, I've concluded that when one has a ticket or accident, they are often expecting an uprate, so depending on their circumstances, they often just pay a renewal and go on with their lives.

My observations in the small commercial market is that there is far more shopping at renewal as business owners of all stripes are looking for ways to save, and tend to be skeptical of the insurance industry in general and agents in particular about getting the most for their money.

Of course, these are my observations based on my own limited view of the market as a whole, and other's milage may and probably will vary.

[scott]

I'm hearing from some mentor clients that PL clients who are on an automatic payment system (monthly debit or charge to a credit card) are not as prone to shopping.

True?

[d's insurance store]

Yes, Scott...I agree with your mentor clients...my experience as a mostly personal lines agency owner is that in today's marketplace, the 'set it and forget it' payment mode works extremely well at quieting down the urge to shop for price. Premium changes upward will often prompt an inquiry, especially if there is no known trigger (like a ticket or accident) behind the increased price change.

Of course, an agency has to be able to respond to client needs as those needs arise...the moment the client feels as though they are forgotten, then the bond is broken and the comparison shopping begins anew. But a reality of personal lines is that a very small number of clients need constant attention, and there could be a very strong argument that those clients requiring intensive, ongoing intervention often are the segment having the most losses and those with self imposed payment problems, and that segment should perhaps be jettisoned (or would be in different economic conditions) allowing the agency to concentrate on a 'higher value' segment of the insurance buying public.

[scott]

It makes sense actually. Inertia keeps people from moving.

I just finished the book Nudge by Richard Thaler and Cass Sunstein. They make the point that people are always making choices. The book covers ways that we can influence choices.

Each transaction is a choice. We often choose badly. In business we cause choices. We control the presentation of choices. The presentation can have a huge impact on the choices our clients make.

I get about 25 different periodicals and publications. Some renew automatically, hitting my credit card with the fee. Others send me a bill. The former requires me to do nothing to keep the subscription. The bill forces me to affirmatively request renewal and pay. One is easy - the other requires choice.

I bet renewal rates are higher by publications that auto-renew.

[meytai]

Great responses

Thanks