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Insurance treated as a commodity

If your broking service looks the same as everyone else's, then your results will as well. There is a reason that most people are in the middle - it's because it is safe there.

Monday, February 14th 2011, 4:45PM

by Russell Hutchinson

When you first started in this business you probably found it hard to get going. Some of the things necessary for success were things you didn't really want to do - it does take time to get used to selling. So the early years were often a gradual process of finding out what other people do that works and learning how to do it yourself. Hence: the "crowded middle".

That was all very well when you could double your income by achieving the average. Now you have got there and you want to double your income again you have to unlearn half of the way you were taught to do business in the first place. The attitudes, skills, and knowledge that will take you to the very top are not the same as those that took you to the "middle". They can't be - there aren't many people at the top and they aren't all just doing the same as the rest, only "more and harder".

Take your service as an insurance broker. I've seen plenty of broker's sales presentations over the years - and even more of the written reports that go with them. They aren't very different, surprisingly.

Sometimes I hear people talk about how unfair it is that people treat insurance like a commodity - and how it isn't a commodity. But what I don't often see is the passion for the important differences in the insurance contracts. I don't often see the passion for telling the story about the relative risks. I don't often see the well-told story about the claims services provided by one insurer over another. The simple fact is, if you treat insurance as a commodity, then your clients certainly will. Clients actually don't really want commodities. Most opt for individuality where they can - they like to see the unique beauty in their home, garden, the bikes they ride, the telephones they use and the clothes they wear. Somehow you have got to tap into the novelty-seeking idea and create more involvement in the product - that way, you'll have relevant differentiation, and you will cease to play a price comparison game.

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