You probably know that when one of your car insurance clients calls you, they often want to talk to you about pricing. Consumers generally want to save as much as possible on their premium. As their agent, you want to do everything you can to help them do so. One of the ways you might help them out is ensuring that they qualify for policy discounts. However, to keep discounts active, clients need to take a few extra steps. What can you do to help them?
Understanding Insurance Discounts
All car owners have a car insurance premium to pay. It is the cost they must bear to keep their policy active. Premiums vary considerably from client to client. The following factors might influence your clients' premiums, for example:
- The age and value of the car
- The driving record of the policyholder (drivers with tarnished records might pay more)
- The policyholder's age and gender
- An applicant's credit history
- The amount of coverage the driver buys
- The policyholder's location
- Whether the driver has a history of making claims on other policies
In a basic sense, the higher the driver's operating risks, the more they might pay for their policy. This is because they have a higher likelihood of their policy having to pay on their behalf. To make up the cost risk, the policyholder might have to pay more.
You know how you can help your clients set up their policies and balance their coverage to their benefit. You can also help them examine their policy options to determine which ones offer extra savings. One of the primary ways to do so is through applying insurance discounts.
A discount is a percentage reduction in a car insurance premium. There are multiple types of discounts on the market, and they might vary from up to 10% or more.
The special things about discounts is that only certain policyholders can qualify for them, which is part of what makes them special. Those who receive discounts might save significant amounts on their policies, compared to those who have the exact same premium and policies otherwise.
Helping Clients Keep Their Discounts
Discounts are conditional. Clients have to meet certain qualifications to keep discounts attached to their policies. If they ever make mistakes, or ignore certain obligations, the discounts might go away.
You job isn't just about applying discounts, but helping them remain attached to clients' policies. So, as their agent, what can you do to help them keep their discounts?
1. Ensure They Pay Their Premiums
Some of the most-common discounts are for clients who enroll in automatic payments or pay-in-full when enrolling in coverage.
With an automatic payment setup, clients authorize the insurer to directly deduct their premiums directly from their bank accounts. The insurer can claim the money without relying on the customer to send a check or pay online after every statement. Therefore, the client's risk of letting their policy lapse from non-payment will drop.
Pay-in-full discounts are a little different. Many insurers allow their clients to pay their full policy premium up-front. Therefore, the client won't have to worry about making regular payments. The policy will remain active, discounts applied, for throughout its term.
These savings are often very beneficial to policyholders, and the discounts are often very easy for them to maintain. Therefore, if your client's chosen policy offers these discounts, then you should encourage them to take advantage.
2. Encourage Them To Remain A Safe Driver
A lot of discounts apply to a driver's safety record. Again, because a driver who doesn't have accidents or break driving law is likely a lower-risk driver, these drivers often qualify for even better discounts. Some of these might include:
- Accident Forgiveness: If policyholders have only one accident every few years, then insurers might maintain premium rates — even if the policyholder files a claim. Therefore, clients might see no changes in their rates following infrequent mistakes.
- Safe Driver Discount: Should drivers not receive tickets or moving violations, they might be able to maintain policy discounts.
- Safety Course Discounts: Driver safety courses teach policyholders defensive driving techniques that could help them avoid accidents in the future. If drivers complete one of these courses, some insurers will offer them discounts.
3. Advise Them On Other Discounts
There are many discounts that don't relate to a driver's safety practices or payment setup. However, they can provide benefits.
- Bundling Discounts can help drivers save if they buy multiple policies from one insurance company. Therefore, if clients need auto insurance, homeowners insurance and other policies simultaneously, encourage them to take advantage of a bundle.
- Reliable customer savings might apply if a client continues to buy their insurance policies from the same company year over year.
When you start to quote a policy for one of your clients, don't forget to look at their eligibility for discounts. Even if a client only wants to make changes to their policy, they might be able to save considerably by doing so. Don’t hesitate to talk to them about discounts any time you review their coverage.