A recent study conducted by PYMNTS found that 18% of Millennials and 20% of Gen Z look to their financial institutions for insurance information.
These are the generations of the future. In fact, Millennials (born between 1981 and 1996) have already become the largest group of consumers in the world today. And Gen Z isn’t far behind.
Millennials love to shop online and use their smartphones – even when shopping physically in a store. They want to find the best prices, the best service, and the best value for their money. Convenience is another imperative. Fast, easy, friendly service is essential.
All this to say, incorporating a bank-owned insurance agency could be a smart business move. Offering your customers insurance when they take out an auto loan or mortgage is an easy cross-selling opportunity that you shouldn’t pass up.
Not only will you capture the attention of your Millennial consumer base by offering insurance options when they need them most, but you’ll set your business up for success with the generations to come.
Why Bank-Owned Insurance Agencies Are the Future
Here are several other reasons a bank should strongly consider partnering with an insurance agency.
1. Incorporate Speed and Technology
In the past, bank and insurance agency partnerships have failed due to misalignment. A bank could generate dozens or even hundreds of referrals for an insurance agency. But if the agency couldn’t keep up with demands, it could result in distrust and frustration for everyone involved.
Today, we have the technology to get accurate pricing indications from top insurance carriers fast. Banks can send referrals to their insurance partners with the data they’ve already generated from a mortgage or auto loan application. The insurance agency will then work to get the clients quality quotes that fit their needs and budget.
Our advanced technology also allows us to conduct business and track metrics in real-time. Digital marketing and analytics tools enable agents to take a scientific approach to insurance sales. And monitoring leads across different channels and personalizing data empowers financial institutions to connect with customers more authentically.
We offer easy-to-use price comparison tools, mobile-friendly shopping, and custom-fit solutions for your customers. As a bonus, we can notify customers automatically if their insurance rates increase and when it’s time to renew a policy.
2. Earn Non-Interest Income
Your bank can drive non-interest income by selling auto, home, and commercial insurance to customers. Insurance, a non-core activity, can play a substantial role in your overall profitability. Having an additional revenue stream can help your business maintain profit margins, especially when interest rates are low.
3. Create a Better Customer Experience
Your customers already need insurance if they’re taking out an auto, business, or home loan. You may not even have to sell them on that point. Offering them insurance right then and there provides them with immediate access to the products they need.
You can lighten their burden by taking another item off their list. Doing so creates a better customer experience while also generating more revenue for your business.
Imagine a customer working through the process of buying their first family home. They’re overwhelmed dealing with the home inspection, closing procedures, and everything else on their plate. You – as their lender – can offer them the insurance they need to secure their mortgage.
Pro tip: Getting a mortgage is by far the easiest time to set up or switch homeowners insurance.
4. Save Money (and Headaches)
By partnering with an insurance agency, versus acquiring an agency or starting a new one from scratch, your business can save a lot of money. You can also avoid adopting the cultural and operational nightmares that often come with many agencies seeking to sell.
An experienced insurance partner can work with you to start building revenue immediately, generate ROI, and continue to grow year after year.
5. Get Ahead of Competitors
It’s not a matter of if but when your competitors will start offering property and casualty insurance options in their stores. Cross-selling insurance to your current customers is a smart business move. Not only do insurance needs accompany loans, but they often transcend loan expiration dates.
Giving Your Banking Customers the Insurance Agency Expertise They Want and Need
Coverage Direct is a cutting-edge insurance agency solution for financial institutions. Learn how easy it is to drive new revenue by giving your customers exactly what they want: access to top-rated insurance carriers.
We offer the small business customer service your clients love with the technology, speed, and convenience typically only large national companies can provide. We also offer tailored coverage options while implementing industry-leading technology to make the insurance-buying process as efficient and easy as possible.
Contact us to learn more.