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

Paid vs. Organic Insurance Leads: Which Is Better?

Buying Insurance Leads
Jun 23, 2022
minute read
Nectar Team
Paid vs. Organic Insurance Leads: Which Is Better?

Insurance lead generation provides agents with a means by which to grow their business. There are two main types of leads; organic and paid. Each has pros and cons, and the two types can work together to support agents who are starting from scratch as well as those who have a developed book of business.

In the insurance industry, a lead is someone who has expressed an interest in getting a quote for an insurance product. You may have a name, contact information, and some details about the information they requested.

Let's take a deeper look at the pros and cons of organic and paid leads and see which type you need for your business.

How Do Insurance Agents Find Leads?

Scratch agents may start their insurance business with zero clients, and high-quality leads can help them build their business quickly. An agent that purchases or inherits their book of business may have a steady stream of residuals coming in, but it's crucial to continue to build the business and find more leads.

Agents looking to grow their business generally have two options when it comes to finding leads. Organic lead-generation methods can range from traditional advertising and using social media to seeking client referrals. With pad leads, on the other hand, an agent simply receives a lead from a company that has already done the legwork of finding them.

Organic lead generation efforts like traditional advertising may not yield fast results the way that purchasing leads and using that list to develop new business can. However, not all paid leads are created equal, and some companies offer warmer leads than others.

Pros and Cons of Organic Lead Generation

When it comes to organic lead generation, you have several options for generating leads naturally.

Traditional advertising, social media, and cold-calling can all be effective organic lead generation methods, but it's important to understand the downside of each lead generation method, as well.

Traditional advertising

Agents may choose to invest in traditional advertising methods, including billboards, signs, mailers, radio, and television ads, to help build their business and drive leads to them.

These lead generation methods help increase your name recognition in your area since traditional advertising is targeted to a specific geographical area. However, unless you already have a strong presence in your local marketplace, it may be prohibitively expensive and time-consuming to attempt to build a new business on name recognition.

Google AdWords and Search Engine Optimization (SEO)

It's possible to generate leads in house using search engines and the internet. Because this method requires a great deal of knowledge and money, many agents don't use SEO and Google AdWords as their core lead generation strategy.

However, with this DIY method of lead generation, you know exactly where your leads come from and you can rest assured that they are valid. It's worth a look for any agent serious about finding strong leads.

Agency website

Agents typically have access to a basic website with their agency's brand. They can use this site to provide information about their services, the types of insurance they offer, their background, and their contact information. People in the market to buy insurance expect to see basic information about the agent online. It's crucial for an agent to maintain their presence on the company website.

Developing your internet presence by taking advantage of the opportunity to use your agency website is a smart way to bridge the legitimacy gap with potential clients. However, generating leads via a website requires a certain basic knowledge of search engine optimization (SEO) strategy. In some cases, it may be necessary to hire an SEO expert.

Social media

Facebook, Twitter, LinkedIn, and even TikTok can help you find new leads if you're comfortable with the platform and understands how to market using various forms of social media. Even if you don't choose to use social media to generate leads, it's important to have a basic profile on LinkedIn with your professional photo, some basic information about your location and background, and your contact information.

People expect to see their insurance agent on LinkedIn and other platforms. Your profile may help legitimize you as a trustworthy agent. Plus, using paid ads on social media targets people researching insurance options, providing access to warm leads.

That said, this method of lead generation requires some expertise. It can be expensive, too. Agents who use social media paid ads typically hire someone to run their campaign so they can focus on other aspects of growing their business.


Calling phone numbers from a list of leads to provide a sales pitch is referred to as cold-calling. Many professionals aren't comfortable with cold-calling, and you may make many calls before you make contact with someone. Many agents build a successful business without cold-calling.

Still, if someone at your office is willing to cold-call, you may find that it's a cheap way to generate leads, depending on how successful they are at making contact with people in your area who are interested in your product.

Referrals and cross-selling

Agents with a book of business can leverage those contacts to generate referrals. It's easy to close a referral since the lead knows someone who is happy with your services. Cross-selling involves asking your current customers about what other insurance products they may need. Review your clients' current coverages with them annually if possible. Suggest ways they can save on their premiums, like bundling home and auto coverage.

There's not a definitive downside to referrals and cross-selling as lead generation methods. Both help support strong relationships with your clients, which helps you retain business over time.

Pros and Cons of Paid Lead Generation

Purchasing leads from a company that specializes in providing insurance agents with leads is an easy way to get the connections you need to help build your business. When you purchase leads, you get access to a database of leads that you didn't have to work hard to get.

Paid lead generation pros

Leads that are most likely to pan out are those that are sourced organically by the lead generation company through search engine marketing and advertising.

Access to high-quality leads

When you work with a lead-generation partner that can provide you with high-quality leads on an as-needed basis, you have the opportunity to turn warm leads into new business.

Better opportunities to sell

Cold leads can be more work than they're worth, and organic leads take time to materialize, but with high-quality paid leads, you have a much better chance of closing new business. A database of good leads can produce a better result in less time, leading to an increased ROI.

Paid lead generation cons

Choosing to pay for leads is the right move for many agents who want to grow their business, but it's crucial to choose a reputable lead generation company. With some lead generation companies, it's difficult to know where the leads came from.

Leads of questionable quality

One of the downsides to purchasing leads is that you may not be able to control how "warm" those leads are. Some lead aggregators simply purchase lead databases and resell them.

You must spend money to buy leads

High-quality leads cost money, so it's important to create a plan for how you'll use the leads to help build your business. Put processes in place to make contact and follow up until you can close the sale or determine that it's time to move on. Keep track of your return on investment (ROI) as part of your lead-processing plan.

Which Kind of Leads Do You Need?

For long-term success, agents need both organic and paid leads. However, finding quality leads that will ultimately increase your book of business takes time. While low-cost leads may seem like an easy way to get in touch with potential new customers, they can also be time-wasters.

Get the Leads You Need Today

When you shop for a paid lead generation partner, it's crucial to choose a company with a reputation for providing high-quality leads to your industry. Growing an insurance business takes time, and you deserve a lead generation partner that can support your organic lead generation efforts with warm leads until your flow of incoming leads increases.

When you partner with a company like Nectar that consistently produces high-quality, real-time leads for agents, you eliminate much of the frustration that comes with generating leads to help you grow your insurance business.

Any agent that wants to focus on growth can benefit from connecting with leads that have been vetted to confirm that they're interested in buying right now. Trust Nectar to help you connect with future customers who are looking for you. Learn more about our insurance leads and get started building your book of business.

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