Rules of Negotiation

By Ed Lamont 

Whether negotiating renewals or competing for new business, rules of negotiation are critical to sales success. Far too often rules are vague, assumed, or, worst of all, unstated when insurance agents negotiate protection programs and conditions for acceptance. The result – low closing ratios, sales failure, and wasted time.
Insurance professionals must know the rules they want set and forcefully participate to establish negotiation protocols. What up-front commitments do you seek from your buyer? What rules of negotiation are fair to you, your agency team, and your insurance companies? If you don’t know what you want, you end up accepting terms unilaterally set by buyers.
Pre-think and prepare to establish fair rules of insurance negotiation by asking these questions:
  1. What’s the up-front agreement you want before offering your professional support?
  2. Is a free flow of information agreed upon? Are loss data, financial statements, and candid discussions of operations willingly shared?
  3. Are problems that exist with the current protection program, agent, or insurance company frankly discussed?
  4. Who else is competing and why?
  5. How are insurance markets assigned? What markets are available to you in order to effectively build an insurance protection plan for your buyer?
  6. What’s the buyer’s budget? If you provide coverage or solutions that add cost, is the buyer’s budget flexible?
  7. How is the buying decision made? Who’s the decision maker? Does anyone else influence the choice of agents or protection plans?
  8. What’s the time line for receiving underwriting information, presenting proposals, and obtaining a “yes” or “no” to your proposal?
Pre-think rules of negotiation you want set. Don’t leave to chance what’s fair to you. Your time, agency team efforts, and insurance company support are at risk of being wasted. Rigorously qualify buyers based on their willingness to agree to your rules of negotiation. That’s fair. That’s professional.
Ed Lamont CIC, CRM is founder of Lamont Consulting Group, Inc. in Palm Beach, FL.  He’s the author of STREET SMART SELLING: The Beliefs, Strategies, and Management Ideas of Successful Insurance Professionals. His sales and marketing ideas can be read regularly in AMERICAN AGENT & BROKER and RESOURCES magazines.  Ed’s led scores of sales, marketing, and sales management webinars as well as hundreds of one-on-one consultations with insurance sales professionals. Lamont Consulting Group 561.737.7388, legspeak, To learn more, register at for Ed’s March 23, 2010 1:00 – 2:15 pm EST webinar: POSITION YOURSELF AS AN INSURANCE EXPERT
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