If you asked an insurance agent what took up the most time every workday, they’d probably tell you “finding new clients.” Cold calling, cold emailing, and browsing for leads can drain your time even if you’re efficient in the process. That’s where insurance referral marketing comes in.

Searching for leads is necessary — customers are the lifeblood of any business. But there are ways to make the process work for you. There are many steps you can take to automate your outreach efforts, for example. But you can take outreach even further by setting up your marketing scheme, so that leads find you first.

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What’s insurance referral marketing and how can you use it?

Insurance referral marketing is what brings insurance leads to you without having to go out and find them. Many businesses use this marketing tactic because it brings in more qualified leads from the start, translating to more customers and more revenue. This method works through providing the maximum benefit to the customers you already have, then asking them to refer you to others if they’re satisfied with your service.

Referrals are how many businesses bring in new clients, and it’s the way most people decide where to go next for whatever needs they might have. 

Referral marketing can be tricky for insurance companies. If you plan on offering incentives like gift cards or discounts, you may have to do a bit of homework to be sure you’re abiding by your state’s regulations for insurance companies. That said, a good referral plan will pay dividends that make the extra effort worth it.

How do I ask for referrals?‌

At first, asking for anything can feel awkward, especially if someone is already a paying customer. But most of the time, people are happy to spread the word if they’ve benefitted from your business. So how do you go about it?

1. Make the customer feel better about the referral‌

One helpful way to think about referrals is to focus on the benefit it offers your customer. They already like you, and by recommending a great business to friends or family, your customers will gain a bit of social capital.

Make the customer feel better about referring you by maintaining a positive and professional appearance. That can include:

  • Holding yourself to high ethics and integrity standards
  • Always following through
  • Being timely
  • Maintaining cohesive branding across all channels — website, social, and more.

2. Don’t be afraid to ask them early on‌

You should, of course, do this tactfully and without pestering people, but if you’ve just finished a great interaction with a customer, there’s no reason not to leverage that into a referral.

You could ask them in a follow-up email and reiterate how great it was to work with them and get them the help they needed. Stress that you’ll provide the same level of excellent service to whomever they send your way, and then let it be.

Don’t be overly aggressive with follow-ups. If someone tells you they’ll “think about it and get back to you,” don’t press them. At most, reach out with a short and tactful follow-up. If someone tells you that they aren’t interested in referring, don’t pressure them to change their minds.

3. Ask at one of three key points‌

There are generally three times during your interaction with a customer that it’s best to ask for a referral. They are:

  • After they’ve bought something from you
  • After they’ve shown strong support for your brand
  • After a past client provides a referral

When someone has just agreed to buy your product or service, they have a favorable opinion of you. Reinforce that by thanking your new customer with an email or handwritten note for their business. Let them know you’re here to help if they have any additional questions about their plan, and you are able to provide the same level of service to anyone they know who needs an insurance provider.

Strong supporters of your brand have already been with you for years and may have already referred you to people they know. In this case, it’s more about maintaining the relationship and letting them know you value their loyalty.

When a past client sends a referral to you, reach out and say thanks. Promise to take good care of the person they sent and update them on how things are going. You want to reinforce the idea that anyone they send you is in good hands.

What does a referral look like?‌

Referrals can come in many forms, and there are just as many ways to reach out to people to ask. A follow-up email is a great way to do it and is something you can automate if you’re using CRM (Customer Relationship Management) software in conjunction with your email management. You could also send someone a message on LinkedIn. They might be more open to that type of correspondence since it’s a professional social network.

While a direct referral is always best, there are other ways people can help your business by endorsing you more generally. They could add a testimonial to your LinkedIn page or website, or give you a five-star Google or Yelp review. Reviews are critical for local businesses, as more good reviews help raise your page rank and make it more likely you’ll show up for “near me” searches.

If someone does agree to refer your business to someone they know, make it easy for them. Consider providing a short, simple email template your customer can use if they’re not sure what to say — they can even tweak it to fit their voice better.

Offer incentives and return the favor

Little incentives can give people the nudge they need to refer your business when they wouldn’t otherwise. Thimble, for example, implemented a gift card program. They awarded a $10 gift card to customers for every referral, capped at $50. Again, make sure you aren’t crossing any regulatory lines if you choose to do something like this yourself.

You can also refer your clients! Chances are, you’ll get to know their business when helping them with their policy. Say they do drywall, and you have another client who’s doing home renovations soon. Refer that client to the drywaller! They’ll appreciate it and be more likely to help you out in the future.

Turning new referrals into clients

When someone is referred to your business, they’re already coming to you with some measure of trust because you were recommended by someone they know. Your job is to maintain that trust and let them know it was justified.

It’s as simple as providing excellent service. Get to know your new client and what they need from their policy. Help them work within their budget and find solutions that give them peace of mind. Provide value to them, and they’ll thank you for it by becoming a loyal customer.

Interested in more tips for insurance professionals and business owners? The Constant Contact blog has you covered. And if that’s not enough, download the free .pdf, The Download: Making Sense of Online Marketing, for inside knowledge on marketing for businesses.