Offering discounts and rebates to customers in the insurance distribution business is one of the worst things a company can do for its brand. Discounts and rebates devalue the brand, attract the wrong segment of customers that tend to claim more, and are less likely to be retained at renewal due to their tendency to switch for a slightly cheaper option.
Insurance advisors, or salespeople, will always struggle to communicate the company’s value proposition when they have margin to discount. Throwing discounts at a prospect may seem like an easy way to secure a sale, but it actually decreases efficiency. Without the room to discount, an insurance advisor can spend less time in negotiation and more time providing better service and advice.
The long-term effects of discounting and rebating can be damaging to an insurance business. It often results in customers who are not loyal and who are more likely to shop around for a better deal. This can lead to increased churn and decreased profitability. Furthermore, discounting and rebating can lead to customer dissatisfaction, as customers may feel that they have been taken advantage of by the company. This is actually true, because a reduction in average margins means that the business will be forced to cut corners elsewhere which can end up costing the customer a lot more than they’d expect.
It is important for insurance companies to focus on providing excellent customer service and quality products that stand out from the competition. This will ensure that customers are more likely to stay loyal to the company, even if there are cheaper options available. Insurance companies should also strive to build relationships with customers and provide them with personalized advice and guidance.
By offering discounts and rebates, insurance companies are sending the wrong message to their customers. Instead, they should focus on providing exceptional service and quality products that customers can rely on. This will help to build trust and loyalty, and will ensure that customers are more likely to remain with the company in the long term.
At InsuranceMarket.ae, while our goal is to find you the best deal based on your requirements, we strictly do not engage in discounts and rebates. Thankfully, we have among the highest customer retention rates in the market along with incomparable satisfaction levels at a 4.9/5 average rating from 19,000+ Google reviews
Believe in your brand, product and value proposition – say no to discounts and rebates Your customers will actually appreciate it.