Any good salesperson is always looking for ways to organically increase sales. You care about your client relationships, and while you don’t want to come across as pushy or “salesy,” you want to naturally increase customer value. Upselling insurance products, cross-selling other services, and adding additional value for customers while making more money is a win-win. That is, after all, the reason you’re in business, right?
If you’ve been in any sales role before you’ve no doubt read about or even tried several selling techniques in the past, one of which may have been upselling. Upselling insurance products can be as simple as one question or a lengthy conversation. It can increase the lifetime value of your customers and for insurance agents, that should be enough to make it a priority in your sales strategy.
Let’s dive into some common questions and go over ways to easily (and naturally) incorporate upselling into your regular sales routine.
Upselling vs. Cross-Selling
Before diving in let’s make a quick distinction between upselling and cross-selling.
- Upselling is actually quite simple to understand. It’s when a salesperson suggests that the customer considers upgrading their current package to a more premium product. This is in no way a bait-and-switch technique. Your customers have every right and opportunity to purchase the option they were originally considering. Instead, you’re simply offering a higher quality product to what they’re looking for.
- Cross-selling invites customers to review and investigate complementary services or additional products in tandem to the original product or service, such as adding home insurance to an auto insurance request or adding renter’s insurance as a bundle to an auto insurance request.
These terms are often used interchangeably, however, both offer unique benefits for the customer as well as the sales agent selling them.
Upselling Can Exist in Any Industry
There are many industries where upselling is a natural part of the sales pitch. Car dealers may have customers that come in looking for a basic model, but when they test drive the vehicle with a sunroof, heated seats, and a remote starter, they’re swayed to splurge for the additional features. Jewelers can easily convince a future groom to upgrade from a small solitaire to higher-quality, multi-stone ring. You get the picture. Upselling happens just as organically in the insurance industry.
Applying These Practices to Insurance Sales
Much cross- and upselling can stem from keeping detailed accounts of your customers’ life events. For example, if a customer comes to you to renew or purchase a home or renters insurance policy, and you know (or asked and found out) that they recently got engaged, you could use this information to the advantage by suggesting adding a rider to their policy that will protect the ring. There’s no harm in suggesting the additional protection — the newly engaged couple may be grateful if they didn’t know the coverage existed.
Let’s circle back to the customer who purchased the car with additional features. Vehicle insurance is mandatory in almost every state, so she’ll reach out to you for coverage. There are a few ways you can upsell this policy: first, take a look at her previous limitations. Are they high enough to cover her brand-new car? They may need to be raised, which offers an opportunity for an upsell. Next, demonstrate value by suggesting additional endorsements such as rental car coverage or roadside assistance. Most customers will happily add those endorsements to their overall coverage if you can show why the value of those options overrides the cost.
The Importance of Upselling for Customer Lifetime Value
You may be reading this and thinking, will I really make that much more money from a few small upsells?
Upselling your leads doesn’t simply benefit you on a one-time basis. Consider how the customer lifetime value changes after the addition of one enhancement, such as adding roadside assistance to your policy. If your customer keeps her business with you for the long run, the original upsell makes you money for as many years as you write her policy.