Insurance agencies are a dime a dozen. Good ones that are easy to work with are a bit harder to come by. But many of the insurance agencies you’ll find are very similar – they’re working with the way things used to be, not the way things are now.
We’ve already addressed lessons learned from starting an e-agency, in a post we published over at Agency Nation. Now, it’s time to take a look at how to run an insurance agency like a startup, and win in the process. You can do this whether you’re literally a startup that’s just launching or you’ve been in business for twenty years.
Do You Have Partners And Stakeholders… Or Employees?
Startup culture is light on employees and heavy on people who have a significant investment in the business. It may not be financial, but their hours away from their lives and families, their dedication, and their willingness to stand by you even when it requires personal sacrifices makes the people who work with you stakeholders.
Instead of treating them as employees who are replaceable, make sure you’re treating the people who are stakeholders in your agency as vital parts of the team. Sure, you could hire another CSR. But could you hire one that’s as dedicated and knowledgable about your business as the one you’ve already got? Probably not. Training is a significant expense, and the value of a person who just knows what to do and how to make things run smoothly goes far beyond their direct contributions.
Treat the people who work for you in a way that makes it clear that you recognize that they are as heavily invested in the business as you are, and they’ll continue to invest. Fail at this, and they’ll go invest themselves elsewhere, at a great cost to you.
Break The Rules
Sometimes, you have to make the big boys a little cranky in order to differentiate yourself from the crowd. Not that you should break the rules that govern the profession – your E&O carrier and the DOI isn’t likely to appreciate such things. But the rules of how insurance is sold and what services are provided? Those rules are made to be broken.
Is your agency in a town that’s mostly the 9-5 crowd? Maybe you should be open 11 AM – 8 PM a day or two a week so that people with office jobs can come in and sit down with you without having to take time off work. Do people want to buy policies online? Make it possible. Does everyone else in town charge a policy fee just because they can? Maybe you shouldn’t do that. Figure out what conventions are holding you back just because that’s the way you’ve always done it, and fix them.
Leverage Cash Flow
You’re running a business, so it’s important to know where your cash is going. It’s also important to understand where your cash should be going and how to make it work for you. Do you need to print brochures when your carriers might offer them for free and even print your phone number on them? There’s a few hundred bucks that you can plow right back into the business.
Can you lease equipment instead of buying it? Sometimes that’s a great solution, sometimes not so much. If you primarily work online or over the phone, you don’t necessarily need Main Street office space. You might be able to cut fixed costs drastically by locating your startup agency somewhere accessible, but off the beaten path. Look critically at your expenses and make sure you’re getting value out of them. If you’re not, figure out a way to do things in a more cost-effective manner. Run an insurance agency like a startup and leverage cash flow accordingly, and you’ll be able to do more with the resources you have instead of wishing you had more resources.
Use New Media – Even Though No One Likes The Term “New Media”
The term new media has been around long enough that it may actually be old media by now, after a fashion. Quite frankly, we’ve hated the term since it became a thing in the dot-com bubble days. But it seems to be here to stay. Just the other day, we heard a local agency advertising on the radio of all places. Do you think we had a pen and paper handy to write down their phone number so we could call during business hours?
Instead of throwing big money at the traditional forms of advertising, see how you can make your ad dollars stretch. Social media can be a great option. Review sites are often ranked highly in search engines. Good content on your own site tends to rank well. We’ve invested heavily in useful content that gives people free answers to their common questions, and it’s paid off. Position yourself in new media as an expert, and people will flock to you. All you have to do is know your niche well and be able to talk about it ad infinitum. We all know that insurance agents can talk at great length about what they do – we suspect that’s why we never get invited to parties! Channel that into content for your niche, and you’ll do well.
Creative Solutions To Pain Points Of Your Insureds
What are your insureds afraid of that you can’t readily insure? Do they worry about their pets getting sick or injured? Maybe you don’t need to get appointed with a pet insurance carrier, maybe an affiliate banner on your website that pays $15 per sale is enough to make them happy. The guy down the street doesn’t offer pet insurance, so you’re the only one in town offering a comprehensive solution to your insured’s problems.
Maybe you work with lots of tenants who hate having to leave a month or two of rent on deposit as security for their landlord. Can you offer security deposit bonds? These aren’t specific solutions for your business, of course, these are to make the point that once you figure out what your insureds’ pain points are, you can solve them!
How do you find those pain points? Talk to your insureds. Ask them what they wish they could insure, or what risks keep them up at night. This has the added benefit of making them remember why they work with you instead of a direct writer – because you care about their needs, and because you have non-traditional solutions to the very real problems they face.
No, not the kind of takeaway you get from that Australian-themed steakhouse. The takeaway from all of this is quite simple: Be flexible. Value the people who make you great. Listen to your insureds and offer them what you want. Be ready to pivot when and where necessary. Run an insurance agency like a startup, and you’ll do well as the old guard fades into oblivion.