Starting an insurance agency is a good way of making a lot of money. It is advisable that you have some experience in the financial industry before you start your own business. If you think you are experienced enough, and want to start your own insurance agency, there are some key things that you need to consider along the way.
Set up the business structure
The first step is to decide on a business structure and deal with all of the admin. Coming up with a catchy name that will make you stand out, and then registering the name is important. You will then need to register your business with the relevant authorities and make sure that you have all of the correct business permits. You can then make sure that you are operating legally.
The next step is to decide how you are going to fund your new business. You may have the money to fund it yourself but if not, there are a few different ways that you can get the capital that you need. You could apply for a loan from companies like Springtree Group, or look at independent investors.
Once you have sorted all of the admin and funding considerations, you are ready to start trading properly. You might get some business from previous associates or friends and family, but you need to start generating leads before you will make any real money. There are plenty of different ways to generate leads, some more effective than others.
Internet Leads might seem like an easy way to generate some business, but they are not as reliable as you might think. Buying a whole database of phone numbers is a quick way to get in touch with a lot of people. Unfortunately, these leads are usually sold to multiple agencies, so your potential customers will be contacted by your competition as well as you. This means that the percentage of return on these leads is very low and you might actually end up losing money on them in the long run.
Direct Mail is a lot cheaper than buying internet leads but again, the return is not brilliant. It can also eat up a lot of time in the early stages of the business and you won’t get anything out of it.
Social Media is a much more effective way of generating business. Once you set up an online presence, you will be generating leads without having to put too many man hours in. It is also very cost effective as you don’t need to pay so even if you don’t generate any business from it, you aren’t losing money.
Don’t underestimate the power of referrals and networking. There are plenty of other business that require your services on a regular basis so you could get long-term clients through referrals. Realtors and mortgage loan officers are good places to look as they are required to have homeowners insurance before they sell loans.
If you use these methods to get leads, you should be able to build yourself a solid client base fairly quickly.