How to Set Up An Insurance Agent Business
These days, a lot of people want to find an additional source of income. One excellent way to do so is to start an insurance agent business, by becoming a PSOP and selling insurance online.
A POSP (or Point of Sales Person) is a type of insurance advisor recognized by the IRDAI. After passing a specified training program, they are certified to sell insurance policies in both life insurance and general insurance categories. This includes motor insurance, health insurance, travel insurance, and more.
When you become a POSP, you can work with insurance companies or brokers to sell insurance policies directly to customers. And since the work is done part-time, and online, all you need for the job is a smartphone, a laptop, and a good internet connection.
Starting An Insurance Agent Business
Enroll as a POSP and Get a License
To start as a POSP, you can either register with a specific company, or an insurance intermediary. To do so, you need to be at least 18 years old, and you should have completed and graduated Class 10.
Then, you must complete the compulsory training from the IRDAI to get a license to sell insurance. If you have registered through a company, the training will usually be provided by the insurance company itself. Once you have finished the training, and passed the exam, you will get an eCertificate and your POSP License.
Choose the Right Company to Sign Up With
Be sure to check into the insurance company or intermediary that you are planning to sign up with to sell insurance. Some things to check are:
- Will you work directly with the company, or are middlemen involved?
- Do they offer a wide range of insurance policies, such as cover health, motor, travel, home, etc.?
- Does the company offer insurance policies online, or do they have long procedures and paperwork?
- Will you be able to earn a commission even when a customer you got on board renews their policy?
- Check how long the company takes to settle commissions based on the policies you sell.
- Does the company have a strong backend support team who will help you out?
What Tools Do You Need to Start Your Insurance Business?
Here are some things you will need to have in place to ensure the smooth running and the success of your insurance business:
- A Website – Having a site for your business can help you generate lead, and offer testimonials, and information to potential clients, and include a way for them to contact or leave their information with you.
- Google Listing – Ensure that your website appears in Google’s search results. You can do this by following Search Engine Optimization guidelines and including certain keywords, or getting specialist help.
- Ads – Use paid advertising programs on social media platforms like Facebook, Instagram, and Twitter as well as ads on search engines such as Google to increase traffic to your site and to gain potential leads.
- Facebook Page – A Facebook page is a great way for more people to find you and your business easily, and reach out and gather inquiries from prospects.
- LinkedIn Page – Use a LinkedIn profile to acquire new customers. You can use it to join groups related to your industry, and maintain professional relationships with your contacts and clients.
While there are some offline tools that you can use, they are not as important since things are moving into the online sphere. Some of these might include:
- Office setup – It is possible to conduct your entire insurance business just from home, especially if you sell insurance online, but you can also maintain a dedicated office for the same.
- Landline numbers – While usually a dedicated mobile number is enough, you can also set up a landline number for cold calling and to deal with potential leads and clients.
- Print Ads – You can also advertise in print media like newspapers, industry trade magazines, etc.
How to Build Your Client Base
One of the most difficult aspects about being an insurance agent is finding good leads. Bult, while the market may be saturated with many agents, there are still many opportunities out there with insurance market in India growing steadily every year.
Here are some well-established ideas for finding insurance leads:
Networking is essential for bringing in new clients. There are a large number of people out there who need insurance, and this is a great way to connect to them. You can network using a number of different methods, such as:
- Joining social media groups.
- Connecting with your old school or college associations
- Reaching out to other professionals, like real estate agents, financial planners, or mortgage brokers and set up a lead-sharing relationship where you refer business to each other.
Unfortunately, every pitch you make will not lead to a sale, so it is important to show your leads that you provide extra value. This way they will keep your business in mind the next time they require insurance. You can do this by sending regular email newsletters with insurance tips, writing blogs on your website that demonstrate your expertise, and more.
Word of Mouth Marketing
Another way to help people discover your business is to use word on mouth. This can include
- Referrals from satisfied clients
- Asking your friends, family, or former colleagues to spread the word.
Other Things to Consider Before Becoming a POSP Insurance Agent
There are a few things you might want to keep in mind and consider before you choose to become a POSP. Some of these include:
- You might need to make extra effort to gain experience - Since the minimum training required to become a POSP is just 15 hours, you would need to make a personal effort to acquire more experience or expertise in aspects such as customer handling, or pre- and post-sale aspects on insurance policies.
- Know how much time you can invest in selling insurance - One of the advantages of being a POSP is that you have the freedom to work from home as per your convenience. But, before you start out you should keep in mind how much of your time you wish to invest in this work. Remember, the more time and effort involved, the more you will likely be able to earn.
- Check who will be settling the claims and complaints for the policies you sell - Usually, when you sell insurance policies as a POSP through a broker or an insurance company, they will handle any claims to be processed, complains, and other customer support. However, POSPs might also be expected to act as customer representatives and handle claims, etc. So be sure to check what the process will be.