How Do You Handle A Customer Who Wanted To Cancel Service Or Move To A Competitor

What to do when your customer wants to cancel a policy

Insurance cancellations are a fact of life for every agent. Here's how you can keep them to a minimum – and what to say when a customer wants to cancel.

Man looks at his computer with concern.

When a client wants to cancel an insurance policy, it'south not a done deal. Information technology simply ways information technology's time to step up and put your powers of persuasion to work.

It's your job to:

Understand the reasons why your client wants to exit;
Explain the possible risks of cancellation;
Explore how you could potentially encounter their evolving needs and keep them as a client.

If your client is unhappy with customer service, coverage, or costs, y'all may be able to plough the human relationship effectually. And with the right retention strategies, you can help limit counterfoil threats and reduce churn across your business.

Beneath you lot'll learn what to say when a customer wants to cancel, strategies for customer retention, and tips for handling cancellations with professionalism.

Preclude cancellations by creating loyal customers

The insurance industry is a competitive market. To retain customers, you need to keep them happy.

When a customer is happy, they're much more likely to renew their policy. They may fifty-fifty sing your praises in person and on social media, helping drive new business for you.

You can keep your customers satisfied by offering affordable rates, elevation-notch customer back up and service, and flexible policies that adjust to their needs over time.

But how do y'all know if your clients are happy? Easy: but ask them.

The most constructive style to retain insurance clients is to bank check in with them on a regular basis with phone calls or electronic mail.

As a rule of pollex, telephone call your clients once each quarter to ensure their policies are even so coming together their needs. Find out if any circumstances have changed that might affect their coverage needs. And for business clients, track their industry news to see if any trends could increase their risk.

Beingness proactive in your communication makes clients feel valued, which builds loyalty and improves retentiveness. Simply even the best customer service can't always prevent a client from wanting to abolish.

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How to address common reasons customers desire to cancel their policies

Ernst & Young's "Reimagining Customer Relationships" shows that about 66% of insurance customers say they are probable or very likely to recommend their former providers. And so why practise clients leave in the kickoff place?

Even if yous're using the correct retention strategies, you're however going to accept clients who want to abolish. It's the nature of the insurance concern.

When y'all become a cancellation request, don't take it personally. Clients have many unlike reasons for wanting to cancel their policy. Information technology's not necessarily a reflection on you or your agency. Only one time a client mentions cancellation, try to salvage their business before admitting defeat.

These tips can help accost clients' mutual reasons for canceling, counter frequent objections, and help you prevent unnecessary cancellations.

Reason #1: A change in avails

Oftentimes, you'll hear that a business owner needs to cancel a policy because they're permanently endmost. But for those that remain open and wish to abolish considering they're selling a property or downsizing, policy adjustments can usually resolve the problems.

Tell your customer that you can likely modify their existing insurance policy to fit their new needs. You'll need to hash out whether they'll need increased or reduced policy limits, or mayhap the addition of new coverages. Merely they probably don't need a brand-new policy.

Reason #ii: Relocation

A client may inform you they're canceling due to a move to a new residence or business concern location. They may think a new policy is the easiest choice, but it isn't e'er their best class of action. Whether they're moving within the land or to the other side of the country, yous probably don't take to lose their business.

For out-of-state relocations, some insurance volition require a new policy due to land regulations. But near carriers offering insurance nationwide. You tin can probable ready your customer with the new policy they need.

For intrastate moves, a new policy isn't required. But policy premiums may be affected due to changing risks. If your client is unhappy due to a rise in premium payments, you can accommodate their coverage to find the correct price for their budget.

In whatsoever case, warn your customer that even a brief lapse in coverage could damage their reputation in the eyes of insurers and make getting a new policy more than costly. Let them know yous tin lower their coverage limit until they've resettled. Instead of dropping their policy altogether, reducing their coverage will lower their rate so they're not wasting money on insurance that's not being used.

Reason #3: Rate hikes

A customer may say they're jumping transport because of a premium increase. Customers volition often become in search of a better deal when costs go up.

Answer past offering to assist them find a ameliorate deal, or adjust their coverages to lower their rate.

Reason #four: Poor service

A client may consider canceling as a result of customer service issues. Clients put some of their most valued assets in your care. Emotions tin can run high when something goes wrong. Poor communication can bear on client satisfaction, causing even loyal customers to look for a new amanuensis.

Yous should strive to understand the cause of your client's unhappiness. If it's a service effect or something else you can accost, apologize and explain how you'll fix the result and make certain it doesn't happen again. When you lot show your commitment to making things right, they may reconsider canceling.

Unfortunately, the cause of client dissatisfaction is sometimes beyond your control. That's why y'all'll want to consider protecting yourself and your business organization with your ain professional liability insurance such as errors and omissions coverage. The amount of professional person liability insurance yous'll want to comport will vary based on your book of business concern.

Top reasons clients cancel insurance policies

No matter the reasons clients cull to cancel, in that location are always risks involved. Help your customers weigh those risks.

Whether they have business insurance, personal insurance, or both, the counterfoil risks can be costly. Sharing those risks could potentially change their mind.

Treatment other common objections for canceling personal insurance

For personal insurance, canceling a policy oft does more harm than good, specially without a new policy lined up. If your customer wants to cancel a personal insurance policy, here's what they need to know:

Many mortgage lenders require borrowers to purchase and maintain homeowners insurance over the life of the loan.
Driving without land-mandated auto insurance can result in heavy legal fines and penalties, not to mention devastating out-of-pocket costs for your client if they cause an accident.
Stopping and starting insurance coverage is a red flag for whatever insurance provider, and it may upshot in higher premiums down the route.

Treatment other mutual objections for canceling business insurance

The U.S. Chamber for Legal Reform reports that 43% of small business concern owners have been threatened with or involved in a civil arrange. That's why information technology'southward essential that concern owners have an active business insurance policy at all times. If your client wants to cancel business concern insurance coverage, hither are some of the risks they could confront:

In most every land, businesses with employees are legally required to buy workers' compensation insurance. Depending on the manufacture, client contracts or local regulations might too require a business organisation to carry surety bonds.
For any type of business insurance, your customer probably isn't entitled to a full refund for prepaid premiums if they cancel. In add-on, they might end up paying more than for new coverage in the future.
They could lose their business organisation licenses and permits.
While uninsured, they'll exist responsible for the costs of any damaged or stolen property.
They could default on their loans, mortgage, or charter understanding if their lenders require business insurance.
They may exist required to pay out-of-pocket for the costs of an employee's on-the-task car accident.

When you can't change their mind: How to deal with clients who abolish

Even if you lot do your all-time to try to keep a customer's business organisation, some cancellations are unavoidable. Just even then, y'all should take steps to leave the door open up on the possibility of getting that customer back.

Take the cancellation in stride, and send every canceled customer a "lamentable to run into y'all go" email to thank them for beingness a valued customer. It's important to end on good terms and keep the lines of communication open up for hereafter opportunities.

In the electronic mail, enquire them to provide honest feedback on their experience as a customer, whether positive or negative. Was your client happy with their rate, policy options, and customer service they received?

Yous tin use that feedback to better client service from yous and your support squad (if yous take one). And if you're receiving similar feedback from multiple clients, you may need to consider broader changes to your business organization. When you make client experience a priority, your retention rates will naturally better.

Your long-term success as an insurance agent depends as much on retaining existing customers every bit information technology does on finding new ones. That's why client satisfaction needs to be a top priority. And so does knowing how to plough a threat of cancellation into a potential opportunity.

By honing your customer service and objection handling skills, y'all can continue your customers happy, your revenue up, and your business running smoothly.

Complete Insureon's like shooting fish in a barrel online application today to compare quotes for business insurance from top-rated U.S. carriers. Once you find the right policy for your small business concern, you lot tin can begin coverage in less than 24 hours.