by fariba » Thu Jan 10, 2008 11:58 am
Hello all,
I already have PC and life license, and I prefer to become an independent agent versus a captive. I spoke with couple of Managing Agent and Surplus Line Brokers, but I don't know how to qualify them, also what kind of agency management soft wear you recommend, and how can I get Acord form on line at no cost / or low cost, and who recommend for E&O ?
I would be extremely grateful for Any advice, and thank you for your time
I already have PC and life license, and I prefer to become an independent agent versus a captive. I spoke with couple of Managing Agent and Surplus Line Brokers, but I don't know how to qualify them, also what kind of agency management soft wear you recommend, and how can I get Acord form on line at no cost / or low cost, and who recommend for E&O ?
I would be extremely grateful for Any advice, and thank you for your time
Posted: Thu Jan 10, 2008 02:17 pm Post Subject: HOW TO SET UP INSURACNE AGENCY
Hi fariba and Welcome!
I already have PC and life license, and I prefer to become an independent agent versus a captive.
There have been many posts on this topic and to be quite honest, I just don't know how to find them. I will try to summarize some of these posts.
Before you open your door for business as an "Independent Agent", you will need:
An office, office furniture, a computer and printer, a phone system, a fax machine and a copier. You will also need a sign on the outside of your office, business cards, a company brochure and other advertising materials. You will also need a business plan describing where you are going and how long it will take you to get there. You will also need an advertising campaign designed to let people know what insurance products you offer and how to find you. You will also need contracts with insurance carriers. Believe me, there is a lot of work involved in starting out as an "independent agent". To be quite honest, most fail due to the lack of proper planning and working capital.
Don't make the mistake of trying to hire people. Payroll will be the most expensive item in your agency and you can completely exhaust all working capital just on payroll. Pay yourself last, after all other expenses have been paid. I can tell you, from experience, some weeks there won't be anything left to pay yourself.
The good side - you are your own boss and you can choose what products you sell and with what companies you conduct business.
As a "captive" agent, you will already have all the "required" items that I mentioned previously. In most cases, you will also receive a regular weekly or monthly paycheck. The drawback - you only get to sell what that particular company offers.
spoke with couple of Managing Agent and Surplus Line Brokers, but I don't know how to qualify them
I have never found a really sound way to do this. You may want to look at the A. M. Best ratings or other ratings which reflect a company's claims paying ability. If the company doesn't pay claims, it doesn't matter how cheap the insurance is, right? "Legal for Less" is not always a good thing!
what kind of agency management soft wear you recommend
None - that is unless you have tons of money. The least expensive agency management software that I have been able to find runs about $10,000. You just don't need it at first. What you will need is a good "database" software program, like ACT or something similar.
how can I get Acord form on line
You can find all the Acord forms you will need here:
http://www.simply-easier-acord-forms.com/
The basic forms are free. If you want to have forms that you can complete online, there is a fee.
and who recommend for E&O
I would actually make no recommendation. I know that USLI (United States Life Insurance Company) will write E&O for new insurance agents.
If you go to work for another independent agent or become a captive agent, your E&O would most likely be furnished to you.
I hope this information has helped you.
Why don't you start your blog?
Posted: Fri Aug 22, 2008 06:16 am Post Subject:
If you're an insurance professional eager to increase your earnings potential, starting an agency of your own may be just the right move.
With a little risk, setting out on your own can provide the independence and profitability you desire, while helping you gear up for a solid future.
Establish a Business Plan
Every successful agency starts with a clear vision and sound business plan.
First figure out where you're going and the road you'll take to get there. This is your business plan.
Ask yourself the following questions to help sharpen your focus and define your objectives:
1. Where will my business be located?
2. Will I buy, lease or build?
3. Who are my competitors?
4. How can I identify my customers?
5. What method will I use to sell to them?
6. Where will I find qualified employees? (if applicable)
Get as much measurable information as possible about your competitors, the area surrounding your potential business, and your community's plans for business growth. (You may also want to consider purchasing an existing agency to save time and start-up costs.)
Based on the information you collect from your research and inquiries, reexamine your business plan. Don't hesitate to make revisions if you find your agency vision collides unfavorably with your business opportunities.
Determine Your Product Line
What type of insurance you handle should be based, at least in part, on your expertise and the marketplace.
Secure Financing
Finding adequate financing is a primary concern for most agents forging out on their own.
Unless you have large sums of money at your disposal, you'll need to approach a bank, the Small Business Administration (SBA) or a private individual to secure the funding needed to start your business venture.
Develop a Marketing Plan
Now that you've acquired the finances you need, develop a marketing plan so you can get down to business. To do this:
* Identify your target market
* Decide what makes your product unique
* Develop a strategy to communicate this distinctiveness to potential customers
Determine Pricing, Distribution & Staffing
Material, labor and overhead costs are the three main components of pricing.
Before pricing the policies you'll sell, conduct a complete cost analysis and set prices in line with your marketing strategy.
Gaining Your Independence
If you're an agent seeking freedom and increased profitability, consider starting your own insurance agency.
With some hard work, time and perseverance, your efforts will most likely pay off, rewarding you with a lucrative future!
Posted: Sat Aug 30, 2008 09:45 am Post Subject:
esauldaris, for the sake of argument and NOT to be argumentative I'm going to throw in my 2 cents regarding your post.
I'm NOT attacking you personally just offering a more reasoned approach.
Your "plan" is the fast track to failure whereby one pollutes their mind with collateral minutia and focuses on everything EXCEPT generating new business.
Try reading my replies with an eye towards humor and some sarcasm, they won't seem so harsh then......
You wrote:
Establish a Business Plan
Make sales calls.
Every successful agency starts with a clear vision and sound business plan.
Make more sales calls.
First figure out where you're going and the road you'll take to get there. This is your business plan.
Making sales calls is the road to success when you're in sales.
1. Where will my business be located?
In the master bedroom with a phone and a desk.
2. Will I buy, lease or build?
Have you made any sales calls yet?
If not stay focused and make some sales calls.
3. Who are my competitors?
You are only competing with yourself and you are losing because you've lost your focus again. Now, how many times do I have to tell you?
GO MAKE SOME SALES CALLS!
4. How can I identify my customers?
By making sales calls.
5. What method will I use to sell to them?
Matching a clients NEEDS to your product and services works every time.
6. Where will I find qualified employees?
Employees for what? To make sales calls?
Get as much measurable information as possible about your competitors, the area surrounding your potential business, and your community's plans for business growth. (You may also want to consider purchasing an existing agency to save time and start-up costs.)
Try making sales calls first.
Based on the information you collect from your research and inquiries, reexamine your business plan. Don't hesitate to make revisions if you find your agency vision collides unfavorably with your business opportunities.
If you don't you start making sales calls there WILL NOT be any business opportunities.
Determine Your Product Line
What type of insurance you handle should be based, at least in part, on your expertise and the marketplace.
I agree.
Then go make some sales calls.
Secure Financing
Finding adequate financing is a primary concern for most agents forging out on their own.
Unless you have large sums of money at your disposal, you'll need to approach a bank, the Small Business Administration (SBA) or a private individual to secure the funding needed to start your business venture.
If you'd simply get off your assterisk and make some sales calls you won't need any financing.
Develop a Marketing Plan
Now that you've acquired the finances you need, develop a marketing plan so you can get down to business. To do this:
* Identify your target market
* Decide what makes your product unique
* Develop a strategy to communicate this distinctiveness to potential customers
By this time, after you've wasted time and money, you're out of business.
Next time just stick to making sales calls and everything else will fall into place.
Determine Pricing, Distribution & Staffing
Material, labor and overhead costs are the three main components of pricing.
Before pricing the policies you'll sell, conduct a complete cost analysis and set prices in line with your marketing strategy.
Absurd statement.
Agents don't determine insurance product "pricing."
You may take the following comment personally:
You have no idea of the insurance business subject matter of which you speak. I would use stronger language but I don't want to get banned. You simply don't know what you are talking about.
Best regards.
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