8 Ways to Get Insurance Referrals

Getting referrals is an integral part your insurance business that you can't afford not to do it. Most insurance agents do well at the beginning of their insurance career by focusing on natural market. Sadly, many of them quit the business after they have exhausted their natural market and have nobody to sell to.

Getting referrals is the key for long term growth and stability of your insurance business. Selling to referrals is a much easier task than selling to complete strangers since the referrals may have learnt something about you before you approach them.

The following are some methods an insurance agent can use to get referrals:

(a) Build referral request into your sales process

At the beginning of a sales interview, let your prospects know that you are in people business where you need to meet a lot of people and you would appreciate if at the end of the sales interview they could recommend your service to people they know.

(b) Use referral cards

A referral card is the bridge to bring you to your future customers. Design professional and visually appealing referral cards. Leave behind referral cards at the end of your sales or service appointment. Let your customers know you will pick them up in your next visit.

(c) Give your customers reasons why they should give you referrals

Help your clients understand the benefits of recommending your service to their contacts. In order for you to continue to service them, you need a strong and healthy business. This is only possible if you continue to have people to see.

(d) Provide service that delights your clients

It is important to know that we have to earn referrals. If you have done a good job and they are pleased with the way you take care of them, there is no reason why they are reluctant to let their friends be your customers.

(e) Get customers' support to grow your business

Invite customers who have business network for lunch. During the lunch, don't talk about the customer, talk about your career and business goals. Tell your customers that they are the key to your business success. State the types of referrals you need from them.

(f) Exchange referrals

Form a tip club and exchange clientele with customers who are lawyers, accountants or business owners. Referrals you get from this source mostly turn out to be high quality customers. The referrals would trust you as how they trust your customers.

(g) Send newsletters

Send newsletters to your customers. Have a special column in your newsletter that allows your customers to recommend referrals to you if they find some products or services highlighted in your newsletter may be of benefit to their friends.

(h) Reward system

Let your customers know that they are helping you save marketing dollars by referring new customers to you. This allows you to pass on the savings to them in the form of gifts such as movie tickets or you can buy your customers an appreciation dinner.

You can ask your prospects or clients for referrals at any point during the sales process when there is opportunity for you to do so. Some may give you referrals right away if they find you trustworthy; some may give you later if they need time to think; and some will never give you any referral for whatever reason.

However if you put enough efforts and seize every opportunity to ask for referrals, you will always be in the business. You will always have people to see and never run out of prospects.

Asking for referrals is part and parcel in your sales process. Your next big case may come from a referral given by your customer. Not asking for referral is like cutting yourself off from your future business success.

When you ask for referrals, you mean business. We need to first satisfy ourselves if the level of service we provide to our existing customers earns us the right to ask for referrals. Insurance agents who frequently get quality referrals are always the ones who provide good, solid and quality services.

Xoseph Chu

Insurance Sales Referrals - The Skill of Asking For Insurance Referrals at the Right Time

Contrary to what you are told, insurance sales referrals are not your lifeline. Getting insurance referrals is a learned skill. Here you will find how to ask for sales referrals at the correct time and how to earn them. 

I remember very clearly decades later the instructions that the general agent at my first career office told me. In fact even though my memory nowadays has faded, on the topic of referrals his remarks are as clear as if it was yesterday. Somehow, you seem to remember two things your life bad advice you fought against and good opportunity choices you made. The remarks about getting insurance referrals still haunt me as bad advice that later I found thousands and thousands of agents received. First, the sales referrals advice I received and then the logic I discovered.

Here are the insurance sales referrals instructions I was implanted with. First I was shocking told I could not survive in insurance sales without acquiring instant referrals. So with the fear emotion implanted, this is what I was instructed. After making an insurance referral, tell the client it is their duty to let others know of the problem they could incur by properly insured. Then I was to ask them to help me deliver this message directly. Therefore, they were to get their address book right then and there, and set up three appointments for me.

Someone how, being somewhat of a maverick, I could not bring myself to do that requirement. Moreover, I found out I was justified not to do so. Your general agent or insurance manager stresses strongly getting insurance sales referrals immediately. The truth to this is that the general agent or insurance manager is not willing to invest money providing you leads. Therefore making you fear the consequences of not getting referral leads is actually true. However, it is false that you will die out if your new sales clients do not provide you with insurance referrals. Very few professional insurance agents, 1% or less, will say that it was referrals that kept them alive during their first four years. 

Right away, a prospective client will apply reverse strategies to get out of a pressure situation. Push for referrals, and do not be surprised when the phone rings the next day with buyer remorse, can celling the sale. It is amazing that not only insurance managers give the advice above, but also sales coaches. Insurance managers get sales referrals directly from the home office of people ready to buy insurance. These are not "true referrals" that the manager personally obtained they were given to them. Sales coaches are paid to give advice, but there is no guarantee all the advice given is the best. 

Currently 20% to 25% of the business of firm gets is from referrals. We did not ask for these sales referrals, but received them for work well done. They call us, we do not call them nagging or begging, or trying to bribe them with rewards. Find how to get referrals in a preferred manner.

SALES REFERRALS ARE A BONUS, A REWARD FOR WORK WELL DONE. 

GETTING REFERRALS CORRECTLY

You often get referrals by not directly asking for them, but delivering service, that competing insurance agents do not give. An easy way is by making sure on every sale you have their email address. Develop a simple website expressing yourself, not your company, as being a specialist. The website should always appear on the main page have your email address, business address, and phone number. Now set up a plan to email your clients at least every month, even though a 3 week time span is proven to be more effective. Purchase a variety of ebooks your clients may enjoy on various topics Ebooks are inexpensive and will greatly pay off as they can be given away countless times. I use them, you should too. Write a brief article about insurance your clients may not be aware of.

PUTTING IT TOGETHER Now send out your short newsletter with a greeting and the message. Do not ask them to inquire about more insurance. Just make sure you give all your contact details. Then make them a Free no obligation offer. Tell them your have obtained distribution rights to a wonderful storybook like "Aesop's Fables" by Hans Christian Anderson. Just by emailing you, you will send them a free copy, which they can read on their computer with a program like Adobe, which most computers already have. If not, in your email back with the eBook attachment, you can provide a link for a free adobe pdf reader. Every month to three weeks, you send another short email, again including a different free eBook option. 

The kicker. After a few emails, you mention they must have people they know that would like these same ebooks. Offer a set of three ebooks free if they simply send you the name of someone else that might be interested. This is an incentive, not a bribe. Something they will willing do. Now you have sales referrals leads. Gently send the referral free ebooks first. Then turn it into a sales appointment.

Another approach. Send a few of your clients that have been receiving your emails a separate email. This one will be to contact them to review their present coverage. On the review appointment, you have trusted clients who have received no obligation ebooks, and are probably willing to provide a couple insurance sales referrals. No pressure and you keep satisfied clients.

Claims approach. Follow up with you insurance clients upon notice of any claim that is filed. Offer service to assist them, and make sure all benefits were paid. Allow a few months to elapse then make an appointment with this customer. Now you can personally request that the client assist others benefit from the insurance you provided your client. An insurance user is probably one of the best quality referral givers. So having a benefit story to tell makes your product very irresistible. 

Always remember your client owes you nothing. Your initial commissions and renewals are your justified earnings. Most satisfied customers will provide you more business with additional sales, than you will receive with insurance sales referrals. Key your eye out for getting insurance referrals the right way, but remember your client comes first.

Donald Yerke

How to Attract Highly Profitable Referrals

Referrals are the life-blood of millions of small businesses who wish to build a business that is transformational, profitable and fun. 

And, you do want to own a business that makes a difference, earns you great profits and enjoyable, don't you? 

Like many new start-ups, when I started my first business in 2002, I had very little idea about where I to find my first customers. Somehow, I landed myself at a breakfast networking meeting in Birmingham with an internationally renowned group. In the years that followed, I realised that there was much more to networking than met the eye. 

Having refined my networking prowess through trial and error and by befriending great networkers as my mentors, I realised very little was mentioned about the quality of referrals and leads. Unfortunately, many of the referrals that are handed at networking events are nothing but duds. Needless to say, I had to figure out a simple and easy way to discern between the different qualities of referrals I was receiving and giving out. 

It took a little while for it to dawn on me that the success as medical sales professional in the previous decade was almost entirely based on referrals. Given the complexity of the hospital environments I used to visit, it was imperative to be discerning about the quality of the connections I was making. The NHS was and still is the biggest employer in the UK. 

In essence, there are four kinds of referrals which may lead to a business relationship and, hopefully, sales: 

The Cold Fish 

The Warm Referral 

Hot Referral 

The Sizzler 

1. COLD FISH 

In an attempt to help their fellow entrepreneurs, some people will recommend any individual from a company as a prospective client. No telephone number or email address is given nor any attempt to contact the referred is made let alone providing a valid reason for contacting them. This is not a referral and any attempt to call a prospective customer will be little more than a cold call. 

2. WARM REFERRAL 

I am sorry, but it has to be said. Most people offer these kind of referrals out of laziness. Occasionally, your connector may really be too busy to give you any more support than offering a Warm Referral. Here is how it works. Your connector introduces you to one of their contacts via email or text. It is up to you to take the communication from there. 

Whilst some connectors have built a reputation so solid that the sheer mention of their name speaks volumes, most networkers overestimate the importance of their own name to the world at large. Humility is a much more attractive characteristic than pretending to be Don Corleone! 

3. HOT REFERRAL 

Any good networker understands the nature of a quality connection. Hot referrals are the bread and butter of a successful referral-based business. Typically, your connector will telephone their contact to establish there is a need for your product and a willingness to pay for it. Your connector is not their sell your product, but to introduce you as a trusted advisor from their network. People prefer to buy from people they know, like and trust. Your connector is putting their rapport, trust and loyalty on the line when they introduce you to their contact. It is now up to you to honour that help and support. 

4. THE SIZZLER 

These are my favourite types of referrals by a mile. When a connector arranges a three-way meeting between you, them and your referral contact with the specific aim of acting as a bridge, the prospects of a business relationship being borne are very high. These types of referrals are particularly powerful when dealing with a client or customer that may lead to a high-value lifetime business relationship. The costs involved in gaining a new customer are minimal, yet the potential returns are vast. 

I am a big fan of the 80/20 rule in that 80% of your business should come from 20% of your referrals. Therefore, build the kind of relationships that put you in a strong mutually beneficial position. Aim for 20% of the referrals that produce the 80% of the results to come from the Sizzlers. Do your best to inspire and motivate your connectors to give you the next 20% from the Hot Referrals. That leaves 60% of referrals. A wise person would aim to get 80% of the 60% from Warm Referrals. What happens to the remaining 20%, i.e. the Cold Fish? Discard them? Save them for a rainy day? Feed them to the cat? Contact them anyway? You decide. It is your business! 

Harun Rabbani

Why Referral Strategies Are The Most Cost Effective Way To Get More Customers

Referral Strategies and Marketing

What exactly is a referral system? Do you need one for your business? More importantly, do you already have one? A good definition for referral marketing follows:

Referral Marketing: Acquiring new customers who are suggested or referred to you by existing customers

To design a great referral marketing strategy and system for your business, start by answering a few basic questions. 

How can you provide incentives for your customers to give you a referral?

What offers and rewards will excite them?

How will you keep track of referrals?

How will you approach a referred prospect?

How will you make certain that your employees and staff consistently ask for referrals? What incentives will keep your staff excited?

Sometimes marketers and business people talk about word-of-mouth as a source of business. You need to be careful to understand that referral marketing and word-of-mouth are not the same thing. Word-of-mouth referrals are typically left up to the customer. The business owner has very little if any control over when or even if any of his customers make a recommendation for his or her business. Typically, word-of-mouth referrals come up as part of everyday or ordinary conversations between two customers rather than as a system or process built by the business owner. If someone asks, "Where did you get your hair cut?" that can be an opening for a word-of-mouth referral. You tell your friend or colleague that you got your hair cut at a certain location and then talk about the experience. Whether or not your friend goes to the same place for a hair cut is more or less random. If they happen to need a haircut and they trust your opinion, they might go to the same place. But, there is no incentive for them to do so.

With referral marketing, you the business owner have more control over the outcomes. You are asking your customers specifically for one or more referrals from people they know and you are providing incentives for them to make those referrals. This is much more proactive than waiting on a chance word-of-mouth conversation. You can also provide incentives for new customers that are referred to you by your current customers. One way to bring the referrals in to your business is to tell your current customers that you have a special deal or offer for anyone they refer to your business.

You do need to make certain that you and your business have the reputation and service that your customers want to refer to their friends and colleagues. If you are an auto shop and fix a customer's car, if that car keeps running and the repairs are done properly, then the customer will feel much more confident about making referrals. Remember that you are asking your customers to refer you to their friends and colleagues. Their reputation is on the line too as well as yours.

Your referral system has to be systematic as well. By systematic, we mean consistent execution over an extended period of time. For example, do you know how you will collect referral information? Will you ask your customers to refer their friends and colleagues by themselves? Or, will you ask your customers to give you their friend's contact information so that you can follow up? These are important parts of the system that you need to put in place and you need to make these decisions so that you and your staff or employees are doing the same things in getting referrals from customers.

If you let customers make referrals on their own, then you need to provide them with a way to let you know that they have made a referral. This can be as simple as a pre-addressed postcard that the customer can use to provide you with information about their referrals. It's also important to keep track of referrals so that you can reward your customers for their efforts. If you and your staff are keeping track of referrals and new customer contact information this can also be as simple as recording referral information on a card or ledger of some form. Then you will need to keep your customers informed of any follow up with their referrals and progress toward receiving the incentives you provide. Either way, these are important pieces of building a great referral marketing system.

You and your business can also get referrals from complementary businesses. Let's look at a couple of examples on how this might work. For example, let's say you have a plumbing repair service company. As you make plumbing repairs in people's houses you have an opportunity to take notice of conditions there. Maybe it looks like the carpet needs to be cleaned. Or perhaps the garden and flower beds are not in good condition. If you have a referral program with a carpet cleaning service and a gardening or landscape service, you can make referrals to these other two businesses. It's always best of course to ask the customer or homeowner before making a direct referral. If you have been in business for a while, it will be easier to talk to customers that you know well or your best customers and ask if they would like a referral to one of the other businesses you represent. Some of the same principles we've discussed about being referable apply here too. If you are referring your customers to another business, you want to make sure that you know that business well enough to understand how they will treat your customers. And, remember too that some people will agree to a referral and some will not. And, that is okay. The outcome will be similar for your customers. Some will give you referrals and some will not. That is okay too. The point is that you need to have a systematic approach to referral marketing.

Why is referral marketing so important? There are several reasons and we'll work through a couple of examples on how much impact referrals can have on your business, but first consider the following. 

Referrals are credible from the first time you have contact with them. When a trusted friend or colleague tells you about a business, product or service you immediately transfer that trust to the business. Even if you have never heard of that specific business or location, if the information about them comes from someone you know and trust you have an implicit trust of that business. As the business owner, you can rely on this trust factor rather than have to build trust with a brand new customer.

People who are referred to a business tend to spend more money. People and your customers tend to refer other people that they know are in your target market or are in need of your service. So, you won't have to convince them of the need for your product or service, but you will have to make sure they know the value of what you provide. Generally, you won't refer a friend or colleague to a business if you think they aren't serious about wanting the product or service. You wouldn't refer a friend to the same place where you got a haircut if you didn't think they were serious about going there. And, this is especially true when you will receive some incentives for providing referrals. Most of your customers won't refer other people to your business that aren't serious about making a purchase.

Referrals are very cost-effective. Think about this one for a minute. How much does it cost you to ask one of your current customers for a referral? Yes, it takes a little time and you have to have a way track and report results of the referral, but these types of costs are typically very small. Also, keep in mind that the incentives you provide customers for their referrals will cost you something as well. But, these costs will be minimal as well - especially if you use your own products or services as a reward for referrals. You can provide these incentives at little or minimal cost. In total, the return to you and your business from referral marketing is very high. It doesn't cost you much to get referrals and the referrals spend more than other new customers so the ratio of revenue to cost (return on investment) is usually a BIG number.

Let's work through some of the specific numbers and examples related to referral marketing systems. By the time we are done, you will begin to see the power of referrals and how you can grow your business in a BIG way FAST. And, all of this of course will get you that much closer to achieving your dividend objective and profit goals for your business.

To properly assess the impact of referral marketing on your business, fill in the blanks for the following questions:

How many years have you been in business? ___________ (Let's assume 5 years)

How much do you spend on advertising each year? ___________ (Assume $5,000)

How much are your other expenses and costs? ___________ (Let's say $195,000)

How many customers do you have? ___________ (Let's use a 1,200 number)

Here is what you can do with this information:

Your total business costs each year total $200,000 - the total of advertising plus other expenses.

If you have been in business for 5 years, then your total investment so far is $1,000,000 ($200,000 x 5).

For your 1,200 customers, each one is worth $833 ($1,000,000 divided by 1,200) or stated another way, you have invested $833 in each customer to this point.

Can you sell your business for 1M? No? Can you sell it for 500K? Maybe...No. What about 250K? Yet, this money (1M) been through you till and out to pay for your business expenses!

Does it make sense to Maximize that investment in your business? Now consider the value of referrals. What if only half or 50% of your customers are willing to make referrals to your business. To start with that is 600 customers that sign up for your referral program. You provide free gifts, special rewards, and VIP recognition as incentives for these customers to provide you with referrals and implement a systematic effort to recruit customers to your referral program. In actuality not everyone that signs up for your referral program and incentives will wind up making referrals for you and your business. Let's assume that only half of the original number actually make a referral to your business within a reasonable period of time. This final number will be 25% of your beginning base of 1,200 customer, or 300 customers in total that are actively making referrals to your business. What happens to your business if each of these 300 customers refers 4 friends or colleagues to your business over the next year? If that happens, you will now have 1,200 (300 x 4) NEW customers to go with your 1,200 prior or existing customers.

By using a referral marketing program you could have DOUBLED the size of your business. And, all it took to accomplish that was a systematic, consistent approach to asking your current customers for referrals. Of course, you had to follow up with each new customer and close the sale. But, that is part of your business operations and requires no special effort beyond what you would do for a new customer anyway.

And, what happens if each customer makes more referrals? Or, what happens if more of your customers actually follow through and make referrals than the 25% we have assumed here? Are there ways to help customers make more referrals? Consider the following table of results when you build your own referral program.

Think about providing different levels of incentives - I've used silver, gold, platinum, and diamond below.

Now you can see the power in referral marketing. As more customers make more referrals, there are BIG increases in the size of your business that can result. If half of the customer base we used in our example calculations made 15 referrals each over the next year, your business would increase 750%. Would you like to have a business next year that is 8 times the size of the business you have this year?

It becomes that much more important to also recognize the value of your current customers. You have invested a lot to get them as customers. Providing incentives to them - and you know your business and customers well enough to know what kinds of incentives are appealing to them - in relation to the value they can bring to you and your business through referrals makes good business sense. Most of us would like to have more new customers that we can obtain inexpensively and have them spend more than other new customers. At some point, your new customers today will also be the customers that make referrals for you in the future too. Referral marketing can be the engine that drives substantial growth in your business not only in the short-term but also in the long-term. If you don't have a referral program today, it should be one of your top priorities.

Dmitri Stern