How would you like to sustain your entire agency on referrals alone? For some insurance agents, this isn’t just a dream. They’ve built a successful business around customer referrals, using them to drive new leads. And because an insurance referral program is powered by word-of-mouth, it’s an extremely cost-effective way to grow your agency.
To help get your own insurance referral program off the ground (or to revamp your existing one), take a look at the Q & A’s below that cover the basics.
1. How do insurance referrals work?
Ideally, your level of service creates such a great experience for customers that they want to tell their friends about it. Unfortunately, as I’m sure you already realize, it's not always quite so simple. Sometimes even with amazing service and happy customers, you still have to offer some type of incentive to motivate current customers to go out of their way to give you referrals.
2. What is an insurance referral fee?
That motivation we just referred to sometimes comes in the way of an insurance referral fee. You thank customers for sending you new referrals with a bonus, discount, or other type of payment. Gift cards are a popular way of rewarding customers for referring new business.
One of the most effective referral fee systems I’ve seen is to give customers a small monetary incentive for sharing referral names along with introductions, and then offer them an additional bonus for every new client who signs up. For example, you can send a $5 gift card for every new name you get along with an email introduction, and a $25 gift card for each person who buys a policy.
Another method is to give insurance discounts for referrals, such as 5% off the premiums for the next six months or 2% off the next month. For example, if a customer refer three people and at least one signs up, he or she gets a 5% discount on the next six-month premium.
For agents, gift cards are a simpler than discounting insurance premiums, plus, people like money in their pocket—and they can spend the cards anywhere they want.
3. What is an insurance referral form?
Incentive programs only work if you can track them properly. The simplest way to do that is with an insurance referral form. An insurance referral form is simply a way for you to track incoming leads referred from existing customers. It can be a free Google Form that you send to clients to fill out. One of the benefits of using Google Forms is that they autoload and prefill data into the Google Sheets spreadsheet for free.
4. What are the best tools to set up an insurance referral program?
The best tool for you is one you probably already understand and actually something most insurance professionals use regularly. Excel and Google Sheets are popular spreadsheet programs that many agents use to keep track of their customers, policies, and other important information.
The easiest way to set up an insurance referral program inside a spreadsheet is to add start dates for all your new customers, so you can know when to reach out to them and ask for referrals. If you use a calendar platform like Google or Outlook Calendar, when you enter a customer's start date you can simply set a reminder to contact them for 3 months out.
You can also add that you’re looking for referrals in your email signature and newsletters. Don’t forget to mention it on all of your social media accounts, too, and consider creating campaigns to promote your referral efforts.
5. How can you create an insurance referral program?
Setting up an effective insurance referral program essentially requires you to put together all the pieces to create a system for obtaining, tracking and rewarding for referrals. Keep in mind that customers tend to refer people who are similar to them. This means they may work in the same field, drive similar cars, have similar backgrounds (in terms of financial and marital status), and live in the same zip code. One of the ancillary benefits of setting up an insurance referral program is that you’ll often be able to write similar policies and save time.
6. What are some best practices for getting insurance referrals?
Unfortunately, there’s no surefire method for getting instant referrals. However, you can increase your chances of getting recommendations by providing unbeatable customer service and showing a genuine interest in your current clients. Reach out to them and show them you care. Check in on them every three months just to make sure everything's going okay, and of course don't forget to ask your best customers if they have any friends or family who might be looking for a better insurance policy. Just checking in regularly and asking for referrals are incredibly simple ways to help kickstart your referral program.
Are you ready for more referrals?
If you want more referrals, it all starts by creating better relationships with your existing customers. The more often you reach out to them in a helpful way, the more likely they’ll be to renew their policies and send new business in your direction.
If you’re still looking to increase your client base, talk to us at EverQuote. We provide 100% originally sourced leads that are never-recycled, which means you have the best chance to reach out to people who actually intend to buy insurance, and who fit your insurance model. We tap the internet to find you customers who can bring in real business, real growth, and real ROI.