23. Treat Your Agency Like a Camry, Not a Lamborghini
Get the most from your insurance agency by having expectations grounded in fundamentals and reality.
[00:35] Growing Your Agency Too Fast Often Leads to Fast Losses
[01:19] Long-Term Agency Growth is Based on Relationships
[02:13] Only Grow with Those Who Will Be With You in 10 Years
[03:02] Diversify Your Insurance Agency or Business Portfolio if Bored
[03:49] Don’t Try to Turn Your Agency (a Camry) into a Lamborghini
Full (Edited) Transcript
If you want to get the most out of your insurance agency growth, treat it like a Toyota Camry, not like a Lamborghini. So many insurance agency owners really love the fact that the business model is consistent and it's steady, and it is almost recession proof, and yet they forget this. They forget that with this comes the downside that just as it loses business very slowly, it's usually slower to grow.
Now something like Lamborghini, there's certain business models where you can grow very quickly, but you can also lose it very quickly.
So the first thing to remember about your agency is that growing too fast often leads to fast losses, and by fast losses, I mean high turnover rate, low Retention rates.
And so when customers come to you and the transaction's done too quickly, the sale is done too quickly. The signature is collected, but the customer does not understand what they've purchased very often. There's no loyalty there. They didn't learn anything from you. And the next time somebody tries to sell them, they're gonna be very price sensitive.
And as long as the person has even the possibility of a better price, they're gonna be open to shopping because you missed that opportunity for connection.
Long-term insurance agency growth is based on relationships, it's based on quality, not just quantity. So I hear a lot of people say that sales is a numbers game, and that is true to some level.
You need a certain amount of activity to get a certain number of results, but it's also even more a relationship game, specifically the insurance agency business, specifically the Multiline Insurance Agency business. Where we're telling our customers, we're looking out for their overall situation, their family, their loved ones.
We're taking care of their assets, and we're helping to make sure they protect their goals and their dreams. Your growth is gonna be based on you connecting with customers, even if they only purchase auto and home insurance with you, even if they never purchased the life or the disability, the health of the annuity.
The simple fact that you'll have that conversation with 'em builds rapport and leads to longer term relationships.
You only want to grow your agency with those who will be with you in 10 years. Think about the way any business is set up. There's this basic concept that most of us know that selling to an existing client is anywhere from five to seven times easier than selling to a new client.
Now, in our case, selling a repeat client is ridiculously easy, as long as we keep in touch with 'em. As long as we make sure that they're still getting what they paid for most of our customers, somewhere north of 80% are gonna stick with us. And so we want to, when we're underwriting, when we're writing people in the first place, we wanna make sure that we're really only investing our time in people who will be with us in 10 years or longer.
And so what I want to invite you to consider is that
There will become a time where your insurance agency is not that exciting to you, at least not the property and casualty part, the auto and home part. And so if you want to keep it exciting, you're gonna need to diversify your portfolio. Now you can diversify within your portfolio of your business.
You can sell multiple lines, life insurance, health insurance, disability insurance, annuities, retirement planning, commercial insurance, farm and ag. There's all sorts of things you can do there. Or you can decide that you want to open another agency location, or you could decide that you want to diversify into another business altogether.
You wanna be a business coach, you wanna open a restaurant, whatever it might be. But overall, keep your expectations grounded and understand what your business is and what it isn't.
Trying to make your Toyota Camry of a business. Operate like a Lamborghini is gonna lead to headaches, it's gonna lead to frustration.
It's based on unrealistic expectations. You're gonna get frustrated with team members. You're gonna get frustrated with yourself. You're gonna get ticked off at the market. Understanding the brilliance of our business model is critical. We don't grow all that quickly. But if you were around during the 2008 recession time, Most of the insurance agents, owners that I knew only suffered maybe a one, two or 3% gross income loss, while other people were suffering 20, 30, 40, 50, 60% losses losing their businesses.
So we want to be able to be wise enough to take the upside with the downside. We need to know what we're doing. Trying to make your business go too fast is simply gonna lead you to churn business, possibly hurt your relationship, and even churn team members.
I hope you find this helpful. As always, look forward to helping you understand the best ways to grow your business and make the most out of it.
To help the most people to create a great team, and yet still make sure that you're investing your energy in those 80 20 activities, in those 80 20 projects, the projects, the things that they're gonna pay off the highest for you so that you can impact more people and make the most amount of money in the least amount of time.
And allow yourself to have a lifestyle so you can fully enjoy your family, your friends, your freedom and your life.
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We’ll Discuss Your
- Biggest Goal - If you or your agency could only achieve 1 thing in the next 12 months, what would it be?
- Value of Biggest Goal - What's it worth to you (money, free time and / or happiness) to achieve this goal?
- Biggest Frustration - If you could "fix" 1 thing in your agency in the next 12 months, what would it be?
- Frustration Cost - What is your biggest frustration COSTING you (money, free time and / or happiness)?
Then, We’ll Discuss the Plan & Expected Results
- Which goal(s) are likely to be achieved and how long it usually takes, based on our experience.
- The best way to help you achieve your goals, based on your style and time available to implement.
- Your anticipated time investments & money investments.
- What guarantees we can make