Looks kind of likeBuilding an Insurance Agency Dynasty

everybody’s gonna do everything so it looks kind of like this. You’ve got this generalist staff person and they’re making a base salary of whatever the market rate is and their perceived role is that they’re gonna sell and service. And let’s say their goals are that they’re gonna do 20 auto and fire and a combined four life and health. And actually these people, some of them are doing the 20 auto and fire

and the four life and health so they’ve got 10 auto, 10 fire, two life and two health. If you looked at that overall, we say they have a 20% multiline ratio. Again, using that analogy of

conversion rates in basketball, they sold 20 P&C

products, 20 auto and fire and they also sold four

life health products. So overall, 20% of the

time they’re multilining, that’s good. The agency has another

person just like this and they too are labeled a generalist. So far so good. Here’s where we start

running into challenges. The third person is also a generalist. They have the same goals

to do 20 auto and fire and four life and health. Unfortunately, they’re doing

zero life and zero health so their multiline ratio is 0%. Same thing with the other

person on the bottom right here so what we have here is two people who were supposed to be able to convert P&C to multiline sales but they can’t. It’s kind of like playing

basketball with somebody where you give them the ball and every time you give them the ball, they cannot put the ball on the basket. Well, pretty soon you decide I’m not gonna give you the ball. I’m gonna give the ball to somebody else but I can’t keep giving it to you if you can’t put the ball in the basket. And so in this model, the agency owner has

to write the four life and four health to hit the agency goals. It’s not catastrophic but it’s certainly not what we’re aiming for. If we make just one minor shift here, we might be able to see a huge increase in the life health production. If we take this first person and say look, we’re gonna have you be a

multiline sales specialist. And actually what we’re gonna do is we’re gonna pay you a base salary that’s slightly below market but we’re gonna give you an opportunity to make huge bonuses. And so now, if you can

continue to convert 20% of your P&C opportunities

to multiline sales and if we simply give you twice

as many P&C opportunities, well hopefully we’ll

see twice as many sales. Instead of doing 10 auto, 10

fire, two life, two health, this person is doing 20 auto, 20 fire, four life, four health. On the top right we’ve done the same thing with the other person

that was able to convert at a 20% multiline ratio. Now on the bottom left,

we’ve got this person who’s going to be a

renewal sales specialist and we’re gonna say, look, your role is to service and retain. We’re gonna keep your

base salary at market rate and your goals are to

have a 10% lapse rate or to have 90% retention

to set appointments and to free up the sales people, the multiline sales people

so they can sell more. The other person on the bottom right is also gonna be a

renewal sales specialist with the same objectives. What we’re doing is we’re

taking the pressure off of them to multiline sell which

they’re probably not good at and simply wanting them

to focus on retention which we know is gonna

be best for the agency. They can stay in the role

performing successfully for years on end without

having to worry about the pressure for being a

multiline sales person. If this works out, we can now get to our eight life and eight health a month without the agency owner

having to sell anything. And so, what that allows us to do is the agency owner does not need to focus on production goals and they can focus on other

ways of growing the agency. Here is where a lot of agency owners stop growing their agencies.

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