Erica Kiefer from AgencyBloc interviewed me, asking how agency owners and agents can thrive, not just survive, in today's insurance industry and healthcare climate. A version of this article was originally published on their blog.
AgencyBloc: What is the number one thing a new agent/agency can do to boost their chances of surviving those first three years?
Wendy Keneipp: The number one problem agencies are facing today that threatens their survival – and one that is easily countered – is not defining who they are as an organization and how they operate. This industry has been built on winging it and following the competition – who is also winging it.
To survive and thrive, agencies must start with a plan:
- Create a vision for what the company is going to do and what it is going to grow into.
- Define the value proposition offered to clients.
- Identify who the ideal target client is that will benefit from that value proposition.
- Create a systematic approach to targeting prospects, marketing to them, and converting them into clients. Hold people accountable to this system.
- Hire smart people who get excited about growing and creating new things.
- Have a reason for being in business that is bigger than just revenue. The owner is the only one who gets excited about that and you need everyone on the team to have a reason to be excited about the business.
AB: What's the biggest mistake you see agency owners make that effects team turnover negatively?
WK: Owners tend to think that hiring a sales person is where their role ends in having a successful sales team. This is completely wrong; hiring is just the beginning. Owners need to equip sales teams with a systematic approach to prospecting, marketing, and sales conversations. They also need to provide them with technology to assist in all phases of prospecting, marketing, and selling. For the benefit of the producer and the agency.
A cloud-based CRM is preferred today so the sales team can access the data from the office or on the go. Managers should have complete access to all prospecting data to watch the growth and development of the agency pipeline and make budgeting plans accordingly.
Capturing this information in real-time is also necessary to be able to have one-on-one coaching conversations and help the team keep prospects moving through the pipeline, giving themselves as much opportunity for success as possible.
Another benefit that comes from having a complete CRM is to use the data collectively to review where the team is seeing success and where they’re struggling. For example, if you have a three-step sales process and producers are regularly moving successfully from meeting one to two, but then not getting from two to three, that’s an opportunity for training. What’s holding the team back from making that critical move?
Or if the manager sees prospects going into the pipeline, but no further movement, that provides an opportunity to coach producers in one-on-one conversations to help them overcome hurdles that may be holding them back.
To support the producers in their prospecting and selling activities, the agency needs to provide a comprehensive marketing effort. Marketing should be used to challenge and educate prospective clients and prepare them for the sales conversation. Without a marketing effort, the sales process is overly dependent on the producer, yet the agency as a whole should be invested in bringing on new business and retaining it year after year.
AB: Knowing that major changes to the healthcare system and coverage are coming, do you think becoming an agent will be more, or less, attractive?
WK: I see this as a matter of perspective. If “brokers” or “agents” think of themselves as simply that, and only provide the service of brokering health plans, then it will be much less attractive. In that model, the agency’s options are incredibly limited and overly dependent on the government and carrier decisions.
If, however, people approach the role as a consultant to employers, helping them drive improved operations and profitability through effective employee management, then the world is their oyster. Employers need help in many ways because their core business is threatened by the many distractions that come with managing employees, which continues to become increasingly complex. Expand the ways you can help and you expand your options for running a long-term, successful business.
AB: How do you feel about the future of health insurance agencies in recruitment & retention, and how do they prepare for changes on the horizon?
WK: Agencies are notoriously poor at making good hiring decisions, with two primary factors influencing the outcomes:
- Sales people naturally want to sell, and when they are the ones doing the hiring, instead of effectively evaluating a candidate, they tend to turn it into a competition to see if they can “sell” the candidate (potentially unknowingly).
- Owners tend to want a magic solution in hiring new producers: Simply bring people on who already know what to do and a network of people to talk to, and the revenue starts flowing. No training required.
These are flawed approaches to take into the hiring process, which then naturally influences the retention of producers. If things get off to a bad start, then neither party is happy with the results of the relationship and turnover becomes the obvious answer.
Prepare for changes on the horizon with a new approach:
- Have a defined hiring process which involves more than the owner and sales leader.
- Don’t limit recruiting to existing insurance producers. They already have habits established and will bring those with them, good or bad. Learn what those established habits and beliefs are, and don’t go into a recruiting and hiring situation expecting to find producers that are already “trained." Even if they are, they’ll be trained in somebody else’s ways, but then representing your company. Train to establish the habits and behaviors that represent your brand.
- And when the producer is selected, have a defined onboarding program to set the producer up for success. Plan to spend time – the owner’s/sales leader’s time – introducing the new producer to the agency’s way of working. Invest in any additional training that is necessary.
- A key part of the training is having a defined sales process that all producers are taught and follow. Have accountability measures in place to ensure consistency.
- Continue the training with regular one-on-one coaching and group sales meetings focused on preparation and practice, not simply reviewing results.
AB: What would you say to a young person considering this career path?
WK: Do it!
But follow the caveat that you need to fully vet the agency before jumping on board. Look for an agency that addresses the ideas outlined above and ask them to tell you about their:
- Three-year vision
- Sales process
- Onboarding and ongoing training program
- Sales coaching and mentoring program
If the agency is solely focused on selling insurance and their revenue is completely dependent on carrier commission, I’d move on. Look for another agency who is moving their model into a comprehensive consulting practice and building the back-office team to support that model.
This is a model that has unlimited potential for everyone on the team!
Photo by Olu Eletu