One Year Later.

I’ve found the insurance industry to be very humbling. Just when I think things are going well, the Big Lad upstairs likes to remind me how far I am away from where I want, and need, to be. Goal setting is vital because it measures – for better or worse.

When I walked into the office on my very first day, I literally had no idea what I was doing. I mean, I understood insurance (at least I thought I did), but I didn’t know first hand what it took to be successful. I knew what kinds of things I would need to do to grow my client and referral bases, but I hadn’t done them before.

The benefit of this I think is quite obvious: I didn’t have any bad habits. If you were to ask a collection of insurance professionals which they’d prefer; a seasoned vet who has a lot of bad habits or a rookie who will run the plays in the book, you may be surprised with what they say. Now, this is contingent on how that agency operates. As in, if the Principal is some old guy who sits on his book, he will take the vet because he doesn’t care. If the agency is progressive in its operations, it is highly likely they will take the new guy.

There is also a fine line between guidance and micro-management. My bosses continue to guide me yet remind me frequently that they are “not here to hold hands”. This is great, because it suits me perfectly. Some people prefer to have their hand held during work, regardless of what they do, because they can’t function without it. Think how much that would cripple productivity.

I joined various networking and business groups to help with meeting people as that has always been the hardest part for me. I’m good at talking with people and I love to do it, but I am also not originally from the U.S. and have to battle to develop business relationships with people. Everyone battles, but most will have a good base to start with or a solid support network.

I have spent this past year putting my boots on the pavement, handing out hundreds of business cards, stopping in to businesses to introduce myself and making phone calls. This can be a lot of work and can lead to absolutely nothing other than making some stranger uncomfortable. But, I would argue even that has a lot of value.

I think I made around 250 calls my first week in the office. I don’t quite do that many now, probably closer to 100 per week. This is what I had to do at the beginning because I literally did not have a single name in my head that I could talk to about their insurance. I originally planned on going back home after college but as often as the Big Man humbles me, He throws me a bone every now and again, and did so when I met my now-wife during my senior year. The rest, as they say, is history. On top of that, my Father-In-Law is an independent insurance agent also, so I couldn’t even start talking to my wife’s family! So, I got on the phone.

As mentioned, I still get on the phone but it is not the same as it was. I enjoy cold-calling at times when I am in the mood for it, but I have had some instances where I have bore the fruit of my labor from months prior. This is something that I was not necessarily convinced would happen, just from lack of experience.

That’s how business works I think, and probably how it should, if a potential client is serious. I would suggest that most deals are not done on the first meeting. It takes at least a few well-directed meetings or conversations to even get to the point of talking business. After all, there are those out there that pay a lot of money for their insurance and their agent, so they need to think about it very carefully. I would if it were me.

I am trying to learn to appreciate the fact that this is a marathon, not a sprint (this is something I toil with back and forth, depending how patient I am feeling at that moment; sometimes I can be seen acting as if there is zero time left on the clock). I would love to commit to it right away and all the time, and even though I know how it works, sometimes my brain does not let that reality through, especially when I’m onto something. But again, so much is the effect of inexperience.

It is just so very hard to do. Things can be so fast-paced at times that suggesting it is a marathon can seem contradictory; how can I be running so hard for something that yields no immediate reward? A constant internal battle of “keep hammering” versus “is this working?” The mental game alone is the main reason, coupled with impatient or neglectful principals, that so many agents do need reach beyond their first year is because they lose the mental battle. After all, believing that something is there and working is hard to believe because there can often be no evidence of it, at least right away. Faith, I believe they call it.

I have read countless books, not on sales, but on the psychology of working within sales. How and why do people do it? What makes some successful and others move on? What is the effect of instability on the mind and therefore production results? The reason I read these and not the hardcore closer books is because I think unlocking and freeing the mind is the key to continued and consistent success.

I recently visited NYC with my wife to visit my parents who traveled over from Northern Ireland to celebrate their 29th anniversary and also my mother’s 50th birthday. It was my first time in New York, and we stayed at the Roosevelt Hotel just off Times Square. Times Square is full of salespeople; ticket agents for bus tours, people dressed as Disney characters who pose for pictures and then demand $20 EACH for doing so. Hell, even when I waved my bus tour tickets in front of their eyes to show I already had what they were trying to sell, it then transitioned to, “We can upgrade those for you”, “We can get something else added to that for you to visit”, etc. Absolutely relentless.

I know insurance agents who do the same thing. The ‘one and done’ guys who as long as they get paid once, they don’t care about the account again as they plan on replacing it with something else next year, to keep the commission in their pocket and in turn, their income more or less the same.

At times, I don’t blame them. Even the most loyal client will fire a fantastic agent just because, so why bother working so hard on the relationship side of the business? There are a few things at play here, including personal branding which for me is why I will never do business like this; I’d hate for people to think I’m like that, and not because I care about what they think, but because I know I am not like that (for better or worse, everyone needs to know what I’m really like and how I actually do business).

The point here is that it making it in the business will work for some and not for others, even if the ones who don’t make it do everything right. Now, what does “making it” mean? Everyone will have different plans and aspirations as to a certain level they want to reach professionally, so “making it” is a relative phrase. But, as a general rule, let’s assume making it means reaching the point you hoped you’d reach, whether it is income, job flexibility, whatever the case may be. On top of this, there are agents who are very successful who will not deviate from the sentiment that if someone has failed out, it was due to their own inadequacies. This I could not agree with less. Right place, right time, for example, is a huge factor, and not just in the insurance business.

Doing the right things as agents is what is important. Whether or not I have a solid future on the agent side remains to be seen, regardless of how many aspects of the job I enjoy. It doesn’t matter how much you like something; if it isn’t working, it simply isn’t working. At the end of each week, when I look down at my activity log, as long as all the boxes are ticked, there is nothing more I can do. Again, reverberating back to the ‘figure it out, always-something-more-to-be-done’ veteran agents; they will say otherwise. What they don’t realize is that young agents like myself are the ones left picking up the pieces of an industry that just a few decades ago was price-based only (no wonder clients have the negative perceptions of the industry and agents), so it is arguable that they don’t know the modern game at all. They get by because the majority of their clientele can’t be bothered to hold them accountable, or question them because they’ve been around ‘forever’.

Every dog has his day, and regardless of whether or not I get mine in this industry, what is incontrovertible is that these old dogs’ days are numbered because of their backward approach to insurance. That is, ignoring the changing landscape of the industry, and the demographic therein. The clock is ticking.

Keep hammering.

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The Insurance Evolution

Insurance is a droll topic to the vast majority. Imagine how a topic like the history of insurance in the U.S. would be received…

Insurance in America is said to have started in Philadelphia in 1752 by the ‘Philadelphia Contributionship For The Insurance Of Houses From Loss By Fire’ (not quite the savvy agency names we often see toady). It was a mutual company, hence the word ‘Contributionship’, and they are still insuring across the nation to this day. Just like today, insurance in 1752 helped standardize the construction of homes as the company refused to insure anything that was considered a fire hazards. Consider that, in 1752, everything was made out of wood and typically built very closely together in the interest of saving space as settlements grew over time. As a side note, open fire flame was the main/ only source of heat and light. Quite frankly this represents haunting combination in the insurance world. Regardless, the role insurance played in setting standards 265 years ago helped regulate and implement zoning laws and building codes that are still used today. Within a decade, the first Life insurance company would be founded.

Fast-forward 265 years and needless to say the landscape of insurance has changed quite a bit, across all lines of insurance. While the foundation and purpose of insurance has remained the same all this time, the risks that we face in 2017 are vastly different than those in centuries prior. In fact, one of the biggest changes in insurance came on September 11, 2001.

On this date, the best part of the world played witness for the first time to a ‘new’ threat – terrorism.

The Terrorism Exclusion Act was signed into law by George W. Bush on November 26, 2002, which in essence created a federal backstop on insurance claims arising from acts of terrorism. This means that while terrorism coverage is a purchasable product, it is subject to the TRIA’s definition of what constitutes a terrorist act.

The point being that before 9/11, terrorism insurance did not exist in the U.S. Of course, not many small business owners are in need of it, but companies that are on the international stage, making millions/ billions of dollars in revenue, with foreign connections, may see the value of having a policy… subject to a sizable premium.

While unfortunately we see acts of terrorism on almost a weekly basis in today’s world, there are multiple other risks that have developed over the past 20 years that are very applicable to our society; both on a personal and commercial level. But, what are some of the risks that business owners should be paying attention to?

The Digital Age

The internet changed everything. I don’t just mean insurance, I mean everything. All of a sudden we had access to the World Wide Web, an unending expanse of information became available to us right at the click of a mouse. In 2017, anything we need or want to know is carried around in our pockets.

This has created exponential growth, discovery, communication and efficiency. It has also created a new world of crime, fear, paranoia and deceit. This is known as “the dark web”.

Over the past few weeks, the general public has witnessed what a data breach is with the Equifax ordeal. According to Equifax, hackers may have had access to the personal information of over 145 million people. That is, names, addresses, Social Security Numbers, dates of birth, driver’s license numbers and even credit card numbers. Pretty terrifying stuff, really.

Cyber Liability is a product many insurance companies nationwide have began to implement or have already done so. This product, however, is not just for the Equifaxes of the world. On the contrary, there are very few businesses out there today that do not have any need for Cyber Liability coverage.

Let’s say you are a small business owner. You have a nice website that people often visit to learn more about what you do, as well as various social media outlets to create more avenues of advertising. You have some employees, let’s say 8, each with their own payment information they have given to you for their direct deposit. You have many clients that have recurring orders or services with your business and so you have an active account for each of them, or perhaps a client was one-time deal but your protocol is too keep all transactions on file. You as the business owner keep your financials on digital file.

What would happen if someone hacked your system?

Imagine if someone hacked your website, got rid of all your content and replaced it with slanderous or inappropriate content. You could be held liable for damages caused. The same goes for your social media outlets. Imagine if someone got into the payment information of all your employees, wreaked havoc on their accounts and robbed them or destroyed a credit score. Imagine if all your clients’ information, personal or business, was compromised. Imagine if they got hold of your financials.

Without trying to create fear around this, all of the aforementioned scenarios have happened; over and over and over again. And, not just to the big boys.

As is in its name, this is a liability policy. It is designed to protect the policyholder from liability claims stemming from data breaches. Your General Liability policy will not apply here. The lamentable part of this is, Equifax will probably be fine because of their size, but the small business owner could be down and out if victim of a data breach.

Cyber Liability can often be built-in to some policies but many companies can offer it as a stand-alone policy. Either way, consider purchasing one. As it is 2017 and the risk has never been higher, it could be one of the more shrewd and inexpensive investments you make for your business.

The Politically-Correct Age

Lawsuits these days are more common than those beer koozies you get at golf tournaments.

Everyone has a stance on politics whether they know it or not. Everyone has something that offends them more than it should. What’s more is that a lot of what we see in terms of behavior was not happening a few years ago. The sense of entitlement displayed in 2017 was, from what I hear, unfathomable 30 years ago. We all have to be very, very careful as to what we say.

Now, I’m not saying that all the controversy surrounding these issues is nonsense, but we are living in the snowflake era. This is a fact. There are human beings that wake up every day with the intent of causing problems, whether directly or indirectly. To quote my guy Michael Caine in ‘The Dark Knight‘, “Some men just want to watch the world burn“.

Say the ‘wrong’ thing and be prepared to get sued. How does this relate to insurance?

Employment Practices Liability insurance is a product that is vital to the protection of all businesses, including smaller ones. This policy provides coverage to employers for claims made by employees on a discriminatory basis, wrongful termination, harassment, extending all the way to things like failure to promote. What many people don’t know is that this applies to interviewing potential candidates as well.

The examples listed are the most prominent by way of claim volume. Let’s use wrongful termination as an example. Usually, the employer and the employee will not be on the same page in a termination situation. As in, it is doubtful an employee will agree with being fired. Even if an employer has all the grounds in the world to fire an employee, by doing so, they can open themselves up to a lawsuit if the employee feels he or she has enough grounds to prove otherwise; lawsuits do not need to have an ounce of truth within them to be filed.

Of course, this should not stop an employer from firing someone they feel needs to go. A lawsuit is uncomfortable, time-consuming and costly, but doing the right thing for your business by terminating a bad employee is always the way to go. The likelihood of this happening is relatively slim given that the job candidate would have to hire a lawyer and go through the same arduous process and almost certainly lose, but what if an employer actually does say/ do something, wrong, inappropriate or offensive? This is where EPLI kicks in.

The problem is we don’t know what offends each person and even if we did, people are offended by something different every day. But, we can all safely agree that racism, sexism, ageism, and all the ‘isms’ should not be tolerated, and employers should face the consequences if they hit the wrong button.

Aside from purchasing a policy, the advice here is to speak with your lawyer on these matters. The nature of small businesses means they will probably not have their own legal department, so having someone on your side (your lawyer and your insurance agent) to explain and advise in great detail would be a good step to take for employers.

The Entrepreneurial Age

Let’s get away from liability and get into something just as unsettling.

When it comes to your business, what do you fear the most? Or, what keeps you up at night?

Again, every business owner has at least one. For some it is the management of employees. Others lay awake thinking about growth. But some think about something much more detrimental, and it’s a question I always make sure to ask; What would you do if your business was gone tomorrow?

I recently worked with a client who’s business makes great money but everything else relative to the business was not really of higher value. Buildings were old and in need of eventual replacement and so were insured to Actual Cash Value. Business Personal Property was at a minimum as everything could be replaced for less dollars than a deductible. The Commercial Auto costs more or less the same as it would if insured on a personal basis. The General Liability wasn’t anything out of the ordinary.

When I took stock of all of this, I thought the package premium would be very small, which is a good thing for the insured.

This business makes almost $1 million per year. In the event the business could not operate due to a covered loss, how do you protect the potential revenue?

First of all, we should remember that companies rate different policies in different ways. They can be based on revenue, payroll, square footage of property, etc. So, using the above example, the utmost importance was to protect the annual revenue of the business.

Business Income/ Extra Expense coverage is designed to do just this. This client could rebuild its facilities for a comparatively small cost if a storm came through and wiped it out. The problem is that rebuilding takes time, sometimes a lot of time depending on what was lost. During this time, the client would be unable to make the money it would otherwise be making normally.

There are various choices to the extent of this coverage; such as time frame limits of three, six, twelve months. This means that if a business owner was able to calculate the maximum amount of time they would be out of business in the event of a loss, they could make an informed decision on the necessary amount of coverage. Beyond that, some companies have the settlement option of ALS (Acutal Loss Sustained), meaning the policy is set up to pay the actual lost amount in dollars. This is a good option to consider as many businesses can fluctuate in revenue, and this will have you covered regardless (although you should always keep your insurance agent in the loop with your revenue at least on an annual basis).

Knowing that if your business was to burn down overnight and you have coverage in place to protect your earnings is quite simply a beautiful thing. To me, this is the ultimate peace of mind but each to their own. But whether you have something more pressing or not, you owe it to yourself, your employees if you have any and the business itself to protect accordingly.

 

It is the job of business owners to work with their respective agents on making sure coverage is up-to-date. Your agent may call you every once in a while and let you know of a coverage they believe you should consider having. This is not to get more money out of you; this is to make you aware of areas that may be lacking coverage. Your agent works for you and as such has the duty to bring you up to speed with changing times. My ploy to business owners is that they listen to what their agent has to say and then make an informed decision on whether or not they need the coverage. These are a few examples of coverages that I believe every single business should have. Not all businesses need the same coverage, so always be willing to work with your agent to make sure you remain protected on all fronts.

 

 

Hard Work or Talent?

An age-older.

“Hard work beats talent until talent decides to work hard”, is an expression used by Nike on their shirts to promote athlete commitment to training, analogous to, “No hustle, no progress” and “Every. Damn. Day.”

They also have a shirt that says, “Lazy But Talented”.

Of course, Nike just want to sell shirts, and the more shirts they can print, of the same phrase, that they can put into different words, the better. Hence why they do not mind contradicting themselves. So much for branding.

But that’s the face value. Nike understand that, in the world of elite athletics, there are two ways to get there (assuming no one bribes there way onto professional sports teams); supreme, unworldly talent, or – beyond-the-human-limit hard work.

We can argue some middle ground within these, and they do exist, but it’s never at a top-performer level. As in, true success is not achieved by those who are kind-of hardworking and kind-of talented. There’s too much middle-ground there. Nike understands that people, consumers, love athletes that are inexplicably talented, or ones that have defied all odds to get to the highest level of their discipline.

From this, comes the debate; what is ‘better’ – talent or hard work? If I ever had a chance to ask Stephen A. Smith on ESPN a question, this would be it. Now there are many variables to this question but I would hope he would have one direction and explain why he thinks so. I think everyone has an opinion. I just like listening to him, him and Skip Bayliss.

The same goes in business world.

Companies today will do whatever they can to secure whatever they deem is high-potential talent. Many outsource this process to consulting firms, people who are experts in identifying candidates as high-performers. Candidates that demonstrate behavior and have the inherent traits to be successful in a given field.

At the same time, there are companies, pioneering, world-leading companies, whose workforce is comprised solely of hard workers; people who should become massively successful based on how much work they put in.

The problem with talented people is that they believe they can coast through, that success will come to them, without doing much of anything. That being said, this happens often – much to the frustration of the hard-workers. On the contrary, the problem with hard-workers is they might not have the juice, the flare, the instinct, that makes people in their industry ultra-successful.

But what’s preferred? Each to their own, and frequently dictated by industry.

I’m not a fan of hybrid cars because they circumvent what a car, to me, is supposed to be. Fuel-guzzling, throaty, fast, and ultimately raw. Not a hybrid car in the world I would designate any of those adjectives to.

I’d hate Stephen A. Smith to answer the question the way I would answer the question, and so goes hypocrisy.

In this case, a hybrid is the answer. Imagine the success of talented individuals who are the hardest-working individuals findable.

I thought I would saunter through everything I ever came across in my life because that’s how it was for my first eighteen years. I was just good at everything without trying (excuse me). That’s not to say I couldn’t have done a hell-of-a-lot better. But it was enough to surpass all those in my scope of competition. Talent personified.

Fast-forward to 22-years-old when I entered the insurance industry in a foreign country. No presence, no reputation, no credentials.

I worked out pretty quickly that I would have to dig deep to source something that I, for a lot of my life, hadn’t employed before. Ask my mother and she’ll tell you I’ve always been a hard-worker, and many of people that know me now in the professional realm would probably attest that I appear to be grafting. What can often appear as hard work to some is natural to the incumbent.

I played soccer for twenty years and reached some memorable heights, and with that comes intense training. But to me training was just training; a necessity I had to undergo in order to get where I wanted to be. Training never felt hard. Yes, I hated it at times, but it was still easy, natural if you will. I did well in school, so well that I must have been studying hard. In truth I never had a liking for school, mainly because I felt time was wasted with things I didn’t need or things I didn’t want. Even in college they make you take general education classes that simply will not apply, but hey, the more money schools can pry from you the better your life will be… I never studied. This is not a bragging statement; I genuinely believe in the role of education, but in a much more directed way.

The point being, when I started in insurance, I had to reinvent, to re-strategize if I was going to succeed. This process will last the duration of my career.

I would say a hybrid of the two is ideal. However, you can’t teach talent. Detailed, you can’t teach what talent entails (the juice, the flare, the instinct). Many will say you can’t teach hard work, and in some ways you can’t. I will always advocate that, while there are certain levels of hard work that may never be achieved by the talented, it is something that can be learned. Talent is inherent, instinctual, natural.

I’m glad I’ve learned on the trial-by-fire basis. I think that this is the best way to learn the importance of hard work. When talented people experience times when things aren’t going their way, they sometimes have no Plan B. This is where the hard work comes in. Vice versa, when a hard worker’s hard work isn’t working, what can they fall back on? If a talent has learned that hard work will be part and parcel of their career, they can revert to it, and while it should be synonymous with how they handle their business, it will always be their natural state they rely on.

This is why companies pay so much, either directly or indirectly, for talent. Raw talent can be tweaked to the industry and then set alight. Hence why we have the interview process. How many times has the smartest, most-qualified candidate been declined a job because they are unable to be, at the most basic level, personable in an interview? Untold times.

The most successful people are made for their fields and also have an unnatural talent for working hard. They love what they do, it comes easily to them and so the work doesn’t seem hard, yet they are working harder than anyone will ever see.

I conclude that it comes down to what works for the individual. Many will say there is no substitute for hard work, while the other mob will scream, “Work smarter, not harder!” In short, find the remedy you need to succeed.

Hard-working talent will succeed.

 

Why I’m Motivated.

Motivation is something I believe everyone struggles with at some point during their careers and lives in general. Motivation by definition is the reason, or reasons, one has for acting or behaving in a certain way.

The insurance gig isn’t for the fainthearted. It comes with more rejection in a day than a lot of people will ever experience in a lifetime. It’s long hours in and out of the office. It’s cutthroat. Ultimately, it’s mercilessly ruthless, and now that I think about it, that’s one of the reasons I love it so much.

These factors are solidly verified by the industry turnover rate. They say only about 11% last more than 3 years, a percentage that I would say is pretty generous. I’ve been to a few Producer schools through my agency and I am surrounded by agents that are good, some are very good, and some are even great. But, this is an industry where even greatness, for most of us sitting in the classroom, will not suffice. Of the 40 of us attending the class, 36 of us will be into new industries in 36 months.

Reading what I’ve written so far makes for grim contemplation. So surely there must be a reason, or reasons, that I am motivated to be in this job. It is strange, however, how other people outside of the industry think the job works. Some phrases I hear all the time:

“I should get into insurance, all you guys do is drink beer and play golf with clients all day!”

“It must be nice to have so much free time.”

“You guys make a ton of money by doing very little.”

I tend to greet most of these statements with a laugh, depending how I’m feeling when someone says them to me, of course. One of my bosses always hits me with the reminder: “If it was easy, everybody would be doing it.” I’ve adopted this as my main verbal response to the aforementioned fallacies, in place of something much more rude.

Opportunity – this career is full of it, that much is true. This is as close to being your own boss as one could ever be without being one (which, by the way, to me is very appealing in its own right). In terms of earning potential, the sky’s the limit, providing you’re willing to sacrifice a lot of things along the way, at least for certain periods of time. Once you have a solid book of business built, for example, if you ever want a pay raise, just write a new account. But it’s the big picture that is the real deal – I have the power to choose the life I want to live through how much work I put in and in turn how much money I make. And not just for me, but for my wife and future kids. Talk about motivation.

The perks – playing golf and drinking beer are two of my very favorite things to do at this point in my life. And it just so happens, other professionals around me love those things as well. It’s an age-old saying that a lot of business gets done on the golf course, and given the chance, who wouldn’t swap the office for the golf course or their favorite watering hole? This is part and parcel of the job; the same goes for realtors, financial advisers, really anyone who is truly in control of their own career. Take it as you wish.

Being ‘The Man’ – I tend to be a little bit of a show-off and never shy away from being the center of attention; again, take that as you wish. But in an industry with such a high failure rate, you have to set yourself apart. I love to hit people with the ol’ razzle dazzle. I love showing people how good I am. This cannot be achieved without the proof, however. As someone who has this personality, there is nothing more confusing to me than someone who acts in this way and has zero right to do so. It’s embarrassing. Rockstars are rockstars because they actually are rockstars, not because they behave that way.

People – being out and about all the time, I have the privilege of meeting all kinds of people. This is the basis of my business; I operate on a referral basis. That being said, without people, I don’t exist. The friends I have made in my short time pounding the pavement are friends I know I will likely have forever, in some form or another. I get to see how other professionals operate, learn from them, unlearn from them, what makes them so successful and what they do that hinders their success. There are some pretty sharp people out there, I’ll tell you that for free.

Genuinely helping others – this is the biggest one by far. Not many jobs allow one to truly help people. As an insurance agent, providing I’m doing my job well, I get to be there throughout a client’s life; the good, the bad, the ugly. I get to see their excitement when they buy a new house and want some info on Homeowners insurance, the same with a new vehicle. I get to talk to clients about Life insurance for their newborn baby. I get to be the one to who goes to a client’s house after a storm has ripped their property to pieces, and tell them it’s going to be alright. I get to fight for them, advocate for them, protect them. I get to sit-down with new business owners and explain the ins and out of the insurance side of their business, and how it can help make them more profitable. I get to take on the weight of protecting their investment so they can focus on what they do best, which is running the business. I get to say that I’m not the right guy for you in this instance, but this guy is, give him a call and tell him I sent you.

It depends what you want out of a career. Some people enjoy the solid 9-5 with the steady income, which is by no means a bad thing. My parents raised a family on this basis and couldn’t have done a better job; I still aspire to have the success that they have had. This is simply my two cents as to why I’m motivated to be an insurance agent.

Doing what you love is of the utmost importance, as we all know life is too short to do otherwise. We all fail at our jobs. I fail every day at mine and this is why motivation is paramount. We strive to be better. One of the guys I was in class with at one of the schools said a line that his agency principal, a real veteran of the game, says to young producers when they mess up and start apologizing frantically that I thought was great; he says, “Don’t be sorry, just be better.” 

Talk about motivation.

The Young Agent

Supposedly, by 2018, 1/4 of the insurance agents currently active today will have gone into retirement. ONE. QUARTER.

I am yet to meet another insurance agent as young as I am (I will be 25 in one month), and while they do exist in abundance, typically insurance agents have a few more grey hairs than I do, for a few reasons.

One being that insurance is a tough gig. It can be utterly dismantling in terms of the toll it can take on you. Massive amounts of work can often lead to zero results. They are few industries that require such efforts and can reap such little reward. On the flip side, of course, the rewards can be huge; life-changing in fact.

The second is that success often comes with years. This is a common denominator across most industries; time invested I think they call it. What I mean is that some ‘older’ people, even someone as little as ten years older than myself, have a hard time trusting a “kid” with something as important as their insurance.

I usually like to find out at the first meeting/ on the first phone call if being “so young” is going to be a deal breaker for a potential client. After all, there will never be a point in my life where it is acceptable to waste time.

I was at a networking event recently and had a few cocktails with other young professionals who are very much in the same boat as me. They are also in formidable industries (Financial Planning, Real Estate, etc.), and while we brushed shoulders for a picture, someone blurted out, “This is the future right here”. Needless to say, he could not have been more correct. I then looked around, and noticed the average age at the event was considerably lower than the majority of successful people within our respective industries. And I got to thinking as to why.

For a start, times are changing. I can’t be sure but I don’t think networking was the same kind of dynamic as it is today, nor could it have had the same effect. The reason for this is that selling as a practice is handled differently, something my agency principal says he is glad to see. I talked in a previous blog post about reputation and relationship, and this is how selling happens today.

I believe in the process of learning the hard way, the trial-by-fire way, the “thrown to the wolves” way. I know the guys I was at the networking event with have gone through much of the same process. We’re running hard, so hard in fact that the old guys don’t know how to combat it, aside from showing everyone how many years they’ve been in business and how many awards they have. Yawn.

In sales, it is important to know who your competition is. It just so happens that I know my competition probably better than they know themselves. I know who the agency principal is, who’s on his team, who his best producer is, what he likes to write, how he likes to approach, where he woos his clients; basically everything short of his Social Security Number. To me, you have to know this stuff. The wonderful part about it is, though, is that they have no idea who I am, other than perhaps the fact that I am out there, slowly picking away at his business. Talk about guerrilla warfare.

I like to acknowledge my youth with people. I say things like “I know! How lucky are you to be able to have the same agent for 30+ years to come?!” or “I know, think how smart I must be!” Of course, I put a tone of jest on these statements because people don’t always like the cocky kid, but there are certainly elements of truth in what I say. Think about it – I WILL be around for the next 30+ years; and the smart thing? Well that’s what people assume because the industry is so dominated by people older than myself, so if you’re in the running, that’s impressive.

Running with the big dogs is a lot of fun, especially when you know you are making waves – big or small.

The big dogs have worked hard all their careers to build their agencies into well-respected, profitable businesses. These are agents, even of competing agencies, I admire and in some ways try to emulate because their success speaks for itself. But, because they are stuck managing their agencies, they simply cannot keep up with agents like me who are pounding the pavement; guys who at this point in their careers, have nothing to lose.

Now, it will be a while before I am on level par with these guys, perhaps longer than I want to think about. But that’s the driving factor, the fact that I am not there yet. And for me this is the fun part too, there’s always more work to do and more potential clients to chase. Again, these older agents aren’t chasing anyone, much to their detriment. But that’s fine by me.

There are certain qualities of young agents that a different, older generation simply lacks. One of the biggest of these is the ability to handle technology and social media.

Take my own mother, for example. I’ve been in the U.S. for six years now, and we have Skyped or FaceTimed basically every weekend all that time. Nonetheless, I can guarantee that every time I call her to talk, the first five minutes will be spent on her trying to figure out how to use the same application she’s used for the past six years. Aggravates me to no end. The point is she’s just “not very good” (her words, not mine) at figuring out and using technology.

Apply this to an older insurance agent in today’s market. It is crippling if you do not have a grasp on that, so much so that you will eventually be left behind. It’s one of the reasons I started this blog – it is another avenue where I can reach people on an informational basis, another avenue that my name appears on someone’s phone or computer screen. And, what’s worse is, if they do not handle this well, they pay someone $50,000 per year to do it for them.

Selling insurance is a personal sale, you are selling yourself as the servicing agent. Despite what you are told, we all sell the same products, through the same carriers, and we are all subject to the same rates. What my clients are guaranteed is a call back in the same day, from me. It shocks me how many people I talk to who’s primary complaint is that they can’t get their agent to talk to them. Imagine that – clients are paying you money and you can’t even call them back?! Can’t fly, won’t fly.

A good young insurance agent over-delivers, he calls back right away when he has your answer, he follows-up immediately, he is always accessible, he is enthusiastic, he is involved in the community, he is highly educated, he is very active, and he gets sh*t done.

It is not the fault of the older generation that their adaptability is not as versatile as those of the younger generation. The world moved much slower 30 years ago, heck even 10 years ago, than it does today. To reference Bane in the Dark Knight Rises, young insurance agents were born in it, molded by it.

I have a substantial amount to learn in this industry, again more than I would like to think about. Much of what I will learn will come from the big dogs I am competing against; in what they do well and what they fail to do.

I’ve never made a secret that I am coming after every single agency in my county for their biggest, best, juiciest accounts. And, when I get them, I’ll ensure they are not taken from me the same way I took them from their former agencies.

The future is bright.

Choosing Your Agent

As I try to alleviate some of the myths and solidify some of the truths about the insurance industry in this blog, I thought this segment to be one of the most important I will publish. In this article, we will run through why choosing the correct agent is important, as well as a few pointers on how to do so.

 

One of the biggest myths surrounding the insurance industry is that insurance as a product is all the same. Quite bewildering considering no two people are exactly alike, therefore how could two insurances be exactly alike? The same goes for the men and women that broker and service your insurance.

“People buy from people they like”, is the age-old aphorism, and while I am a solid advocate for building relationships with clients, I affirm that this can be a double-edged sword. After all, would you pay a terrible agent to handle your insurance, just because he or she is a nice person? I would hope not.

The choice you make on who is your ‘guy’ is one that will either stick by you throughout your insurance-having life, or come back to bite you pretty nastily if you don’t pay enough attention to it.

The relationship between agent and client is first and foremost a business relationship; whatever happens thereafter is supplementary and situational. Do not forget that you are paying your agent to service your insurance; do not fall into the trap of tolerating inadequate service because your agent is ‘nice’.

It is very had to make a true determination on who is or will be a good agent for you. I will make no secret that there are far too many agents in the industry that are experts at face-value selling, good throughout the proposal process until they have your check in-hand and then you never hear from them again. It is no wonder why consumers think agents are all the same, and I can only apologize for the people in my business who handle it this way. We will get into ways in which this choice can be broken down a little more easily.

What is an agent supposed to do for you? Well, this will change depending on who you talk to (or who is writing the article), as well as what is important to the client. Service should be tailored just as much as an insurance policy itself. That being said, agents are somewhat tailored in the servicing techniques as well, i.e. some are detailed, some have a regimented process that a client has to abide by, some let the client choose how much or how little service they feel is necessary.

Without giving away the magic of what services our agency provides for clients, there are some fundamentals that every single account should undergo throughout the course of an annual term. Services such as policy delivery, coverage review, exposure review, mid-term review, timeline management and bi-yearly market analysis should be the minimum that your agent, and/ or their team, provides for you. The larger the account, the more services I would add to this list, depending on the industry.

I mentioned a client’s choice of agent should include factors on what is important to them; essentially, what are the things that keep you up at night when it comes to your insurance? The answers to these questions should outline what is important to you, or rather, where you would like to have more focus when we talk about your insurance.

Insurance on the home and auto level is viewed as a commodity, a legality that you more or less have to have in order to stay removed from trouble. Knowing that the majority of consumers have this viewpoint is quite unsettling. The impact insurance can have on people’s lives is staggering, arguably the most significant impact of any service one has. Medicine can save lives, insurance can rebuild them. Make sure your agent understands what is important to you, why it is important to you and how best to protect it. If you feel you are not on the same page as your agent, find one who understands what you are wanting.

What are some of the best ways to determine who I should choose to be my agent?

When wrapping up a meeting with a client, I always ask them if they have some people in there lives that could use the same level of service and expertise that they have just received. Usually, everyone knows someone who is unhappy with their insurance or their insurance agent (because that’s just insurance!). Or, if the experience is vastly superior, a client will give you those names, plus a few more of other people who they simply believe I should talk to, even if they love their situation. The point here is that if you are looking for a new agent to service your personal insurance, asking your friends and family who they have as their agent will go a long way in helping you create a shortlist of who is good at what they do. Once you have a strong idea of the best players, then you can decide who you “like” the most.

On the commercial side, there are a few more ways along with the above to help with the decision.

The first stop I would recommend is talk to other business owners. Any business owners, regardless of industry. See what agent or agency pops up most often. Ask who they have used in the past and who they use now. Ask them why they made a change. Ask them have they heard anything about XYZ agency. None of this is anything concrete, but it certainly helps paint a fuller picture by having some general perspectives in the mix.

Next, go to other industry-related business owners. There are many agencies that specialize in certain industry insurance packages, and many business owners like to work with these agencies for obvious reasons. But, if you are a painter, ask other painters who they’re with and why so. Ask them what their agent/ agency does that is more industry-specific servicing. Again, some generalizing to do here but it all adds to the finished picture.

Perhaps you would like to talk to your trade association. Many trade associations will recommend to business owners certain carriers and agencies that they have partnered with, and this can be beneficial. The reason being is that usually the carriers and agencies are tried and tested to the point that the trade association still recommends them, and they can also help with other aspects of whatever the industry may be.

Lastly, you may want to look to the World Wide Web for some final hints as to who may be the best fit for you. Things like the agency website, review pages and social media pages can often help in feeling out an agency culture and how they present themselves to the public.

Once you have completed these steps, we arrive back to the ‘who do you like the best?’ question. The previous steps will help you weed out the part-timers, the pretenders and the prima donnas, but you will still have a list of maybe two, three, four agents that tick all of the boxes of what you want for an agent. Now comes time to meet with said agents and feel them out, but what separates good from great, great from the best?

I said in the decision-making process that you should pay attention to what names of agents and agencies pop up most often; I cannot stress this point enough – for two reasons: The first is that, yes, it can show who is successful at what they do. The second is that it may show you how much service you are likely to receive. Don’t be fooled by a “big” agency; just because they are big does not mean they are the best. Consider, do you think your $3,000 account will receive the same attention as a $100,000 account? If the answer is no, then perhaps it would be a better fit for you to be with a smaller agency. A great agent will set the expectation with you on what to expect in terms of how service is structured within their agency; if it does not line up with what you want, find an agency that does what you want. There are pitfalls for big agencies just as there are for small agencies, it ultimately comes down to what is the best fit for your needs.

An agent’s experience is very noticeable and the best in the business have all the experience in the world. They’ve seen it all, and they’ve done it all. This alone can be enough satisfaction for many clients; having the old guard overseeing things is as sure as it can get. That said, take note, or ask outright, what your agent’s plans are for the next five years. Is he or she going to be around? Who will be taking over? If the agent is the reason you want to make a change but they will be gone in five years, is it still in your best interest to move? I attest that one of my strongest assets is that I can honestly sit down with clients and say that I will be around for the next thirty years to be their guy. Imagine that, having the ability of sticking with the same insurance agent for three decades. Then you can truly say “my guy”. The point here is that experience can be a big deal for a lot of people, but so can longevity. Again, depends what is important to you.

I always like to see what qualifications and certifications people carry within their industry, really only out of my own curiosity. I believe they should be acknowledged, for better or worse, in your process of choosing your agent. I say better or worse because we all know someone we went to college with that missed the majority of classes, didn’t do much homework, skipped finals, etc. that still, somehow, ended up hanging their degree on their wall. Qualifications, certifications, licensing are important, perhaps legal, to have. For example, every agent needs a license to sell insurance at least within their home state, but what can an agent have beyond that? A few examples come from my own agency principals; one has the CPCU (Chartered Property Casualty Underwriting) designation, and the other carries his CIC (Certified Insurance Counselor). I could really get into what these mean, but plainly these are good indicators that an agent knows what they’re doing. The flip side to consider is, an agent has all the certifications in the world, but is their service up to standard?

The process of choosing an agent is not easy, but often underestimated. I encourage clients to really think about who they are working with and why they are working with them. Your agent has a huge responsibility to deliver on what they promise. You pay for your product, you are paying your agent, and you should get what you pay for. You have the power to hire and fire.

Reputation & Relationship

This article talks about the effects of bidding commercial insurance accounts on an annual basis does to an account and its reputation.  The ideas and opinions expressed here solely represent my own.

 

“I like to keep my current agent honest.”

“I like to know I have the cheapest price on the market.”

“Companies change their rates every year so I have to change my insurance.”

“You guys bump the rate up every year so I have no choice but to shop.”

 

The above reasons are phrases I hear on a daily basis, and they all carry some weight. There are agents out there who aren’t honest; it is nice to know you aren’t overpaying for your insurance; companies can experience multiple rate changes over a few-year span; it does seem like WE are the guys that are trying to take more and more money from you.

The fact of the matter is there will always be a reason, whether good or bad, to shop your insurance on an annual basis. There are some things that I do believe warrant an insured to make the decision to open up their account to bidding, such as poor service (if you feel your service is poor, then it probably is – find an agent that will service you as well as you pay them, and then some).

While the mass belief is that this is simply a phenomenon highlighted by agents to prevent clients from shopping, the ‘true’ truth is that shopping your insurance can be detrimental to your insurance reputation in the marketplace; and yes, you do currently have an insurance reputation. But what exactly is an insurance reputation?

Now, continually shopping your insurance does you no favors, regardless of whether you are a commercial account that pays $100,000 per year on insurance, or a personal lines account paying $3,000 per year; the effects just grow exponentially as the premiums increase. So, that being said, let’s talk about the insurance reputation of a $100,000 commercial lines account.

From the moment your account enters the insurance market, there begins its, and your, reputations. Insurance carriers divide all lines of their operating into territories, thus making them much more easily managed. Within each territory, there will be an Underwriting Department. Assuming that your business does not undergo a massive relocation, and the carrier continues to write in your state while you’re in business, it is likely they know of your account – for better or worse. If it is for better, this means you are known to be a dream account in every sense of the idea – you are a sizable premium, a well-run business, positive outlook for future plans, you as the owner work well with the carrier, and you don’t shop around providing you receive good service. If it is for worse, then you might have a real problem.

‘Worse’ implies you are someone who is perhaps late on payments, perhaps has a terrible claim history, or perhaps may be difficult to work with; but more likely is that they insist on putting their account up for bidding every year. All the other aspects listed can be worked with, but the shopping around thing is big no-no in the world of commercial insurance. It will destroy your reputation in the insurance market.

I am a firm believer that insurance is a relationship industry, and without good relationships, this industry would be totally online. Catch a different guy, however, and he will tell you it is going that way anyway, but I refuse to adhere to nonsense. A relationship by nature is, or should be, mutually beneficial. An insurance company is willing to pay out millions of dollars to cover a claim according to the insurance contract, in exchange for a much smaller amount of capital. While $100,000 is by no means a small amount of money, (please bear in mind that insurance on the commercial level should represent around 1% of income, meaning he/ she who pays $100,000 per year makes $10,000,000 per year), it is minute in comparison to what would be paid out in the event of a huge claim or total loss.

The point here is that your insurance company, while receiving what seems like handsome pay (if we were to do the breakdown of a premium, you would see how small the profit margin is!), assumes great risk. But that is their game, that’s what they’re in business to do, yet the fact remains that they much prefer to have solid relationships with clients than make a boatload of money from an account that will be gone the next year.

This is how the annual process plays out for an insured who plays the bidding game:

  1. Three months before renewal, the insurance person will be instructed to get “apples-to-apples” quotes on the current policy.
  2. They will find 3-5 agents/ agencies, and ask each to prepare 3-5 proposals.
  3. One month before renewal, they will take these 15-20 proposals, along with the incumbent agent’s proposals, and check the coverages to make sure everything is the same.
  4. Once they have set aside all policies that match exactly to the current policy, they will select the policy with the lowest premium, and cut the check for it.
  5. Repeat next year.

Many businesses will call this their SOP (Standard Operating Procedure), and back it up with, “What does it matter if the coverage is the same and if the price is good?” And from the outset, it doesn’t seem like it would cause much damage.

The first thing about his method is that eventually you will run out of carriers that will want to write your account. Please don’t be fooled into believing that you pay so much for insurance that a carrier would be stupid to turn it down. They are in the business of risk management, and after a while of that kind of repetitive activity, the numbers just do not make sense anymore – and in more ways than one.

Consider the manpower, time, effort, money and resources that goes into appropriately analyzing the risk of a large account; it is a lot on all fronts. Then, consider how much coverage is put into the pot available to your account in the event of loss versus the premium paid for it; also a lot. Lastly, consider what cost of the maintenance of the account throughout a year; depending on the client, this can definitely be a lot too. Plainly it is not worth the manpower, time, effort, money and resources of a carrier to write your account anymore.

The really bad news for the insured is, whether or not they realize it yet, they will be one and done in the event they have a considerable loss. They would still receive the same service and claim handling procedure as any other account, but it is likely they would be non-renewed. Should this happen, good luck finding a standard carrier who will write your insurance.

You may get a young, enthusiastic agent who wants to write everything, take your policy to the market, only to be told “Try another sucker.” In layman’s terms, what is being said here is, “I know it seems like a good account, but we see this one every year. Even if they give you the business, you won’t have it next year. I’m sorry but we will not write this account ever again.” At which point, you are limited on options. You either go to the assigned risk markets that will surcharge you at least 25%, or go uninsured.

Make no mistake; insurance is a huge financial portion of running a business, and should be approached in the same way as any other financial agreement. Your insurance will be the one thing you pay for that is there to bring your business back to life rather than leaving you in the hole. The relationship a business has with its insurance carrier, agent, underwriter, or whatever the case may be, will directly affect how well their insurance works when needed. And I don’t mean in terms of the payouts, but also what happens after the payouts. They will not be quick to cancel or non-renew the policy as they know the business/ business owner has had a great previous ten years with no claims in a growing business; they know you pay on time; they know you are diligent with providing information; they know you are good people with integrity who understands the importance of the reciprocal relationship.

But, change is certain; rate changes happen, carriers change appetites, carriers change territories, etc. The best way to approach any change that needs attention is the same as it always is – work with your agent and your carrier. Let your agent and your carrier protect your reputation in the marketplace by advocating for you, in whatever capacity that may be. They cannot advocate for you based off a six-month relationship via a policy, the same way a solid relationship cannot be built in that time. This advocacy, the same as a good friend, comes through when you need it most, and is becomes stronger with longevity.

Never make a decision based on emotion, and insurance is an emotional purchase. It may seem like a formality, a legality, but think of how it protects your business, and what having your business does for your life and your family. All these things contribute to why you buy insurance. Approach the choice of your agent, carrier and policy with a lot of care, and choose accordingly as that decision could have a significant impact on your life. Find people you like, and stick with them.