How to Have Difficult Conversations with Clients

Most of us tend to shy away from having tough conversations, particularly when we know that what we’re about to say will be a hard pill for our clients to swallow. But straight talk and transparency bring respect and trust, particularly now more than ever when there is so much stress and uncertainty as we all navigate unchartered territory.

Clients want you to communicate and tell them how it is, even if you’re delivering unwanted news. This may involve telling your clients that coverage is not available for a specific loss (consider all the loss-of-income claims filed by businesses that were shut down because of COVID-19, which is typically not covered under a Business Interruption or Property policy). Or, it may mean telling clients that certain limits are no longer possible or are more expensive to purchase because of the severity of losses the insurance industry has experienced over the last few years. There are countless examples where you know a difficult conversation has to take place with a client. Here are some tips to help those conversations go more smoothly:

• Make the decision to have the conversation.

Weigh the pros and cons of having the conversation realizing, in most cases, the price will be too high if things are left unsaid. You could end up losing the client and having your reputation tarnished if the client decides to tell others about your perceived lack of honesty.

• Set expectations early on.

If you need to advise clients that premiums will be going up, let them know. Give them a head’s up way before renewal so they are prepared and aren’t blindsided, making the situation more difficult for you and them. If a claim is not going to be covered because of the policy’s terms and conditions, let the clients know immediately so they aren’t anticipating a different outcome.

• Be transparent.

Be a straight-shooter and don’t waffle or make excuses. This will help you build trust and convey your integrity, as your clients will know you are not shying away from either taking accountability or explaining a difficult situation.

• Emphasize you’re working on behalf of your clients; you are on their team and have their best interests in mind.

In speaking to clients, use the words “we” and “us,” conveying a real, genuine partnership.

• Back up your news with facts and data so clients truly understand the reasoning behind what you have to say.

For example, if a client’s insurance program needs to be moved to another carrier because of individual losses or the carrier is exiting a specific market due to underwriting unprofitability, explain this clearly. If you have facts and figures, show them to your clients. It’s easier to understand trends when they come alive visually. The move to another carrier could end up being a good thing, or it may involve changes in an insurance program such as lower limits, the inclusion of some exclusions that didn’t exist before, and higher premiums. Make sure your clients know (and show them) you are doing all you can to provide the best value.

• Walk in their shoes.

Empathy goes a long way if you truly understand how a client feels. Think about how you would feel receiving the same type of news so you can approach the conversation in a similar fashion.

• Leave your emotions at the door.

Stick to the facts and avoid attacking the client. Let’s say you have a client who is consistently rude to your staff, making unreasonable demands in a way that is disruptive. Let the client know how his or her actions are being perceived and how together you can move forward in setting boundaries and having a successful relationship with all the team members. Don’t get angry, as this will stall any potential progress.

Remember, during this time emotions are high and people are stressed out. The insurance market cycle has undergone significant changes in many product lines and within many industry sectors, making things challenging for you and your staff. This has been further exacerbated by the coronavirus pandemic with businesses looking to you as a trusted advisor to help them survive and thrive. Stay clear and focused and keep all communication lines open.