insurance department business plan

Insurance Agency Business Plan Template

Written by Dave Lavinsky

Over the past 20+ years, we have helped over 3,000 entrepreneurs and business owners create business plans to start and grow their insurance agencies. On this page, we will first give you some background information with regards to the importance of business planning. We will then go through an insurance agency business plan template step-by-step so you can create your plan today.

Download our Ultimate Insurance Business Plan Template here >

What is an Insurance Agency Business Plan?

A business plan provides a snapshot of your insurance agency as it stands today, and lays out your growth plan for the next five years. It explains your business goals and your strategy for reaching them. It also includes market research to support your plans.

Why You Need a Business Plan for an Insurance Agency

If you’re looking to start an insurance agency or grow your existing insurance agency you need a business plan. A business plan will help you raise funding, if needed, and plan out the growth of your insurance agency in order to improve your chances of success. Your insurance agency business plan is a living document that should be updated annually as your agency grows and changes.

Source of Funding for Insurance Agencies

With regards to funding, the main sources of funding for an insurance agency are personal savings, credit cards, bank loans, and angel investors. With regards to bank loans, banks will want to review your business plan and gain confidence that you will be able to repay your loan and interest. To acquire this confidence, the loan officer will not only want to confirm that your financials are reasonable. But they will want to see a professional plan. Such a plan will give them the confidence that you can successfully and professionally operate the business.

The second most common form of funding for an insurance agency is angel investors. Angel investors are wealthy individuals who will write you a check. They will either take equity in return for their funding, or, like a bank, they will give you a loan. Venture capitalists will not fund an insurance agency unless it is based on a unique, scalable technology.

Finish Your Business Plan Today!

Your insurance agency business plan should include 10 sections as follows:

Executive Summary

Your executive summary provides an introduction to your business plan, but it is normally the last section you write because it provides a summary of each key section of your plan.

The goal of your Executive Summary is to quickly engage the reader. Explain to them the type of insurance agency business you are operating and the status; for example, are you a startup, do you have an insurance agency that you would like to grow, or are you operating multiple insurance agency locations already.

Next, provide an overview of each of the subsequent sections of your plan. For example, give a brief overview of the insurance agency industry. Discuss the type of insurance agency you are operating. Detail your direct competitors. Give an overview of your target customers. Provide a snapshot of your marketing plan. Identify the key members of your team. And offer an overview of your financial plan.

Company Analysis

In your company analysis, you will detail the type of insurance agency you are operating.

For example, you might operate one of the following types:

• Direct Writer / Captive : this type of insurance agency only sells one insurance company’s products – like Allstate or State Farm
• Independent Insurance Agent : this type of insurance agency is privately-owned, and sells policies with may different insurance companies

In addition to explaining the type of insurance agency you operate, the Company Analysis section of your business plan needs to provide background on the business.

Include answers to question such as:

• When and why did you start the business?
• What milestones have you achieved to date? Milestones could include sales goals you’ve reached, new location openings, etc.
• Your legal structure. Are you incorporated as an S-Corp? An LLC? A sole proprietorship? Explain your legal structure here.

Industry Analysis

In your industry analysis, you need to provide an overview of the insurance business.

While this may seem unnecessary, it serves multiple purposes.

First, researching the insurance industry educates you. It helps you understand the market in which you are operating.

Secondly, market research can improve your strategy particularly if your research identifies market trends. For example, if there was a trend towards weather-related policy purchases, it would be helpful to ensure your plans call for flood insurance options.

The third reason for market research is to prove to readers that you are an expert in your industry. By conducting the research and presenting it in your plan, you achieve just that.

The following questions should be answered in the industry analysis section of your insurance company business plan:

• How big is the insurance agency business (in dollars)?
• Is the market declining or increasing?
• Who are the key competitors in the market?
• Who are the key insurance carriers in the market?
• What trends are affecting the industry?
• What is the industry’s growth forecast over the next 5 – 10 years?
• What is the relevant market size? That is, how big is the potential market for your insurance agency. You can extrapolate such a figure by assessing the size of the market in the entire country and then applying that figure to your local population.

Customer Analysis

The customer analysis section of your insurance agency business plan must detail the customers you serve and/or expect to serve.

The following are examples of customer segments: individuals, households, businesses, etc.

As you can imagine, the customer segment(s) you choose will have a great impact on the type of insurance agency you operate. Clearly baby boomers would want different pricing and product options, and would respond to different marketing promotions than recent college graduates.

Try to break out your target customers in terms of their demographic and psychographic profiles. With regards to demographics, include a discussion of the ages, genders, locations and income levels of the customers you seek to serve. Because most insurance agencies primarily serve customers living in their same geographic region, such demographic information is easy to find on government websites.

Psychographic profiles explain the wants and needs of your target customers. The more you can understand and define these needs, the better you will do in attracting and retaining your customers.

Finish Your Insurance Business Plan in 1 Day!

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With Growthink’s Ultimate Insurance Business Plan Template you can finish your plan in just 8 hours or less!

Competitive Analysis

Your competitive analysis should identify the indirect and direct competitors your business faces and then focus on the latter.

Direct competitors are other insurance agencies.

Indirect competitors are other options that customers have to purchase from you that aren’t direct competitors. This includes self pay and public (Medicare, Medicaid in the case of health insurance) insurance or directly working with an insurance carrier. You need to mention such competition to show you understand that not everyone who purchases insurance does so through an insurance agency.

With regards to direct competition, you want to detail the other insurance agencies with which you compete. Most likely, your direct competitors will be insurance agencies located in your geographic region.

For each such competitor, provide an overview of their businesses and document their strengths and weaknesses. Unless you once worked at your competitors’ businesses, it will be impossible to know everything about them. But you should be able to find out key things about them such as:

• What types of customers do they serve?
• What products do they offer?
• What is their pricing (premium, low, etc.)?
• What are they good at?
• What are their weaknesses?

With regards to the last two questions, think about your answers from the customers’ perspective.

The final part of your competitive analysis section is to document your areas of competitive advantage. For example:

• Will you provide superior insurance agency products/services?
• Will you provide insurance agency products that your competitors don’t offer?
• Will you make it easier or faster for customers to acquire your products?
• Will you provide better customer service?
• Will you offer better pricing?

Think about ways you will outperform your competition and document them in this section of your plan.

Marketing Plan

Traditionally, a marketing plan includes the four P’s: Product, Price, Place, and Promotion. For an insurance agency business plan, your marketing plan should include the following:

Product : in the product section you should reiterate the type of insurance agency that you documented in your Company Analysis. Then, detail the specific products/services you will be offering. For example, in addition to P&C insurance, will you also offer life insurance?

Price : Document the prices you will offer and how they compare to your competitors. Essentially in the product and price sub-sections of your marketing plan, you are presenting the menu items you offer and their prices.

Place : Place refers to the location of your insurance agency. Document your location and mention how the location will impact your success. For example, is your insurance agency located next to the Department of Motor Vehicles, or a heavily populated office building, etc. Discuss how your location might provide a steady stream of customers.

Promotions : the final part of your insurance agency marketing plan is the promotions section. Here you will document how you will drive customers to your location(s). The following are some promotional methods you might consider:

• Making your insurance agency’s front store extra appealing to attract passing customers
• Advertising in local papers and magazines
• Reaching out to local bloggers and websites
• Partnerships with local organizations (e.g., auto dealerships or car rental stores)
• Local radio advertising
• Banner ads at local venues

Operations Plan

While the earlier sections of your business plan explained your goals, your operations plan describes how you will meet them. Your operations plan should have two distinct sections as follows.

Everyday short-term processes include all of the tasks involved in running your insurance agency such as serving customers, procuring relationships with insurance carriers, negotiating with repair shops, etc.

Long-term goals are the milestones you hope to achieve. These could include the dates when you expect to acquire your 500th customer, or when you hope to reach $X in sales. It could also be when you expect to hire your Xth employee or launch a new location.

Management Team

To demonstrate your insurance agency’s ability to succeed as a business, a strong management team is essential. Highlight your key players’ backgrounds, emphasizing those skills and experiences that prove their ability to grow a company.

Ideally you and/or your team members have direct experience in the insurance agency business. If so, highlight this experience and expertise. But also highlight any experience that you think will help your business succeed.

If your team is lacking, consider assembling an advisory board. An advisory board would include 2 to 8 individuals who would act like mentors to your business. They would help answer questions and provide strategic guidance. If needed, look for advisory board members with experience in insurance agencies and/or successfully running small businesses.

Financial Plan

Your financial plan should include your 5-year financial statement broken out both monthly or quarterly for the first year and then annually. Your financial statements include your income statement, balance sheet and cash flow statements.

Income Statement : an income statement is more commonly called a Profit and Loss statement or P&L. It shows your revenues and then subtracts your costs to show whether you turned a profit or not.

In developing your income statement, you need to devise assumptions. For example, will you acquire 20 new customers per month or 50? And will sales grow by 2% or 10% per year? As you can imagine, your choice of assumptions will greatly impact the financial forecasts for your business. As much as possible, conduct research to try to root your assumptions in reality.

Balance Sheets : While balance sheets include much information, to simplify them to the key items you need to know about, balance sheets show your assets and liabilities. For instance, if you spend $100,000 on building out your insurance agency location and/or website, that will not give you immediate profits. Rather it is an asset that will hopefully help you generate profits for years to come. Likewise, if a bank writes you a check for $100.000, you don’t need to pay it back immediately. Rather, that is a liability you will pay back over time.

Cash Flow Statement : Your cash flow statement will help determine how much money you need to start or grow your business, and make sure you never run out of money.

In developing your Income Statement and Balance Sheets be sure to include several of the key costs needed in starting or growing an insurance agency:

• Location build-out including design fees, construction, etc.
• Marketing expenses
• Website development
• Payroll or salaries paid to staff
• Business insurance
• Taxes and permits
• Legal expenses

Attach your full financial projections in the appendix of your plan along with any supporting documents that make your plan more compelling. For example, you might include your store design blueprint or location lease.

Insurance Business Plan Summary

Putting together a business plan for your insurance agency is a worthwhile endeavor. If you follow the template above, by the time you are done, you will truly be an expert. You will really understand the insurance agency business, your competition and your customers. You will have developed a marketing plan and will really understand what it takes to launch and grow a successful insurance agency.

Download Our Insurance Business Plan PDF

You can download our insurance business plan PDF here . This is a business plan template you can use in PDF format.

Insurance Business Plan FAQs

What is the easiest way to complete my insurance business plan.

Growthink's Ultimate Insurance Business Plan Template allows you to quickly and easily complete your Insurance Business Plan.

Where Can I Download an Insurance Business Plan PDF?

You can download our insurance business plan PDF template here . This is a business plan template you can use in PDF format.

Don’t you wish there was a faster, easier way to finish your Insurance business plan?

OR, Let Us Develop Your Plan For You

Since 1999, Growthink has developed business plans for thousands of companies who have gone on to achieve tremendous success.   Click here to learn about Growthink’s business plan writing services .

Other Helpful Business Plan Articles & Templates

Insurance Business Plan Template

Written by Dave Lavinsky

Business Plan Outline

• Insurance Business Plan Home
• 1. Executive Summary
• 2. Company Overview
• 3. Industry Analysis
• 4. Customer Analysis
• 5. Competitive Analysis
• 6. Marketing Plan
• 7. Operations Plan
• 8. Management Team
• 9. Financial Plan

Insurance Agency Business Plan

You’ve come to the right place to create your own business plan.

We have helped over 100,000 entrepreneurs and business owners create business plans and many have used them to start or grow their insurance companies.

Essential Components of a Business Plan For an Insurance Agency

Below we describe what should be included in each section of a business plan for a successful insurance agency and links to a sample of each section:

• Executive Summary – In the Executive Summary, you will provide a high-level overview of your business plan. It should include your agency’s mission statement, as well as information on the products or services you offer, your target market, and your insurance agency’s goals and objectives.
• Company Overview – This section provides an in-depth company description, including information on your insurance agency’s history, ownership structure, and management team.
• Industry Analysis – Also called the Market Analysis, in this section, you will provide an overview of the industry in which your insurance agency will operate. You will discuss trends affecting the insurance industry, as well as your target market’s needs and buying habits.
• Customer Analysis – In this section, you will describe your target market and explain how you intend to reach them. You will also provide information on your customers’ needs and buying habits.
• Competitive Analysis – This section will provide an overview of your competition, including their strengths and weaknesses. It will also discuss your competitive advantage and how you intend to differentiate your insurance agency from the competition.
• Marketing Plan – In this section, you will detail your marketing strategy, including your advertising and promotion plans. You will also discuss your pricing strategy and how you intend to position your insurance agency in the market.
• Operations Plan – This section will provide an overview of your agency’s operations, including your office location, hours of operation, and staff. You will also discuss your business processes and procedures.
• Management Team – In this section, you will provide information on your insurance agency’s management team, including their experience and qualifications.
• Financial Plan – This section will detail your insurance agency’s financial statements, including your profit and loss statement, balance sheet, and cash flow statement. It will also include information on your funding requirements and how you intend to use the funds.

Next Section: Executive Summary >

Insurance Agency Business Plan FAQs

What is an insurance agency business plan.

An insurance agency business plan is a plan to start and/or grow your insurance business. Among other things, it outlines your business concept, identifies your target customers, presents your marketing plan and details your financial projections.

You can  easily complete your insurance agency business plan using our Insurance Agency Business Plan Template here .

What Are the Main Types of Insurance Companies?

There are a few types of insurance agencies. Most companies provide life and health insurance for individuals and/or households. There are also agencies that specialize strictly in auto and home insurance. Other agencies focus strictly on businesses and provide a variety of liability insurance products to protect their operations. 

What Are the Main Sources of Revenue and Expenses for an Insurance Agency Business?

The primary source of revenue for insurance agencies are the fees and commissions paid by the client for the insurance products they choose.

The key expenses for an insurance agency business are the cost of purchasing the insurance, licensing, permitting, and payroll for the office staff. Other expenses are the overhead expenses for the business office, utilities, website maintenance, and any marketing or advertising fees. 

How Do You Get Funding for Your Insurance Agency Business Plan?

Insurance agency businesses are most likely to receive funding from banks. Typically you will find a local bank and present your business plan to them. Other options for funding are outside investors, angel investors, and crowdfunding sources. This is true for a business plan for insurance agent or an insurance company business plan.

What are the Steps To Start an Insurance Business?

Starting an insurance business can be an exciting endeavor. Having a clear roadmap of the steps to start a business will help you stay focused on your goals and get started faster.

1. Develop An Insurance Business Plan - The first step in starting a business is to create a detailed insurance business plan that outlines all aspects of the venture. This should include potential market size and target customers, the services or products you will offer, pricing strategies and a detailed financial forecast.  

2. Choose Your Legal Structure - It's important to select an appropriate legal entity for your insurance business. This could be a limited liability company (LLC), corporation, partnership, or sole proprietorship. Each type has its own benefits and drawbacks so it’s important to do research and choose wisely so that your insurance business is in compliance with local laws.

3. Register Your Insurance Business - Once you have chosen a legal structure, the next step is to register your insurance business with the government or state where you’re operating from. This includes obtaining licenses and permits as required by federal, state, and local laws. 

4. Identify Financing Options - It’s likely that you’ll need some capital to start your insurance business, so take some time to identify what financing options are available such as bank loans, investor funding, grants, or crowdfunding platforms. 

5. Choose a Location - Whether you plan on operating out of a physical location or not, you should always have an idea of where you’ll be based should it become necessary in the future as well as what kind of space would be suitable for your operations. 

6. Hire Employees - There are several ways to find qualified employees including job boards like LinkedIn or Indeed as well as hiring agencies if needed – depending on what type of employees you need it might also be more effective to reach out directly through networking events. 

7. Acquire Necessary Insurance Equipment & Supplies - In order to start your insurance business, you'll need to purchase all of the necessary equipment and supplies to run a successful operation. 

8. Market & Promote Your Business - Once you have all the necessary pieces in place, it’s time to start promoting and marketing your insurance business. This includes creating a website, utilizing social media platforms like Facebook or Twitter, and having an effective Search Engine Optimization (SEO) strategy. You should also consider traditional marketing techniques such as radio or print advertising. 

Learn more about how to start a successful insurance business:

• How to Start an Insurance Business

Where Can I Get an Insurance Business Plan PDF?

You can download our free insurance business plan template PDF here . This is a sample insurance business plan template you can use in PDF format.

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Launch Your New Insurance Agency With This Business Plan Template

Whether you're a brand new agent or one with several decades of experience, the idea of opening a new insurance agency probably seems daunting—where do you start?

One of the first things you’ll need to do is come up with a business plan for your insurance agency. After all, you can walk into a bank or a potential investor’s office looking for funding, but you won’t get very far unless you have a robust insurance agency business plan that proves you’re on the right track toward turning a profit in the near future.

Follow the steps below when building out your insurance business plan to maximize your chances of securing funding and getting your new agency off to a strong start.

7 Steps To Build Your Insurance Agency Business Plan

1. develop your executive and business summaries..

In business plan terms, the executive summary is the driving force behind your other decisions. It should explain why you’re starting your agency. The business summary is similar, but it should narrow down your “why” into a list of “hows.”

Ask yourself:

• Why do you want to open an agency?
• What types of insurance do you wish to sell?
• What do you hope to accomplish?
• What return on investment do you expect to receive?
• How are you going to generate demand and ensure supply for your service?

Jot your answers down so you can refer back to them as you move forward.

2. Decide whether you want to be a captive agent or an independent agent.

Many large agencies, such as Allstate and Farmers, work with captive agents who can only sell insurance for that specific provider. Independent agents, on the other hand, can sell insurance for multiple providers, but they get locked out of working with the big-name captive carriers who only work with captive agents. (Read more about captive agents here and get a seasoned agent’s POV on both types of agents here. )

Before you can nail down the details of the rest of your business plan, you’ll have to make a choice between these two options.

3. Do a market analysis.

Though it might seem like a tedious process, conducting a thorough market analysis is crucial to your success. Analyzing your local market—including the backgrounds, shopping behaviors, and preferences of your target customers—gives you the insights you’ll need to attract these folks to your business.

Your market analysis will look a little different depending on whether you prefer to be a captive or an independent agent. The state you live in is another factor that will affect your analysis—in fact, it may even influence your decision to be captive or independent.

Take a close look at the demographics of your region.

• How many homeowners live in your state?
• What’s the average insurance premium per home?
• How many people live in each home, on average?
• How many drivers live in your state?
• How many vehicles does the average household own?
• Do you live in an area with an aging population ?
• How many families live in your region?
• What insurance carriers do locals in your state gravitate toward?
• In your area, what might be some successful strategies for retaining clients (rather than just acquiring them)?

These questions are all important, but pay particular attention to the last one. If you open an agency without a plan for client retention, you’re going to struggle. And, unfortunately, this is one of the most overlooked aspects of an insurance agency business plan.

4. Identify where you’ll find your first clients.

It’s one thing to know there are X number of potential clients living in your state, but it’s quite another to have a plan that will help you reach out to those folks and land your first policy sales.

Some investors will require a list of leads before they’ll even consider funding your agency. Even if it’s not a requirement, it’s always a good idea to have a pipeline ready to go. This is where getting set-up for purchasing warm leads from EverQuote can put you in a great position for success.

Plus, tackling this step before you even open your doors will help you better understand the costs you’ll incur—and therefore how much startup funding you will need.

You might also consider other options, such as placing ads in local newspapers, going to networking events, investing in digital marketing, sponsoring local Little League teams, or asking for referrals.

5. Create a financial plan.

Many new agencies fail because their owners overlooked something critical during startup. Do your best to look at your financial plans from every angle:

• Where will you find leads, and how much will they cost?
• What is your advertising budget?
• Does this budget line up with the going rates of local newspapers, billboards, or online ads?
• Do you plan to have 1099 employees or W2 employees selling insurance for your agency?
• How will you decide on a commission and benefits structure for these employees?
• What retention and loss ratios (for clients and employees) do you expect based on the numbers of other agencies in your area?
• How will you handle the delay between policy renewals and income hitting your bank account?
• If there are X amount of people shopping for insurance in your area, what percentage of those people are in a niche you can serve?
• From that percentage of potential clients, how many do you think you can successfully land?
• If you sell policies to these customers, how much will you earn from their premiums?
• How do your projected profits compare to your expected advertising costs, the cost to buy leads, office rent, and other expenses?

Take detailed notes of your calculations, and try to run the numbers a few different ways to obtain a conservative outcome, a likely outcome, and a “best case scenario.”

6. Draw up a formal business plan using a proven format.

Your notes will be incredibly valuable as you move forward, but you’ll need a way to present them clearly and concisely in a way that looks attractive to investors.

Loan officers and investors don’t want to read long-form essays detailing your business background and your ideas for the future. Keep your format simple and straightforward, with clear sections that answer the questions investors will want to know.

We recommend a format similar to the following:

Executive Summary Overall mission Primary objectives Keys to success Financial plans Profit forecast for at least three years Business Summary Business overview Summary of startup costs Funding you’ll require Company executives/ownership Services Services you provide Market Analysis Overall business analysis Details of your competition Buying patterns of your competition Your planned buying patterns Market segmentation and analysis Target market strategies Include details for each market segment Strategy Your competitive edge Marketing strategy Sales strategy Yearly sales projections Key milestones Management Your plan for finding staff Financial Plan Funding you have accepted Funding you will need Detailed startup costs Calculations for your break-even point Projected profit Yearly profit Gross and net yearly profit Anticipated losses, if any Cash flow patterns Plans for balance sheet Calculations of important business ratios

7. Revise and adjust your plan over time.

You may not secure funding for your agency immediately. Even if you do, you’ll likely find that your real world numbers don’t match up exactly with your calculated projections. Plus, carriers frequently change their underwriting policies, and the economy itself is always in a state of flux.

Keep your business plan current by updating the information anytime circumstances change.

Start your journey with a full lead pipeline from EverQuote.

One of the scariest parts about starting a new agency is not being certain where and when you’ll be able to start making sales.

Skip the fear and the unknown and go right to making sales with warm real-time leads from EverQuote. Whether you’re still trying to find startup funding or your doors are already open, you can always boost your business and maximize your chances of a steady income by working with EverQuote.

Connect with us today.

Topics: Featured , Insurance Agency Growth

About the Author Chris Durling, VP of P&C Sales

Chris Durling is a visionary leader in P&C insurance sales and distribution, with over 10 years of experience in the industry.

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Insurance Agency Business Plan Template

Writing a successful business plan for your insurance agency + template.

If you’re looking to start or grow an insurance agency , you need a business plan. Your plan will outline your business goals and strategies, and how you plan on achieving them. It will also detail the amount of funding you need, and if needed, present a case to investors and lenders regarding why they should invest in your business.

In this article, we’ll explain why you should invest the time and energy into creating an insurance agency business plan, and provide you with an insurance agency business plan template that includes an overview of what should be included in each section.

Why Write a Business Plan For an Insurance Agency ?

There are many reasons to write a business plan for an insurance agency , even if you’re not looking for funding. A business plan can help you see potential pitfalls in your business strategy, as well as identify opportunities you may not have considered. It can also help you track your progress and adjust your plans as needed.

That said, if you are looking for funding, a business plan is essential. Investors and lenders want to see that you have a solid understanding of your industry, your customers, and your competition. They also want to know that you have a realistic view of your financial situation and how much money you’ll need to get started.

How To Write a Business Plan For an Insurance Agency  

While every business plan is different, there are 10 essential components that all insurance agency business plans should include:

Executive Summary

Company description, industry analysis, customer analysis, competitor analysis, marketing plan, operations plan, management team, financial plan.

Keep in mind that you’ll need to tailor this information to your specific type of insurance agency , but these 10 components should be included in every plan.

The executive summary is the first section of your business plan, but it’s often written last. This is because it provides an overview of the entire document.

In the executive summary, briefly explain what your business does, your business goals, and how you plan on achieving them. You should also include a brief overview of your financial situation, including how much money you’ll need to get started.

For organizational purposes, you could create headings for each main section of your business plan to highlight the key takeaways.

For example, your insurance agency executive summary might look something like this:

Company Overview

[Insert Company Introduction / Short Summary]

Business Goals

[Insert Business Goals & How You Plan To Achieve Them]

Industry Overview

[Insert Industry Statistics on the Size of Your Market]

Competition

[Insert Overview of Competitors & Your Competitive Advantage]

[Insert Information About The Marketing Strategies You Will Use To Attract Clients/Customers]

Financial Overview

You can add and/or remove sections as needed, but these are the basics that should be included in every executive summary.

The next section of your insurance agency business plan is the company description, where you’ll provide an overview of your business.

Include information about your:

• Company History & Accomplishments To Date

Mission Statement and/or Company Values

With regards to the company overview, here you will document the type of insurance agency you operate. For example, there are several types of insurance agencies such as:

• Life insurance agency
• Health insurance agency
• Auto insurance agency
• Homeowners insurance agency
• Commercial Insurance Agency

For example, an insurance agency company description might look something like this:

We are an X type of insurance agency .

Company History

If an existing company: Since launching, our team has served X customers and generated $Y in revenue.

If startup: I conceived [company name] on this date. Since that time, we have developed the company logo, found potential space, etc. 

This is just an example, but your company description should give potential investors a clear idea of who you are, what you do, and why you’re the best at what you do.

The next section of your business plan is the industry analysis. In this section, you’ll need to provide an overview of the industry you’re in, as well as any trends or changes that might impact your business.

Questions you will want to answer include:

• What is the overall size of the insurance industry?
• How is the industry growing or changing?
• What are the major trends affecting the insurance industry?
• Who are the major players in the insurance industry?

For example, your industry analysis might look something like this:

The size of the insurance industry is $XX billion.

It is currently growing at an annual rate of XX% and is expected to reach $XX billion by the year 20XX. The insurance industry has been booming in recent years.

Major trends affecting the industry are larger companies consolidating and the rise of digital marketing and e-commerce.

How We Fit Into The Industry

This is just an example, but your industry analysis should give potential investors a clear idea of the overall industry, and how your company fits into that industry.

The next section of your insurance agency business plan is the customer analysis. In this section, you’ll need to provide an overview of who your target customers are and what their needs are.

• Who are your target customers?
• What are their needs?
• How do they interact with your industry?
• How do they make purchasing decisions?

You want a thorough understanding of your target customers to provide them with the best possible products and/or services. Oftentimes, you will want to include the specific demographics of your target market, such as age, gender, income, etc., but you’ll also want to highlight the psychographics, such as their interests, lifestyles, and values.

This information will help you better understand your target market and how to reach them.

For example, your customer analysis might look something like this:

Target Market & Demographics

The demographic (age, gender, location, income, etc.) profile of our target insurance agency customer is as follows: 

– Age: 25-60

– Gender: Male/Female

– Location: Anywhere in the United States

– Income: $50,000-$250,000

– Education: College degree or higher

Psychographics

Our core customer interests are as follows: 

– Saving money: They are always looking for ways to save money, whether it’s on their insurance premiums or other household expenses.

– Convenience: They value convenience and want to be able to do business with companies that make their lives easier.

In summary, your customer analysis should give potential investors a clear idea of who your target market is and how you reach them.

The next section of your business plan is the competitor analysis. In this section, you’ll need to provide an overview of who your major competitors are and their strengths and weaknesses.

• Who are your major competitors?
• What are their strengths and weaknesses?
• How do they compare to you?

You want to make sure that you have a clear understanding of your competition so that you can position yourself in the market. Creating a SWOT Analysis (strengths, weaknesses, opportunities, threats) for each of your major competitors helps you do this. 

For example, your competitor analysis might look something like this:

Major Competitors

XYZ Company is our major competitor. Its offerings include this, this and this. Its strengths include XYZ, and its weaknesses include XYZ.

Competitive Advantage

Your competitor analysis should give potential lenders and investors a clear idea of who your major competitors are and how you compare to them.

The next section of your business plan is the marketing plan. In this section, you’ll need to provide an overview of your marketing strategy and how you plan on executing it.

Specifically, you will document your “4 Ps” as follows:

• Products/Services : Here is where you’ll document your product/service offerings.
• Price : Detail your pricing strategy here.
• Place : Document where customers will find you and whether you will use distribution channels (e.g., partnerships) to reach them.
• Promotion : Here you will document how you will reach your target customers. For instance, insurance agencies often reach new customers via promotional tactics including online advertising, direct mail, and personal selling.

For example, your marketing plan might look something like this:

Products/Services

We offer the following products/services: 

We will use a premium pricing strategy to establish ourselves as the highest quality brand.

We will serve customers directly and through a partnership with XYZ company.

As you can see, your marketing plan should give potential investors a clear idea of your marketing objectives, strategies, and tactics.

The next section of your business plan is the operations plan. In this section, you’ll need to provide an overview of your company’s day-to-day operations and how they will be structured.

• What are your company’s daily operations?
• How are your company’s operations structured?
• Who is responsible for each task?

Your operations plan should be detailed and concise. You want to make sure that potential investors have a clear understanding of your company’s day-to-day operations and how they are structured.

You will also include information regarding your long-term goals for your operations and how you plan on achieving them.

For example, your operations plan might look something like this:

Daily Operations

Our company’s daily operations include XYZ.

Operational Structure

Our company is structured as follows:

• Department 1
• Department 2
• Department 3

Each department is responsible for XYZ tasks.

Long-Term Goals

Our long-term goals for our operations are to achieve the following over the next five years.

Date 1: Goal 1

Date 2: Goal 2

Date 3: Goal 3

Date 4: Goal 4

Your operations plan should give readers a clear idea of your company’s day-to-day operations, how they are structured, and your long-term goals for the company.

The next section of your business plan is the management team. In this section, you’ll need to provide an overview of your management team and their experience.

• Who is on your management team?
• What are their qualifications?
• What is their experience?

Your management team ideally includes individuals who are experts in their respective fields. You want to make sure that lenders and investors have a clear understanding of your management team’s qualifications and experience, and feel they can execute on your plan.

For example, your management team might look something like this:

Our management team is comprised of the following X individuals with the following experience.

Team Member 1: 

Team member 1’s qualifications and experience include XYZ.

Team Member 2: 

Your management team should give potential lenders and investors a clear idea of who is on your team and how their qualifications and experience will help your company succeed.

The final core section of your business plan is the financial plan. In this section, you’ll need to provide an overview of your company’s financials.

• What are your company’s projected revenues?
• What are your company’s projected expenses?
• What is your company’s projected growth rate?
• How much funding do you need and for what purposes? For example, most startup insurance agencies need outside funding for pre-launch activities such as licenses, office space, and marketing initiatives.

Your financial plan should give potential investors a clear understanding of your company’s financials. While you may include a summary of this information in this section, you will include full financial statements in the appendix of your business plan.

For example, your financial plan might look something like this:

Our company’s projected revenues over the next five years are $XYZ.

Expenses & Net Income

Our company’s projected expenses and net income over the next five years are $XYZ.

Uses of Funding

This is just an example, but your financial plan should give potential investors a clear idea of your company’s financial projections.

The final section of your business plan is the appendix. In this section, you’ll need to provide any additional information that was not included in the previous sections.

This may include items such as:

• Full financial statements
• Resumes of key management team members
• Letters of reference
• Articles or press releases
• Marketing materials
• Product information
• Any other relevant information

By including this information in the appendix, you are allowing potential investors and lenders to learn more about your company.

In summary, writing an insurance agency business plan is a vital step in the process of starting and/or growing your own business.

A business plan will give you a roadmap to follow. It can also help you attract investors and partners.

By following the tips outlined in this article, you can be sure that your business plan will be effective and help you achieve your goals.

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How To Write an Insurance Company Business Plan + Template

Creating a business plan is essential for any business, but it can be especially helpful for insurance companies that want to improve their strategy and/or raise funding.

A well-crafted business plan not only outlines the vision for your company, but also documents a step-by-step roadmap of how you are going to accomplish it. In order to create an effective business plan, you must first understand the components that are essential to its success.

This article provides an overview of the key elements that every insurance company owner should include in their business plan.

Download the Ultimate Insurance Business Plan Template

What is an Insurance Company Business Plan?

An insurance company business plan is a formal written document that describes your company’s business strategy and its feasibility. It documents the reasons you will be successful, your areas of competitive advantage, and it includes information about your team members. Your business plan is a key document that will convince investors and lenders (if needed) that you are positioned to become a successful venture.

Why Write an Insurance Company Business Plan?

An insurance company business plan is required for banks and investors. The document is a clear and concise guide of your business idea and the steps you will take to make it profitable.

Entrepreneurs can also use this as a roadmap when starting their new company or venture, especially if they are inexperienced in starting a business.

Writing an Effective Insurance Company Business Plan

The following are the key components of a successful insurance company business plan:

Executive Summary

The executive summary of an insurance company business plan is a one to two page overview of your entire business plan. It should summarize the main points, which will be presented in full in the rest of your business plan.

• Start with a one-line description of your insurance company
• Provide a short summary of the key points in each section of your business plan, which includes information about your company’s management team, industry analysis, competitive analysis, and financial forecast among others.

Company Description

This section should include a brief history of your company. Include a short description of how your company started, and provide a timeline of milestones your company has achieved.

If you are just starting your insurance company , you may not have a long company history. Instead, you can include information about your professional experience in this industry and how and why you conceived your new venture. If you have worked for a similar company before or have been involved in an entrepreneurial venture before starting your insurance company firm, mention this.

You will also include information about your chosen insurance company business model and how, if applicable, it is different from other companies in your industry.

Industry Analysis

The industry or market analysis is an important component of an insurance company business plan. Conduct thorough market research to determine industry trends and document the size of your market. 

Questions to answer include:

• What part of the insurance industry are you targeting?
• How big is the market?
• What trends are happening in the industry right now (and if applicable, how do these trends support the success of your company)?

You should also include sources for the information you provide, such as published research reports and expert opinions.

Customer Analysis

This section should include a list of your target audience(s) with demographic and psychographic profiles (e.g., age, gender, income level, profession, job titles, interests). You will need to provide a profile of each customer segment separately, including their needs and wants.

For example, the customers of an insurance company may include individuals, families, small businesses, and large corporations.

You can include information about how your customers make the decision to buy from you as well as what keeps them buying from you.

Develop a strategy for targeting those customers who are most likely to buy from you, as well as those that might be influenced to buy your products or insurance company services with the right marketing.

Competitive Analysis

The competitive analysis helps you determine how your product or service will be different from competitors, and what your unique selling proposition (USP) might be that will set you apart in this industry.

For each competitor, list their strengths and weaknesses. Next, determine your areas of competitive differentiation and/or advantage; that is, in what ways are you different from and ideally better than your competitors.

Below are sample competitive advantages your insurance company may have:

• Specialized industry knowledge
• Proven track record
• Strong customer relationships
• Robust product offerings
• Innovative solutions

Marketing Plan

This part of the business plan is where you determine and document your marketing plan. . Your plan should be clearly laid out, including the following 4 Ps.

• Product/Service : Detail your product/service offerings here. Document their features and benefits.
• Price : Document your pricing strategy here. In addition to stating the prices for your products/services, mention how your pricing compares to your competition.
• Place : Where will your customers find you? What channels of distribution (e.g., partnerships) will you use to reach them if applicable?
• Promotion : How will you reach your target customers? For example, you may use social media, write blog posts, create an email marketing campaign, use pay-per-click advertising, launch a direct mail campaign. 
• Or, you may promote your insurance company business via word of mouth.

Operations Plan

This part of your insurance company business plan should include the following information:

• How will you deliver your product/service to customers? For example, will you do it in person or over the phone only?
• What infrastructure, equipment, and resources are needed to operate successfully? How can you meet those requirements within budget constraints?

The operations plan is where you also need to include your company’s business policies. You will want to establish policies related to everything from customer service to pricing, to the overall brand image you are trying to present.

Finally, and most importantly, in your Operations Plan, you will lay out the milestones your company hopes to achieve within the next five years. Create a chart that shows the key milestone(s) you hope to achieve each quarter for the next four quarters, and then each year for the following four years. Examples of milestones for an insurance company include reaching $X in sales. Other examples include expanding to a new geographic market, launching a new product or service line, or signing on new major customers.

Management Team

List your team members here including their names and titles, as well as their expertise and experience relevant to your specific insurance industry. Include brief biography sketches for each team member.

Particularly if you are seeking funding, the goal of this section is to convince investors and lenders that your team has the expertise and experience to execute on your plan. If you are missing key team members, document the roles and responsibilities you plan to hire for in the future.

Financial Plan

Here you will include a summary of your complete and detailed financial plan (your full financial projections go in the Appendix). 

This includes the following three financial statements:

Income Statement

Your income statement should include:

• Revenue : how much revenue you generate.
• Cost of Goods Sold : These are your direct costs associated with generating revenue. This includes labor costs, as well as the cost of any equipment and supplies used to deliver the product/service offering.
• Net Income (or loss) : Once expenses and revenue are totaled and deducted from each other, this is the net income or loss.

Sample Income Statement for a Startup Insurance Company

Balance sheet.

Include a balance sheet that shows your assets, liabilities, and equity. Your balance sheet should include:

• Assets : All of the things you own (including cash).
• Liabilities : This is what you owe against your company’s assets, such as accounts payable or loans.
• Equity : The worth of your business after all liabilities and assets are totaled and deducted from each other.

Sample Balance Sheet for a Startup Insurance Company

Cash flow statement.

Include a cash flow statement showing how much cash comes in, how much cash goes out and a net cash flow for each year. The cash flow statement should include:

• Cash Flow From Operations
• Cash Flow From Investments
• Cash Flow From Financing

Below is a sample of a projected cash flow statement for a startup insurance company business.

Sample Cash Flow Statement for a Startup Insurance Company

You will also want to include an appendix section which will include:

• Your complete financial projections
• A complete list of your company’s business policies and procedures related to the rest of the business plan (marketing, operations, etc.)
• Any other documentation which supports what you included in the body of your business plan.

Writing a good business plan gives you the advantage of being fully prepared to launch and/or grow your insurance company . It not only outlines your business vision but also provides a step-by-step process of how you are going to accomplish it. All in all, a business plan is a key to the success of any business.  

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How To Write an Insurance Agency Business Plan + Template

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Crafting an Effective Insurance Agency Business Plan

If you're an independent insurance agent, you know that success doesn't happen by chance. It requires strategic planning and a clear roadmap for the future. That's where an insurance agency business plan comes into play. 

In this guide, we'll explore what a business plan is, why it's essential, and how to create one tailored to your home insurance agency.

At a glance:

• Crafting a well-defined insurance agency business plan provides strategic direction and goal-setting for success.
• A comprehensive business plan allows for adaptability in an ever-evolving industry.
• Defining your brand, researching funding options, and staying compliant with regulations, are the ingredients that can transform your business plan into an effective tool for growth.

Benefits of having a business plan

Having a solid roadmap is like holding a compass in a dense forest. It not only guides you on how to become a successful insurance agency, but also ensures you stay on course.

Strategic direction

So let’s continue that analogy: you’re on a road trip without a map, compass, or GPS. You might eventually reach your destination, but it would be a long and uncertain journey. Similarly, running an insurance agency without a business plan is like traveling without a guide. A well-crafted plan provides a clear path and helps you stay focused on your goals.

Goal setting

Setting realistic and achievable goals is vital for any business. Your insurance agency business plan acts as a compass, allowing you to establish clear objectives. Whether you want to increase your client base, revenue, or expand your services, a business plan helps you chart the course.

Investor confidence

If you find yourself in a place to seek external funding, whether from investors or lenders, a comprehensive business plan is a must. It demonstrates that you've thought through your business strategy, increasing your chances of securing financial support.

Adaptability

The insurance industry is never stagnant, and as such adaptability is key. A business plan isn't set in stone; it's a living document that can be adjusted as circumstances change. If done correctly, it allows you to stay flexible and make informed decisions as market trends shift.

Key components of an insurance agency business plan

Your business plan is the document that transforms your vision into a tangible reality, ensuring your journey as an independent insurance agent is not only successful but prosperous too. 

Let’s explore the key components of an effective business plan, including the executive summary, company overview and more. 

Executive summary

The executive summary serves as the elevator pitch for your entire business plan. It's designed to capture the reader's attention and give them a quick, compelling overview of your insurance agency. You'll want to concisely highlight your agency's mission, vision, and goals. Think of it as distilling your agency's essence into a few powerful sentences. It's an invitation for the reader to learn more about your agency's journey.

Company overview

The company overview is your opportunity to introduce your insurance agency in detail. It's where you set the stage for the rest of your business plan. In this section, you’ll want to dive into the history of your agency, including its founding story, location(s), and size. You should also describe every type of insurance product you offer and provide a snapshot of what makes your agency unique.

Industry analysis

The industry analysis puts your industry knowledge to good use. It's all about understanding the broader insurance market, including its trends, challenges, and opportunities. In this section, you'll research and present data and insights into the insurance industry. Discuss market trends, regulatory changes, and any challenges that could impact your independent agency. Identifying opportunities within the industry allows you to position your agency effectively to take advantage of them.

Customer analysis

Understanding your target market is essential for tailoring your services and marketing efforts effectively. Create detailed buyer personas that encompass their needs, preferences, and pain points. This information is the foundation for developing products and services that resonate with your audience.

Competitive analysis

Knowing your competition is about gaining insights into their strengths and weaknesses. When performing your market analysis, or market research, be sure to look at factors like their market share, marketing strategy, pricing models, and customer service practices. Understanding how you stack up against the competition will help you develop a winning strategy that sets your agency apart.

Marketing plan

Your marketing plan is the strategic playbook for how you'll attract and retain clients. Specify your marketing channels, both online and offline; outline your budget and set measurable goals. Whether it's through digital advertising, content marketing, or print advertising, your marketing plan should maximize your independent insurance agency's reach and impact.

Operations plan

The operations plan is the behind-the-scenes blueprint for how your independent agency runs day-to-day. Detail your team structure, office setup, and technology requirements. It's about ensuring smooth workflow and efficient service delivery. This section gives a clear picture of how your agency operates on a daily basis.

Management team

Your management team is the engine that drives your agency. Introduce the key members of your management team and highlight their expertise. Explain how their skills and experiences contribute to the agency's success. 

Financial plan

The financial plan is the heart of your business plan. It's where you demonstrate that your agency is not just a vision but a financially viable venture. For any enterprise, including insurance agencies, it’s important to provide detailed financial projections in your business plan, including income statements, balance sheets, and cash flow statements. Set clear financial goals and explain how you intend to achieve them.

Tips for creating an effective insurance agency business plan

Creating an insurance agency business plan is akin to crafting that roadmap we talked about earlier. But here's the twist—this isn't just any road; it's twisting and on an ever-changing landscape. To navigate it successfully, you need more than just directions; you need insider tips and tricks.

Define your brand

Your brand is more than just a logo; it's who you are. Define your brand identity, including your mission statement, core values, and unique selling proposition. A strong brand will set you apart in a crowded market.

Research funding options

If you need capital to start or expand your agency, explore different funding options, which could include personal savings, loans, or investors. Your business plan should outline your funding needs and how you intend to secure the necessary capital.

Apply for licenses

Ensure that you comply with all regulatory requirements in your area. This includes obtaining the necessary licenses and insurance policies to operate legally. Failing to do so could jeopardize your agency's success.

Set goals and establish metrics

Your business plan should include specific, measurable, and time-bound goals. Track key performance indicators to measure your progress and adjust your strategy accordingly. Regularly reviewing and updating your plan keeps you on the path to success.

A strategic roadmap for success

For an independent insurance agency, a well-crafted business plan is not simply a document; it's a dynamic tool that provides strategic direction, fosters adaptability, and instills investor confidence. By defining your brand, understanding your market, and detailing your operational and financial strategies, your insurance agency business plan becomes the compass guiding you through the complexities of the industry. 

With clear goals, a solid management team, and a proactive approach to change, your agency can navigate the insurance industry effectively, ensuring not only agency survival but also sustainable growth

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About the Author

Alyssa Little | Senior Content Strategist

Alyssa is the Senior Content Strategist at Openly, collaborating with industry thought leaders to provide insightful and informative content in the home insurance space. With over 15 years experience in content marketing strategy, copywriting, and editing, Alyssa has refined her expertise through her work at such companies as Gartner, Nike, and Trupanion. Alyssa holds a BA in History from the University of Puget Sound and an MA in Museum Studies from Newcastle University.

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Home > Business Plan Templates > Insurance Agency Business Plan Template With Examples

Insurance Agency Business Plan Template With Examples

Apr 7, 2024 | Business Plan Templates

As you navigate through this insurance agency business plan template, remember that the primary goal is to thoroughly represent your business concept, operational plans, and financial projections for your insurance agency.

This template is merely a guide; it’s essential to tailor it to fit your agency’s unique attributes and market positioning, ensuring your ideas and strategic direction are communicated effectively. Because every insurance agency is different in its own way, it is okay to modify this business plan to suit your specific situation better.

Always back up your findings with solid data wherever possible and provide clear, concise explanations. Insurance can be a complex field for many individuals.

Your ability to simplify these complexities into understandable terms will serve you well in your plan and in the agency’s overall operations.

Table of Contents

1. Executive Summary

The executive summary provides a brief, comprehensive synopsis of your insurance agency. While it appears at the beginning of your plan, it is often written last to ensure that it encapsulates all critical points from the rest of the sections.

Introduction and Agency Overview

Start by succinctly introducing your insurance agency—its name, the types of insurance it covers (auto, health, home, life, etc.), and why it stands out in the market.

Example: SecureNow Insurance Agency is a customer-centric firm that provides holistic, efficient, and tailored insurance solutions. Its primary focus is on auto, home, health, and comprehensive business insurance packages.

Mission and Vision Statement

Your mission and vision should communicate the agency’s core principles, strategic goals, and commitment to its clientele.

Example: Our mission is to ensure our clients have peace of mind by offering personalised insurance coverage that adequately caters to their particular needs. Our vision is to be the leading insurance agency known for its exceptional customer service and innovative insurance solutions.

Geographic Area and Accessibility

Detail the area where your insurance agency primarily operates. Discuss where you have a significant market presence and the main demographic in these regions.

Example: SecureNow operates within the tri-state area, serving thousands of individuals, families, and businesses within these regions, offering them convenience and quicker claim processing.

Type of Insurance Services Offered

Briefly describe the kind of insurance services you provide.

Example: SecureNow offers a multitude of comprehensive insurance products – auto insurance for various vehicle classes, home insurance covering homeowners and rentals, health insurance with personalised plans, and business insurance covering liability, worker’s compensation, and commercial property.

Key Goals and Objectives

Outline your key short-term and long-term goals. These should be SMART (Specific, Measurable, Achievable, Realistic, Time-bound) goals.

Example: Our primary goal for the next year is to grow our customer base by 25% and increase our policy renewal rate to 85%. Over the next five years, we aim to expand into two additional states and to be rated among the top 5 most trusted insurance agencies in our operating regions.

2. Services Overview

This section offers an in-depth understanding of your insurance agency’s offerings, their relevance, and their potential impact on your customers’ lives.

Service Definition and Themes

Describe in detail the insurance products and services your agency provides. Explain the guiding principles for each type of insurance policy.

Example: SecureNow Insurance Agency provides a range of insurance services, each framed to offer our customers maximum protection and peace of mind. They encompass Auto Insurance, accommodating a range of vehicles and drivers; Home Insurance, offering comprehensive coverage for homeowners and renters; Health Insurance, aligning with varying needs and budgets; and Business Insurance, offering tailored solutions from liability to commercial asset protection.

Range of Insurance Services

List and highlight the main features of the services under each insurance type.

Example: Our Auto Insurance includes liability coverage, collision, comprehensive, and personalised bundles. Our Home Insurance provides coverage for the structure, personal belongings, liability, and additional living expenses. Health Insurance varies from basic coverage options to more comprehensive plans, including specific disease policies. Business Insurance delivers solutions for property damage, worker’s compensation, liability protections, and more.

Target Customer Analysis

Detail who benefits most from your policies, indicating how they are targeted and why they are the principal focus of your services.

Example: Our target customers range from young drivers seeking auto insurance, homeowners and renters needing property protection, individuals and families requiring health coverage, and large and small businesses seeking to mitigate their operational risks. Our focus remains on these groups as they represent a broad segment of the population most in need of reliable, affordable, and customizable insurance solutions.

3. Agency History and Organisation

This section provides a historical background of your insurance agency and insight into its organisational structure.

Legal Status and Structure

Specify your agency’s legal status—is it a limited liability company (LLC) , a partnership , a corporation, or a sole proprietorship ? Discuss why the particular business structure was chosen.

Example: SecureNow operates as a Limited Liability Company (LLC), chosen for its protective attributes and flexibility. This structure offers protection against personal liability and provides operational and management flexibilities akin to a partnership.

Owners and Management Team

Briefly introduce your agency’s owners and management, outlining their experience and contributions.

Example: SecureNow is owned and managed by John Doe and Jane Smith. John, a seasoned insurance professional with over 20 years in the industry, manages strategic decisions and partnerships. With an extensive background in customer service and operations, Jane oversees day-to-day operations, ensuring top-notch customer service and smooth agency functioning.

Key Milestones

Highlight key milestones in your agency’s history to demonstrate growth and impact over time.

Example: SecureNow was established in 2010 as a two-person firm, initially only offering auto insurance. In 2012, we expanded our services to include home insurance, followed by health insurance in 2015. We introduced our comprehensive business insurance solutions in 2018. Today, we serve over 10,000 clients across the tri-state area, thanks to our continuously expanding product portfolio and customer-centric approach.

4. Business Model

This section will depict how your agency operates, generates revenue, and strives towards financial sustainability.

Primary Revenue Sources

Describe your insurance agency’s main sources of income; this could include commissions, contingency bonuses, and fee-based services.

Example: SecureNow’s primary revenue stream comes from commissions on each policy sold and renewed. We also earn contingency bonuses based on reaching certain targets set by the insurance carriers and fee-based income from consulting services for complex business insurance needs.

Planned Partnerships and Collaborations

Consider any partnerships or collaborations you intend to establish, including partnerships with other businesses, insurance carriers, and influential organisations.

Example: SecureNow is looking to form partnerships with major auto retailers and real estate agencies to provide insurance services to their customers, broadening our customer reach. We are also planning to collaborate with niche insurance carriers, expanding our range of specialised insurance products.

Special Projects

If any special initiatives are planned that can boost agency income or offer significant benefits to your agency, explain them here.

Example: One of our major upcoming initiatives is the launch of a comprehensive mobile app aimed at streamlining claim processes, making it easier for customers to buy, manage, and claim insurance. This app will not only help in customer retention but, with features like refer-a-friend, it will also help attract new customers .

5. Market Analysis

This section offers a deep dive into the market in which your insurance agency operates, including existing market needs, target demographics, and competitive environment.

Current Market Needs

Describe the insurance-related needs currently observed in your market. Use data and real examples to illustrate these needs.

Example: The tri-state area where we operate has a high concentration of small businesses (over 200,000), representing a significant demand for reliable business insurance solutions. Additionally, with an average of 5 million registered vehicles and a high homeownership rate, there is a substantial need for auto and home insurance packages.

Target Market Analysis

Detail the demographic, socioeconomic, and other relevant characteristics of the customers your agency aims to serve.

Example: Our target market encompasses small business owners in need of robust business insurance, drivers requiring comprehensive, affordable auto insurance, homeowners and renters seeking varying degrees of home insurance, and individuals/families at different life stages seeking health coverage. Our customer base is diverse and spans demographics, posing unique insurance needs, which we aim to cover comprehensively.

Competitive Analysis

Assess other insurance agencies operating in the same space, explore their approach, and underscore how your services differentiate.

Example: While other agencies in the region primarily deal with one or two types of insurance, SecureNow sets itself apart by providing a comprehensive roster of insurance services – auto, home, health, and business. Coupled with our personalised approach and excellent customer service, we offer a one-stop solution for varied insurance needs.

Positioning and Strategy

Explain how your agency is positioned to cater to market needs, target demographics, and competitive landscape. Detail your strategy to meet these needs.

Example: SecureNow positions itself as a full-service insurance agency, offering a wide range of products that cater to diverse customer segments under one roof. Our strategy involves educating our customers about their insurance needs and providing them with personalised solutions. We leverage our strong relationships with various insurance carriers to offer competitive rates and comprehensive coverage.

6. Marketing and Acquisition Strategy

This section outlines how you plan to attract new clients to your insurance agency, generate awareness about your range of services, and retain existing customers.

Marketing Strategy

Outline your approach to increase visibility and generate leads.

Example: SecureNow’s marketing strategy leverages both online and offline channels. We use Search Engine Optimization (SEO) and paid search advertising to increase our online visibility on popular search engines. Simultaneously, we utilise direct mail campaigns, local radio advertisements, and community events to broaden our reach within the local community.

Acquisition Plan

Describe your plan to acquire new customers. This plan may incorporate strategies like referral incentives, partnerships with other businesses, and lead-generation methods.

Example: We focus on customer referrals, offering incentives for every successful referral. SecureNow also plans to collaborate with local automobile dealerships and real estate agencies, providing insurance services to their customers to garner new clients.

Community Engagement and Outreach

Discuss your initiatives to engage with the community beyond the provision of insurance services.

Example: SecureNow regularly holds free insurance education seminars and financial planning workshops for the local community. We sponsor local events and sports teams, contributing to our brand visibility and showcasing our commitment to the community.

7. Operations

This section will cover how your insurance agency functions on a day-to-day basis, detailing staff recruitment, technology needs, and the agency’s operational structure.

Team Recruitment and Roles

Define how you plan to staff your insurance agency—the roles required, standards for each position, hiring plans, and recruitment strategies.

Example: SecureNow intends to recruit a mix of experienced professionals and new talent for roles including Insurance Agents, Customer Service Representatives, and Claims Handlers. We will also employ digital marketing experts to oversee our online presence and a strong management team to lead the agency. We aim to recruit from local colleges and also via online job portals to find individuals passionate about the insurance sector.

Office Structure and Management

Discuss the composition and function of your office. What roles do your employees play, and how are tasks divided among them?

Example: Our office operates with a hierarchy of Management, Sales, Customer Service, and Claims. While the management team oversees agency operations and strategic partnerships, the sales team focuses on acquiring new business and maintaining relationships with existing customers. The customer service team handles customer queries and escalations, and the claims team oversees the smooth processing of insurance claims.

Technology Requirements

Discuss the technology you need for smooth operation. This might include CRM for client management, digital tools for online marketing, or efficient hardware/software for everyday tasks.

Example: SecureNow utilises a CRM system to manage our client database, policy renewals, and marketing campaign data. We also employ digital tools like Google Analytics for online marketing efforts and use secure data servers to store sensitive data.

Office Space Requirements

Outline your requirements in terms of physical location. Do you need office spaces, meeting rooms, or parking lots?

Example: SecureNow currently operates from a commercial office building with spaces allocated for customer interactions, staff operations, and a meeting room. As a part of our five-year plan, we aim to open two more branch offices within the tri-state area.

8. Sales Strategy and Customer Retention

This section covers how your insurance agency plans to sell its services to potential customers and retain current clients.

Sales Tactics

Outline your strategy to sell insurance policies.

Example: SecureNow’s sales approach is primarily consultative, focusing on understanding customer needs and providing tailored insurance solutions. Our sales team is well-trained to communicate the benefits of our policies effectively and clarify any potential questions or doubts.

Website and Social Media

Discuss your agency’s online presence and how it would be used for customer communication and selling policies.

Example: SecureNow maintains an intuitive website where customers can learn about various insurance products, get quotes, and contact us for further assistance. We also run social media profiles on major platforms, sharing information on insurance basics, updates about our services, and customer success stories.

Customer Engagement and Retention

Explain how you plan to retain customers and enhance their satisfaction.

Example: SecureNow emphasises customer retention through personalised service, timely claim settlements, and regular communication. Our devoted customer service team efficiently handles policy inquiries and claim requests. We also run a loyalty rewards program that offers discounts on policy renewals and additional services for long-term customers.

9. Financial Projections

This section focuses on your agency’s financial aspects, detailing how funds will be generated and utilised.

Current/Projected Budget

Detail out whether you’re presenting your current budget or projecting a budget for the next financial year, including income and expenses.

Example: SecureNow’s projected income for the upcoming financial year is $1 million, taking into account commissions, fee-based incomes, and other sources. Operating expenses (office rent, staff salaries, marketing spending) are expected to amount to around $650,000, with profit expected to stand at $350,000 post-tax.

Proposed Financing

Discuss your proposed financing options, such as loans, investors, etc.

Example : At the moment, SecureNow operates on revenue earned through commissions and fee-based services. However, we are considering inviting investors for future expansion plans and exploring low-interest business loan options for immediate cash flow support.

Key Financial Assumptions and Justifications

Detail underlying assumptions in your financial plan, justifying why these assumptions have been made.

Example: Our projected revenue assumes a 15% increase in new policies and a 90% customer renewal rate based on the previous year’s growth. We believe this is achievable given our aggressive marketing plan and the introduction of new insurance products. We have also accounted for a 5% contingency fund in our budget to cover unexpected expenses.

10. Appendices

This section includes any additional documents or supporting material related to your agency’s business plan.

Organisational Chart

Include a visual representation of your insurance agency’s structure.

Example: An organisational chart highlighting the hierarchy from management to sales, customer service, and the claims department will make the agency structure clearer to stakeholders.

Resumes of Key Staff

Attach resumes or brief bios of key members of your management and staff to assure potential investors, partners, or even customers of their qualifications and expertise.

Example: We have included the resume of our Agency Manager, who has extensive insurance sector experience and has led SecureNow to become one of the most preferred insurance agencies in the area.

Detailed Budget

Provide a detailed budget if your financial plan references an annual budget with a breakdown of income and expenditures.

Example: An exhaustive breakdown of our annual budget shows our judicious allocation of resources, justifying operational expenses and projected revenues.

Related Market Research

Include any market research or customer data analysis that supports your business plan and gives weight to the strategies presented.

Example: Data from a Recent Customer Survey indicates high satisfaction levels with our services, validating our customer-centric approach. Similarly, results from a Market Analysis show a steady demand for comprehensive and personalised insurance solutions in our operating area, supporting our expansion plans.

Wrapping Up Our Insurance Agency Business Plan Template

Remember, an effective business plan doubles as a roadmap for your agency and an instrument of engagement for potential investors, partners, and high-ranking personnel you may seek to attract to your organisation.

Taking the time to complete this process will help you better understand your market, operational, and financial goals, which will help you navigate your insurance agency to success. Good luck!

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November 1979 - September 2023

Crafting a Winning Business Plan for Your Insurance Agency

Deanna deBara

Whether you have experience as a captive insurance agent or you’re an independent agent looking to branch away from working for others,  starting an insurance agency  might make sense as your next career move.

And now’s as good a time as any to start. In fact, broker and agency revenue  increased by 1.5% over the past five years —with growth expected to continue as the economy improves.

But with this growth and opportunity comes competition. The insurance industry is continuing to evolve, which means different companies—like those that use  insurtech  to blend insurance with technological innovations—are entering the fray and  competing for market share .

To give your new agency the edge over its competition and make sure your company is viable, you need a plan—an insurance agency business plan. Let’s look at why you need this document, what it should include, and other things to consider before you present your plan and launch your agency.

What Is a Business Plan—and Why Do You Need One?

A business plan is a document that outlines your approach to starting and running your agency. This document serves as a roadmap to follow at each stage of business growth, from your initial planning stages to achieving your  long-term goals . 

It can include information about how to structure and fund your agency, financial projections and goals, and guidance for how to run the agency as it evolves and grows.

There are a number of reasons you should consider creating a plan for your insurance agency, including:

• Help your agency succeed: About  20% of startups  fail within their first year. Though creating a business plan doesn’t guarantee your business will succeed, business owners who write out formal plans are  16% more likely to succeed  than entrepreneurs who wing it without one. Why? Planning helps you lay a solid foundation for your business, giving you a step-by-step guide for how to reach your goals.
• Secure funding: Many lenders require you to provide a plan for your business if you apply for a business loan or investment. The reason? A plan can reveal how viable your business is—including if you (and your leadership) are qualified to run a successful agency, what your  financial forecast  is for hitting different milestones, and what your overall objectives are for achieving success. In other words, lenders and investors want to know the likelihood of you paying off your debt and earning a profit—and, if so, how soon you’ll hit both milestones. A business plan helps them get a better idea of that likelihood—information they can use to determine if they want to lend to or invest in your business.
• Inform your decisions over time: A business plan for an insurance agency is a roadmap that defines your goals and objectives—as well as how to achieve them. But as your business grows, it’s easy to lose track of your long-term plans. Being able to refer to a document that details your plans can help you remain committed, even as your team—and agency—grows.

What To Include in Your Insurance Agency Plan 

Now that you know the importance of writing an insurance agency business plan, the next question is: what do you include in it? 

When it comes to creating a plan for your insurance agency, there aren’t any hard requirements. In fact, your plan can be in any format you’d like (including a “lean plan,” which focuses only on key elements)—though, if you’re looking for a bank loan or investment, your plan  should  be as detailed as possible.

Elements you might want to consider including in a  traditional business plan  for insurance agencies include:

Executive Summary

As its name implies, the executive summary is a brief overview of your plan. It should include general information about your insurance agency, though this information might change over time depending on how long your agency is operational. 

For example, a startup insurance agency might include a brief mention of market competition and its planned growth strategy. On the other hand, an established agency might summarize past achievements and include information about employees.

Items to include in your executive summary are:

• Your agency name
• Your mission statement
• A high-level overview of the products or services you offer or plan to offer
• Background on you  and your agency’s leadership team
• Information about your employees
• The location and market you operate or will operate in
• A brief description of your marketing plan
• Brief financial information and an overview of your growth plan, including projected costs (though you’ll expand on that later in the document)

Because your executive summary is a top-level overview of your insurance agency business plan, keep it concise and enticing. 

The idea is to encourage a reader to keep reading your business plan and learn more about your agency—especially if you’re looking for funding. 

In other words, the executive summary should be just that: a  summary  that introduces ideas you’ll expand upon later in your plan. Limit yourself to a couple of short, brief sentences for each idea and save specifics for dedicated sections of the document.

Company Description/Business Summary

The second element to include in your plan for an insurance agency is a detailed description of your company. This is your opportunity to expand upon some of the ideas you introduced in the executive summary. Here are some things to discuss:

• Legal structure of your agency: Your agency’s form of business, like a  sole proprietorship, limited liability company , partnership, or S-Corp. (Not sure which structure to choose? Make sure to read the next section.)
• Organizational chart: An organizational chart identifies your management team members and highlights their qualifications and expertise to determine who’s responsible for different aspects of running the agency. (You can attach resumes in an appendix to the business plan too).
• Target market: Who you plan to market to (such as individuals, businesses, or a mix of both).
• Business history: If your agency has already been established, what it’s achieved since it first opened.
• What sets you apart from the competition: For example, if you serve a wider (or more specific) target market or offer products other agencies don’t, or if you or your agents are uniquely qualified.
• SWOT analysis: A  SWOT analysis  identifies your core Strengths, Weaknesses, Opportunities, and Threats to give you (and your plan’s readers) an accurate and objective insight into your agency to inform future decisions, like investing in your agency startup.

What is the Best Business Structure for an Insurance Agency?

Many insurance agencies structure their business as a limited liability company (LLC), as it provides certain tax benefits and helps to protect their personal assets. 

That being said, the best structure for  your  business will depend on a variety of factors, including your goals, number of employees, and projected revenue. 

If you’re not sure how to structure your business, consider talking to a business lawyer and/or tax professional with experience in the insurance industry.

Product List

An effective insurance agency business plan should include a comprehensive list of the products and services it offers or plans to offer. Include the lines of insurance you’ll sell—like personal lines or  commercial lines —as well as the specific insurance policies you sell (or plan to), like  workers’ comp , life insurance or professional liability insurance.

And don’t skimp out on details. Mention the benefits of the insurance products you plan to offer, premiums and pricing, and your sales projections for each product. 

You should also include which insurance carriers your agency will represent—and which policies they’re responsible for underwriting. You might also want to provide a brief description of what  appointment  and representation means (or, in other words, which insurance carriers allow you to sell their products and represent their companies)—especially if you’ll be using your plan to secure funding for your agency since lenders might not be entirely familiar with the insurance industry.

Market Analysis

A major reason for creating a plan for your insurance agency is to prove that your business idea is viable. In other words, you need to demonstrate that there’s a demand for the products you offer—and that you have a competitive advantage that lets you capture enough market share to turn a profit.

And the place to do that? The market analysis section.

In this section, include detailed information about your agency’s target clients. Try to determine if there’s room for your agency. If not, look for underserved niches that you might be able to fill. At the same time, look at your market’s demographics to make sure your potential offerings meet their demands for insurance products.

For example, if you plan on selling commercial insurance, will you market specifically to construction companies and contractors or businesses in general? You might also want to limit your marketing efforts to small businesses that earn up to a certain revenue (like businesses with annual revenue between $1 million and $2.5 million).

You should also include a competitive analysis that identifies your key competitors, including their market share, target customers, and the specific products and services they offer. From there, explain how your marketing strategy will be competitive. 

For example, do you plan to  partner with an insurtech  company to attract leads and drive conversions?  Hourly  combines time tracking, payroll, and workers’ compensation insurance into one easy-to-use platform. Premiums are based on real-time payroll data, so your clients can say buh-bye to those nasty audit surprises.

Finally, include the demand for your proposed offers—and your sales strategy for how your insurance products meet the needs of your potential clients.

Financial Plan

How your agency earns money—and when you can expect it to turn a profit—is crucial for securing lending and making sure you have a stable cash flow. Your financial plan should include your:

• Projected costs: How much will it cost initially to open your agency, purchase office furniture and supplies, and hire and train agents? How much will your ongoing expenses (like rent, advertising, health insurance and other employee benefits, and salaries and commissions) cost?
• Estimated cash flow: How much money do you expect your agency to generate and spend over time—and how much of that revenue is profit?
• Break-even analysis: What is the sales forecast for how many policies you need to sell before you’ve covered the cost of opening and running your insurance agency? At what point does your agency become profitable?

Generally, your financial plan should cover at least three to five years. If your agency is already established, you should support your financial plan with  balance sheets , cash flow statements,  income statements , and other financial statements. 

If your agency is a startup, you should include detailed estimates and projections supported by industry or competitor data. 

Similarly, you might want to provide monthly or quarterly projections for your first year in business (vs. annual projections for the following years) to help explain and emphasize how viable your agency will be in its first year—as well as when you expect to break even or achieve profitability.

How Profitable are Insurance Agencies?

Insurance agencies may see a profit margin of about 10% or more, however that number can vary widely based on agency size, where you're located, what you sell, demand, and your efficiency.

Funding Request

If the purpose of your insurance agency business plan is to request funding, you need to specify how much cash you need—and what you need it  for . Start by outlining the type of funding you need—like a bank loan or investment funds—and how long you need the funding to last. You should also outline your preferred structure—like debt or equity—and any repayment terms.

Then nail down the details.  Create a budget  that stipulates how the money will be used. Make sure to also tie your request into your overall financial plan. Ideally, funding should sustain your agency until it meets its break-even point and a stable cash flow—and how you plan to do that should be clearly outlined in your business plan.

Insurance Agency Business Plan Template

Creating a business plan can seem complex at first, especially if you’ve never done it before. The good news? You don’t need to start from scratch. 

This customizable template can help you get started. Just use it as an outline, fill it in with details about your business, and voila! You’ve got your plan.

Easy-to-Use Outline

Text Copied to Clipboard

Agency name

Mission statement

Products and services

Management team background

Employee information

Location/market information

Brief marketing plan description

Brief financial information:

Projected costs

• Growth plan

Company Description

Legal structure

Organizational chart

• Target market

Business history

Competitive advantage(s)

SWOT analysis

Product #1: Description, price, sales projections

Product #2: Description, price, sales projections

Competitive analysis: Competitor #1

• Market share
• Products offered

Competitor #2

Marketing strategy

Product demand

Sales strategy

Estimated cash flow

Break-even analysis

Financial statements

• Balance sheet/projections
• Cash flow statement/projections
• Income statement/projections
• Other financial documentation

Amount of funding required

Reason(s) for funding

Type of funding requested

How long of a period funds needs to cover

Preferred funding structure

Repayment terms

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Other Things to Do When Creating Your Plan

Now that you understand the importance and benefits of a business plan for your insurance agency, let’s jump into a few things to keep in mind while creating your plan to ensure that it sets the stage for launching a successful insurance agency: 

• Define your brand identity: Your agency’s brand—its name, purpose, and values—helps it stand out from your competition and draw in new customers. Defining and committing to your agency’s identity helps you establish trustworthiness and reliability.
• Apply for licenses and permits: Small businesses are subject to local and state laws that might require you to obtain a business license, insurance coverage, and other types of licenses and permits. And because the insurance industry is so heavily regulated, check with your state’s  insurance department  to learn if you require any additional licenses or permits.
• Research potential funding options: When it comes to funding, there’s no one-size-fits-all. Compare and contrast different funding options—like self-funding, taking out a loan, looking for investors, or even crowdfunding—and choose what makes the most sense for your agency.
• Identify potential insurance companies to represent: Before you launch your agency, research potential insurance carrier partners to find those that align with your goals and values. Partner with insurance companies that offer the types of insurance products your ideal clients want—at the prices they’re willing to pay—and don’t dismiss the importance of exceptional customer service.

Tips for Presenting Your Business Plan

After you’ve drafted your business plan, the final step is to present it to interested lenders and investors. But how do you successfully present your plan for an insurance agency with confidence?

• Set up an in-person meeting: A face-to-face meeting helps humanize the people behind your plan—you and your management team. It also gives you a chance to establish and build credibility, field any questions, and demonstrate your excitement and passion for launching your new business. If meeting in person isn’t doable, set up a video conference to recreate the face-to-face experience.
• Use a clean, detailed, and professional layout: Your business plan should be legible, concise, and direct. Make sure it appears professional by proofreading it to correct any typos or misspellings. Include clear charts that support your claims and statements. Finally, make both digital and physical copies to distribute (and print extras—just in case!).
• Practice and rehearse your presentation: Come prepared to answer any questions that your business plan might not have covered or that a lender needs extra clarification about. That doesn’t mean you need to memorize your presentation word-for-word, but you should have a solid idea of your plan’s specifics and certain important details, like your break-even point or the amount of funding you’re requesting.

Plan to Set Yourself Up for Success 

Starting a small business is hard. And in the competitive insurance space, you need every competitive advantage you can get to set yourself up for success when launching an insurance agency. 

Writing an insurance agency business plan can help you outline—and commit to—your goals and objectives, giving you a clearly-defined path to success.

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How to Start an Insurance Company

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1. Become a licensed insurance agent

2. write a business plan, 3. choose a business structure, 4. register and license your business, 5. get business insurance, 6. form relationships with insurance companies, 7. grow your client base.

Starting an insurance agency is a lot like starting any business . You’ll need to choose a business structure, register and license your business, get insurance and more.

But you’ll also need to become a licensed insurance agent and learn how to navigate a highly regulated field.

Here’s how to get started.

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You can get an insurance agent license in a matter of weeks or months, depending on the requirements in your state. Here are the steps to follow:

Learn about your state’s licensing process. The National Insurance Producer Registry or your state’s branch of the Independent Insurance Agents and Brokers of America can help you understand those specific requirements.

Decide what type of insurance to sell. You can be licensed to sell several different “lines of authority” or types of insurance. The most extensive lines of authority include:

Accident and health or sickness.

The names of these lines of authority may differ in your state. You can be licensed to sell multiple lines of authority. Life and health are often offered as one package, as are property and casualty.

In general, most types of business insurance are property or casualty policies. With a property and casualty license, you can sell personal and commercial insurance . Most agents choose to specialize in one or the other, though.

Take a pre-licensing class. Your coursework should focus on the type of insurance you choose to specialize in. Courses can be done in person or online in most states.

Schedule your licensing exam. These are usually administered at testing centers run by third-party testing companies, which may immediately inform you of the results.

Apply for your license. Submit your licensing application to your state’s governing body. You’ll need to provide personal information, such as your Social Security number, date of birth and residency information, and pay any applicable fees. If your application is approved, you’ll be able to sell insurance products.

If you’re new to selling insurance, you may want to get some experience working for an insurance company or another brokerage before venturing out on your own.

How much do you need?

with Fundera by NerdWallet

We’ll start with a brief questionnaire to better understand the unique needs of your business.

Once we uncover your personalized matches, our team will consult you on the process moving forward.

Your business plan outlines what you want your business to look like and how you plan to get there. The process of writing it should force you to answer complex questions, like what unique value you’ll offer customers and how much money you’ll need to get started.

» MORE: NerdWallet's picks for the best business plan software

Your business structure determines how your business profits are taxed and how your personal and business assets are kept separate, among other things.

There’s also an insurance-specific question you’ll need to answer: Whether you want your insurance agency to work with one specific insurer or with many different providers.

Captive agents (agents who work with a particular insurance company) can benefit from brand recognition and don’t have to convince insurers to work with them. But, on the other hand, they can only sell a limited suite of insurance policies. For example, State Farm works with a network of independent contractor agents who run their agencies but only sell State Farm products.

Many other insurance agency owners are independent agents, selling products from multiple insurance companies. Independent agents might have to work harder to establish and market their brand to customers and insurers, but they can start relationships with many insurance providers.

Before running your business, you’ll need to register with your state, typically with the secretary of state’s office.

Most insurance businesses will probably need to apply for an employer identification number from the IRS. With an EIN, you can open a business checking account .

As part of this process, make sure to obtain a business license, a sales tax permit and any other documents your state or city requires.

Your business entity may also need a license from your state's insurance department. Check your state’s requirements to find out what you need.

» MORE: Everything you need to do to start a business

As an insurance agent, you already know how important it is for your customers to be fully insured. Get business insurance to protect your business assets.

Most insurance companies are likely to need professional liability insurance and general liability insurance . Depending on your agency’s size, location and day-to-day activities, you may also need commercial auto insurance, workers’ compensation insurance and other types of business insurance.

If you’re an independent agent, you’ll need to apply to work with any insurance companies whose products you want to sell. If they approve your application, they’ll grant you an appointment to sell their policies.

It can be challenging to start relationships with insurance companies directly without having several years of experience and a client base.

Joining a professional association, like the Independent Insurance Agents and Brokers of America, or an agent network like Smart Choice, can help you access insurance providers to sell their policies. These groups may also provide marketing materials, discounts on your business insurance policies, and other resources.

If you choose to start an independent agency, you may have to hustle for your first few clients. Start by joining your local Chamber of Commerce, attending networking events and advertising in your local market.

Having an online presence is essential, too. Make sure your website clearly outlines what kinds of insurance you sell and the customers you serve. Information about how to contact you should be easy to find.

If you start an agency affiliated with a particular insurance company, you might get referrals as customers seek out agents near them. However, you’ll probably need to do local marketing too.

On a similar note...

Insurance Business Plan

Back in 2018, the Insurance Information Institute (III) reported that the insurance industry’s written premiums reached USD 1.22 trillion worth in the United States alone. In line with this, fifty-one percent consists of car and other property insurance, while the forty-nine percent are covered by health and annuity or life insurance. With that much worth in mind, making your very own insurance agency is surely a good idea. So, what’s stopping you? Don’t waste time and create a business plan that outlines your future business process, market analysis , SWOT analysis , marketing strategies, budget , and other business development coverage! For your convenience in planning your financial protection service provider business, we encourage you to look at our examples below!

10+ Insurance Business Plan Examples

1. insurance business plan template.

• Google Docs

Size: A4, US

2. Insurance Agency Business Plan Template

3. Sample Insurance Agency Business Plan Template

4. Insurance Business Plan Example

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5. Insurance Business Plan in PDF

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7. Insurance Financial Business Plan

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11. Client Insurance Business Plan Template

What Is an Insurance Business Plan?

An insurance business plan is a process document covering how an insurance agency will be developed and maintained. In the blog site Now From Nationwide, such a document is referred to as a roadmap towards a business’s success . The same article shared that it provides entrepreneurs a clear understanding of all aspects of a business right from its operations to the complete description of its products or services. This document is necessary, especially for startup businesses, to acquire much-needed financial assistance from bank loans or investors. It is also a crucial element in the documentation policy or documentation plan of the business.

Types of Insurance Most People Need

There are many types of insurance , with each of them serving a distinct purpose. However, not all of them are necessary for most people. Investing in the wrong insurance policy can obviously do more harm than good. Here are the types of insurance that people must have:

1. Life Insurance – covers your funeral expenses while securing the financial assistance of your beneficiaries 2. Health Insurance – insure people from medical expenses 3. Disability Insurance – provides financial assistance to workers who lost the capability to work due to a certain disability 4. Auto Insurance – indemnifies people during vehicle mishaps

How To Create an Insurance Business Plan

Every element of a business plan is essential for the development and sustainability of a business. Because of that fact, there’s a need for you to be thorough and concise on its content. Not only those, you also have to make it in accordance with the standard documentation procedure . In order for you to achieve the aforementioned qualities, we have made our standardized outline ready for you. Check them out below.

1. Provide the Executive Summary

Even though the executive summary is the first section of a business plan, it is written last. Its role is to make a good first impression to the readers by abiding by the proper executive summary writing practices. This section must give brief details on the overall business, long-term goals , products or services, target market, methodologies, and financial outlook.

2. Present the Business Overview

The business overview section comes right after the executive summary . In this section, you give out the full details of the mission statement , short-term and long-term goals , target market, business structure, competitive advantage, as well as the product and service descriptions. These areas will help readers know what kind of business you have, how you can sustain it, and who your audience will be.

3. Write Down Sales & Marketing Strategy

After presenting the business overview, write down the sales and marketing strategies for your business. With most business activities shifting to digital platforms, both the sales and marketing aspects of a business plan should focus on online engagement. In fact, many insurance companies attract potential policyholders through their respective websites and social media accounts. The same goes in the selling of these policies.

4. Advance the Operations & Management Processes

Once the strategies for both sales and marketing aspects have been laid down, give the full details on how your business will operate and how it will be sustained in the years to come. It is in this section where you have to proffer various insurance workflows and methodologies. The stakeholders for each of your business’s departments are also considered in this part, along with their job descriptions.

5. Summarize Financial Plan

To conclude your business plan, summarize your financial plan. This should thoroughly discuss the money that you’ll be getting to get your business started and how you’ll be getting them. If you’re a startup, the most common way is to reach out to banks to make loans, which pretty much require business plans.

What is an insurance policy?

An insurance policy is a contract that binds the insurer and the insured. It provides complete details of the premium payment, insurance coverage, and more. The most common provision in all insurance policies is the insurer’s rights to withhold coverage if the insured refuses to pay the premiums.

How does an insurance company make money?

An insurance company makes money in two ways. The first one is through underwritings, where the insurer gambles to offer coverage to the insured with high hopes to collect more money than the payouts. The second one is with investments. Whenever the insured pays their premium, the insurer places them down in financial markets to grow.

What happens to the insurance company when policyholders decide to get their cash back?

Insurance companies not just secure the money of the policyholders, but also grow them. Once these policyholders find that out, they will most likely try to withdraw them right away along with the cash value. At the same time, they close their accounts.

When such a circumstance happens, all the liabilities that the insurance company holds will end. Moreover, it keeps the paid premiums but pays the customer with deductions on the interests brought about by investments. These interests and other remaining cash goes directly to the company’s revenue.

If helping out individuals does not always go hand in hand with making profits, then an insurance business is a special case. There’s no denying that such a business is too risky for an entrepreneur. However, we can’t also disagree with the fact that it can be profitable when done carefully. And, an insurance business plan is a perfect document that can help you with being so.

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How to Choose a Health Insurance Plan for Your Small Business

A s a small business owner, you're no doubt aware that it's important to not only attract solid talent, but do what you can to retain talented employees. And a good way to do that is to make sure you're offering a nice benefits package. That package might include a retirement savings plan you help contribute to, paid vacation time, and health insurance.

Now, you should know that if you run a business with fewer than 50 full-time employees, you're technically not required to provide health insurance. But that doesn't mean you shouldn't.

Healthcare can be an astronomical expense in the absence of insurance. And even if you're willing to raise salaries in lieu of providing insurance, you may find that prospective employees are turned off by the prospect of having to go out and purchase health coverage themselves.

Of course, choosing a health plan for your business isn't exactly an easy thing to do. Here are some tips for navigating the process.

1. Decide how much you're willing and able to spend

Within the realm of small business health insurance, there's a range of plans. As you might imagine, costlier plans tend to offer superior coverage, while those that are less expensive don't offer as much to participants.

It's important to be realistic about how much you can afford to spend on health insurance. As a smaller operation, you can't benefit from the bulk rates a company with 12,000 employees might snag. So you'll need to take a look at your banking records and see what's realistic, keeping in mind that you'll likely be picking up a large share of those premium costs.

2. Figure out if you want a high-deductible insurance plan

High-deductible health insurance plans can be burdensome for participants -- especially those with family members who tend to get sick often. But the costs for these plans can be more reasonable, as plans with higher deductibles tend to come with lower premiums. That's something to keep in mind if you'll be covering those premiums at 100%.

Also, if you offer a high-deductible plan, it may allow you to offer a health savings account in conjunction with that plan. That could make it easier for your employees to cover their medical costs while reaping tax savings.

3. Consider partnering up with an insurance broker

As a small business owner, you may not be all that well-versed on health insurance options. But it's the job of an insurance broker to walk you through your options and do research on your behalf, so you can focus on running your business. Not only might an insurance broker help you find the right plan, but they can generally help you get set up so you don't find yourself lost in a sea of paperwork.

Whether a health insurance plan is something you're looking to offer because it's a requirement or because it's a benefit you want to provide, it's important to find the best plan for your company. Take your time in making that decision so you and your employees wind up happy with it.

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We're firm believers in the Golden Rule, which is why editorial opinions are ours alone and have not been previously reviewed, approved, or endorsed by included advertisers. The Ascent does not cover all offers on the market. Editorial content from The Ascent is separate from The Motley Fool editorial content and is created by a different analyst team.The Motley Fool has a disclosure policy .

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Collusion in Health Care Pricing? Regulators Are Asked to Investigate

A data analytics firm has helped big health insurers cut payments to doctors, raising concerns about possible price fixing.

By Chris Hamby

Chris Hamby has been investigating the lucrative business of out-of-network medical claims.

Recent revelations about a data analytics firm’s role in determining medical payments have heightened concerns about possible price fixing in health care and led to a call for a federal investigation.

In a letter this week, Senator Amy Klobuchar asked federal regulators to examine whether algorithms used by the firm, MultiPlan, have helped major health insurers conspire to cut payments to doctors and leave patients with large bills. She cited a New York Times investigation last month into MultiPlan’s dominance of the lucrative business of pricing out-of-network medical claims.

“Algorithms should be used to make decisions more accurate, appropriate and efficient, not to allow competitors to collude to make health care more costly for patients,” Ms. Klobuchar wrote to the heads of the Justice Department’s antitrust division and the Federal Trade Commission.

When patients see a medical provider outside their plan’s network, insurers often send their claims to MultiPlan, which uses proprietary algorithms to recommend how much to pay. By driving down payments to providers, MultiPlan and the insurers can collect higher fees for themselves, The Times reported, but this can lead to higher bills for patients, who may get charged the unpaid balance.

UnitedHealthcare, Cigna, Aetna and other major insurers use MultiPlan’s pricing recommendations, and the firm has boasted to investors that it is “deeply embedded” in its clients’ claims-processing systems.

In interviews, Ms. Klobuchar, a Democrat from Minnesota, and experts in antitrust law said this arrangement could amount to price fixing: Rather than competing to offer better coverage, insurers could use the low prices recommended by MultiPlan’s algorithms, knowing their competitors would likely do the same.

“This should trigger an investigation by the agencies,” said Barak Orbach, a law professor at the University of Arizona. “There seems to be a really strong case.”

The F.T.C. and Justice Department declined to comment, but both agencies have raised concerns in the past about similar arrangements in other industries.

In a statement, MultiPlan did not address the price-fixing allegations, instead emphasizing its commitment “to helping make health care transparent, fair and affordable for all.” In legal filings, the firm has denied allegations of collusion and said that insurers are free to reject its pricing recommendations or negotiate higher payments with providers.

Insurers have said that MultiPlan’s tools help combat outrageous billing by some providers, including consolidated hospital systems and private-equity-backed staffing firms.

Documents reviewed by The Times indicate that MultiPlan has sometimes told insurers how their unnamed competitors were using the firm’s pricing tools. In a 2017 presentation to UnitedHealthcare, MultiPlan shared “Recent Client Strategies to Improve Results,” which included techniques that could reduce payments to providers.

After a 2019 meeting, a UnitedHealthcare senior vice president reported to her colleagues that a MultiPlan executive “did not specifically name competitors but from what he did say we were able to glean who was who.” She then described how Cigna, Aetna and some Blue Cross Blue Shield plans were apparently using the firm’s pricing tools.

Three hospital systems have sued MultiPlan, accusing it of colluding with major insurers to set unreasonably low payments for medical care, and patients and providers have complained to the F.T.C. about MultiPlan, records obtained through a public records request show.

One provider reported slashed payments from UnitedHealthcare, Cigna and an Aetna subsidiary after the insurers routed claims to MultiPlan’s most aggressive pricing tool . Another said the tool “has decimated my life” and caused “the closing of my business,” which has “left patients having to travel 2.5 hrs for surgery.”

Patients complained to the agency of receiving large bills after insurers used MultiPlan-recommended prices. “This is now affecting my credit score,” wrote one patient, describing a bill that had been sent to a debt collector. Another reported being billed thousands of dollars “since they refuse to pay my providers the correct amount.”

Pricing algorithms have driven MultiPlan’s growth over the past 15 years. The firm previously focused on controlling costs by negotiating with medical providers, but after being sold to private equity investors, it embraced automated, algorithm-based tools, which typically yield lower payment recommendations.

Access to data from hundreds of clients has helped entrench the firm’s dominance, executives have told investors. “We build our algorithms on a much larger data lake,” one executive said in a 2020 presentation.

The focus on MultiPlan’s automated pricing tools highlights growing concern among regulators and some in Congress that algorithms are supercharging price-fixing schemes and driving up costs for consumers.

During the Biden administration, companies’ increasing embrace of technological advancements has collided with aggressive enforcement efforts by regulators. The results have been mixed, as the agencies seek to apply laws enacted to combat 19th-century oil and railroad robber barons to 21st-century technology firms.

“Algorithms are the new frontier,” the Justice Department wrote in a brief in one case. “And, given the amount of information an algorithm can access and digest, this new frontier poses an even greater anticompetitive threat than the last.”

Regulators and some antitrust scholars worry that algorithms can enable sophisticated collusion that is difficult to police. Competitors no longer need to meet in secret to hatch a conspiracy and communicate among themselves to perpetuate it. They can simply agree to use a common pricing algorithm.

Weighing in on private lawsuits involving apartment rents and hotel room prices , the agencies have argued that such an arrangement is illegal, even if competitors agree with a wink and a nod rather than a formal pact.

But in one case, a judge disagreed in a December ruling, allowing the lawsuit to go forward but requiring renters to offer more explicit evidence that landlords had conspired to raise prices using an algorithm.

Ms. Klobuchar has introduced legislation that would effectively make the agencies’ position the default. Courts would presume it illegal for competitors to share nonpublic data with a middleman and use the pricing recommendations that the firm’s algorithms produced.

“It is not clear whether current antitrust laws are sufficient to stop this practice,” Ms. Klobuchar said in an interview. “It is much better just to clarify this and to close the loophole.”

The bill would also require companies to tell consumers if they are buying something that was priced using an algorithm, and it would give regulators greater authority to demand details about how an algorithm works.

Chris Hamby is an investigative reporter for The Times, based in Washington. More about Chris Hamby

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Your business is unique and will differ from any example or template you come across. So, use this example as a starting point and customize it to your needs.

2. Remember it's just an example

Our sample business plans are examples of what one business owner did. That doesn't make them perfect or require you to cram your business idea to fit the plan structure.

Use the information, financials, and formatting for inspiration. It will speed up and guide the plan writing process.

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