How to Determine if Independence is Right for You as an Insurance Agent

Many people who work in the insurance industry start off as captive agents. They work directly for a large insurance carrier as a regular employee, gaining the support and name recognition that comes along with that carrier. 

The other option for insurance agents is to become independent. When they do so, they are essentially small business owners, running everything in their agency from start to finish. 

There are many benefits of being an independent insurance agent, but it’s not for everyone. In this article, we’ll present some ways you can determine if independence is right for you as an insurance agent. 

Can You Handle the Responsibilities? 

Independent insurance agents have a lot of responsibilities they must shoulder. They have to handle every aspect of their business, including choosing and obtaining the technology they want to use, to marketing and sales efforts, and much more. 

As an independent agent, you also must work to establish approved relationships with carriers so that you can sell their insurance policies. This takes a lot of time, organization, effort and dedication. 

Independent agents must be self-starters as a result. They have to find ways to be motivated and work hard so they can build the business from the ground up.  

There are no large agencies or even other people to help and support you along the way. 

Can You Afford the Financial Uncertainty? 

Being independent gives you the freedom to determine your own earnings. You will be able to earn higher commissions and won’t be capped by anything that’s determined by the company you work for. 

The trade-off to that is you won’t have a salary to rely on in case you have a down sales week. Your income may also be inconsistent, with ebbs and flows. 

In addition, all costs related to the business will come out of your pocket. This includes paying for marketing, letterhead, sales materials and technology. 

Sometimes, it takes time to build your business, which means you may need to rely on personal savings as you’re building your business. 

Before you become independent, you should assess whether you can afford the financial uncertainty that can come with the job. You should also assess whether you have enough in your own savings to withstand potential down times in income so you can sustain your business for the long term. 

Have You Determined a Vision? 

All successful businesses have a vision for what they want to do and how they want to do it. If you want to be a good independent insurance agent, you should also have a vision — about what products you want to sell, who you want to target and how, and what will differentiate you from other agencies. 

Without this vision, you’ll be running blind, which can create significant challenges.  

Before you become independent, you should create a detailed business plan that includes your vision for the different aspects of your agency and how you are going to achieve those goals. 

Think about which insurance products you want to sell, what carriers you want to contract with, who your target market is going to be and what strategies you are going to use to get where you want to be. 

It’s a good idea to set a short-, mid- and long-term vision for your agency. Things you might want to consider is whether you want to build out an agency with other employees, or whether you want to keep it small. 

Over time, you can adjust your vision based on your experience, your success and your preferences. 

Do You Have the Right Partners in Place? 

Unlike captive agents, independent insurance agents don’t have a structure of support provided to them from a major carrier. They are expected to do everything on their own. 

Independent agents don’t have to go it completely alone, though. By partnering with Good Life Insurance Associations (GLIA), independent agents can build a support network that will guide them to success. 

At GLIA, we provide independent agents with guidance, knowledge, tools, support and services that help them launch and sustain successful agencies. We also provide access to a full range of insurance products through more than 100 national carriers. 

For more information or to partner with us, visit us online or contact us today.