How to Grow Your Book of Business as an Insurance Agent

By Jason Rogers

Want to take your insurance agent book of business to the next level? This article will help you get started.

Growing your insurance book of business is something most insurance agents and agencies desire. And why wouldn’t they? The benefits of getting larger are plain to see:

• With greater size typically comes more prominence in your community. The larger your business becomes, the more likely consumers will come to you for quotes.
• As you grow, your fixed costs spread across a larger book, helping you achieve economies of scale and more profitability.
• With a larger business, your operation becomes more appealing to insurers, diversifying your product portfolio and helping you to attract more employees and agents (if you have any).
• Finally, with greater size comes higher compensation and a more comfortable lifestyle.

For these reasons, deciding to increase your business size is usually an easy decision to make. The hard part is answering the age-old question, “How do insurance agents grow?” Below are some strategies that should help you jumpstart your growth initiative:

Targeting a Specific Market Niche

You might ask yourself, “How can I grow my book of business?” When contemplating expanding your business, chasing after a new market is often tempting. It’s human nature to get excited about pursuing something new rather than doubling down on the same customer types you’ve always served. But enhancing your efforts in one or several existing niches will generally have a greater return on investment than pursuing a market in which you’re currently not active.

Even with familiar clients, the ability to expand your business is attractive. Because you already know them— and they know you— you can use your market expertise to make a strong approach to similar clients. Many of them may know the former, allowing you to drop names and share testimonials about your work.

Furthermore, you may not know your clients as well as you think. Those in a particular niche may have highly specialized insurance risks that you haven’t addressed yet. Talk to them about their unmitigated exposures, and then use your insurance knowledge to package appropriate solutions. The time and money you invest in niche marketing will likely justify the expense.

Expand Your Product Offerings

Becoming a multi-line insurance agent or agency will stimulate business growth by allowing you to become your clients’ one-stop insurance shop. This will provide two compelling advantages. First, it will facilitate your ability to bundle insurance products to offer client discounts. Multi-product discounts are hugely popular and, once sold, feature significantly higher retention.

Even if your clients don’t bundle their insurance purchases, you can still use your expanded products to attract new prospects to your business and initiate relationships with other insurers.

Finally, more products give you a reason to recruit more employees and agents (assuming you have agents working for you). A well-stocked product portfolio is always an advantage in the insurance marketplace, both from a client and producer perspective.

Do More Marketing

Developing better marketing strategies can help you increase your growth. Three specific opportunities are possible. The first is to create a value proposition if you don’t have one or to clarify it if your current one needs more focus. What’s a value proposition? It’s an explicit statement of what your business does, for whom and why. Having one gives your business the focus to make a strong buying appeal to new and existing customers.

The second opportunity is to build a comprehensive marketing plan. Write down every action you plan to take during the year to grow your business. Then assign a budget figure and responsible person to each step. When you work from a written marketing plan, you’ll prevent yourself from getting distracted.

Finally, once you have a value proposition and a marketing plan, digitize as much of your marketing as possible. Years ago, insurance agents and agencies spent most of their advertising budgets on print advertising and direct mail. Today, your marketing options have multiplied and gone online. By leveraging the power of the internet, you can now expand your marketing reach, track results and provide more prospect and client touchpoints. Becoming a digital marketing pro will greatly increase your ability to expand your book of business substantially.

How to do this? Use digital platforms to acquire leads, assess client needs, produce quotes, process applications and bind insurance. Here are some specific tools you may want to deploy:

• Social media sites (organic and paid advertising)
• Online quoting systems
• Self-service platforms
• Search engine advertising
• Video call quotes and policy reviews
• Artificial intelligence and chatbots 

Automate Your Operations

Doing business the traditional way— mainly on paper— is an efficiency drag and a barrier to growth. Implementing a new agency management system (AMS) or upgrading your current one will set the stage for explosive growth.

Having a powerful AMS in place is just the starting point. Use your AMS to identify customer leads and create marketing campaigns targeting prospects, current customers and former policyholders. Also, ensure your AMS “talks” to your carriers’ computers to automatically populate customer records with essential data, such as policy renewal dates. Your AMS can then provide alerts to contact insureds before their renewal dates.

Acquiring a Book of Business

Buying another agent or agency’s book of business is a fast way to grow your business. Unlike buying all of an agency’s tangible assets— building, staff, name, goodwill, website and in-force policies— buying a book of business involves purchasing just the customers and the policies they have bought over time.

After identifying a credible acquisition target, execute confidentiality agreements with the target-firm principals. Also, check in with your errors and omissions (E&O) insurer to be sure the transaction won’t create liability problems.

Then do your due diligence. Closely examine the agency’s financials, carrier appointments, client base and more. Does it own its account expirations? Are there reported compliance incidents lurking in the background?

If you decide to proceed, avoid making common mistakes, such as:

• Paying a premium over the agency’s valuation.
• Projecting too much future growth.
• Not doing a full background check to uncover regulatory events.
• Not evaluating the agency’s technology platforms.
• Not considering whether the agency’s culture is compatible with yours.

More Pointers

If you’re still considering how to build a book of business as an insurance agent, here are some additional tactics to consider:

• Use data analytics to see which of your customer segments are most profitable– Then find more prospects who fit that profile.
• Schedule cross-selling campaigns for your most profitable products– Execute them at least quarterly.
• Increase your access to insurance markets– Based on untapped customer needs, reach out to carriers with the insurance coverage your customers need and get appointed with them.
• Optimize your website– You want it to be an inbound marketing machine (getting people who find your company online to click through to your website). You also want it to provide quotes and service on a 24/7 basis using current technology.

Finally, evaluate your E&O insurance to ensure you have enough protection as you generate more business. Growth always brings added risks, so be sure your E&O coverage appropriately protects your business.

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