What Gives ......?????

almostintears

New Member
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I don't know anything about the compensation that agents receive so not sure if what I am about to post has anything to do with money but think it might?
I started "tweaking" my support role after noticing I was calling the same customers nearly every week looking for past due amounts, policies going to be cancelled for non-payment etc. so I took a "proactive" approach and started calling these customers BEFORE their payments were due letting them know that their payments were due in XXXXX amount of time and I was calling them to save the $10 late fee and possibly avoid having to make a double payment if the policy was in the "cancel" stages, etc.

Is there more money in the agent's pocket if people don't pay on time? or if they are cancelled and then re-instate? Obviously the late fee is lining someone's pocket.

I think it has saved money in postage (reminder letters, etc.) and I should know because I am the one typing and mailing everything out, my time because I am not calling them every day for two weeks (10 phone calls per each late person as long as a payment wasn't made) and I can use the extra phone time to cross-sell instead of headhunt, the customers don't seem to be "avoiding" us because they are now in good standing when I make the call before they are due vs calling them when they are late, and it makes us appear to be trying to save them even more money by avoiding unnecessary late fees, etc.

I actually thought this would be a win/win situation for all parties .... the Agent I work for was just wondering why I was doing this and I thought it was obvious .... so I thought there may be money involved that I don't know about. Obviously, she's not gonna come out and say hey don't provide good customer service or to hell with them, etc. but not sure if my effectiveness is costing her money somehow??? :skeptical:
 
If you're actually saving the business then that's great. My best guess is they think that retention efforts and calls like that either don't work or they set a precedent. I'm not sure how much water it holds, but if you establish a pattern of calling them about a late payment and that's their time they decide to pay, then you don't and they lapse and there's a claim, I believe that's an argument that's been used successfully in court to make people that didn't pay their premium get claims paid. That said, if no calls and no pattern was ever established what little basis that had as a claim goes completely out the window.

It's a lot easier to keep a client on the books then find a new one. I think you might be looking for something that isn't there.
 
I would say Josh hit it on the head. It is the E&O exposure. Although if you are calling if the payment is late, then I really don't see any difference from an E&O perspective if you call before the payment is due.

I'd probably wait to see if someone ends up on the "frequent late payers" list before making the proactive calls. In reality, unless you are working the substandard market, it might make more sense for the agency to just let these clients go. It sounds like they suck up a lot of time and resources that could be better used finding better clients.
 
The question is let say you move on or get busy and can no longer proactivly call and the customer ends up lapsing and they incur a claim. They can claim you changed your standard procedures and but for your not calling them is the only reason they lapsed.

Personally I think it is junk but is probably an E&O issue. I would explain why I was doing it to the agent and get a response in writing from the agent to either Yes keep doing this or no not do this.
 
I would say Josh hit it on the head. It is the E&O exposure. Although if you are calling if the payment is late, then I really don't see any difference from an E&O perspective if you call before the payment is due.

I'd probably wait to see if someone ends up on the "frequent late payers" list before making the proactive calls. In reality, unless you are working the substandard market, it might make more sense for the agency to just let these clients go. It sounds like they suck up a lot of time and resources that could be better used finding better clients.

Spot on for E&O claim. I have a friend that is a GR....ge agent and was calling out in 2009-2010 to keep payments from bouncing during the lean times then.

Well a pattern was established and had to defend 2 E&O claims because they stopped calling at the end of 2010 and people lapsed out.

Grrrr ..... F'n lawyers.
 
In this case, do you think sending a letter to the clients explaining the policy change would be enough to prevent E&O exposure?
 
I had a doctor client. I wrote $500,000 term life on him. He was always late on the semi annual premium. I would send him a letter, if still not paid, I would call his office and leave a message. This went on for several years. Several times, we had to get the policy re instated.
One morning, I'm reading our daily paper and on the front paper is an article about his airplane being struck by lightening in Montana. The doctor was killed along with one of his children.
When I got to work, I called the ins co to find out if the policy was active. Nope, canceled.
Several weeks go by. I get a telephone call from an attorney wanting to know if this life policy was active. I tell the attorney no. The attorney then says to me, "why did you allow this policy to lapse?"
So I explained to the attorney this was a normal pattern for the doctor. The doctor ignored the premium notices from the company, ignored my letter, ignored my tele msg.
Never heard any more after this telephone call.
 
I had a doctor client. I wrote $500,000 term life on him. He was always late on the semi annual premium. I would send him a letter, if still not paid, I would call his office and leave a message. This went on for several years. Several times, we had to get the policy re instated.
One morning, I'm reading our daily paper and on the front paper is an article about his airplane being struck by lightening in Montana. The doctor was killed along with one of his children.
When I got to work, I called the ins co to find out if the policy was active. Nope, canceled.
Several weeks go by. I get a telephone call from an attorney wanting to know if this life policy was active. I tell the attorney no. The attorney then says to me, "why did you allow this policy to lapse?"
So I explained to the attorney this was a normal pattern for the doctor. The doctor ignored the premium notices from the company, ignored my letter, ignored my tele msg.
Never heard any more after this telephone call.

I remember you telling that story in Vegas a couple of years ago.

I would have been tempted to say, "I didn't, the deceased did when he failed to make his premium payment."
 
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