Did you know that insurance companies cannot sell insurance right before, during and after a storm? You probably knew that, but have you analyzed your selling opportunities within these cracks of time? Because there is room to make some money while protecting your clients to your utmost ability. We want to show you how.
Your clients may be asking you for last-minute hurricane insurance or extra coverage for a tornado when storm trends looking pretty bleak. Depending on where they are, you may not be able to sell a flood or earthquake insurance policy for weeks after a catastrophe. Selling insurance when a storm is approaching is tricky and often depends on how close the storm is.
If You’re Selling Flood Insurance Last Minute
As for flood insurance, remember that it takes 30 days to take effect, so your client may buy and experience a catastrophic loss before their policy is effective. So let’s say you sell in Texas and are able to sell a flood policy now, if the storm hits in 28 days, your client will have no coverage when the storm hits.
It’s important to communicate the details of a policy and not wait until disaster strikes. If you’re selling to people who are trying to secure their homes last minute, that’s a good thing, but it’s important to be clear about the effective dates so they are not due for a shock if they find out that their losses aren’t covered.
Be Transparent About Insurance Coverage After a Storm
The more transparent you are during the sales process, the better off you are. Don’t exclude important facts for fear of not making the sale. Retaining clients and maintaining a good reputation are more important. If you’re selling last minute, you should explain that it’s a gamble against time if they want the flood policy to be effective for an oncoming storm.
Windstorms are also tricky and have waiting periods, which vary by state. In Texas, for example, you cannot buy a windstorm policy if the storm is within a specific range. In Connecticut, the waiting period is just a mere 15 days, but then again, Connecticut is not known for many hurricanes, and the last time the state was touched by one was in 1985.
Mississippi, which like Texas experiences devastating storms and buying insurance is contingent upon how close an oncoming storm is . Basically, if a certain region is known for certain types of storms, you can bet there are stringent rules about when policies can be sold and when they will go into effect.
Upselling Insurance Prior to or During a Storm
The good news is that you can tweak existing policies at any time. What you can do is contact all your clients to make sure they have set high enough limits for reconstruction costs. If they have not, it’s the perfect time to upsell. You can also tell them to increase their limits for other living expenses, like temporary lodging and meals.
So, your hands are not completely tied as we await storms to hit and possibly hit hard. It’s just harder to make new sales. But every upsell is gold right now.
It’s very challenging to protect clients who are buying in the nick of time. While their attempts may fail, you can still convince them to buy insurance to secure what they end up rebuilding out of pocket after the storm settles. Tell them that it’s never too late to act wisely. We all learn from mistakes, so be compassionate when you just can’t get around the regulations around storms.
Cross-selling Insurance Before a Storm
While the most important thing to a client is their home, even if it’s too late to protect them with enough home insurance in time for the storm, car insurance policies are a little less stringent when it comes to the timing of an oncoming storm. Cover your client with comprehensive coverage, which would cover storm damages. Unless the area is under a storm watch, you can still add on this important coverage,. Only comprehensive coverage will protect against floods, hail and other windstorms which may overturn a car.
Remind Customers About Insurance Options
Tell them that their homeowners insurance will not cover flood. It will also not cover all hurricane damage. Many hurricane-prone states do not cover all windstorm damage, which is what a hurricane would amount to. In coastal states the customer may need to buy a separate windstorm policy or an add-on rider.
The following are a few associations that offer windstorm coverage and hail coverage for homeowners who live in high-risk coastal areas and are unable to buy it elsewhere. See if the state(s) you cover offer(s) windstorm coverage:
- Alabama: Alabama Insurance Underwriting Association
- Connecticut: Coastal Market Assistance Program
- Florida: Citizens Property Insurance Corporation
- Georgia: Georgia Underwriting Association
- Louisiana: Louisiana Citizens Property Insurance Corporation
- Massachusetts: Massachusetts Property Insurance Underwriting Association
- Mississippi: Mississippi Windstorm Underwriting Association
- New Jersey: New Jersey Insurance Underwriting Association
- New York: New York Property Insurance Underwriting Association
- South Carolina: South Carolina Wind and Hail Underwriting Association
- Texas: Texas Windstorm Insurance Association
- Virginia: Virginia Property Insurance Association
