ACSR 5 - Customer Service and Its Impact

Confidence

Insurance professionals can earn customers' ____ by making appropriate coverage recommendations, processing transactions promptly and accurately, answering questions and explaining coverage clearly, keeping track of transactions and following up on any processing delays, identifying and resolving errors quickly, and offering advice and support in the event of a loss.

Mission Statement

One way in which organizations can further excel in customer service is by committing to it in their ____. Customer service then becomes a basis for performance objectives and is subject to monitoring and measurement. This keeps its value in the spotlight and encourages innovation and continuous improvement.

1. Understanding customers' needs 2. Acting efficiently and competently 3. Identifying and resolving potential problems early 4. Responding effectively to criticism and feedback

The four steps to exceeding customers' expectations are:

C. Listen empathetically and quote coverage for a different type of vehicle.

Tina is a customer service representative at an agency. A customer's son has recently obtained his driver's license and is considering buying a sports car. His parents have advised him to get an insurance quote beforehand. When Tina tells him how expensive coverage will be, he becomes angry. What is the best approach for Tina to take? A. Explain there is nothing she can do about the cost. B. Allow the young man to express his anger. C. Listen empathetically and quote coverage for a different type of vehicle. D. Suggest he put the vehicle in his parents' name to reduce the premiums.

- Knowledge of the subject - Attention to detail, organization, and efficiency - A genuine interest in the customer

To exceed the service expectations of all types of customers as well as meet production goals, CSRs must develop these qualities:

They want to feel welcome. They want to feel comfortable. They want to feel understood. They want to feel important.

To provide high-quality service, an insurance professional first must understand what customers want:

A. Welcome, comfortable, and important

To provide high-quality service, an insurance professional first needs to understand what customers want. Which one of the following best describes what customers want to feel? A. Welcome, comfortable, and important B. That the customer service representative is busy C. That they are like every other customer D. That the customer service representative will do only what they ask

Satisfying

____ a customer's needs, an insurance professional must go beyond what is asked. Insurance can be complex, and customers do not always know what they require.

CSRs

____ also provide information and support to internal staff, such as producers and other team members, and to external individuals such as insurers' employees.

Exceeding

____ customer expectations means providing services and options the customer might not think to ask about.

Customers

____ want to feel welcome, comfortable, understood, and important.

Account Rounding

____, often called cross-selling, allows an organization to meet all of a customer's insurance needs. For example, the CSR responsible for a commercial property account might offer to quote on the customer's automobile fleet in the hope of writing that coverage as well.

True

(T/F) It costs several times more to write a new piece of business than to renew an existing account.

Basic

Meeting ____ expectations involves common courtesy, reasonable responsiveness, and compliance with customers' requests. It includes being polite, returning telephone calls and e-mails promptly, and processing transactions as required.

CSRs

Whatever the environment, ____ are responsible for providing excellent service to their customers. These customers include prospects, policyholders, and claimants, in addition to clients who have purchased risk management or other services.

CSRs

____ bring quality to internal service and production activities in the same ways they do to interactions with external customers.

Customer Retention

____ has a direct influence on the long-term profitability of an agency, a brokerage, or an insurance company. Even a small improvement can result in surprisingly lower costs and increased profits over a few years.

Retention

Customer ____ enhances profitability because it is far more cost-effective to renew an existing policy than to write a new piece of business.

Customer Service

In broad terms, _____ is the process of getting an organization's products and services to the customer.

Customer Retention

In the insurance industry, one of the most important factors in long-term profitability is ____.

B. Exceed customers' expectations.

Studies have found that in order to improve customer retention, organizations need to A. Satisfy customers. B. Exceed customers' expectations. C. Offer the lowest prices. D. Meet customers' basic expectations.

CSR

The role of a ____ is to delight customers by understanding their needs, acting efficiently and competently, identifying and resolving potential problems early, and responding effectively to criticism and feedback.

True (Also, if customers purchase one policy from an agency or a brokerage and are delighted by the service they receive, they are more likely to place additional business there, compounding the retention-enhancing effects of service excellence.)

(T/F) Agencies, brokerages, and insurers also have found that customers are less inclined to defect to the competition when they have more than one policy with an organization.

True (However, these same studies indicate that when customers are delighted—when their expectations are exceeded—retention improves significantly.)

(T/F) Customer satisfaction is not enough to ensure customer retention.

Errors and omissions (E&O)

Negligent acts (errors) committed by a person conducting insurance business that give rise to legal liability for damages; a failure to act (omission) that creates legal liability.

Service-Oriented

A ____ insurance professional will determine whether this amount is sufficient for a customer and arrange to provide additional coverage if necessary.

Service-Oriented

A ____ insurance professional will encourage the customer to express his or her dissatisfaction and listen actively and empathetically. Rather than react defensively, he or she will acknowledge any error, delay, or misunderstanding; apologize; explain how the situation will be corrected; and remedy the situation promptly.

5; 50

A ____ percent increase in customer retention can translate into a ____ percent increase in future profits.

Mission statement

A broad expression of an entity's goals.

Service-Oriented

A commercial lines underwriter may recommend loss control measures that the insured does not want to implement. A claim representative may request information that an insured is unwilling to provide. ____ CSRs seek out the middle ground in these situations and negotiate solutions that are acceptable to everyone involved.

D. Exceeding the customer's expectations

A customer calls a customer service representative (CSR) to advise that her teenage son has just obtained his driver's license and will be an occasional driver of her vehicle. While on the telephone, the CSR makes the change to the policy and informs the customer what the increase in premium will be. The CSR also tells the customer that the premium increase will be less if the son takes a driver's education course, and then provides the names of several nearby organizations that offer courses. In addition, the CSR mentions there may be a further premium reduction if the son participates in community service activities. This is an example of which one of the following? A. Disappointing the customer B. Meeting the customer's basic expectations C. Fulfilling the customer's needs D. Exceeding the customer's expectations

B. Meeting the customer's basic expectations

A customer calls to advise a customer service representative (CSR) of a change in vehicle. The CSR answers the telephone, takes the necessary information, and promptly and accurately removes the old vehicle from the policy and adds the new vehicle. This is an example of which one of the following? A. Disappointing the customer B. Meeting the customer's basic expectations C. Fulfilling the customer's needs D. Exceeding the customer's expectations

C. Fulfilling the customer's needs

A customer has just purchased a house and visits the customer service representative (CSR) to arrange homeowners insurance. The CSR learns there is a mortgage on the property. The customer is unaware the mortgage lender will require that a mortgage clause be added to the property policy. However, the CSR is familiar with this requirement and adds the mortgage clause. This is an example of which one of the following? A. Disappointing the customer B. Meeting the customer's basic expectations C. Fulfilling the customer's needs D. Exceeding the customer's expectations

D. Acting efficiently and competently.

A customer service representative (CSR) can earn customers' confidence and demonstrate professionalism by: A. Making them feel welcome. B. Denying that errors occur. C. Doing whatever the customers ask. D. Acting efficiently and competently.

D. Research loss exposures that might exist in an old converted commercial building, and give the customer a list of questions to ask before the purchase

A customer service representative (CSR) receives a call from a customer who is considering purchasing a house in the country that has been converted from a century-old general store. The customer has rented apartments in the city her entire life, and this new retirement home would be her first homeownership experience. The customer requests a quote for "whatever insurance coverage is normal." Which one of the following would be the CSR's best option for identifying and resolving potential problems that might result from ownership of this home and the coverage required to adequately insure it? A. Insure the home as requested, advising the customer that a property inspection will be required B. Explain that specialty policies with coverage limitations might be the only option for this older home C. Refer the customer to an agency specializing in insuring old and unique properties D. Research loss exposures that might exist in an old converted commercial building, and give the customer a list of questions to ask before the purchase

C. Be empathetic while explaining that all losses have the potential of having significant value, and try to negotiate a renewal with a higher deductible

A customer service representative (CSR) receives a call from a customer whose homeowners policy has been canceled as a result of her loss frequency. She is angry because some of the losses were not covered, some losses were below her deductible, and only one loss was of significant value. Which one of the following is the best way for the CSR to respond to this criticism while working to exceed the customer's expectations? A. Place coverage with another insurer that is willing to accept the customer's loss history at a higher premium B. Encourage the customer to express her anger and listen empathetically C. Be empathetic while explaining that all losses have the potential of having significant value, and try to negotiate a renewal with a higher deductible D. Refer the customer to an agency specializing in providing coverage to customers with a high loss frequency

C. Explore with the customer the loss exposures of her new business, risk management techniques that might apply, and ways to offset the cost of any extra coverage required

A customer service representative (CSR) receives a call from a customer with a homeowners policy. The customer has lost her job and is starting a small business in her home selling Internet advertising. The customer wants to see what she can do to reduce her premium until she can establish her business. Which one of the following would be the best way for the CSR to exceed the customer's expectations and promote customer satisfaction? A. Review the homeowners policy and find ways to reduce the premium through coverage cuts and an increased deductible B. Create a checklist of ways the homeowners policy can be changed, with corresponding premium reductions, to review with the customer C. Explore with the customer the loss exposures of her new business, risk management techniques that might apply, and ways to offset the cost of any extra coverage required D. Suggest replacing the homeowners policy with a policy from another insurer that might offer a lower rate, even though that insurer's claim service is not considered good

B. Call a watercraft underwriter to ask for advice in insuring the unique vessel

A customer service representative (CSR) receives a request from a customer who has purchased a barge on which an architect built an office as a promotion of his architectural skills. The customer would like to insure the barge and building. The barge is not a standard watercraft and does not conform to the underwriting guidelines of any insurer the agency represents. Which one of the following would be the CSR's best approach for efficiently and competently responding to the customer's coverage request? A. Refer the customer to an agency that specializes in watercraft B. Call a watercraft underwriter to ask for advice in insuring the unique vessel C. Submit applications to all insurers the agency represents to see if any are willing to accept the risk D. Bind coverage with one insurer before exploring coverage options

D. Help the customer determine what property and liability exposures he will assume in the purchase

A customer service representative (CSR) receives a visit from a customer who is purchasing a building with a restaurant on the ground floor and two second-floor apartments. He has never owned a commercial venture before and wants to arrange for insurance coverage before he closes the sale. Which one of the following would be the CSR's best approach to efficiently and competently help this customer? A. Refer the customer to an insurance agency that specializes in commercial property B. Go to the property with the customer for a "walk through" and note any concerns C. Submit an application and photos of the property to an underwriter for a quote D. Help the customer determine what property and liability exposures he will assume in the purchase

B. Determine the liability to the customer for the daughter's use of the car and recommend the most appropriate coverage limits

A customer service representative (CSR) receives a visit from a customer whose 17-year-old daughter has just received her driver's license. The daughter's grandparents plan to surprise her with the gift of a car. The customer has high limits of liability coverage on her own car and wonders if she can buy a separate policy for her daughter with lower limits of liability coverage to reduce the cost of the policy. Which one of the following would be the best way for the CSR to exceed the customer's expectations and promote customer satisfaction? A. Suggest the grandparents purchase the insurance for the car as part of the gift B. Determine the liability to the customer for the daughter's use of the car and recommend the most appropriate coverage limits C. Arrange for coverage that meets the minimum limits needed in her state at the lowest price D. Explain that the customer will receive a multi-car discount if she adds the daughter's car to her own policy

A. Educate the customer about automobile liability exposures, his assets at risk, and coverage that is appropriate to protect his assets

A customer service representative (CSR) receives a visit from an 18-year-old who is a new car owner. The customer owns a condominium and is living on structured payments established from his deceased parents' estate. His income is modest, so he would like to purchase minimum coverage limits. The CSR recognizes that minimum limits might be inadequate for the customer if he is responsible for an accident. Which one of the following would be the CSR's best option for resolving this potential problem? A. Educate the customer about automobile liability exposures, his assets at risk, and coverage that is appropriate to protect his assets B. Suggest a course available at the library where the customer can learn about insurance and how it works C. Write the coverage at the minimum limits and require the customer to sign a statement indicating he had been advised to purchase higher limits D. Provide the customer with claims statistics highlighting instances when coverage limits are inadequate

B. Listen actively and reduce premiums by eliminating unnecessary coverage and increasing deductibles

A customer service representative (CSR) receives a visit from an angry business owner whose premiums increased 75 percent from the previous renewal even though he had no losses. Which one of the following is the best way for the CSR to respond to this criticism while working to exceed the customer's expectations? A. Explain that changes in premiums occur in cycles in the insurance industry and are out of the agents' control B. Listen actively and reduce premiums by eliminating unnecessary coverage and increasing deductibles C. Refer the customer to the agency manager, who is a long-time acquaintance of the customer D. Listen empathetically and explain that there are no other alternatives, since prices are equally high if coverage is placed with another insurer

Professional; Productive; Pleasant

A service-oriented CSR will ensure that each customer interaction is as ____, ____ & ____ as possible.

Producer

A service-oriented CSR works closely with the ____ to learn as much as possible about the target market and to understand the loss exposures and required coverage specific to that type of account.

Retention

Agencies and brokerages can improve ____ through regular communication and personalized contact with customers.

Referral

Agencies and brokerages can positively influence their bottom line by actively seeking ____ business from their most profitable customers.

- Exceed customer expectations - Cross-sell existing accounts

Agencies, brokerages, and insurers all have customer retention objectives. There are two principal ways that an insurance organization can improve retention:

D. They focus on completing their own job rather than on building cooperative relationships.

All of the following statements are correct with respect to service-oriented customer service representatives' interactions with others in an agency or brokerage, EXCEPT: A. They work closely with producers to develop new business or round existing accounts. B. They may provide administrative support to loss control representatives. C. They work to understand the role they fill and the extent to which others rely on them. D. They focus on completing their own job rather than on building cooperative relationships.

Sales Goals

Although new business is usually generated by producers, CSRs often have ____ in addition to customer service responsibilities. For example, a CSR may have an annual objective of cross-selling homeowners policies to 10 percent of his or her existing automobile customers.

- Understand the coverage, exclusions, and limitations of each insurance policy form - Understand the coverage provided by each endorsement - Learn as much as possible about that particular customer to determine which combination of forms and endorsements is best - Communicate to the customer in a logical, understandable way so the customer can make an informed decision regarding his or her coverage

An insurance professional can tailor coverage to best meet a customer's specific needs using a variety of forms and endorsements. But first he or she must be able to do four things:

- Understand customers' needs - Act efficiently and competently - Respond promptly to criticism and feedback

An insurance professional who is committed to consistently exceeding customers' expectations will do three things:

Customer Expectations

An insurance professional who understands customers' needs, acts efficiently and competently, and responds appropriately to criticism and feedback can consistently exceed ____.

Organization

Attention to detail, organization, and efficiency are important to the service-oriented CSR. ____ allows CSRs to do their job well. For example, well before a policy expires, a conscientious commercial lines CSR will contact the customer to assess whether there have been changes in that customer's loss exposures. This allows sufficient time to prepare a renewal proposal that best meets the customer's current needs.

Efficiency

Attention to detail, organization, and efficiency are important to the service-oriented CSR. ____ means taking prompt action to resolve small issues before they become larger ones.

Attention to Detail

Attention to detail, organization, and efficiency are important to the service-oriented CSR. ____ significantly reduces errors, oversights, and delays, any of which can result in customer dissatisfaction.

B. Demonstrate a genuine interest in their customers.

Being empathetic and supportive when customers suffer a loss, understanding their frustration when problems arise, and resolving issues promptly are all ways in which customer service representatives (CSRs) can A. Reduce errors and omissions exposures. B. Demonstrate a genuine interest in their customers. C. Satisfy all of their customers' needs. D. Demonstrate their level of insurance knowledge.

Customers in the traditional sense of the word, producers and other co-workers, and insurance company personnel.

CSRs have three groups of customers:

Internal Duties

CSRs may be responsible for ____ such as verifying the accuracy of premium transactions, monitoring accounts receivable, or preparing invoices

360-Degree

CSRs provide ____ service in that they have a variety of customer types, each with their own requirements, objectives, and perspectives.

Job Satisfaction

Delighted customers are more enjoyable to deal with than disgruntled customers, and building long-term professional relationships is a source of ____.

Those that are common to many customers, and those that are specific to the individual.

Each customer has two types of needs:

Profitability

Enhanced ____ is the reason customer retention is so important to insurance organizations, and it more than offsets any costs associated with providing exceptional customer service. The cost-effectiveness of customer retention has a direct effect on an organization's bottom line.

Genuinely Interested

Finally, service-oriented CSRs are ____ in their customers. Asking customers questions and actively listening to their answers is the best way to understand their needs and expectations. CSRs can demonstrate their interest by doing a number of things: - Striving to consistently fulfill customers' needs and exceed their expectations - Being empathetic and supportive when customers suffer a loss - Understanding a customer's frustration when problems arise, and resolving issues promptly - Making customers' best interests their first priority

Referral (Referrals from profitable customers will likely also be profitable customers. In addition, referral customers typically have a higher retention rate, which further enhances their profitability.)

If an insurance organization identifies its most profitable customers, it can target those customers for ____. People generally tend to associate with other people like themselves.

Improve retention by communicating effectively with customers, making them feel important, and focusing on their needs.

If customers leave because of poor communication, lack of attention, and indifference, fortunately the solution is simple:

Proactive

In addition, service-oriented insurance professionals are ____ on their customers' behalf. If it is reasonable to expect that an issue may arise, early action can prevent customer dissatisfaction later on.

C. It increases customer retention, which increases profitability.

In an agency or brokerage, cross-selling has which one of the following effects on long-term profitability? A. It increases acquisition costs, which reduces profitability. B. It has no direct impact on profitability. C. It increases customer retention, which increases profitability. D. It increases loss exposures, which reduces profitability.

Customer Dissatisfaction (Unfortunately, the occasional mistake will still be made. But the more quickly a problem is addressed and a solution is found, the more likely the organization is to retain the customer.)

In organizations that are committed to service excellence, everyone works to prevent ____ by identifying and resolving potential problems before they can affect the customer.

Referral

Insurance organizations can also improve profitability by actively seeking ____ business from their most profitable customers

Customer Retention

Insurance organizations focus on ____ because long-term customers are much more profitable than new ones.

Customer Complaints

Many organizations use ____ as a method for monitoring service levels. There are two problems with this approach. First, if a customer complains, the damage is already done. Second, many dissatisfied customers simply go elsewhere without ever making a complaint.

D. A disadvantage of the practice is that, if a customer complains, the damage is already done.

Many organizations use customer complaints as a method of monitoring service levels. Which one of the following statements is correct with respect to this practice? A. It is an effective way of promoting excellent service and ensuring profitability. B. It does little to identify the reasons for customer dissatisfaction. C. Since most dissatisfied customers complain, it is an effective monitoring method. D. A disadvantage of the practice is that, if a customer complains, the damage is already done.

B. Compliance with customers' requests

Meeting customers' basic expectations involves which one of the following? A. Providing services the customer would not think to ask about B. Compliance with customers' requests C. Fulfilling requirements of which the customer is unaware D. Doing the minimum required to complete a task

90

Most independent agencies and brokerages aim for ____ percent customer retention or better, and their ability to achieve this goal depends to a large extent on the level of service they provide.

Customer

Regardless of assigned objectives, for a service-oriented CSR, the focus is on the ____, not the sale. The goal is to identify and meet the customer's needs, not simply to generate commission income or earn a production bonus.

Customer Retention

Service excellence and a genuine interest in the customer can have a significant positive impact on an insurance organization's ____.

A. Knowing each insurer's underwriting requirements and practicing front-line underwriting.

Service-oriented customer service representatives (CSRs) bring quality to their interactions with insurance company employees by A. Knowing each insurer's underwriting requirements and practicing front-line underwriting. B. Focusing on the needs and perspective of the agency's or brokerage's insureds. C. Submitting all of their new business to a single insurer. D. Negotiating coverage, resolving payment issues, and discussing claims.

C. Customer service.

The area in which agencies and brokerages have the most control and the greatest ability to differentiate themselves from the competition and create a competitive advantage is A. Products. B. Pricing. C. Customer service. D. Account retention.

A. Even in the most service-oriented environments, misunderstandings, delays, and errors still occur.

The most successful organizations attempt to exceed expectations and delight customers. Which one of the following statements is correct with respect to these attempts? A. Even in the most service-oriented environments, misunderstandings, delays, and errors still occur. B. While decisions made by owners and managers affect customer service levels, customer service representatives have little direct impact on customer satisfaction. C. Unfortunately, there is little a customer service representative can do to resolve customer dissatisfaction arising out of actions taken by the customer's insurer. D. Provided that an agency is able to satisfy customers' needs, that agency will delight customers.

C. Provide service to customers, producers and teams, and insurers.

The term "360-degree service" refers to the fact that customer service representatives (CSRs) A. Deal with both personal lines and commercial lines customers. B. Attempt to meet all of a customer's insurance needs. C. Provide service to customers, producers and teams, and insurers. D. Participate in both sales and service activities.

B. Listen actively and empathetically.

When faced with valid criticism from an unhappy customer, a service-oriented customer service representative (CSR) will A. Defend himself or herself. B. Listen actively and empathetically. C. Refer the customer to the manager. D. Immediately explain the reason for the problem.

D. Try to negotiate solutions that are acceptable to both parties

When the needs of insurers and customers conflict, which one of the following does a service-oriented customer service representative (CSR) do? A. Always take the customer's side B. Suggest that the customer contact the insurer directly to discuss the situation C. Support the insurer's position and explain it to the customer D. Try to negotiate solutions that are acceptable to both parties

A. They work to identify and resolve potential problems before they can affect the customer.

Which one of the following best describes organizations that are committed to service excellence? A. They work to identify and resolve potential problems before they can affect the customer. B. They incur significantly higher costs to provide excellent service, and these higher costs reduce profitability. C. They are able to avoid the mistakes and oversights that cause customer dissatisfaction. D. They are no more successful at cross-selling existing accounts than organizations that simply meet their customers' needs.

B. The customer takes precautions to prevent losses.

Which one of the following best indicates that a customer will likely be a profitable account for an agency or brokerage? A. The customer "shops" their renewal every year. B. The customer takes precautions to prevent losses. C. The customer refers many other customers. D. The customer pays a large premium.

B. It they receive excellent service, they are more likely to place additional business with the agency.

Which one of the following statements is correct with respect to an agency's customers? A. They rarely leave because of a perceived indifference to their needs. B. It they receive excellent service, they are more likely to place additional business with the agency. C. Regular contact from the agency is generally not an effective way of retaining customers. D. When mistakes are made, there is little an agency can do to keep customers from leaving.

C. It is less cost-effective to write a new piece of business than to renew an existing policy.

Which one of the following statements is correct with respect to an agency's or brokerage's cost of writing new business? A. Acquisition costs in the insurance industry are low compared to other industries. B. There are no expenses involved in writing new business aside from the cost of employees' time. C. It is less cost-effective to write a new piece of business than to renew an existing policy. D. The cost of writing new business has no direct impact on an organization's bottom line.

D. Relatively small increases in customer retention result in significantly larger percentage increases in future profits.

Which one of the following statements is correct with respect to customer retention or agency profitability? A. It costs an agency more to keep an existing customer than it does to attract a new one. B. Whether or not an agency retains customers has no direct impact on customer service representatives' job security. C. Most agencies and brokerages have a goal of 50 percent customer retention. D. Relatively small increases in customer retention result in significantly larger percentage increases in future profits.

B. Price is rarely the only reason; often they leave because of service issues.

Which one of the following statements is correct with respect to customers leaving an agency or brokerage? A. In most cases, customers leave because they have found a lower price elsewhere. B. Price is rarely the only reason; often they leave because of service issues. C. There is little insurance professionals can do to prevent customers from leaving. D. Campaigns to prevent customers from leaving are generally not cost-effective.

A. They tell many other people about their bad experience.

Which one of the following statements is correct with respect to customers who feel they have received poor service? A. They tell many other people about their bad experience. B. They usually complain directly to the organization they are dissatisfied with. C. They generally close their account and say nothing about their experience to anyone. D. They have little effect on the organization or its reputation.

B. Insurance professionals are responsible for knowing minimum requirements and ensuring they are met.

Which one of the following statements is correct with respect to customers' insurance needs? A. The majority of customers share the same insurance needs. B. Insurance professionals are responsible for knowing minimum requirements and ensuring they are met. C. Generally, coverage cannot be tailored to meet an individual customer's needs. D. A customer service representative can meet customers' needs without fully understanding policy forms and endorsements.

A. Poor customer service can result in job-related stress for CSRs.

Which one of the following statements is correct with respect to how service levels can affect customer service representatives (CSRs)? A. Poor customer service can result in job-related stress for CSRs. B. A CSR's sense of self-worth is typically unaffected by customer interactions. C. For a CSR, there is no connection between customer satisfaction and his or her job security. D. Communication between CSRs and customers is rarely confrontational.

B. The first requirement for bringing quality to these interactions is that the CSR be knowledgeable.

Which one of the following statements is correct with respect to interactions between customer service representatives (CSRs) and the insurance-buying public? A. These interactions are generally limited to processing endorsements and accepting premium payments. B. The first requirement for bringing quality to these interactions is that the CSR be knowledgeable. C. There is little a CSR can do to reduce the potential for errors and omissions claims arising from these interactions. D. The CSR should avoid giving advice or making recommendations during these interactions.

B. When an organization commits to quality service in its mission statement, this keeps service excellence in the spotlight.

Which one of the following statements is correct with respect to organizations and the quality of service they provide? A. For an organization to excel, only those employees who have direct customer contact need a commitment to service excellence. B. When an organization commits to quality service in its mission statement, this keeps service excellence in the spotlight. C. An organization's use of resources is generally unaffected by the quality of the service the organization provides. D. Successful organizations consider "meeting customer expectations" to be superior customer service.

A. Referred customers tend to stay with an agency or brokerage longer than customers from other sources.

Which one of the following statements is correct with respect to referrals from existing customers? A. Referred customers tend to stay with an agency or brokerage longer than customers from other sources. B. Referrals from profitable customers are no more likely to be profitable than referrals from unprofitable customers. C. Agencies and brokerages should avoid referrals because a problem with one account can spill over and affect other accounts. D. The best approach for an agency or brokerage is to ask each and every customer for referrals.

B. Satisfied customers can be a source of leads and referrals that customer service representatives (CSRs) and producers can use to generate new business.

Which one of the following statements is correct with respect to service or competition within the insurance industry? A. In insurance, the term "customer service" refers to the process of taking a customer's application and issuing a policy. B. Satisfied customers can be a source of leads and referrals that customer service representatives (CSRs) and producers can use to generate new business. C. Because many insurance products are similar or standardized, there is little competition within the industry. D. Customer loyalty depends on the competitiveness of the premiums they are charged and is unaffected by service levels.

A. They often have assigned objectives for cross-selling accounts.

Which one of the following statements is correct with respect to service-oriented customer service representatives' (CSRs') production activities? A. They often have assigned objectives for cross-selling accounts. B. The most important production goal for CSRs is to generate commission income. C. Cross-selling existing accounts benefits the agency or brokerage but is of little value to customers. D. Changes in customers' circumstances generally do not present CSRs with sales opportunities.

A. CSRs may assist marketers, loss control representatives, or data entry staff in addition to producers.

Which one of the following statements is correct with respect to the interactions or relationships between customer service representatives (CSRs) and others in an agency or brokerage? A. CSRs may assist marketers, loss control representatives, or data entry staff in addition to producers. B. Attention to detail is far less important in interactions with co-workers than in interactions with customers. C. Because CSRs take direction from producers, they need not be knowledgeable about loss exposures or coverage requirements. D. CSRs need only be organized and efficient to bring quality to interactions within an agency or brokerage.

A. Satisfying all the various customer types can be challenging because their needs and wants sometimes conflict.

Which one of the following statements is correct with respect to the service or production activities of customer service representatives (CSRs)? A. Satisfying all the various customer types can be challenging because their needs and wants sometimes conflict. B. CSRs are rarely involved in responding to customers complaints, correcting errors, or resolving claims issues. C. Account rounding is the process of obtaining leads and referrals from existing customers. D. Enhancing their insurance knowledge has little impact on CSRs' interactions with customers.

A. A small percentage increase in customer retention can result in a much larger percentage increase in future profits.

Which one of the following statements is correct? A. A small percentage increase in customer retention can result in a much larger percentage increase in future profits. B. Customer service excellence is generally unrelated to customer service representatives' job security. C. Most agencies and brokerages do not have a customer retention goal. D. People who receive poor service typically turn to the agency with their complaint.

- Poor communication - Lack of personal attention - Indifference to their needs

Why do customers leave? One reason is price. Because an insurance policy is simply a promise—an intangible—many consumers do not recognize its value until after they suffer a loss. They want to pay as little as possible for their coverage, and if they find a lower price, they will switch agents, brokers, or insurers. However, price is rarely the only reason customers leave. Often they place their business elsewhere because of service issues: