Of the major agency building blocks, referrals are usually the first category mentioned by agency principals. If you ask them where most of their business comes from, their answer is most often "referrals." If this is true for your staff, two secrets will help them boost their revenue stream.

Regardless of the level of your service you must ask for referrals. Commercial customers already know this, but how do you get Personal Lines clients into this habit? Tell them how you conduct business, ask for their help, perform inspections, praise them for reducing their risks and taking care of business, and gradually give them more room to breathe. Help your agents write scripts that include referral requests to follow when conversing with clients.

Treat the customers who give referrals like gold. Showing customers your appreciation of their referrals is essential to receiving more from them. The first step is to find out who your referrers are. Have everyone in your shop record their names. Now you can begin thanking them. Just don't overwhelm them with your gratitude, or they'll stop out of embarrassment. Try inexpensive but sincere tokens of appreciation. (State rebate laws may limit your options.) Worthwhile gifts include cards, letters, phone calls, and tickets to local sporting or cultural events.

Many Northeastern agents thanks their referrers by sending lottery tickets in a card with the cover message "Thanks A Million," with a handwritten note inside saying, "Thanks for sending Jane Doe" and this PS: "Hope you win a bundle." Get to know your customers to see what gifts work best. If the proper gift isn't obvious, ask them. If you and your people are sincere, the honesty and sincerity will show through.

The Five Agency Building Blocks

The following one-word building blocks are also important:

Keep: It's no use bringing in customers through the front door only to have them exit out the back. Have your agents segment their customers by importance. Your agents will be spending the most time with the A and A+ customers. Look for ways to keep them and your agents' other customers in the< flock.

Update: It's your agents' duty to provide customers with insurance advice. How often do customers expect it? How often can your agents deliver advice? After an insurance agreement is signed, agents should promise regular contact with each client in a written contract.

Cross-Sell: The goal is more policies, not more policyholders. Single-policy accounts probably do not helongamong your A or A+ clients. There are many ways to cross-sell other coverages to each customer; one of the best is to send a "Call Me" card, and have scripts ready to aid the CSR when the client calls back.

Get More: There are three elements to increasing business:

Recapture the lost A and A+ customers. If they're not satisfied with their new agent, they'll probably move again, but it won't be back to you without an invitation. They'll be too embarrassed. You must pursue them.

Cold-contact-direct mail and telemarketing still work today, especially if the call comes from a local business.

As described above, most agents rely heavily on referrals to generate new business.

People Development: Developing your agency's human assets is the foundation of all agency building blocks. Start with sharing your vision with your staff. Next, train them as a team, evaluating their performance on a regular basis. Remember to praise their efforts. Establish a schedule of small, frequent office celebrations. Show your support, then get out of their way. They'll knock your socks off.

Frank Herberg, CPCU, AAM and Joan Adams, CPCU, CPIW, AAM run the management consulting firm of Herberg, Adams & Associates in Auburn, MA. They may be reached at (508) 832-7600, fax (508) 832-0588 or E-mail: [email protected]