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How to Build and Grow an Insurance Agency in 2024

How to Build and Grow an Insurance Agency

Welcome to 2023, a year that has proven to be a challenging one for entrepreneurs. Inflation is rampant, political tensions are high, and the competition for talent is unprecedented. While many industries are struggling to stay afloat, industries that provide essential goods and services such as healthcare, heating and air conditioning, and insurance have seen a lesser impact. Although the economy is challenging, starting an insurance business still offers potential for growth and success. As a coverage provider, you can take comfort in the fact that people will always need protection for their most important assets, allowing you to scale up your business instead of merely surviving.

Once you master the fundamentals to grow an insurance agency and develop effective strategies, you can put your entrepreneurial dreams into motion. With the right tips and tricks, you will be able to realize your business goals and serve your community.

First Steps

You might not yet be at a growth stage, yet. First, you need an insurance license, not just your own to sell coverage, but also for your business.

With market management and underwriting as two crucial parts of operations, you’ll need to be fluent in enrollment administration and government regulations. This is all covered in your licensed insurance agent exam. The requirements for such designation vary from one state to another. Some areas will require just a one or two-day training session, while others may mandate 40 hours of training. Fortunately, most courses are offered in-person and online to accommodate today’s necessities for a flexible schedule.

Once you become a certified agent, you must go through all the necessary steps to register your business on the local, state, and federal levels. The best place to start is by going to your city or town’s web page and following the instructions. This is where you’ll designate your company’s name and address to the local authorities. Afterward, you’ll register the business with the state and apply for a tax ID number with the federal government.

The government loves small businesses. Contrary to popular opinion, they want you to succeed, so they offer options to help you build an insurance agency. Many .gov websites have robust resources for applying for a business license and information on tax incentives, talent recruitment programs, financial assistance, and more. It’s also important to understand applicable state and federal laws and regulations, such as those which govern the sale of insurance products, the handling of customer data, financial reporting, and other requirements.

Insuring Your Insurance Business

This might sound strange to people outside the industry, but even insurance companies need…insurance.

Even as a sole proprietor, you may need liability coverage to protect you against anyone who might get hurt at your business location. You’ll likely also need a commercial surety bond, which is a guarantee of performance by the principal of the obligation or undertaking described in the bond. Local, state, and federal governments often require these to protect consumers and ensure their money isn’t thrown away if a business fails.

Additionally, you might want to look into Errors and Omissions coverage, which protects you against a client invoking legal action for potentially negligent actions. These causes could involve a policy with ambiguous language or something else contract-related that exposed a customer to financial loss.

Unless you’re a one-person show, you’ll want to look into worker’s compensation. However, insurance is not considered a particularly dangerous business. Most workers will wear a shirt and tie and hold a briefcase. They’re not working with high voltage or operating heavy machinery. Still, slippery sidewalks and carelessly left office equipment can cause injuries. If that happens, it serves the worker and you better by having a policy that will pay promptly without any legal hassles.

Growth Strategies for Insurance Agencies

Now that you’re familiar with the basics of starting an insurance agency, let’s talk about growth strategies.

When you open the doors, your main products might be the primary focus. These typically include life, health, homeowners, and auto. As you expand your product line, you might consider renters, travel, motorcycle, RV, boat, and pet coverage. Why stop there? The options can extend to commercial policies, landlord, rideshare, ATV, SR-22 (for high-risk drivers), and other coverage options.

Many companies also offer complementary products like roadside assistance, windshield repair, tax preparation, car registration renewals, tire hazard plans, paintless dent repair, and more.

Aside from differentiating your product offering, a big focus should be on customer service and building relationships with clients. This could include providing tailored advice, offering discounts, or hosting educational events.

Another key to successful expansion is not to grow too fast. You want to get a firm footing on delivering first-class customer service with your primary products. Gain that brand recognition and reputation. Unless you’re part of a franchise, this can be difficult. Over several years and with a lot of hard work and resources, you might become known for a strong customer experience. Then, you can branch out by adding a few more products and services at a time. Take the same approach of going slowly and focusing on your clients. Continue that path of growing an insurance agency while ensuring your clients get the same high level of service that they got when you only offered a select few products.

Digital Marketing and Referral Programs

Digital marketing strategies can create a powerful, consistent brand presence, help you connect with customers and reach potential clients, and remain competitive in the industry. This could include creating a website, setting up social media accounts, and utilizing search engine optimization to ensure your agency is visible online. With the right expertise and marketing support, it can be a lot easier than you think.

One of the most essential insurance agency growth strategies is to find a way to get customer referrals. If you deliver solid coverage with excellent service, your clients will be your best marketing arm.

Offer people a discount on their premium if they send you a referral that secures a policy with your company. There are a variety of ways to do this, including good old-fashioned direct mail, email, and a simple click-through on your website.

A side benefit of offering a referral program is that it enhances your brand’s image. When people see that you want them to tell others about your company, they understand that you take service seriously. You’re not just trying to get their money and then forgetting about them. Instead, you want to form a good rapport with them—good enough for them to want to tell their friends and family about you.

The Final Step: A Can’t-Miss Growth Strategy

Follow the above tips for growing an insurance agency., and with a little luck, you could create something steady. If you prefer to leave luck out of it entirely and almost guarantee entrepreneurial success, join a team that already has everything in place for you to succeed. Freeway Franchise offers a wide range of services and products tailored to meet their franchisees’ customer needs. They also provide comprehensive support and training to ensure franchisees have the tools and resources they need to succeed.

By becoming a franchise owner with Freeway Franchise, you hit the ground running with a recognizable brand name, a proven track record of success, and all the resources you need. Contact us today at 1-877-822-3024 or fill out our quick online form for more information.


Ready to Open Your Own Freeway Insurance Office?

If you find the Freeway Insurance brand compelling and are looking for a flexible, well-supported business in a rewarding niche of the dynamic insurance industry, contact us.