Why Relying On Insurance Referrals Is The Kiss Of The Death

insurance referrals

According to Wikipedia, the kiss of death (Italian: Il bacio della morte) is the sign given by a mafioso boss or capo that signifies that a member of the crime family has been marked for death. In our space, a much safer space at that, our marking for death is a little different. Like a kiss, our signifier, insurance referrals, are benevolent. The problem isn’t the insurance referral in itself, the problem is when we muster the words…

“we don’t do much online marketing, we get all of our business from word-of-mouth and referrals.”

The Kiss of Death

If I had a dollar for every time I’ve heard you say you rely on insurance referrals, let’s just say I’d be writing this while nestled inside a hammock on my remote private island. One, because I would have a LOT of dollars and two, because I’d be trying to escape the walking dead.

But one the other hand, I get it. Referrals are the life blood of the industry. The fact that you get so many insurance referrals means you’re good. It means your agency has reached the top. It means that people know you and you’re trusted throughout.

So how could I sit here in good faith and say that there’s a bad thing to relying on referrals? Well….

here’s why:


you know you want it…

Think about it, you just don’t want to base your business on a free lunch. Taking your foot off the gas and relying on referrals also means giving up your control. Depending on your clients to spread the word about your business is putting the control of your lead generation in someone else’s hands. Hands that you can’t control.

Referrals leads are overhyped.

Stop for a second. Now, look at your cellphone. What time is it…? Go back and re-read the bolded sentence.

What glitters ain’t always gold and what’s free is not always what’s optimal. Here’s what you’ve been missing out on:

The Ideal Client


Referrals are powerful. However, what’s powerful can be beaten with what’s precise. Precision beats power and insurance referrals are not precise. You aren’t necessarily being referred the business you want. So yes, the referrals grow your book, but, does it grow it in the way you want to grow? If you purchased 50 targeted home insurance leads this month and later found 27 auto insurance leads in your inbox, you would be upset. If your agency wants to focus on commercial, why keep writing renter policies? When you rely on the luck of the draw, this is the reality you face.


With referrals not only are you dependent upon what comes through the door, but you are also at the mercy of the frequency. Every-time you get a referral you’re drawing from the well of your agency’s longstanding goodwill. One of your happy clients takes time from their busy day and helps your business. Eventually, this well of goodwill runs dry. And some days you’ll get them, some days you won’t. Everyday you need new inquiries.


Out of all the reasons listed before this is the worst. You can’t turn up the dial on referrals. You can hire more sales reps, you can double your advertising budget, or you can buy more leads. And within one month your pipeline will start to feel the effects. On the o ther hand, if its time to grow aggresively and you rely on insurance referrals, you’re stuck in first gear, while the agency down the street kicks it up a notch.

Wrapping It Up

Insurance is in an interesting place right now. It seems like everyday there’s a new breakthrough from insurtech startups or the incumbent corporate titans. It’s almost like the space race. However, in this mad dash to bring the industry digital, I do know with 100% certainty that relying on referrals will be your kiss of death! Take back control over your sales funnel, #godigital! Like to reading content like this? Show us some love and follow us on LinkedIn!

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