The insurance industry is full of opportunities. Suppose you are an agent that feels ready to take the next step in your career or a mid-career person that seeks a change of industry. In that case, you may be able to start a successful independent agency that will enable you to call the shots and give you the financial independence you want.
However, like any other business, it will need patience, resourcefulness, and personal conviction for it to take off.
You may need to start small and aim for quality service so as to differentiate yourself in the market. Miller Hanover Insurance agent will give you tips on how you can start an insurance agency.
1. Get licensed
This is arguably the most important step in this journey. To be able to sell insurance, you need to be licensed by the state insurance department. You may need to take a test if you want to sell health or life insurance. You may also have to be a resident of the state you want to start your insurance agency in.
2. Write a Business Plan
You may never need to show it to anyone, but you will feel better if you have a business plan for your insurance agency. It will give you an idea of your goals and your strategies to achieve them. It will also help you stay focused on your goals and not get sidetracked by the daily running of the business. You should know that if you plan to get a loan from a bank or investor, this will be the first thing they will ask for. The plan should include a detailed budget, your target market, a marketing plan, and how you plan to grow the business, risk analysis, among other things.
3. Decide on The Legal Structure of Your Business
This will affect the liability you face if you are sued or accused of malpractice. This is important because it will determine the amount of capital you will need to start the business. For example, if you start a general agency, you will be personally liable for any claim that is made against the agency. If you opt for a corporate structure, you will be able to shield yourself from personal liability and save a lot of money in the long term.
4. Naming Your Insurance Agency
This may seem like a minor thing, but it has a big impact on your marketing efforts. A descriptive name is best for a new agency because it will help you create name recognition in the market. A name like Harvey Home Insurance will instantly tell people what you do. However, you may want to change the name when you have established yourself in the market.
5. Register Your Business
You need to register your business with the state and county. This can be done at the local county clerk’s office or the secretary of state. The process will cost you a fee, but it is worth it. You will also receive a business license that you can use to open a bank account and order stationery. Your name will also be published in the local business journal.
6. Get Your Office Set Up
This is the next thing you will have to do. Unless you are planning to work from home and not have a store, you must have a permanent place of business. This will involve a lot of things like buying furniture, buying a computer, getting a phone system, setting up an internet connection, registering with the state and local authorities, and so on.
This is the most important part of the business. You need to be able to attract and convert customers into long-term relationships. This will help you build a solid customer base that will keep you going. You will also need to get media coverage. This is important because it will help spread the word about your agency and give you free advertising. You may also want to consider direct mail and giving out brochures.
8. Hire Agents
At one point, you may need to hire employees to help you with the workload. You will also have to source your insurance products from various insurance agencies. The insurance companies will give you various options to choose from. You may also have to source your investments from other financial institutions.
Starting an insurance agency may take some time, but ultimately it can pay off if you pay attention to the eight steps mentioned above. You should take a client-focused approach in your business to build long-term relationships with clients.