Growth Is a Choice: How Insurance Agencies Make It

Subscribe

In this episode of The Digital Broker, Ryan Deeds and David W. Clausen talk about how growth works at insurance agencies. By listening to this episode, you will learn:

• How insurance agencies grow in leaps, and how every leap is preceded by an inflection point that forces leadership to make a decision
• What to take into account when making those decisions
• How partnerships and technology assist in the growth process
• How to keep your eyes open for growth opportunities

When you’re doing okay and making money, you generally want to do even better—make more money, grow your market share, and get a leg up on your competitors. In other words, you want to grow. Growth is one of the most coveted objectives in the insurance industry. At a certain point, however, “growth” becomes a hazy concept. What would you grow into, exactly? And what would you need to do to get there?

This episode is about how growth works at an insurance agency, and there’s no better person to opine on it than David W. Clausen. He was born in 1979 and so was his parents’ insurance agency, The Clausen Agency. David grew alongside of it, and eventually into it and with it, becoming one of its top producers and managers. An insurance agency doesn’t exactly grow on its own like a human being does, but it mirrors human growth in another way.

David sees an agency’s growth happening in spurts or leaps. Every leap is preceded by an inflection point that forces the agency’s leadership to make a key decision concerning whether or not to grow. For example, The Clausen Agency recently decided to add a human resources department. The agency could just as easily have decided to pass on it and keep operating as it had traditionally done—but this would have made growth impossible. The agency decided to grow, and in order to grow, it needed the HR department. Growth is a choice—and, curiously, it is not always the correct one.

Growth requires time, investment, and effort, plus the ever-present risk of failure. Not every agency is in a position to handle it. For some agencies, it makes more sense to get the most value out of the status quo before considering any growth or expansion. Sometimes, the right thing to do is neither to grow nor to stay the course but to reshape the whole business model, as David already had to do once before. The job of the leadership team is to a) be on guard for growth opportunities and inflection points, and b) decide how to act upon them.

These decisions can be daunting, as the future of the agency is usually at stake. Leaders are defined by how they handle these decisions. As with any decision, however, it helps to have a few guiding principles.

David’s philosophy is that you should concentrate on what you’re great at, on where you can add the most value. Anything else that you’re not great at, you should delegate, outsource, or eliminate. This attitude is useful during the growth process because growth is usually accompanied by an increase in responsibilities that most agencies aren’t immediately ready to handle. Doing too many things at once is the undoing of many agencies. At the same time, if you are serious about growing, you cannot shirk the new responsibilities altogether. How do you manage?

It is simple. You get help. Whatever you’re not great at, try to partner with someone or something that can do it better than you can. This can be an outside agency, an independent contractor, etc. Sometimes, your best partner is technology—some software or tool that handles much of the work for you. Much of The Clausen Agency’s quoting nowadays is done by virtual assistants—as recently as ten years ago, this wouldn’t have been very feasible. But David kept his eyes open. He looked at what other agencies were doing. He went to conferences, which is where he learned more about virtual assistants. If he hadn’t done so, he might not be leveraging that resource today, and The Clausen Agency might be overtaken by another agency that does. Growth is a choice, but sometimes, your competitors make the choice for you.

You don’t have to invest in every single piece of technology that you come across; in fact, you shouldn’t. Stick to what you’re great, and invest in what you think will help you and your team continue to be great at it. This alone won’t guarantee that you grow, nor will it be all that you think about when you are faced with the decision over whether or not to press forward with a growth strategy. But it might make the decision easier.

If you’re still in doubt or at a crossroads, ask the Digital Broker LinkedIn group to advise you. Which inflection points have forced or are forcing your agency to make a decision over whether or not to grow? Did you already witness or participate in the successful growth of an agency you’ve worked at? Join Ryan and David in this week’s discussion and let us know.