How To Start An Insurance Company

Everything you need to know about starting an insurance company!

Research & Refine your Business Idea

If insurance is what you know and you want to set up your own insurance agency, it’s going to be important that you do it the right way. There are a number of goals that have to be met in order to get started efficiently and legally.

Things like courses, certification, personality and more can play into whether or not you’re likely to succeed in starting this kind of a business. So let’s take a deeper look into the expectations, what you need, the things you’ll need to consider and what kind of paperwork to expect.

What You’ll Need

In order to sell insurance, there’s a good chance you’ll need some kind of licensing. This might either be an agency license or an individual license, depending on whether it will be just you selling insurance, or you plan to hire more employees.

It’s also worth considering the start-up costs, which can vary depending on your unique situation. In addition, you’ll also need to think about your business plan. The greater detail you can get into, the better off you’ll be. Having a detailed business plan will also allow lenders to be more likely to give you a loan.

What To Consider

Selling insurance is a business for those who tend to be assertive, outgoing and willing to work to make the sale. Before you start your own insurance company, it’s important to think about whether or not you feel comfortable in selling insurance to people regularly. If you are, then there are more steps to cover!

There will also be courses you’ll likely need to take, which can be somewhat costly. Putting in the money and time to get your licensing is necessary for building a successful business. It can teach you exactly what you need to do to handle selling insurance, as well as the many other aspects that come with the business.

Doing The Paperwork

As with starting any company, there is going to be some paperwork that you’ll have to get through in order to make a solid start. This will include choosing the setup you want for your business from options like a corporation, LLC or sole proprietorship. Make sure to look over these choices carefully, as each offers different benefits.

You’ll also need to select a name for your company. Make sure it isn’t a name that is already in use, as that can cause problems down the road. As you’re putting together a plan, it can also help to learn about how taxes will work for your business, so that you can be prepared before it comes time to file them.

Creating your Business Website

Not all customers want to talk over the phone, or at least might want the chance to take a look at what your insurance company has to offer before having a phone consultation. Because of that, having a business website is a great way to allow them to find information, leave reviews and communicate if they’re interested in your insurance policies.

It can also be helpful to know that building websites isn’t a difficult thing these days. Through sites such as Wix and Squarespace, you can easily create something professional even if you have never gone through the process of making a website before.

Even if you do have some trouble, their customer service will be there to help you!

Setting up a website isn’t as hard as it may sound, in-fact, many hosting providers have tailored their service around small businesses who may not be tech savvy. We suggest going with BlueHost to host your website as they have a easy one-click WordPress installation tool, you can get 60% Off hosting and a free domain name here.

Additionally, creating a blog on your website is also a great way to attract organic traffic and expand your business. Checkout our full guide on the best and easiest way to setup a WordPress blog here.

Get Ideas for your insurance business name!

Marketing Your Business

When you have a business, you typically want people to know about it! Otherwise, it’s going to be tough to get the business you need. Luckily, there are plenty of marketing strategies that you can make use of that will allow you to catch the eyes of people looking for an insurance company.

Some of the top ways that people choose to market is through print, digitally and by using social media.

Marketing In Print

Print marketing is one that many are familiar with, though it might be less popular in modern times than digital marketing. However, it’s still a great way to reach out to people when they aren’t at home on their computers or watching TV.

Catching people while they are out and about can also be made more convenient by providing web addresses or QR codes that can allow people to reach your website quickly from their phones or other devices they may have on them at the time.

Marketing Digitally

These days, digital marketing is the most popular, so it’s one you’ll definitely want to prioritize. This includes your insurance company website, as well as advertisements placed throughout the internet using the help of Google AdSense and even placing ads on social media sites.

You can also create advertisements for television, radio, podcasts and even for YouTube to display at the beginnings of their videos. There are really many ways that you can reach people through digital marketing. Prioritizing those that your target market will frequent the most is key!

Using Social Media

Even for an insurance business, making use of social media is a very useful way to gain attention and provide a space where your business can communicate with customers. It gives you the opportunity to show that the company is more than just a company, that there are real humans behind it.

On top of that, it’s a free way to get the word out. Any free advertising you can do is advertising that can really only gain for the company. That said, not all social media sites may be appropriate for the kind of business you run.

For example, Facebook for an insurance company can work well, but Instagram may get tricky, considering it’s based primarily on pictures.

Setting Goals and KPI’s

Naturally, you’ll want to set goals for your insurance company so that you can make sure you’re making plenty of progress. This can often be determined by Key Performance Indicators, which are essentially markers you’ll want to keep track of, so you can watch how closely you get to your goals.

Some indicators that can let you know how well you’re doing are how many clients hold policies with you, the overall profit for the company as well as the premiums that are coming in, and the balance of income versus money spent providing care for your customers or their possessions.

Don’t forget to try our insurance business name generator!

Plan your Finances

There are three key aspects to consider when thinking about your finances. The first involves your startup costs. Plan carefully to figure out all of the costs that will be involved, including the cost of office space, classes and licensing, building maintenance, employee pay and anything else you may need to handle.

You’ll then need to decide how to obtain that money. You can ask the bank for a loan, seek out a lending company, talk to family and friends or look for an investor. Make sure to look carefully at each option before ruling it out.

Finally, open up a bank account specifically for business funds. That way, they don’t get mixed up with any other money you may have, and it keeps expenses and income much more clear.

Adopt an Entrepreneurial Mindset

Remember, if starting a business was an easy thing, then everyone would be doing it successfully. It requires a lot of learning as you go, and there are many obstacles that can pop up on the way to creating stability. Keep in mind that this is completely normal, and it’s really just a test to see how flexible you can be. Instead of backing away from these obstacles, it’s going to be key to take them on, continue to learn as your company grows.

Other things to consider when starting your insurance company

Legal Requirements: 

While it may not be exciting, figuring out the legal requirements for your insurance company can help you to get off to a solid start. This includes things like finding an appropriate name, selecting your business structure and understanding the taxes involved.

It also means making sure you have the correct licensing and have any other paperwork handled. After all, you want your business to not only be successful, but also be legal. The laws surrounding insurance companies can also vary from place to place, so make sure you’re following the correct laws for your area.

Accounting & Bookkeeping: 

Though bookkeeping may not be fun, it is necessary for running a business. The good news is, you can easily keep track of the funds incoming and outgoing from your business with the help of programs such as Xero and Quickbooks. They really do a great job of making the number-crunching a little easier.

Otherwise, you can choose to hire someone to take on the task. If you opt to hire a freelancer, it can easily be done through websites like Upwork. You may also be able to find someone who is experienced enough to give you a little guidance on how to handle funds.

If you’d prefer to hire a regular employee, then that’s also a great option. It can provide benefits like having the person in the same building on a regular basis and being able to train them yourself.

Hiring Employees:

When it comes to hiring employees, there are certainly rules that need to be followed. Naturally, it’s a good idea to provide a safe, comfortable workplace for those you intend to hire. This means handling things like healthcare, breaks, sick and maternity leave, and 401K prospects. Like with the general law requirements, these are going to vary a little in different locations.

The same is also going to be true if you decide to hire a freelancer. However, because they are freelancers, those rules can be a little different. There can also be fewer rules you need to deal with, as they aren’t a regular employee. Odds are that for an insurance company, you may have a mix of both. Typically, there are only certain jobs that freelancers tend to take on, like handling bookkeeping, social media, web pages and other similar kinds of activities.

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