If insurance agents are onboarded the right way, they will understand that closing deals while selling insurance policies to customers means that you don’t close a sale, you open a relationship. In essence they have to build relationships with individuals and businesses. This ensures the growth and positive perception of the insurance company leading to profitability. Insurance agents need to have excellent communication and people skills to expand and retain their customer base. They need to be competitive and goal-oriented with the ability to deliver client-focused solutions. An effective onboarding program will address and develop all the aforementioned skills within the new hires.
The India Story of Insurance Agents: Call for Effective Onboarding
The Insurance Regulatory and Development Authority of India (IRDAI), has recently revealed that the number of individual agents in the life insurance industry was 24.50 lakh as on March 2021. This means that there is one agent for every 550 people in India. Indians prefer buying insurance policies from agents and not surprisingly the agents have a market share of 78.40%. Bancassurance, online business and others make up for the rest of the market share. With the clout they wield, insurance agents can thrive in India’s insurance market which has a penetration rate of less than 4%, indicating potential for massive growth.
“India’s insurance industry is growing faster than its GDP. Fuelled by this growth, everyone in the ecosystem, be it insurers, brokers or other intermediaries, all are hiring,” said Apaar Kasliwal, Executive Director at PolicyBoss.com to one of India’s leading business dailies, The Hindu Business Line. The expense involved in the hiring spree of insurance agents will go down the drain with ineffective onboarding. This is indicated by a 10% rise in churn rate of insurance agents in the last financial year. Industry watchers peg the turnover of life insurance agents at about 60%. Nearly 50,000 individual agents have left the life insurance industry in India last year, with private life insurers losing over 38,000 agents and the Indian government’s LIC was left poorer by 10,000 agents. Effective onboarding could have mitigated this loss to a great extent.
Effective Onboarding — A Panacea for Retention of Insurance Agents?
Career counseling company Zippia, after their in-house research came up with telling statistics on the need of proper onboarding procedures across verticals:
- Only 12% of employees feel that their company provides great onboarding.
- Employees are 69% more likely to be loyal for three years with a company on account of good onboarding.
- Just six months into the job, 44% of the workforce left due to deficient onboarding.
- Enterprises with strong onboarding processes improved productivity by over 70%.
Coming specifically to the sales domain, according to a study cited by the Entrepreneur website, the following stats come into the picture:
- On an average an onboarding sales process takes a minimum of 38 days to complete.
- 50% of the sales managers surveyed, disclosed that stressful onboarding caused sales hires to quit early.
- 66% of organizations participating in the study say that they struggle with onboarding.
- Only 54% of enterprises profess that their sales teams possess high-level knowledge of their customers’ industries and markets.
- A paltry 29% agree that their sales playbooks and knowledge resources are accurate and up-to-date.
Hence wholesome onboarding can reduce churn substantially.
The motive of the onboarding exercise is to train new insurance agents on how the company functions, and educate them on the firm’s products and services. It should marinate the newbies in the company culture, create awareness about market competitors and set realistic expectations from them. The training program should establish their responsibilities and performance benchmarks.
The Churn Culture of Insurance Agents
It is a fact that a poor onboarding system can lead to higher employee churn and reduced productivity. More than 90% of new life insurance agents quit their company within the first year of joining. The rate increases to greater than 95% when extended to five years. The aforementioned data gives a clarion call for thoughtful onboarding exercises to stem the detrimental consequences of tedious and poorly organized onboarding.
Spiritless onboarding of new employees will prove to be a costly affair for the organization on account of increased attrition and missed sales targets. Just consider the following. Generally speaking, according to new benchmarking data published in 2022 by the Society for Human Resource Management (SHRM), the average cost per hire was nearly $4,700. Edie Goldberg, founder of E.L. Goldberg & Associates and SHRM Foundation chair-elect states that, “The total cost to hire a new employee can be three to four times the position’s salary. Of those costs, I would say 30 – 40% are hard costs, and the other 60% are soft costs.”
Technology comes to the Rescue
Sales enablement tools are sound investment options to save costs for an insurance company in the long run by reducing agent churn and increasing productivity. Good sales enablement software, can make onboarding quicker and accurate, leading to a sales agent making the first sale faster. This statement is corroborated by a fact from Statista that 63% of insurance agents even in the U.S. believe that insurance firms need to adopt better technology for greater productivity. Thus, an effective, efficient and simple-structured onboarding program helps the new joinees to talk to clients; open and close deals; and generate revenue as soon as possible.
Right now, it is mission critical to lead your new frontline insurance agents out into the field pitching to new customers, selling policies and earning revenue for your organization at speed. To do that the onboarding process needs to be swift without compromising on quality and strategy. If you are still stuck with traditional onboarding methods, you will certainly fall behind your competitors who would have adopted to digital modes of onboarding by now.
It is then a good idea to make the switch to a good sales enablement platform for onboarding. It will make sure that insurance agents micro-learn concepts through regular study of bite sized chunks of information. Bombarding them with a lot of information at one go does not help with memory retention. Learning through quizzes and contests amongst insurance agents makes the process fun and interactive.
If you want to improve your onboarding experience with a data driven, AI enabled, mobile friendly, personalized and gamified sales readiness and enablement platform; then the StreamzAI Sales Onboarding Platform can be the right fit for your business. To discover what StreamzAI can do for your organization, schedule a demo with us.