Connecting Starbucks and Insurance! (DPC: Edition1; Article 3)
By David Thompson, AAI, CPCU, CRIS
How do we connect Starbucks and insurance sales? I must credit longtime friend and fellow “Insurance Nerd” Robert Norberg, AAI who is president of Arden Insurance Services near West Palm Beach with a creative selling tool that, according to him, works wonders with customers when it comes to the cost of insurance.
Robert knows many people who stop by their favorite morning beverage spot almost daily and spend as much as $7.00 for coffee. When we think about that on an annual basis, even $5.00 a day is $25 a week, multiplied by maybe 45 weeks a year that is $1,125 a year. A few other examples:
- My sister gets a manicure and pedicure every two weeks. With tip she spends $95; that is $2,470 a year. (Yes. You read that correctly!)
- My neighbor pays $72 a month at his health club; that’s $864 a year.
- I frequent a local bagel shop at least three times per week, and some weeks it’s more frequently. A bagel with cream cheese and iced tea is about $6.25. At just three times per week, that’s right at $1,000 a year.
I see TV commercials and receive US mail advertisements stating something like, “For only 67 cents per day you can…”
I use this “how much per day” philosophy in my life too. After I closed on my newly constructed house about three years ago, I purchased a ten-year parts and labor warranty on the HVAC system for around $850. When I did the math on that cost, it turned out to be, “Just 23 cents per day.”
My friend, Robert, had a client call him and the client’s personal auto policy had no uninsured motorist (UM) coverage. Robert ran a quote, looked at the annual premium, and said to himself, “I can’t tell this guy it’s $850 a year.” Instead, Robert told the customer, “Mr. Smith, you don’t have UM coverage, and this is how it works. You need this badly and the cost per day is a lot less than you’ll spend at Starbucks tomorrow.” Mr. Smith’s answer was, “I never knew what that stuff was, of course I want to add it.”
In another case I have followed for years, a city in a northern state sued their insurance agency over insufficient ordinance or law (O&L) coverage. The city won the multi-million case against the agency in court. After their century-old building burned, their $1 million of O&L was lacking by over $2 million. The cost to increase the $1 million to $10 million was about $5,000 … or just under $14 per day!
So, the next time your customer says, “That is $1,100 per year” just tell them, “Well, that’s just $3.01 per day. What can you by for that today?” Then, email Robert and thank him for the sales tip!
The takeaway: Explain the benefit of a particular coverage to the client (education is critical) and break the cost down to how many dollars per day it is.
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