Starting an insurance company naturally begins with the prevention or anticipation of the unexpected. Insurance is a major driver of the need for protection against the unexpected, although the anticipation of it will always remain…that’s life. If you are starting an insurance company, you’ll soon address all aspects of prevention and safety for consumers who will rely on you when needed. With this in mind, use the following steps to build a productive and profitable insurance company. Let’s get started:
5 Steps to Start An Insurance Company
Step 1: Analyze Customers and Competition
Insurance agents typically either sell policies and plans through one carrier, ignoring other carriers; or, agents may offer policies and plans through several carriers. You’ll want to first consider the direction of your choice. From there, create a mental picture of your customers:
- What age range best represents your customers? 30s-40s? 50s-60s? Younger or older?
- Where do your customers live and what is their employment status?
- What kind of income do your customers earn?
- Do your customers generally have families? If so, how many children do they have on average?
These kinds of questions will inform the products and services you will offer, including auto insurance packages, home fire and protection insurance, liability and loss insurance and life insurance for the primary provider of the income.
Next, consider your direct and indirect competitors:
Are there several competing insurance companies in your area?
Which services are offered by your competitors?
Do your competitors work for one carrier or several?
How does your competitor’s pricing model compare to yours?
How will your offers overcome those of your competitors?
After assessing your customers and your competition, you’ll want to structure your insurance company.
Step 2: Build Your Business Structure
This document will frame the decisions you’ll make for several years, as well as define the steps you’ll take to get through those years. If you don’t yet have a business plan, use this insurance company business plan as a comprehensive guide. Break the segments into digestible parts to fully integrate each into your plan. Start with the information you’ve analyzed regarding your clients and competition. Add the financial forecast and any funding needed for the launch. Create the marketing strategies you will employ to drive traffic and gain traction in the crowded insurance industry and form an operational plan for day-to-day business. Finally, create your mission statement and objectives as the heart of your plan. Place all of these segments into your plan.
If you require funding for the launch of your company, use the completed business plan as a presentation tool to investors or lenders, banks, and other financial institutions.
Step 3: Secure and Equip the Company Location
To secure the best location, refer to your demographic customer. Choose the best places where they will live, work, or shop. Ensure your location has ample parking and is easily accessible in an active area of your city. You’ll want to create a solid impression on potential clients; and equip your company with solid furnishings, computer, and tech equipment, and multiple seating areas. Ensure the environment of your company is comfortable and serene and include a beverage station for clients, as a nice amenity.
Step 4: Create an Operational Plan
Similar to a business plan, your operational plan will outline the daily operations of your company, including all staff members who are employed there. If you are staffed with one administrative assistant to start, you’ll want to create an operational plan for the two of you; structure brings progress and progress translates to healthy profits. Outline expected roles and responsibilities for employees and design your appointments and daily activities, as well. Define the tasks of each role, even in assigning the simple startup chores. These add purpose to each day and assist in establishing the company as a valid endeavor.
Step 5: Strategically Market Your Company
Concentrate on the purpose of your company to begin strategizing your services: safety and prevention. Use the following to heighten attention and drive traffic to your door:
- Build an active website, offering tools that will inform your purpose and highlight your services.
- Create a blog to discuss current insurance needs and industry practices. Add customer recommendations.
- Sponsor fire department and police department functions; indicate your availability to them in emergencies. Create laminated emergency response phone number cards, including your phone number; and hand them out to all interested parties.
- Join community groups and associations that support the area around your location.
- Invest in small holiday gifts for primary clients and use themes to build organic businesses.
- Collaborate with other companies in your area to create unique offers.
Within these 5 steps to start your insurance company, you’ll find everything needed to move your company from launch toward success and long-term growth. Refer to your business plan often and update it as needed. We wish you the best!
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