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The Secret Psychology of Why People Buy Insurance

The Secret Psychology of Why People Buy Insurance

Understand these reasons why people buy insurance to boost your customer value.

Even though you’re an insurance agent, you may have never really taken a step back to wonder why people buy insurance. State law requires some insurance, and most individuals express a want to protect their assets, but what about the psychology behind it? A crystal clear understanding of this can quickly take your agency to the next level, especially now that we’re in the age where targeting the audience has become a fine art.

Research was conducted into why exactly people buy insurance. It turns out that two separate ‘psycho-motivators’ drive the insurance decision – price and peace of mind. Convenience came third. More often than not, consumers have to decide between a policy within their budget and a policy that provides ample protection and peace of mind.

Success hinges on selecting the right customer segments, offering them a tailored proposition, then giving them a successful experience with superior service. Remember that consumers are driven by price and peace of mind, and you will want to address these two points when talking with a prospect. Ideally, all customers would care about protection and be driven by peace of mind. They would want to have a relationship with the agency they can count on. After all, the most profitable customers you could ever have want a real relationship, not just a transaction.

Loyal clients are more inclined to stay longer. They are dedicated to an agency and like to develop a relationship. In fact, research found that loyal customers are likely to refer a friend, too. This ties in with the ‘peace of mind’ reason for buying insurance – if customers feel satisfied with the service and product that protects their assets, they are more inclined to share this information with friends and family.

You can help capture more clients by delivering ongoing value and creating deeper relationships.

To learn more about how to be successful in your business, contact Mike Stromsoe’s Unstoppable Profit Producer Program. We can offer guidance, helping you perfect your professional posture. We also offer a premier wealth creation program that helps you to work less, earn more, and enjoy life.