Page 58 - The UnCaptive Agent

WHAT KIND OF AGENCY DO YOU WANT TO START? 31

Also, the average revenue per account that your agency
enjoys will go up. You’ll make more money on each cli-
ent. The third reason is that your clients will value you
more, and differently, because they see you increasingly
as the person who manages risk for their business. While
there are advantages to being in the employee benefits
business, there are also significant challenges.
The first challenge is that these products are complex
and require an increasing level of expertise and mar-
ket knowledge to adequately serve your client. While
the products themselves are increasingly complex, and
the market is as well, commissions have been reduced
in recent years because of the cost pressures created
by The Affordable Care Act. While it’s an advantage
to offer these products, you’ll need to think carefully
about how you will go about doing that. Most smaller
agencies offer employee benefits through a brokerage
arrangement with another agency that focuses on health
insurance. While this may be an excellent solution,
you will want to clarify up front who owns the client
relationship. I strongly suggest that your agency does,
as this will not only increase your agency’s value but
allow you to change brokerage partners readily should
the need arise. Should either income or services dictate,
another possibility for offering these capabilities is to
bring in partner who focuses on that area. And finally,
you can also consider a producer to cross-market your
existing commercial lines book of business, as well as
produce new health accounts, which in turn can grow
your commercial lines business.

Don’t Overlook Opportunity

One of the largest overlooked opportunities in the insur-
ance agency business is life insurance. Life insurance