Monoline Policies and the Art of Cross-Selling

Why Cross-Selling Depends on the Initial Sale

Everyone in insurance sales knows the value of cross-selling additional protection to existing insureds. This highly desirable action generates the easiest new commissions of all, while aiding an agency’s retention ratio. That’s because, the more policies that an insured has with you, the more burdensome it is for them to leave your agency. It’s pretty difficult to come up with any flaw in the cross-selling hypothesis, but there is one and it’s elementary. The flaw is you have to sell a person or business at least one policy. Without it, cross-selling is clearly impossible.

Foot in the Door

Okay, so you can’t cross-sell (or upsell or account round) unless you have already sold something first. This “duh department” revelation suggests something that’s counter to the concept of cross-selling: the acceptability of the monoline policy sale.

So, instead of always trying to sell a new prospect everything they need all at once, consider targeting the easiest policy you can just to get your foot in the door. Of course, this “easy” sale varies from prospect to prospect and there are certain errors and omissions considerations as well. Still, monoline personal and commercial sales are viable, and they often involve such popular contracts as bonds, directors and officers liability, employment practices liability insurance, flood insurance, professional liability, umbrellas — or in other words — virtually every coverage offered in the various ads throughout this magazine.

Trial Marriage

A further advantage of soliciting single policies is that the exercise serves as a trial marriage for both parties. The buyer gets to play office with you, seeing what it’s like to do a small amount of business with your agency, without a major commitment. You get to see what it’s like to do actual business with the insured. You’ll learn if they are service-heavy complainers, late-payers, overly claims conscious, etc. When the trial is successful, both parties often agree to move forward. But, if either or both are unhappy, then it’s relatively easy to go your separate ways.

Monoline Commercial Department

Consider establishing an informal commercial monoline department within your agency, one that makes enough money to pay for itself and opens the doors for fuller business relationships. New producers, semi-retired agents, or veteran CSRs can man it part-time. Its mission is to generate revenue through single policy sales that, ideally, lead to additional business down the road. Future potential might be surmised via the completion of a revealing agency questionnaire or a standard coverage checklist.

Soon after this quasi-department’s inception, commercial producers can internally prospect within it for leads, ultimately developing them into fully-rounded accounts. Once any extra policies are written, the account graduates to the agency’s regular commercial department. This, or a similar approach, allows for the “easy” initial monoline sale with cross-selling activities performed soon after.

Conclusion

One-policy accounts pay their way with both commissions and potential. Plus, the time cost for quoting them is usually less since you are targeting only a single policy instead of an entire account. Furthermore, if you sell an important policy that the incumbent agent missed, and there’s a covered claim, who do you think gets the rest of the account? Your agency may become known as an expert for a particular type of policy, which in turn generates referral leads for that policy and more. And there’s always the chance that you’ll write the entire account anyways, instead of just the single contract.

Monoline selling, when enacted as a strategy, can result in fresh revenues and a trove of leads. Just make certain that you are investing your agency’s time and resources in quality sales that have future promise. Don’t sell single policies that you’ll never follow-up on, just for a quick commission. Those are the ones that can cause a lot more problems than they are worth.

Shulman, CPCU, is the publisher of Agency Ideas, a subscription-only sales and market­ing newsletter. He is also the author of the many tools posted on the Agency Ideas Instant Download Store. Phone: 800-724-1435. E-mail: alan@agencyideas.com. Web site: www.agencyideas.com.