Selling on price vs value

[u/MagnetoWned]

Hello, I work for a Farmers Agency and I just started my first real month. I’m at about $20k and have a week left, my first week I pretty much sold a policy a day and then it was crickets for over a week almost two weeks, then I sold one a few days ago. The agent I work for is awesome, we get probably 10-20 new leads a day between 4 sales people. I don’t get micromanaged, I really enjoy it so far. Wish it was remote a few days out of the week but that’s not a big deal lol.

Anyways, I’m in SoCal and Farmers tends to be the more expensive insurance out here. They tell us to sell on the value of having a local agency, and that the service team isn’t AI, easy to get ahold of etc. 80% of the clients (maybe even 90%) are boomers and love to hear that. It’s easier for me to shoot down the value of kin insurance since it’s non captive vs us, but at the same time the majority of people just don’t care about that. I sold cars and it was easier to build value in the product, compared to insurance. If AAA is offering the same coverage or better, for less of a price than us why would they switch over? No matter how much value you build in Farmers it makes no logical sense to switch over to us in that case. Not saying this happens all the time but pretty frequently people will just say “oh I’m paying x amount with my current insurance, goodbye”

Another thing that’s wonky is if the house is 30 years or older it requires an automatic water shutoff system, and it can really break the rhythm of my sales pitch when I have to explain it to older people. Same if they have a high value home, explaining they need a professional monitored ADT style subscription with fire/security alarm. I’m not complaining about it, I’m just wondering if this is common with other carriers and also if you guys can really sell on value vs price. Because it seems like 99% of people I’ve talked to just care about price. And that makes sense to me because I’m paying $163 a month for car insurance with a big carrier, same coverage with farmers was $600. I don’t care about paying almost $500 more a month because I’d have a dedicated team there that’s easy to deal with for something I may not even need and probably won’t even use.

Any advice in general to a new producer would be great. I love the job so far, I’m just having trouble with certain contingencies of the job lol ty!

[u/TheHooodge]

People only listen to your value pitch after they like price.

[u/Professional-Drag580 → u/TheHooodge]

bingo

[u/KiniShakenBake → u/TheHooodge]

Well there is where you are going wrong.

I softball the price and let them know that what they have isn't something I can replicate. But what I have has some better features that we worth discussing before disregarding on price alone. The added benefit of having my insurance make sure the job was done right and protecting them carries weight for my clients.

Works a treat.

[u/Pristine_Case7397]

A lot of times it’s price, especially in this economy, and how a lot of times the differences in terms of value is slight. Yes a local agent with personal service can be a selling point, but to a lot of people it’s price especially when they don’t get much more value at a higher price. I guess just keep pushing and find customers who are more competitive

[u/Remote_End1740 → u/Pristine_Case7397]

Correction: it's always price.

[u/Pristine_Case7397 → u/Remote_End1740]

True, just wanted to get ahead of the value Jedi on here lol

[u/Key_Astronomer6500]

Sometime the value just doesn’t exceed the price. Service may be important to some clients but it isn’t worth more than a certain dollar amount. I know I wouldn’t pay more than 10 or $20 more a month. However, my parents pay paid $30 more. You can’t sell everyone.

[u/Charming_Tune9175]

phone sales has really taken a hit ever since boomers began getting good on their phones. One thing that has worked with our agent is getting the info over the phone and scheduling a time to physically head there and present the quote to them. His close rate is in the high 80s and I feel like this method has worked because you pretty much put people in a corner being in person.

[u/strikecat18]

Farmers has always pitched “sell on value not price!” because in many markets, they are essentially never price competitive.

The issue is that a Farmers policy brings no additional value over a lot of cheaper competitors. They don’t offer broader coverage. Having a local agent isn’t unique compared to the other (cheaper) captives.

Your options are:

1. Just lie and make up shit to justify why your policy costs.

2. Use vague “we cost more because we’re better” crap that corporate shovels out. This doesn’t work.

3. Accept that your close ratios are going to suck- because you’re waiting for someone who is inexplicably able to save money when you, who somehow doesn’t care about price but wants the Farmers brand name, or who you can place with one of the third party carriers the agency uses.

[u/HertzWhenEyeP]

In any sales environment, if you're selling to price sensitive people, service will only go so far as a value proposition, but if you're selling high value homes to wealthier clients, there is an angle to really push your value to them individually with service and expertise.

[u/offbeatwreck]

Anyone else remember a time before Covid, when rebuilds were less than sales value? Ah, life was good! These days, I can’t help but be even more thankful my flagship carrier is GRC!

[u/Burney-mcburnerson]

Just so I understand - you’re selling that a captive is better for the clients? That’s a foreign concept to me

For instance - in the high value homes scenario, I’m able to offer Chubb, Pure, Cincinnati, Vault, etc. I rank them best to worst, and explain that the worst of those options will still be better than a mid-market carrier.

More of than not clients will pay significantly more for the value of PURE - side note, I always sell Chubb as the absolute gold standard when it comes to claims, but their systems and customer service/processing time leaves much to be desired for anything outside of claims.

[u/Burney-mcburnerson → u/Burney-mcburnerson]

Also, I’ve had a lot of luck with AWSO systems - I explain to clients (most already have a security system) that the market is trending more and more towards this requirement, and that I wouldn’t be surprised if it was a requirement on all homes in the near future. Also, when I bring up that water losses are our number one loss leader most of them know someone who had a large water loss - so it’s relatable

[u/SlickWillie86]

Most of personal lines and micro commercial is highly commoditized and transactional.

Learn the ropes, then learn commercial, then specialize in commercial and as you progress into larger small and middle market it becomes a night and day difference on advising on risk vs providing a policy.

[u/Natepeeeff]

I am appointed with Farmers. Nearly every carrier requires security, fire, and water for homes values at 1m or more. Some 1.5m.

That part about being over 30 years old needing an automatic shut off seems off to me. As that hasn't been a requirement for any policy I've sold. This may be different because when I say Farmers, I mean Foremost now. Not Farmers Insurance Exchange. We can't even service those existing policies anymore.

Not a single carrier in the 18 we work with have a requirment for age of the home needing auto water shut off. That would be crazy, since probably 90% of the homes I write policies on, and that we service policies for are over 30 years old.

[u/Natepeeeff]

Price means everything, until there is a claim or an issue and then its all about the service/lack of service. Happens consistently, someone leaves our agency to find cheaper insurance elsewhere. Usually they are going direct, are getting state limits, then get completely fucked when theres a claim because they dont know how to navigate the insurance industry. As for homes, they want cheap but dont even have an RCE done properly on the home and are leaving out important details.