Nectar Marketplace has closed on January 22, 2024. However, you can still access Nectar leads, plus more via MediaAlpha for Agents, an easy to use, lead buying platform that connects you with high-intent consumers. Click here to get started. You can also email Questions? Visit our FAQs page!
Visit Our FAQs Page

Tips for Running a Successful Insurance Agency

Insurance Agency Growth
Mar 22, 2022
minute read
Jacob Tegtman
Tips for Running a Successful Insurance Agency

Managing a successful insurance agency requires mastery in many skill sets. You need efficient plans and processes, plus an environment conducive to optimal performance from everyone involved. Businesses are multi-dimensional and developing each piece of an agency takes time.

The key to success is developing acute problem-solving skills for each area of the business. As an agency owner or manager, employees and clients alike look to you to solve their problems. Challenges can arise from many angles — from financial to technological to sales, customer complaints, and more.

Sometimes, all you need to move forward is a series of insightful tips to inspire and redirect you toward the top priorities in your agency. Read on for ideas to help you get on track for operational success in your agency today.

Focus on Your Goals

Sometimes insurance agency goals are fun and inspiring to think about. At other times, bringing up the topic feels like a burden, or just another method for getting hyped up about something relatively ordinary like, well, insurance.

However, goals are important. In fact, they’re the most important part of your business because they are the reason you put in hard work and long hours at the office each day.

A Harvard Business study found that people with goals are 10 times more successful than their peers without goals. Furthermore, those with written goals are three times more successful than those who had only unwritten goals.

Simply think about what you really want your business to produce for you in terms of money, time, relationships, and lifestyle. Keep that idea in front of you whenever you’re having a hard time, and you’ll find yourself moving forward with greater ease.

Set Boundaries

When managing an agency, you’re responsible for every aspect of the business. That pressure can create a lot of stress, especially when you have days where it seems every producer and customer service representative on your staff, and every client in your book of business, needs something from you at the same time.

For long-term success, it’s healthy to set boundaries for your number of work hours and workdays. It also helps to limit phone calls after business hours and set parameters around the types of policies or clients for whom you want to write.

As you grow, it’s also perfectly acceptable to set boundaries on the types of work you will or won't do. Those you no longer want to do, you can automate or delegate. Many agents, for example, switch to selling primarily, or only, life insurance or commercial insurance as their agency grows, leaving property and casualty policies to producers and customer service reps.

Hire and Promote Staff When Possible

One of the keys to growing a successful agency is to know when it’s time to bring on another producer, customer service rep, or even a commissioned salesperson. It’s also important to know when it’s time to promote one of your staff to become an office manager who can offload general management tasks from your workload.

As a general rule, you should hire new staff or promote current employees when their salary will not burden your profit margins (more on profit margins below). If freeing up more time for yourself will allow you to increase your book’s size, sales, and profits, it’s often worth unburdening yourself from tasks others can do. That way, you can focus on things only you can do at a very high level, such as sales.

Keep an Eye on Profit Margins

Your agency’s profit margins each month, quarter, and year are the lifeblood of your business. If profits are high, you can expand further. If profits are low, or even in the red for an extended time, it may be time to look at selling your agency or even starting a new career.

In his wonderfully practical book, “Simple Numbers, Straight Talk, Big Profits!” author, accountant, and business advisor Greg Crabtree says that businesses should maintain between a 5% to 15% profit margin. By keeping those numbers in your mind as a target, you can plan for when it’s time to hire new staff, promote someone to a new role, purchase new technology, or give yourself that long-deserved raise.

Outsource Tasks

Outsourcing is a great way to bridge gaps in your agency for missing skillsets. It also helps — believe it or not — save your agency money. Tasks such as payroll, website hosting and maintenance, and even blogging or social media management are sometimes best performed by experts that you don't have on staff.

Though the cost is often initially higher for hiring out, there are many advantages to outsourcing that may justify the cost, such as:

  • Your team doesn’t need to spend work hours learning or training. Instead, they can focus on sales and customer service.
  • You don’t need to pay for fees or subscriptions to software and technologies to complete the task (such as website maintenance, payroll, or taxes).
  • Experts can often complete tasks in much less time than your staff may be able to, thus evening out the overall price at a higher quality of work.

Use Operations Manuals

Operations manuals turn your agency of individual staff members and outsourced talent into a full-fledged business system, capable of duplication, scale, and maximized efficiency.

What exactly qualifies as an operations manual, you may ask? In “The E-Myth Revisited,” author Michael E. Gerber describes it as an “authoritative guidebook on how things are done in your business.” Effectively, an operations manual lists out the steps of every task within your agency.

Ideally, it’s even a living document, where employees list questions, and you provide answers. That way, you cut down on training hours for new employees and increase the uniformity of service and production across all aspects of your business.

It can take quite some time to establish operations manuals for each task and role within your agency. However, the payoff of saved time and increased capacity for your business is well worth the investment.

Reconsider What You Offer

Every year, take time to review your agency and make sure that what you’re doing each day and the coverage you’re providing to clients and prospects match the goals you have set for yourself in the long run.

For example, many agencies, after establishing a firm foundation on their property, casualty, and life portfolios, choose to utilize health and Medicare sales as a way to increase profits from their existing books. Especially if you have many clients age 65 and older, simply offering coverage such as Medicare gives you an additional cross-selling opportunity.

Alternatively, if you’re a broker, you may consider adding an additional carrier to cover any gaps in your current coverage portfolio. Or you may make sure that the carrier you currently represent is still looking out for your best interest. It's a somewhat common practice, after all, for some carriers to occasionally change or reduce commission rates on policies.

Prioritize Sales and Marketing

Aside from choosing the wrong agency, the main reason insurance agents quit and fail is because they run out of money. Proper cash flow is the only way to make a career in insurance a long-term proposition.

To keep profits sustainable, and money flowing in, you must focus more on marketing and sales for your agency than any other aspect of your business. After all, if you have a perfectly tuned customer service experience, but not enough clients, you still go home each night with empty pockets. Sales fuel every aspect of your business, top-to-bottom. So, make sure your agency never runs out of gas by keeping focused on the following:

  • Attend networking meetings in your area to create connections and gain referrals.
  • Continually optimize your website and Google listing for your local market with .
  • Utilize Google Ads as you have the budget.
  • Create an office environment where people feel at home and comfortable discussing financial matters.
  • Invest in sales training for your entire production and customer service teams, beginning with prospecting and all the way down to closing. You and your team can never be “too good” at sales.

Invest in High-Quality Insurance Leads

There’s nothing as valuable for your insurance agencies as high-quality leads that come directly to your inbox or phone, from insurance prospects currently looking to buy. Closing sales from leads is not only good for your profit margins and cash flow, but it’s also good for morale.

As you continually invest in your sales and marketing strategies and optimize your agency’s operations, it’s refreshing to have people seek you out to purchase insurance.

Nectar provides insurance leads that you can count on. We source our leads using the latest cutting-edge technology and marketing practices. Outsource a piece of your overall business strategy with us and make managing your agency a little bit easier. Try it today.

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.


Related Blog Posts