“If you fail to plan, you plan to fail.”
Although experts disagree whether Benjamin Franklin was the original author of this quote, there is one thing they agree on — it’s a true statement.
Even if annual business planning for your insurance agency hasn’t been one of your priorities or strengths, we encourage you to seize the moment and map out your goals for 2025. Here are five steps to get started:
1. Be Intentional
It’s easy — and normal — to not want to take time away from generating new business or cultivating client relationships. However, it’s important to set aside a chunk of uninterrupted time to really focus on what you hope to accomplish in the coming year and what needs to be done to make it happen. Start by thinking about your big-picture goals and then break them down into logical categories.
2. Be Specific
One linchpin of your success is clearly defined measurable goals. One or more of the following categories are applicable for most insurance agencies:
- Total premium for your book
- Total revenue including bonus/contingent revenue
- New policy generation including premium and number of policies
- Bundling rates or multi-policy relationships
- Policyholder retention levels
- Mix of policy types
- Marketing return, measured by number of leads generated and conversion rates
In addition to quantifying your goals, it’s important to assign timelines to each item in your plan, including interim benchmarks for hitting these objectives.
3. Be Proactive
The first step in growth is really your marketing plan and being proactive with your approach. A well-executed marketing plan can help drive you toward reaching your goals. You can learn more about how to assess Return On Investment (ROI) for your marketing efforts here.
Conduct a competitive analysis to identify your agency’s strengths, weaknesses and opportunities compared to those who are your greatest competitors. It’s also helpful to evaluate agencies that haven’t been competitors in the past but could emerge as potential threats to your current and future customer base. Create strategies for how you will compete and educate your teams on those strategies so they are consistently implemented.
Other proactive steps include assessing your current staffing. Do you have enough employees to drive your desired growth? Do they have the right skill sets? Should you hire additional staff, add temporary personnel or outsource certain activities (such as marketing or some customer service functions) to support anticipated workload increases?
Determine your preliminary budget for the initiatives needed to propel your agency forward in the coming year.
4. Be Prudent
As you think about your budget, keep in mind that you may need to adjust it up or down as you start plugging in the numbers. Investments into your agency’s growth may include:
- Marketing, advertising and public relations services
- Market research
- Consultants, temporary staff or interns
- Training for yourself and/or current employees
- Additional permanent staff
- Employee benefits for personnel
- Outsourced services to improve efficiency (payroll, in-bound or out-bound customer service, data security, etc.)
- Technology upgrades (hardware, software, online platforms, etc.)
- Office furniture and equipment upgrades
- Larger or remodeled office space
- Contingency fund
After listing out your proposed expenses, look at your agency’s cash sources:
- Savings and liquid investments
- Operating funds
- Commission revenue
- Potential bonus income
- Non-premium revenue (rental income, for example)
If your revenue estimates don’t exceed your planned expenses, right size the expenses and seek out potential working capital loans to fuel the growth.
5. Be Practical
As an insurance agency owner, you’re already familiar with the goal of creating a balanced budget that will help you meet your obligations while also reaching for your goals. If you’ve put together a financially sound and we, but aren’t sure if your existing resources can support it, we encourage you to reach out to our Agency Finance team.
We can work with you to assess the potential benefits of borrowing working capital to support your goals for 2025. At First Mid Bank & Trust, we look forward to seeing you again — or getting to know you for the first time! Please contact us today.
View more Helpful Resource Articles or go to our Home Page
