With nearly 30 million small businesses in the United States, there is a large market for small business insurance. However, many small businesses in the country are gravely underinsured. Often, businesses that are found to not have what some deem as frivolous coverages such as flood, business interruption or cyber insurance are unable to recover from an uninsured financial loss. Even more concerning, a survey of 30,000 small businesses revealed that 44 percent of respondents who have been operating for at least a year have never had insurance.
Insurance agents can use their expertise to help close the small businesses insurance gap, and ensure that more small businesses are able to recover from a major financial loss event. Here are three strategies for closing the small business insurance gap.
1. Specialize
One strategy is to specialize by developing a target or niche market. That means focusing on a group of potential clients who share common characteristics that would make them receptive to customized products or service. Most firms tend to already have a target market, so it makes sense to pursue that market more aggressively.
For agents, target or niche marketing usually brings higher than average profit margins because of built in efficiencies. By selling the same product to multiple clients in the same market, specialized agents are able to be more productive compared to those with a more generalized audience. This efficiency also benefits the clients as well, because agents develop a strong technique and expertise in that specific market.
2. Keep Technology Up-to-Date
The insurance industry is often slow to adopt new technologies, but keeping technology up-to-date is important when deal with the small business market. Many small business owners utilize technology either in their products or services or in the management of their business. Many business owners do a lot of their business from a smartphone or tablet rather than a computer. However, a lot of commercial insurers haven’t adopted the kind of technology that would allow clients to easily use their phone or tablet for insurance-related business.
3. Be Consistent
Often, agents focus most of their effort on marketing sales and then begin to back off a little from their clients. However, it’s through consistency that agents can establish a trusting relationship with their small business clients. Agents should be consistently providing clients and prospects with meaningful touchpoints that make their clients feel valued. Small businesses who feel invested in will in turn refer more business to their insurance agents, giving agents the opportunity to continue to close the small business insurance gap as they expand their small business clientele.
About American Team Managers Insurance Services
Founded in 1998 by Chris C. Michaels, American Team Managers Insurance Services (ATM) has provided wholesale and MGA services to more than 5,000 independent insurance agents throughout the United States. Our goal is to establish close, long-term relationships with our agency partners and insurance carriers and provide competitive products for the Exclusive and Non-Exclusive markets that we serve. For more information on our products and services, give us a call at (714) 414-1200 to speak to a representative.