Creating Unlimited Business Opportunities for an Insurance Sales Force Through Design Thinking

Creating Unlimited Business Opportunities for an Insurance Sales Force Through Design Thinking

Inno Man (COXO Community, Hong Kong) and David Chung (InnoEdge Consulting, Hong Kong)
Copyright: © 2020 |Pages: 18
DOI: 10.4018/978-1-7998-0054-5.ch015

Abstract

New insurance agents approach their pool of close friends and family members because these people have a high level of trust in them and therefore their rate of closing should be higher. As the size of their client pools is a critical survival factor and trust cannot be built rapidly, one major reason that agents quit their jobs is that they deplete their pools. For resolving that industrial deadlock, the company developed a social sales model through design thinking to help insurance agents build trust among their prospective customers. After implementing a pilot project in Hong Kong in 2018, the agents enhanced their abilities of social influencing, lead generation, and deal closing. Following the successful pilot project, the company continues to transform its business and leverage its social sales advantage in Asia.
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Current Challenges Facing The Organization

In reality, the sales model of the insurance industry has remained quite traditional and dependent on face-to-face selling by front-line insurance agents. Under that traditional sales model, there are two critical industrial deadlocks for sales individuals and corporate levels.

In general, in the early stage of their career, new insurance agents would approach their close friends and family members because these people have a high level of trust in them and therefore their rate of closing deals should be higher. However, the number of friends and family members is very limited and difficult to increase within a short period.

Often, the majority of insurance agents will have used up their pool of close friends and family members within 6 to 12 months. Afterward, they face a very tough situation brought about by the lack of another pool of prospective high-trust customers. As the size of the prospective customer pool is a critical survival factor for insurance agents, some proactive agents build their pool through different traditional methods. For example, they may use wealth and health questionnaires to survey strangers, extend their personal networks by participating in different events, and request referrals from their high-trust customers. However, trust is a critical factor in insurance selling and cannot be built rapidly. Therefore, a major reason that insurance agents quit their jobs or leave the industry is that they deplete their pool of prospective high-trust customers.

The limited source of prospective high-trust customers creates a serious business challenge at both the frontline salesforce and corporate level. A high turnover of insurance agents lowers the working morale of the company as a whole. In addition, after insurance agents leave the company, their customers may not be comfortable with the new agents, resulting in some customers terminating their insurance services.

Moreover, the limited source of prospective high-trust customers renders many people unwilling to join the insurance company as an agent, complicating the insurance company’s efforts to scale up their agent force. For the global insurance industry, the limited source of prospective high-trust customers is one of the great challenges to sustainable business growth.

Key Terms in this Chapter

Social Sales Model: Insurance agents approach prospective online customers through social media posts, comments, and messages.

Digital Transformations: It is the profound transformation of business, operational models, organizational processes, and employee competencies to fully leverage the changes and opportunities of a mix of digital strategies and technologies.

Design Thinking Method: It is an innovative problem-solving method and it can be classified as effective human performance technology. The method was developed by d.school of Stanford University. The guiding principle of the method is not only problem-focused, but it's also human-centered.

Traditional Sales Model: Insurance agents approach prospective offline customers through face-to-face activities.

Dunbar's Number: It is a suggested cognitive limit to the number of people with whom one can maintain stable social relationships.

Customer Connection: It is a bundle of subjective feelings that come together to create a bond between customers and companies. The feelings may be anger, sorrow, joy, love, or any of thousands of emotions that humans experience.

5i Model: The 5i Model for customer connections illustrates the all-rounded human demands of the customers when they interact with a product or service.

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