Page 44 - The UnCaptive Agent

A GUT CHECK FOR FOUNDERS 17

Build on What You Know

Another question to ask yourself is how proficient you
are in all areas of the business you seek to sell, includ-
ing personal lines, commercial lines, and employee
benefits. Many exclusive agents and captive agents
have made the transition to being independent agency
owners in the last decade with the assistance of firms
like mine. We regularly see personal insurance agents
who want to sell commercial insurance. While this
is an excellent way to broaden any agency, and one
that we highly recommend, it’s clear that commercial
insurance is more complex than personal lines. The
cycles of the business are very different. For example,
the way prospecting and proposals work as a part of
the sales process for commercial lines is different. If
you don’t have that experience, you can certainly build
it over time. However, it’s important not to create
your agency with the expectation that you’re going
to sell a lot of commercial insurance until you build
that experience.
Do you plan to sell employee benefits, like group
health insurance? If you do, are you an expert in that
area? With the advent of The Affordable Care Act, the
barriers to entry (and certainly the barriers to success)
in employee benefits rose tremendously. Many smaller
employee benefits agencies sold, merged, or went out
of business because the complexity in that part of our
industry was more than they could keep up with. It’s
true that many independent agents include employee
benefits in their product lines. Still, you need to think
carefully about how you will offer those products and
required services on a competitive basis if that is a part
of your business plan.