Within the insurance industry are several different types of businesses. Apart from companies specializing in specific coverage such as commercial space, life insurance, and farm insurance, some operate as captive agencies and independent agencies.

Captive Versus Independent Insurance Agencies

Some agents want to make a transition from a captive insurance agency to an independent insurance agency. However, before going into any details about how to do that successfully, it would help understand what makes each unique.

• Captive Insurance Agency – This type of agency works with just one insurance company. In other words, a captive insurance agency only sells the products that a particular carrier offers and, typically, nothing more. This can often limit a client’s options for coverage and premiums. 
• Independent Insurance Agency – An independent insurance agency represents multiple insurance companies. As such, an agent can compare every aspect of insurance policies to find their client the best deal. That includes the type of policy, deductibles, claims processing, premiums, and more. Ultimately, clients have far more diversity and freedom for insurance coverage.

It can be seen this way. In a Nike store, the only brand customers can buy is Nike. Although Nike shoes are of high quality, and they come in a variety of styles, colors, and sizes, the customer has limited options. Now, if customers walk into a retail shoe store, they could buy the Nike brand, as well as Adidas, New Balance, and many others. That gives them far more variety.

Many agents feel they can better serve clients by transitioning from a captive insurance agency to an independent insurance agency model. The following are some of the factors involved in making the transition.

Carefully Review Your Contract

Before making any move, you need to know what’s in your contract. Keep in mind that if you need help deciphering the contract, it’s best to reach out to an attorney who specializes in contract and insurance law. The biggest issue comes from “blackout periods.” That means the captive agency would block you from selling policies to the clients you’ve served for years.

On the other side, before locking into anything with an independent insurance agency, read the contract word for word. In particular, make sure it has a “free release” clause. That way, if you choose to leave, you can go without any repercussions. Regardless of the contract, you don’t want the company to prevent you from taking your list of clients.

Consider Legalities

Depending on your situation, you might need to borrow money to get your independent insurance agency up and running. There are other legal aspects such as taxes, accounting, and even insurance coverage for the business. Make sure you have all of these taken care of as quickly as possible. Otherwise, you could find yourself in a position of not working while certain things get sorted out.

Develop a New Website

Even if you already have a website up and running, it’s a good idea to start fresh. Not only will that eliminate any connection to the captive insurance agency, but it’ll also allow you to market your customers according to your practices and beliefs. Make sure your insurance agency’s website looks professional, is easy to navigate, and gives individuals and businesses several ways to contact you to discuss coverage.

Change Your Mindset

While working for a captive insurance agency, you probably processed things from a corporate mind. However, once you transition to an independent agency, you need to think more like an entrepreneur. To succeed, you’ll need to change the way you view insurance as a whole.

That includes coming up with unique marketing strategies. Rather than take more of a cookie-cutter approach, you need to get creative. You’ll also need to decide how you want to structure your agency and invest in insurance agency management software. That’ll help you monitor key information, connect better with your clients, and grow your business.

Spread the Word

As an independent agent, it’s your responsibility to promote many different insurance companies. However, the only way they’ll know you exist is by getting your name and the name of your agency to them. So, you’ll need to contact as many carriers as you can.

Networking and Support

Once you transition from a captive agency to an independent one, you want to start networking and building a support system. Especially when representing multiple carriers, you’re going to have questions and need guidance. Rather than try to do everything yourself only to fail, reach out to other professional independent agents. You can also join various associations and attend events as they arise.

Get Your Clients the Insurance They Want and Need

Although it takes some time and effort to transition to an independent agency, it’s worth it. Now, you can introduce your clients to all kinds of new products, help some get lower premiums, expand your product offering and, ultimately, make more money.

When handling business the right way, your insurance agency can achieve a high level of success. As a highly competitive industry, there’s not a lot of room for error. Unfortunately, some insurance agencies possess toxic traits that do significant damage to the culture of the company.

9 Traits of a Toxic Culture

The best way to avoid making costly mistakes is to learn what they are and then fix them. The following are nine things that you need to watch out for. If you identify any of these, take immediate and appropriate action.

Low Employee Morale

One of the easiest ways to determine if your insurance agency has a toxic environment is to gauge the morale of your employees. That includes other agents as well as all office staff. If you notice your workers showing up late, struggling to perform, or grumbling about various things, you need to get to the root of the problem.

Hold a meeting with all your employees. Let them know you care and maintain an open-door policy so they feel comfortable to speak with you freely without any concerns of repercussions. Also, ensure them you’ll do whatever it takes to boost morale.  For this issue, recognition goes a long way. The goal is to get your staff excited and engaged.

To help with this, you can always rely on a software program designed specifically for someone in your position. Powerful insurance agency management software will help tremendously.

Reduced Production

Especially with a booming housing market, insurance agencies have plenty of work to do. However, seeing a reduction in what your employees are accomplishing is another indicator of a toxic culture. This typically goes hand-in-hand with low morale. So, if you fix that problem, production should increase.

Remember, if you want to get your employees motivated to work, make sure they have the necessary tools. That might be something as simple as software that allows them to run reports.

Missed Time at Work

If you find that an increasing number of people are calling in sick, consider that a red flag. When employees feel engaged and get recognized, they’re excited to show up for work.

For some people, skipping a day or two is nothing more than a way to avoid walking into a toxic environment. However, others legitimately don’t feel well. If someone’s overworked and unappreciated, there’s a good chance they’ll feel anxious or stressed. As a result, they stay home rather than address their concerns. This is when you need to lead and listen.

High Turnover Rate

Watching one employee after another leave your insurance agency should be a wake-up call. When people feel satisfied with their jobs, including the culture there, they’ll stay for years, if not for the remainder of their career. On the other hand, poor management can quickly lead to a high turnover rate.

It doesn’t matter if the root cause falls back on you or one of your managers. Whatever the case, you need to do something about the underlying problem. Look, no one likes to admit they’re not doing a good job managing their team. However, instead of giving up or just not caring, you have the opportunity to turn things around.

If you want your insurance agency to thrive, you need to uncover the reason that so many individuals leave. Once identified, you can then develop a plan to correct the issue.

Failure to Establish and Meet Goals

Imagine setting multiple goals only to fail meeting every one of them. It wouldn’t take long for you to question your abilities and value. That’s what happens to employees. So, when setting goals for them to meet, make sure they’re attainable. If not, the people you depend on to help run your insurance agency will get frustrated, which leads to additional problems.

As part of this, review your staff to ensure you have the right people in the right roles. At the same time, be careful not to put inexperienced individuals in positions that set them up to fail. For instance, if you have a relatively new agent come onboard, allow another agent with years of experience to help guide and mentor them.

Lack of Empathy

This applies to both business and personal aspects of your employees’ lives. To avoid creating a toxic culture within your insurance agency, show that you genuinely care and want to see others succeed. When someone’s struggling, take time to find out why and then work with them to find an appropriate remedy.

If an employee’s dealing with personal issues, show a little empathy. Although you can’t let problems from the outside affect the business, you can show kindness and understanding. After all, your employees are human, and as such, they’re going to face challenges in life.

The One and Only Solution

Stop trying to be the one and only person in the agency that can handle everything. You can’t. Even if you have tons of experience and knowledge, there are limitations as to what you can do and the problems you can solve. If you need help from an outside organization, by all means, take advantage of its services.

As an example, say you’ve tried to come up with ways to recognize and reward your staff. While they’ve done “okay,” you’re not seeing the results expected. In this case, turn to a company that specializes in boosting employee morale. There’s nothing wrong with learning from others.

No Agency Values

The core values of your insurance agency set the tone for the overall work environment. Without establishing these, you can inadvertently provide others with a toxic work environment. Along with setting rules and regulations, this involves having a philosophy or mission statement as to what the agency stands for.

If your agency doesn’t currently have established core values, consider having a team event that’s part business and part fun. You might book a full day at a dude ranch, day spa, or hotel with a pool. For several hours, hold a meeting where you provide everyone with insight as to what you want to achieve as the owner of the agency. Then, when you’re finished, everyone can kick back for some needed R&R.

Disengaged Staff

If your employees are disengaged, you’ll have a hard time reaching the level of success you want. This is yet another surefire sign of a toxic culture. In most instances, you’d see this in the comments your staff makes. That might include “It’s not my job,” “I’m too busy to help,” or “That’s not what I was hired to do.”

These and other phrases show that your employees have no real interest in their job or your success as the owner of an insurance agency. Employees who jump in to help whenever and wherever needed are incredibly valuable. Those are the people you want as part of the team at your agency.

Depending on what’s going on, correcting this could come down to better recognition, updated training, or even letting some people go. Unfortunately, once an issue of disengagement occurs, it can quickly lead to dysfunction throughout the entire agency. To avoid problems with attitude and performance, you’ll need to take quick and decisive action.

You know that saying, “You can’t teach an old dog new tricks?” Well, that’s 100 percent false. Not only can seasoned insurance agents learn new things, but they should. For one thing, that allows them to continue playing a key role in an insurance agency’s success. For another, it lets them enhance their teaching and mentoring skills.

There’s another phrase that pretty much sums it up: “Do you have 20 years of insurance experience or one year of insurance experience 20 times?” Think about that for a second. Sure, you might have two decades working as an agent. However, if you’re unwilling to learn something new, an agent with just one year of experience, yet who’s motivated to gain as much knowledge as possible, would add more value.

Take Advantage of Technology

Without question, the insurance industry is highly competitive. That means as an agent, you have to work to secure and then retain new clients. Fortunately, you have multiple ways to do that without expending too much time and effort.

For starters, invest in an insurance agency management system. The right software will simplify tasks but also help you keep better records. As a result, you’ll work more efficiently and effectively.

Just about every client will have a good handle on computers. So, as part of your sales pitch, you can advise them that you use a state-of-the-art program specifically for the insurance industry. If you want to make a good impression, this is one way to do it.

At the same time, working with the right software will make your life as an insurance agent easier. You can create and safely store client information in the cloud, listen to podcasts that further benefit your career, and much more.

Fine Tune Your Sales and Communication Skills

Regardless of the number of years you’ve worked as an insurance agent, you should hone your sales skills periodically. Remember that a lot of today’s clients are significantly different from those 20 years ago. They’re more savvy and now have far more options for insurance protection. This is another area in which a good agency management system can help.

With years in the industry, you’ve probably developed a specific way to communicate with both potential and current clients. However, times have changed and you need to change along with them. Years ago, agents spoke in a more professional manner, using a lot of insurance jargon.

Today, most people want to have an easy conversation. They prefer to discuss business matters in a more relaxed way. Simply put, prospects don’t like complicated conversations. That means you need to avoid “insurance language.” Believe it or not, learning to communicate differently takes some practice, but ultimately, it’ll pay off.

Improve Time Management

Currently, it’s common for both parents to work. Considering that, combined with the daily responsibilities of raising kids, the average parent has little spare time. To show that you respect your clients’ tight schedules, work on your time management.

When you first started working as an insurance agent, people might’ve been a little more laid-back when it came to setting up meetings. Now, even showing up a minute late to meet with a prospect could cost you the account. There’s a definite art to this, but with the right tools and perseverance, you’ll nail it.

Become a Better Problem-Solver

It never hurts to learn how to solve problems yourself. That way, you can reach resolutions quickly and prevent an issue from spiraling out of control. For that reason, you can expect to achieve a higher level of client satisfaction. Also, there’s a sense of pride in solving problems yourself.

Depending on when you started your career, the internet might not have even existed at the time. Now, you have access to thousands upon thousands of websites with valuable information specific to insurance. Use reputable sources to learn better problem-solving for billing, policies, client retention, marketing, networking, and the list goes on.

Develop Better Emotional Intelligence

Some people may have to let go of pride to do this, but to become a better insurance agent, it’s important. What this entails is learning how to recognize emotions in other individuals. As you become more and more emotionally intelligent, you’ll gain an understanding of why some prospects won’t do business with you.

That opens the door for you to make some necessary changes on your end. By reading people’s emotions, relating to them, and then responding in the right way, you can turn the tables. It won’t take long for you to see a difference in how potential clients react to your sales pitch.

The Bottom Line

It’s a good idea to learn how to connect with potential and current clients in today’s world as opposed to how you connected years ago. You can still use many of the skills you already possess. However, adding to those or enhancing some of them will help take the success of your insurance agency or career to a new level.