Are you looking to learn how to become an independent insurance agent?
As you have probably heard, being a captive agent can certainly have it’s perks, but going independent will open so many more opportunities such as owning your own business during your career in the insurance industry. Or, you’re a new agent that learned from other captive insurance agents that independence was the way to go.
Below are the exact steps you need to follow to become an independent insurance agent and succeed in the financial services industry.
- Choose a career path and focus. This is typically life insurance and Health insurance or Property and Casualty insurance (home, auto, and commercial)
- Complete your licensing requirements. Buy an Pre license exam prep course, take your licensing exam, and get your insurance license. Get started here.
- Get errors and omissions (E&O) Insurance. Get started here.
- Get Contracted. Contract with a wholesaler to access your product and insurance company contracts. Get Started Here.
- Create a business plan. Buy leads, and start selling. Get Started Here.
- Stay Compliant. Keep up with your continuing education courses. Get started here.
These 6 steps are simple, but the business is far from easy. I want to make sure you understand exactly what to avoid to ensure you’re setting yourself up for success.
According to the bureau of labor statistics, the average salary of an independent insurance agent is between $44k and $50k per year. If your income falls into those numbers, then your business need resuscitating.
There is a reason this billion dollar industry is full of so many average wage earners, and that is because they continually trip on these 10 common pitfalls.
If you want to learn how to become an independent insurance agent and enjoy the greatest possible financial success, you need to be mindful of following while making sure you don’t veer off course.
- How you conduct yourself.
- Getting over what your friends and family will think.
- How to become more professional.
- Activities required to be successful and build a book of business.
- Taking personal responsibility.
- Generating leads in order to have weekly sales presentations.
These shouldn’t come as a surprise, but sometimes it’s helpful hearing things from someone else’s point of view. And, I love giving my point of view 🙂
Let’s take a look at what commonly get’s in your way.
10 Reasons Independent Insurance Agents Aren’t Reaching Their Potential
#1: Running an insurance agency takes work, stop looking for shortcuts.
By nature, a lot of people become an independent agent because they want to take a shortcut; doing anything they can to avoid going into an office and working an 8 to 5 routine.
They want the freedom to make their own schedule… to come and go as they please. These are the same people who also overestimate their abilities to make a sale and don’t feel they have to use a system.
Invariably, what happens to these types of agents is that going their own route will produce decent results where they may close 10 or 20 percent of their leads. They may also feel good by pocketing some money and getting positive feedback on their successes. But the reality is, if you don’t take shortcuts, follow a tried and true system, and take time to master the fundamentals, you can be successful perhaps as much as 75 percent of the time.
Like anything else that is worthwhile in life, there are no secrets and there are no shortcuts. Success takes time, patience and determination. A “get rich quick” mentality will not help you make any progress toward realistic goals, and over time, you’ll probably get frustrated and move on to something else.
Instead of thinking about shortcuts, think about optimization.
What can you do to optimize an opportunity vs. trying to take a short cut?
#2: You think you need to know everything about every insurance policy
In many sales situations, a sales person works off the premise that a customer will want to know a lot about a product before they make a purchase, especially if it is a sizable acquisition. This especially holds true if you are selling a car, a dryer, a cell phone, or just about any other tangible asset.
But when you are selling an insurance product, you are selling an intangible asset. That is one of the biggest differences between the insurance business and other sales careers.
And that means the rules are a bit different.
If you have done your homework, you will be able to impress a client with your deep knowledge of policy details and overcome sales objections. And each client will have different levels of knowledge they will want to achieve before they the make a decision.
But the bottom line, and one that every client needs to hear, is that if they die their family will be taken care of. Their surviving family members will receive money that will allow them to keep a roof over their head, and/or that burial, cremation and funeral expenses will be taken care of so that they can focus on grieving instead of worrying or arguing about money.
Product knowledge is important whether its life insurance or auto insurance, but it is dramatically over emphasized and misused in the sales process. As a result, sales can become little more than just pitching and presenting, which should not be the primary focus.
Agents who spend all of their time learning about products are anxious to share that knowledge with prospects, instead of focusing on solving their clients’ problems, which is where their true focus should be.
As an agent, it is your job to build value in the mind of a client, and you can’t do that by just talking about the product.
#3: Insurance sales is a profession, but you aren’t treating it that way.
A lot of us want to be considered professionals, but not all of us take the steps necessary to achieve that goal.
Think about how doctors, lawyers, professional athletes and other high achievers reach elite status: They put in the time. They practice. And, through repeated practice, they build confidence and the skills necessary to get to the highest levels of their chosen profession.
Top performers in their profession don’t stop when they get to the top either. They are always looking for ways to keep educating themselves to give them a continued edge that leads to optimal success. They don’t just wing it. They plan for it and they work at it.
As an insurance broker, you should have the same mindset because running an independent insurance agency is the same.
#4: You’re afraid to leverage your natural market, your friends and family.
Insurance sales agents cannot be timid in talking about providing protection for the people in your lives who matter the most. Whether you’re selling iuls or medicare Supplements, some agents do not want to be the guy who feels like he is bugging people in his social circle. It produces a timid conversation, and that leads to a timid outcome.
However, if you truly care about the most important people in your life, whether it’s family members or friends, you should want to have a conversation with them because you care about them and want to make sure their needs are met and their loved ones are protected.
It is a good test to see if you truly believe in what you are doing as an insurance agent. Who is going to take better care of those people in your life? You, or a complete stranger who may come in and provide much needed protection if you do not?
The answer should be obvious.
#5: You expect overnight success.
If you expect overnight results as an insurance agent, you are sure to be disappointed. Like any other profession, it can take several months to fully understand your products, gain valuable experience using a scripted presentation, and going out and getting in front of people several days a week to hone your craft. Feeling comfortable takes time and practice, even if you are making money along the way.
Just starting out, you will have clients who will buy no matter what you say or how you say it, because they are ready to buy. Conversely, you will meet clients who are on the fence, and have probably spoken to many agents along the way. Successfully selling them insurance will require more subtle techniques; you will have to learn how to correctly speak from the heart, follow the right script, and educate them along the way.
You must master subtleties to increase the amount of success you will have.
If you aren’t seeing immediate results, you may be tempted to stray and try something new instead of mastering what has been proven to work. Any system you apply is going to take time to master. You must have proper expectations. To build a business, much like building a home, you must start with a proper foundation, and that does not happen overnight.
If you’re looking for overnight success, selling final expense might be your closest option.
#6: You sell a product instead of solving a problem.
Are you focusing on selling instead of helping? It’s an easy trap to fall into.
As insurance professionals, we can improve our level of success once we help our clients focus on what it is that they really need. You must keep your own goals and your own agenda out of the conversation.
Make sure that the product you are offering matches their needs instead of your beliefs. Different types of insurance products exist for this very reason. They are all useful at different times and under different circumstances.
When you focus on the client’s needs, ultimately, your needs will be met as well.
#7: You talk too much and probably suck at listening.
A smart person once told me there’s a reason you have two ears and one mouth.
This can be an especially common trap for agents who have just passed their test and can’t wait to get in front of clients to tell them all that they know. Your head will be filled with all kinds of new terminology and knowledge that you’ll be tempted to share. Unfortunately, much of this may go over your client’s heads. You run the possibility of confusing them, and that will lead to a “let me think about it” response, instead of closing a sale.
Instead, we need to focus on our prospect’s needs, concerns and challenges. When we listen first, we will be able to understand what is driving their buying decision. Prospects will tell you what they want, the problems they face, and what it takes to have them buy from you. We just need to take the time to truly listen.
The key to is meeting a client’s needs, building a relationship and keep them coming back to you as their expert. And, you can’t build a good relationship if you do not listen and exchange ideas and information.
So, when a client raises their hand to ask a question, you can’t think of it as raising an objection.
You must listen to what they are asking, not get defensive, and understand that it is a natural part of the sales process. By listening to those questions, you are also better understanding the underlying unmet needs that they have, which you can then use to respond and effectively resolve those needs.
#8: You’re not practicing enough or at all.
This involves much more than just sitting behind a desk and rattling off a script. It must include real world application. You need to go out and practice in real time. You must also accept that fact that you’re going to make mistakes. In fact, you should embrace those mistakes because those mistakes are when learning kicks in, and ultimately, that’s what will make you a better agent.
Don’t be afraid to make mistakes. The process of correcting mistakes can be very empowering if you let it.
All of us love to win. But in order to win, you must practice. Unfortunately, many agents are just winging it in all parts of their sales process.
- Do you have an elevator speech? Practice it.
- Do you have a referred lead script? Practice it.
- Do you have an appointment script? Practice it.
- How often do you practice your sales skills?
- How often do you review the right questions to ask to help drive the sales process?
To turn what we know into action takes regular and disciplined practice. We improve by mastering the fundamentals. And the only way to master the fundamentals is to practice them.
#9: You aren’t asking for help or working with a coach.
Knowing how to do something is not enough. We must put what we know into action. Those who are truly committed to being the best find a coach or mentor.
Many business owners, executives and sales people have coaches for the same reason. Coaches can save you time and money, help you make fewer mistakes, and advance your career more quickly. You must think of them as a wise investment of your time and resources.
Coaches will help you to make your business as successful as it can be. But you must be willing to listen and participate for that to happen.
The bottom line: professionals have coaches. Amateurs do not.
#10: You lack confidence and passion.
Confidence is a muscle and it will grow if you let it. Often times, our ability to sell a product is based on the level of confidence we have and we display.
Another way to think about it is that desperate people rarely get dates. Similarly, desperate professionals rarely get sales.
Successful selling also requires passion. Keep in mind, that as a business owner, you know your brand better than anyone else. But if you are not passionate about selling, your efforts are not going to work. You must believe in what you are doing. And you must put in the practice to achieve the level of confidence and passion you will need.
Conclusion: How to be a Successful Insurance Agent
Here are the steps at a glance.
- Choose a career path
- Buy an Pre license exam prep course. Get started here.
- Get errors and omissions (E&O) Insurance. Get started here.
- Get Contracted. Get Started Here.
- Buy leads, and start selling. Get Started Here.
- Keep up with your continuing education courses. Get started here.
We also reviewed the 10 things that are most likely keeping most insurance agent’s from crossing the threshold of average producer to top producer.
If you want to be a successful insurance agent, you need to be self aware and empathetic to the opinions around you. There are a lot of resources to help you learn how to make a six figure residual income selling insurance, but none of those will do anything if you’re mind isn’t open to change or advice from others.
I say it all the time when I speak to agents, “you’re getting in your own way, just stick to the basics”! Becoming an insurance agent is hard enough with all the things you need to do, don’t let the simple thing slip through the cracks.
- Shortcuts are great, optimizing opportunities is better.
- Products are irrelevant if you can’t hold an informative discussion.
- Commit. Don’t kid yourself into thinking you’re something you’re not.
- Take the time to analyze your natural market and grab low hanging fruit.
- Success doesn’t happen overnight, get it out of your mind!
- Focus on problem solving and being an irreplaceable resource for your clients.
- Don’t suck at listening.
- Perfect practice makes perfect.
- Yes you need help, suck it up and take it.
- You’ll never build the confidence you’re searching for if you’re not putting yourself in the position to succeed.