Should You Start Your Own Insurance Agency in 2016?


For insurance agents, starting your own agency is the ultimate freedom. It gives you the chance to be your own boss, to determine the kind of insurance you’ll sell, and what customers you want to work with. That said, running an independent insurance agency isn’t for everyone. Just because you’ve passed your insurance agent exam and have had success selling insurance, doesn’t mean that you’re ready to run your own business and handle all the work it entails. Before making the jump, here are some things to consider about starting your own insurance agency.

Should I start an insurance agency?

Setting Up

Creating an insurance agency isn’t as simple as leasing an office and buying some furniture. It takes acquiring business licenses, applying for loans, consulting with attorneys, creating a business plan, and plenty of other work before it even gets off the ground. If you’re getting ready to start your own business, you need to be sure you have partners you trust. You need to find a lawyer, an accountant, and business partners that you can trust implicitly.

Getting Funding

More often than not, starting an insurance agency will require startup cash. That means either borrowing money from friends and family, finding business partners with a lot of capital, or getting a bank loan. In any case, you’ll need to be able to sell your new insurance agency to investors before it even properly exists, which means you’ll have to be able to show that it has the chance to succeed through the strength of your business plan and your pre-launch planning. If you can’t put together a convincing presentation, it’s a good sign that you’re not ready to be running your own insurance agency.

Insurance agency 2016

Creating Visibility

It takes more than just being a great insurance salesperson to run your own insurance agency. When you work for someone else, they take care of most of the work that isn’t selling to customers. When you run your own agency, however, all of that additional work becomes your responsibility. One of the biggest of those responsibilities is creating visibility for your new agency. If customers don’t know you exist, then they won’t be contacting you to buy insurance.

Running your own insurance agency requires putting a lot of time into marketing. To get the amount of attention they need, new insurance agencies should pursue as many marketing channels as they can afford. Just cold calling customers or just having an aggressive social media presence isn’t enough. Customers want to know that they can trust the insurance agents with whom they work. As such, new insurance agencies have to put in the time to build their reputation through social media presence, online ads, testimonials, and referrals from trusted sources.

Starting your own insurance agency is hard work, but the benefits are worth the rewards. Just be sure you know the risks involved before proceeding.

America’s Professor offers online prep courses for insurance exams in multiple states. Contact us today at 800-870-3130 for more info.


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Billy Williams, PhD
8 years ago

The main problem that I see is that captive agents come into the independent world completely unprepared to do the amount of work necessary to offer a customer the best options available. They tend to lock into one or two carriers and many become a semi-captive version of their [independent] agency. If you were a high performing captive agent with strong agency processes and good staff hiring practices you stand a good chance of becoming a high performing independent agency. In my experience (which is helping my partners start 12 new independent agencies from scratch and buying into 30+ more)… Read more »