Our company surveyed a large group of insurance agencies last year to determine their greatest challenges and underlying trends. One intriguing result was that younger agencies were more successful at achieving their business goals than veteran agencies.
Agencies with eight or fewer years of tenure were far more successful at meeting or exceeding goals than those with nine or more years. Nearly 75 percent of younger agencies said they met or exceeded their goals, and 10 percent said they greatly exceeded them. Just over half of older agencies claimed they met or exceeded their goals.
Are owners of younger agencies smarter and better business people than older agencies? Not necessarily. It’s more likely that after achieving certain levels of growth, many agencies choose to cruise. They collect commissions on renewals and put far less effort into generating new business.
A timeless adage reminds us that when we’re coasting, we’re going downhill. On a bicycle, skis, or a sled, coasting can be both exhilarating and relaxing. But for an insurance agency, coasting can be deadly. The reason can be explained in a single word: attrition. No matter how successful you are as an agent, no matter how well you treat your clients, you’re going to lose some of them every year. Some will die. Others will move away. Some may sell their homes or cars, leaving them with no need for coverage. Still others will move to competitors.
If attrition steals just 5 percent of your business annually, after five years, you’ll have just 74 percent of the business you have now. After eight years, you’ll be down to 66 percent of your current business.
Some agents slip into coasting once they consider themselves to be successful. Instead of remembering how hard they worked, they take their past accomplishments for granted and assume that business will continue to come through the door. They may be fortunate, but it’s more likely that they’ll watch their numbers trickle down and realize that they have to get back into business-building mode. Maintaining success requires sustained effort.
Most agents start out with a great deal of enthusiasm and energy, putting in extra hours and effort to build a book of business. After a while, many of them reach a point at which work becomes extremely frustrating. Either they can’t seem to grow any more or the daily challenge of growing a business has become a boring daily grind.
Owners usually brush those feelings aside and push ahead. But at times, their frustration and boredom brings the business to halt. However, your competitors aren’t standing still, and your lack of activity is giving them an opportunity to carve away at business that should be (or already is) yours.
Keeping a business viable requires drive and determination. Fortunately, there are ways to reignite your business, and regain your energy and positive attitude. Most of them are remarkably simple.
- Time-outs.One of the best ways to recharge your batteries and keep burnout at bay is to spend time away from the agency by taking a vacation. Doing so regularly may be critical for your health. Consider a pair of recent medical studies. In one, doctors followed 13,000 middle-aged men who had risk factors for heart disease. Those who failed to take vacations for five years were 30 percent more likely to suffer heart attacks than those who took a week or more off every year. Even men who missed just one year’s annual vacation saw an increase in the risk of a heart attack. Another study of 1,500 women found that those who vacationed at least twice annually were less tense and depressed than women who did so less often.
- Short retreats. Even short breaks can help you clear your head and restore your energy. Include a half-hour walk or a workout in your daily schedule, and you’ll also build up your physical strength. Commit to taking one afternoon off each week to do something you enjoy, whether that’s golfing, fishing, seeing a movie, or taking part in community activities. You can even use your time off to do good things, such as volunteering at a local school or food pantry. Experts say that shifting your thinking elsewhere can reactivate parts of your brain that you’ve been ignoring, and may even get you to look at your business in new ways.
- New perspective. Outside advisors like your accountant and your attorney may spot things that aren’t readily apparent from your point of view, and they can ask the tough questions that will help you get to the root of the problem. Another great source of help is an organization known as SCORE (score.org), which has representatives in most areas that will sit down with business owners and help them take a fresh look at their companies.
- New challenges. Most agency owners thrive on challenges, and a sense that their businesses are stuck on a plateau may be a signal that they crave a new challenge. Perhaps you need to expand your agency’s efforts into a new market or coverage area that will create those challenges for you. Or, you may be able to find things outside of work that can satisfy that craving. Maybe you’ve always wanted to learn to fly, go rock climbing, or take up sailing. Give them a try, because a lack of challenges can lead to a lack of motivation.
- New people.Bolstering your team by hiring the right people can give your agency a powerful shot of energy and resources. That may involve hiring additional customer service representatives or administrative assistants. For larger agents, it may mean bringing a proven salesperson from another business (or a competitor) on staff. New blood pays off in two ways. First, there’s the additional productivity or revenue that the new employee generates. Second, a new employee’s enthusiasm can be contagious, bringing renewed energy to everyone else at the agency (including you).