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How To Decide What New Insurance Lines To Sell

Insurance Agent Development
May 24, 2022
minute read
Nectar Team
How To Decide What New Insurance Lines To Sell

You may have gone into the insurance business with a singular product focus. Perhaps you looked at the stats that say approximately 73 million people in the United States will have turned 65 by 2030. That estimate alone makes a pretty good case for selling products like Medicare supplement policies, which offer benefits that Medicare Part A and Part B do not. So far, you've been fairly successful. But, you always feel like there's room for growth. The question then becomes: Where will that growth come from?

You can sink more money into marketing your health insurance lines. Yet, you may have experienced that putting more of your eggs in one basket might not produce the results you want. Diversification works as a strategy in business, much as it does in investing.

Fortunately, an insurance sales position gives you many options to diversify. You can choose lines like property and casualty insurance, which allows you to sell auto and homeowners policies. If you're marketing health insurance policies, you probably have a life insurance license. So, that line could be a natural extension of your Medicare business.

Naturally, you'll want to weigh the pros and cons of each move before you divert time and resources away from your principal line of business. Let's explore the scenario a little further so you can find the right way to grow your business with new offerings.

The Benefits of Offering Multiple Coverage Lines

If we use the example of Medicare supplement sales, you understand how that line of business caters to a growing market. However, you're narrowing prospects to a specific demographic and bypassing a larger segment of the population. With that in mind, consider exploring the value of selling multiple insurance lines.

Here are a few reasons why you should diversify your offerings:

  • Offering home and auto policies opens a whole new world. You would have access to many more prospects since your market now includes anyone between the ages of 18-64 who owns a house or automobile in your radius of operations.
  • Current customers who come to you for additional products are less likely to seek another agent. Under one umbrella,  you're meeting several needs for clients and increasing their loyalty.
  • The larger your client base, the more business you are likely to generate. Statistics show that 65% of a company's business comes from repeat customers.
  • You can delve into business insurance with a property and casualty license. When you consider commercial auto, general liability, and workers compensation insurance, some small business premiums can be considerably larger than their personal lines counterparts.
  • If earnings motivate you, more lines to sell equate to opportunities for increased commissions. Home, auto, and business renewals build a base of residual income, which gives your agency revenue stability and predictability as each year approaches.

The Downsides of Offering Multiple Coverage Lines

Before you commit to selling multiple lines of insurance, be fair to yourself by examining any potential downside. While visions of growth and higher earnings dance in your head, you probably understand that those benefits will not be realized without time, effort, and a fair amount of patience.

Here are a few downsides to consider:

  • You may currently have a very full work week, and you need to recognize that there are only so many hours in a day. Taking on additional lines of business will initially require longer weekly hours, so you need to assess your capacity to put in the time.
  • At this point, you hold a license for the specific lines you offer, but branching out into new territory will require you to obtain another license in most states. You'll need adequate time to study, take, and hopefully pass the exam on the first try.  
  • If all goes well, it could also go a little too well. New prospects from referrals and quote requests from existing customers may come flooding in. While this may seem like a dream scenario, well ... refer back to our first point.
  • Your vast knowledge of a specific line may have been built through years of experience. In due time, you'll get to those levels of expertise with other lines. The question you need to ask yourself: Do you really want to steer away from what you do best?
  • Offering new lines of business might also mean finding new carriers to place business with. Most large insurers have considerable volume requirements that you must meet to stay appointed, and you'll need to be realistic about reaching those thresholds.

How To Decide on Your Next Insurance Offering

After doing your cost-benefit analysis, you've decided to make an educated leap of faith and sell some new lines of business. So many successful agents find that selling multiple lines is easily managed when they come in with eyes wide open. Here are a few tips to get you off on the right foot.

Run the numbers

By now, you know that insurance prospecting is a numbers game. But, you'll also need to do some sales projections to set revenue goals, adjust your budget, and get a feel for any additional expenses you will incur. This way you can track monthly policy counts, commissions, and expenses to understand where you stand and whether you need to adjust on the fly.

You should already be tracking these numbers for your principal business line. So, adding columns to a spreadsheet or entries to some basic accounting software is an easy adjustment that won't cause a lot of disruption to your current processes.

Consider building or expanding your staff

You may be flying solo or have some sales and administrative help in the office. Hiring can be an expensive endeavor — especially when a new employee doesn't make the grade. You'll want to calculate the potential return on investment when bringing on experienced sub-producers to tackle sales on additional lines.

Set clear expectations for both admin and sales staff. You might use metrics like commissions generated or policies sold for sales personnel, and a good administrative assistant should shave hours off the time you spend shuffling paper.

Find lines you're comfortable with

Property and casualty lines can often make a great platform for expanding product offerings. Because you almost certainly own auto or homeowners insurance, you get a leg up by understanding the basic coverages included in those policies. The same might be said of basic life insurance, since the mechanics are simple enough.

Business insurance can be more challenging to incorporate. Try to digest as many educational opportunities as you can before selling complex products such as professional liability policies or surety bonds.

Ease into new territory

After you've run the numbers and visualized the growth opportunities, you might feel like busting out of the gate in a full sprint. That's an admirable attitude, but opening up your business to each and every conceivable line could prove to be precarious. Rapid expansion can be difficult to manage unless you already have the staffing and operational pieces in place.

Before committing a ton of resources to numerous new products, choose one additional line of business, get comfortable with it, and run with it for six months to a year. If all goes well from a sales and administrative standpoint, tackle another offering.  

Bundle up

One other reality you've probably encountered is that many insurance prospects are unabashed rate shoppers. In light of rising prices, that characteristic may be even more prevalent among potential clients. If you encounter this challenge, look for carriers that offer some financial incentives for customers who purchase two or more lines of coverage.

It's worth noting that individual health and Medicare insurers rarely cross over into the property and casualty world. However, you may find some health carriers that provide worthwhile perks through affinity organizations such as AARP, trade unions, credit unions, and more.

Keep the pipeline full

It doesn't matter if you sell one line or a dozen. Keeping the prospects flowing into your agency will be critical to your continued success. You may have sources supplying you with substandard leads that go absolutely nowhere.

Why not try new prospecting methods if you're also offering new insurance lines? Warm, real-time leads from Nectar put you in touch with prospects who are looking to buy right now. These shoppers have been thoroughly pre-qualified and stand ready to make a buying decision. The tedious legwork has been done, and you're on the phone with one goal in mind: Sell that new insurance line.

Take the Next Step

If you plan on offering new insurance lines, you need to spend less time prospecting and more time getting up to speed on additional products, Nectar can help. We deliver real-time leads on your schedule and tailored to your line of business. You just need to pick up the phone and do what you do best: Sell. Contact us today for more information.

This article reflects the features of Nectar as of the date of publication. Features are subject to change at any time. This article is meant for informational purposes only, it is not a guarantee that using Nectar will help you achieve specific business or financial results and is not intended to serve as the sole recommendation for any business financial decisions.


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