October 2, 2019
Specialization: What’s Next for Agents
by Mike Furlong
In a competitive field, the thinking goes, it’s best to cover as many industries as possible, but the reverse is often true for agents and brokers.
Many brokers take a generalized approach to their business. In a competitive field, the thinking goes, it’s best to be able to cover as many industries as possible. However, this line of thinking may be doing more harm than good, as specializing can in fact greatly improve business as a broker. Specializing within one industry may provide a number of benefits for a broker’s sales and marketing tactics, such as internal development of expertise on certain products and gaining a reputation for niche knowledge.
Sales and marketing
Clients increasingly expect tailored services across industries, and businesses are responding. A 2016 McKinsey survey found 46% of businesses surveyed said most accounts are managed by individuals focused on a specific industry. By 2021, respondents said they expect that number to climb to 66%.
When insurance agencies or independent brokers specialize, they’re able to market specifically to what needs exist, based on first-hand observations, and tailor sales tactics to what they know to be most important to the industry. Catering to clients’ needs in this way builds key relationships.
For example, if a broker specializes in insuring cannabis businesses, people will get to know the broker by face and name at industry events, and the broker will become ingrained in the industry.
In addition to gaining more clients through word-of-mouth recommendations, insurance professionals who specialize in a given industry will be able to develop product expertise. Knowing the ins and outs of an industry is essential to speak with authority.
This establishes credibility, and speeds up workflow and productivity. Doing something for the first time takes time, but, by the 10th time around, you’re able to do almost anything more quickly. And the more quickly you move — from getting new business and renewal applications completed to building relationships with specific carriers and underwriters — the more clients you can work into your roster.
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Insuring a manufacturer is different than insuring restaurants, which is different than insuring the cannabis industry. Brokers learn that a cannabis distributor needs fire coverage and theft coverage, while a manufacturer needs stronger protection against physical damages to equipment and employee injuries on the job.
Finding a niche
If a particular business operates largely in the region where you live, you may want to specialize there. Or, if you find yourself better able to connect with clients in certain industries, you can put yourself in contact with those people more often. Different industries have different events, people and methods of operation. You are likely to enjoy certain types of events more than others, whether those are meetups, large networking events or smaller gatherings.
If, in addition to talking about insurance, you enjoy talking about tech, small business or law, you can combine outside interests with your work in insurance. You’ll be able to cultivate relationships by showing you’re interested in potential clients’ fields. You’ll be able to make those human connections that people value so much.
Find a niche, and you’ll be able to talk about the latest news, particular pain points and exciting developments that clients are looking forward to implementing. Potential clients will remember you for being able to talk about more than just insurance policies and not rushing to the sale.
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Operating as a specialist as opposed to a generalist gives independent brokers and agencies opportunities to improve business. Streamlining marketing techniques, gaining product expertise and finding a niche, you’ll become an expert, develop stronger client relationships, improve workflow and build your client base.