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$50 Million Life Insurance Sales Starts With P/C Agents
$50 MILLION LIFE INSURANCE SALES STARTS WITH P/C AGENTS Life agents can learn much from the following Life case written by a mother-daughter team. It all started, the agents said, when another agent failed to return to a client as promised, to convert a Term policy. Upset, the client called his P/C agent who in turn called the Life agents he worked with. Together they met with the client and converted his Term insurance. They also identified the need for Second-To-Die insurance, and the client agreed to buy it. The agents then asked about the client's father, a man of considerable wealth who, they learned, carried only $750,000 on his life. His son felt that at least $50 million was needed, and the agents presented a plan of combined permanent and term amounting to $50 million to be written by six companies. The father and son told the agents to call two weeks later for their decision. When they called, the prospects agreed to buy the proposed insurance. But the story doesn't end there. The father's medical examination revealed a prostate problem, so all the carriers declined the case. What would you do? The agents called one of the underwriters for advice on getting these policies issued. The underwriter suggested getting the prostate-specific antigen levels down by having the father drink plenty of water. The creative agents, Judith Panos, CLU, and Debra Franklin, CFP, of Livingston, NJ, called the son, other family members, and the applicant's secretaries, instructing them all to bring him water continuously. Another examination a week later found his antigen levels within a normal range. All six carriers agreed to proceed with underwriting. Still, there were bumps in the road that had to be smoothed. Prior to submitting the apps, the agents had arranged with the six underwriters to coordinate their efforts. Although working independently, they freely shared information. Once one of the major companies approved the case, the others would follow. 'We thought we had the ball over the goal line,' the agents stated, 'until the case got to the issue department. They wanted additional financial information.' The client resisted, unwilling to release this kind of information, especially to six different companies. Gridlock. The problem was solved by getting the companies to agree that if the lead company was satisfied with the financial information, the others would also issue. The client agreed to fax the additional financial information to the lead carrier. Five minutes after the fax was received, that carrier called the agents to say that it was satisfied. All the carriers now approved the case. The agents delivered $30 million of permanent and $20 million of term insurance. They also illustrated how the client could convert the term in four years. When the client bought the original $50 million of coverage, the agents report, he had figured on converting and in his mind would be spending $22,747,295. But the question of converting the term arose. Fortunately, the major carrier offered a credit for the prior year's term premium towards the purchase of a permanent policy, meaning that they didn't have to wait until the fourth year to act. They considered the benefits of converting now. The term premium in 1991 was $159,538, to be paid semi-annually. The major carrier agreed not only to give credit of $159,000, but offered an additional credit of the semi-annual premium that had just been sent in. 'By converting the $10 million of insurance, [the client] would pay $132,252,' the agents explained. But the real impact, they added, was on the overall premium. Instead of spending $22,747,195, his overall premium went down to $21,646,743, a savings of over $1.1 million with $40 million of permanent Life insurance. 'How could he resist?' they asked. The next step, the agents noted, was to convert the final $10 million of term. That was recently done, completing the total package of $50 million of permanent coverage. In addition, the agents reported, during the last three years of working with this client, they were also able to close cases on relatives, key employees, and their families. One of the secretaries came from a very wealthy family, and covering her insurance needs generated premiums in the five-figure range. 'Our next step,' the agents conclude, 'is to find another client like this one.' The question is: How many similar cases are in your client list waiting to be seen? Remember, this case started with a phone call to a P/C agency, triggered by an outside Life agent who had slipped up. You shouldn't wait for such calls. Actively seek to find similar situations by constantly putting out feelers for them. If this client had been your P/C insured, what would have happened?...

How Business Loans in Singapore Help Insurance Agents Scale Operations
In Singapore's competitive insurance sector, agents face increasing demands to grow their operations while managing tight budgets and rising client expectations. Many agents require financial support to invest in marketing, technology, and talent acquisition. For insurance agencies, one of the most effective solutions is securing a business bank loan, which offers the capital needed to scale operations without depleting existing resources. With Singapore's advanced financial ecosystem, banks and financial institutions offer tailored loan solutions that help agents overcome financial hurdles, fuel growth initiatives, and unlock new opportunities for expansion, ensuring they remain competitive in a dynamic market. Investing in Technology and Digital Tools In today's digital-driven landscape, technology is a game-changer for insurance agents. A business bank loan can enable agents to invest in advanced software solutions, such as customer relationship management (CRM) systems, automated underwriting tools, and data analytics platforms. These tools help streamline client interactions, improve lead tracking, and provide personalized services, enhancing overall efficiency. With the growing preference for digital solutions, having a robust online presence is also essential. Insurance agents can use loan funding to upgrade their websites, develop mobile applications, or implement digital marketing strategies that increase their reach and client acquisition rates. (Photo by Adeolu Eletu on Unsplash) Expanding Marketing Efforts Scaling operations often require greater visibility and targeted marketing campaigns. Business loans provide insurance agents with the resources to invest in multi-channel marketing strategies, including social media ads, search engine optimization, and email outreach programs. By leveraging these tools, agents can attract more prospects, nurture client relationships, and strengthen their position in the market. Additionally, loans can fund offline marketing efforts such as networking events, seminars, and trade shows, where agents can showcase their expertise and connect with potential clients. A business bank loan helps agents strike the right balance between digital and traditional marketing to drive growth. Hiring and Training Talent To scale operations successfully, insurance agents need a strong team to manage client portfolios and ensure exceptional service delivery. Business loans enable agents to recruit skilled professionals, such as sales representatives, administrative staff, and financial planners, who can drive business development. Furthermore, these funds can be used for training programs that enhance the team's knowledge and skills, keeping them updated with industry trends and regulatory changes. Investing in talent not only improves client satisfaction but also helps agents build a solid foundation for long-term success. Managing Cash Flow and Expansion Costs Scaling operations often come with fluctuating cash flow and unexpected expenses. A business bank loan provides insurance agents with the financial flexibility to manage day-to-day operations, cover overhead costs, and mitigate cash flow challenges. Whether it’s renting office space, purchasing equipment, or expanding into new markets, loans serve as a vital tool for handling growth-related expenses without financial strain. Conclusion For insurance agents in Singapore, securing a business bank loan is a strategic step toward scaling operations, improving efficiency, and expanding market reach. By investing in technology, enhancing marketing efforts, hiring talent, and managing cash flow effectively, agents can position themselves for sustained growth and success. With the support of tailored business loans, Singapore’s insurance agents are better equipped to thrive in an increasingly competitive and digitalized industry....

Insurance Agent/Broker Licensing
INSURANCE AGENT/BROKER LICENSING by Marcus Ramsey Growing your agency's business might require you to obtain licenses in other states. Most experienced agents/brokers comprehend and are willing to do what it takes to ensure that the commercial side of the transaction succeeds. However, some seem to forget all this hard work is wasted if project planning fails to allow adequate time to obtain proper licensing in the target state(s). 'Ramsey's Rules' outlined below will direct you toward obtaining and maintaining proper licenses to help your new venture prosper. (I assume that anyone who reads this article already holds insurance licenses in one or more states but needs (at least one) additional license in another state to take advantage of a business opportunity. RAMSEY'S RULE #1: NEVER RELY SOLELY ON THE FREELY GIVEN ADVICE OF OTHERS. I am constantly reminded of the number of intelligent, thoughtful agency executives who for all intents and purposes jeopardize their business by accepting half-baked advice from someone they would not trust with their car and daughter on prom night. Obtaining the licensing information as the first step of your new project/program (not your third, 15th or 23rd step). How do you go about obtaining this information? Contact the agent licensing section of the department of insurance of the target state and request a copy of its agent/broker license instructions and application forms (see the State Insurance Department Directory in back). Most states have their own specific, easy-to-follow instructions on the licensing process. Get this packet and quickly read through it even if you intend to delegate the project of obtaining the license to a member of your staff or retain a consultant or licensing service. In fact, reading over the instructions will give you a good idea of the time and effort involved in obtaining the necessary license and whether you or a staff member will have the time to prepare, file, and follow up on license issuance within the time constraints you are working under. You should consider retaining outside assistance when you plan to seek licenses in several states at the same time. Be sure that whoever is going to do this work can focus the necessary attention on the project to complete it as quickly as possible. RAMSEY'S RULE #2: IF SOMEBODY ELSE IS DOING THE WORK FOR YOU, MAKE SURE YOU KNOW AT LEAST GENERALLY WHAT IS INVOLVED, REQUIRE PERIODIC PROGRESS REPORTS, AND QUESTION ANYTHING THAT SEEMS WRONG TO YOU. Remember, it is YOUR business and you had better look out for its best interests unless you are looking for a career change. RAMSEY'S RULE #3: RELATE THE LICENSING REQUIREMENTS TO YOUR ACTUAL BUSINESS SITUATION. Clearly define how you intend to operate and identify the key points to be covered in licensing. Licensing services and consultants who do licensing work usually ask the client to complete a form which requests most of the information contained on state application forms. This information is then typed onto the appropriate state forms and returned to the client for rechecking, signature, and attachment of the proper fees. The problem with this approach is that planned operations might not match license authorization. That can mean trouble later, unless someone is willing to take a couple of extra minutes to be sure everything is right. The answer to simple questions such as, 'Will you write Life/Disability or Property/Casualty coverages or both?' and 'Do you intend to open an office in the target state or do you plan to operate from your existing office?' will help define the types of licenses needed. Whether you intend to conduct business as an individual, partnership, or corporation can have a direct bearing on whether a license can be obtained for that entity (a few states, such as Alabama, issue nonresident licenses only to individuals, not to partnerships or corporations). If you are seeking a license for a corporation, make sure that an application for individual licenses are also filed. When you receive an approval, make sure you have approval for the corporation and all individual transactors. By carefully outlining how operations will be conducted, you can dictate whether you need to seek licensure as an agent, broker, managing general agency, surplus line broker, etc. Sometimes you find that you do not need to obtain a license in another state. For example, some states, such as California, do not require nonresidents to obtain a license to insure risks with incidental exposures in the state as long as the unlicensed nonresident does not enter the state to solicit, service, or inspect the entities insured; However, other states, such a Texas, do require nonresidents to be licensed under the same circumstances. Keep in mind that 'entering' the state may include obtaining information by mail and telephone as well as physical presence inside the state. Also, many states will not issue a surplus line broker's license to a nonresident except in connection with a risk retention group. If your activities will involve related services by the same or by one or more related entities, such as a third-party administrator or claims adjuster, check to see if those activities require licensing as well and, if they are, be sure that those licenses are obtained as well for the corporations and all individuals involved. 'FC&S Bulletins' published by the National Underwriter Company and the 'State Licensing Requirements Guide' published by Pictorial, Inc. offer helpful summaries of state licensing procedures and provide invaluable overviews of each state's licensing and continuing education requirements. Even if someone else is going to do the licensing work for you, you should at least review the state's overview/summary. RAMSEY'S RULE #4: OBTAIN AND REVIEW EACH STATE'S INSURANCE CODE. If someone else will actually do the licensing work for you, it may be enough for you to review a state overview or summary during the application process. However, the individual handling the licensing work for you MUST obtain and review all applicable sections of the target state's insurance code. Once the license has been obtained, you will need access to a copy of the state insurance code, regulations, and bulletins. How can you obtain another state's insurance code? Some state departments of insurance sell or can refer you to a source for a relatively inexpensive copy of the state insurance code, the department's regulations, and the department's bulletins. Otherwise, contact the National Insurance Law Service (NILS) or another law book publisher. If you are comfortable 'surfing the net,' you will find pricey but instant access to on-line law libraries on the Internet. Another possible source is the law library maintained by a local bar association or a nearby law school. RAMSEY'S RULE #5: IF THE WORK NECESSARY TO OBTAIN THE LICENSE(S) SEEMS TOO EASY OR QUICK, YOU ARE PROBABLY ON THE WRONG TRACK. This sounds cynical, but the people who drafted agent/broker licensing laws and regulations never considered whether the requirements being adopted would make it easier for the agent/broker to make a living. Just filling out the forms won't suffice. Most states require that you provide a copy of your license certified by your home state insurance department. If you are seeking licenses for a corporation, you probably will also need to obtain a copy of the articles of incorporation and/or certificate of good standing certified by your home state's Secretary of State. As a rule of thumb, it takes 30 to 60 days to gather all the information necessary to file the application. Once the application has been filed, don't expect to receive the approval by return mail: approval time frames of 60 to 90 days or even longer are not uncommon in certain states for certain types of licenses. Because the licensing process can be terribly slow (even when the process moves quickly, it is very slow), you need to begin as soon as possible. Since you cannot start writing the program/account until you have the necessary licenses, processing delays may push you beyond your frustration tolerance level. However, all you can do is relax, breathe deeply, and try to make sure that you aren't the reason for the delay. Keep the ball in the department's court by making certain the application and any required supplemental information are complete in every respect. Many states will simply return an incomplete application without action. Once the application and all necessary supplements have been submitted, your application will be 'ripened' according to the season of the year in a big pile of similar forms. Discount any claims by license services or consultants that they can obtain the license you need significantly faster than anyone else on earth. To deliver on such a promise, it would be necessary to overcome the Universal Laws of Orderly Bureaucratic Work Flow and Form Processing. While occasional triumphs over this inertia have been reported, they are rarely confirmed by reliable sources or any documented evidence. Only a complete application will allow unimpeded progress step to step. Again, if you make it your business to know generally what's involved in obtaining the license(s) you need and if you monitor activities through periodic progress reports, you should be able to assess the quality and timeliness of the work being done on your behalf. RAMSEY'S RULE #6: ONCE YOU OBTAIN THE NECESSARY LICENSE, KEEP IT CURRENT TO AVOID REPEATING THE RIGMAROLE. You should apply this rule to all licenses, permits, and/or corporate authorizations held. For example, don't assume that meeting your home state's continuing education requirements will be sufficient to retain the license(s) obtained from other states. If your home state does not have a continuing education requirement, you will probably need to meet the continuing education requirements for each state in which you are licensed. Also, maintaining corporate authority usually requires making one or two filings each year. Make sure that you, your attorney, a consultant you have retained, or someone on your staff is assigned to monitor and ensure that all requirements are met when due, that all necessary filings are made in a timely manner. Demand that your files be clearly documented to show what must be done, what has been done, when it was done, who received copies, the check number, the date, the amount of any fees paid, etc. In summary, obtaining agent/broker licenses in new states can sometimes be a frustrating, humbling, time-consuming exercise which is nonetheless a necessary part of an agent/broker's success. In many ways, producer licensing is a lot like building a campfire: In the warmth of the glow, one can scarcely remember gathering the wood. STATE INSURANCE DEPARTMENT DIRECTORY Alabama, 135 S. Union St., Montgomery, AL 36130, (205) 269-3570 Alaska, P.O. Box 110805, Juneau, AK 99811, (907) 465-2515 Arizona, 2910 N. 44th St., #210 Phoenix, AZ 85018, (602) 912-8466 Arkansas, 1123 University Ave., #400 Little Rock, AR 72204, (501) 686-2900 California, 700 L St., 4th Floor, Sacramento, CA 95814, (916) 322-3555 Colorado, 1560 Broadway, #850, Denver, CO 80202, (303) 894-7499 Connecticut, P.O. Box 816, Hartford, CT 06142, (203) 297-3800 Delaware, 841 Silver Lake Blvd., Dover, DE 19901, (302) 739-4251 Dist of Columbia...) 266-8699 Wyoming, 122 W. 25th St., Cheyenne, WY 82002, (307) 777-7401 This article was written by Marcus Ramsey, CPCU, principal of Ramsey Consulting Services, 14026 Donart Drive, Poway, CA 92064, (619) 748-6315.

6 Tips For Succeeding As An Insurance Agent
How do you become an insurance agent? How do you get clients? Do you need to be educated in order to sell insurance? Do you need to know about Instagram Ads? These are all questions that many potential insurance agents have, but they shouldn't stop them from getting into the industry. With the right attitude and some helpful advice, you can succeed as an insurance agent regardless of your experience or lack thereof. Here are six tips that will get you started on the path toward success as an insurance agent. 1) Invite your friends and family As with many new professions, it helps to have a few people who are familiar with your work know what you're doing and who you're doing it for. It's especially helpful when they have a vested interest in your success (like family members). Make sure they know that you can do a good job representing them—and make sure they know how. Invite everyone you know to a grand opening party or event; give them free tickets to something big; ask their opinions about making key decisions. Let them feel like part of your team and part of your project. And don't be afraid to advertise—word-of-mouth is still one of the best ways people hear about new business ventures. 2) Have a good digital footprint Before you can even think about finding clients, you need to have a website. Your insurance website should include information about your background and history, describe your professional accomplishments, display your educational and certification credentials, provide a list of other satisfied customers, and direct potential clients to contact you with any questions they may have. Make sure it's mobile-responsive so people can find you on their phones. You also need a LinkedIn profile that includes links to your website and Twitter account. Update your digital footprint regularly—don't let it sit stagnant. If you don't keep things up-to-date people will forget who you are or what services you offer. 3) Know your product inside out You've probably heard a million times that the devil is in the details, but that's actually a good thing when it comes to insurance sales. That's because you don't want to be so concerned with selling policies, especially at first, that you forget to focus on all of those little details. This can seem frustrating at first if you feel like your money is tied up in details, but once you become more established and start earning bigger commissions, paying attention to detail can mean huge dollars in your pocket. Focus on things like complying with your state and company's specific processes and procedures; following up on leads within 48 hours; writing clear lead reports; and building solid relationships with both internal and external customers. 4) Use social media wisely Social media has become an integral part of today's business world. It's a great place to find clients and boost visibility. However, it's also a place where some insurance agents post unprofessional or too-promotional content—and turn off potential customers in their droves. To avoid these social-media slip ups, try to only post relevant content to your company's social channels and hire someone (or teach yourself) how to use photo editing software to make sure you always look sharp and in control. 5) Add value to other people's lives People buy products and services, not companies. You can increase your sales substantially by creating relationships with prospects and customers that focus on solving their problems. If you're looking to succeed in any business—not just insurance—this should be one of your top priorities. After all, what's better than selling something people want? Selling something people need. If your product or service is sold on its own merits, it becomes that much easier to sell. When you're helping someone solve a problem—that's when people tend to spend money. 6) Focus on the little things There's a popular saying that goes, A chain is only as strong as its weakest link. A chain with five or ten weak links will break quickly. The same holds true in business—every task you perform contributes to your overall goal of succeeding as an insurance agent. It may not seem like each individual task makes much of a difference, but they do; so focus on every little thing and see your progress snowball over time....

How to become an insurance agent.
Should Graduates Get Into The Insurance Sector? Some insurance is mandatory, some is life-saving, and some is there as a “just in case”. The reality is that there’s insurance for pretty much everything, and the industry is booming, making it a great career option for graduates, regardless of what they’ve studied. Graduating with a degree in insurance is ideal, but it isn’t necessary, as there are some basic skills that are desirable too, such as numeracy, good communication, and analytical skills. Anyone can work in insurance It really doesn’t matter what you got your degree in: anyone can go on to work in insurance. So, if you spent years studying psychology and then decide it isn’t for you, switching to insurance is a good move. Plus, your degree shows that you can commit to your education, which employers will value and be likely to invest back into your career. The reality is that insurance is everywhere, and your degree will always be relevant in one way or another. Everyone needs and has some sort of insurance, from medical and home insurance to car and pet insurance. This means that specializing in another area is very likely to be relevant to the insurance sector in one way or another. Do you need to go to university to work in insurance? The short answer here is no, but it can do wonders for you if you do. Many universities offer degrees in insurance, so if you know it’s the sector you want to get into, get your degree in it and let the insurance companies compete for you, offering you higher pay based on your education, and they’ll be sure to progress you once you prove yourself to them, as you’ve already acquired the knowledge and skills. This will help you to pay off your student loans. The best student loan consolidation companies can save you money on interest and change your term length to suit you based on how much you’re earning and can afford to pay. Once you work your way up to higher paying roles, you can pay your debts off quicker, and the investment into your insurance degree will be well worth it. Ideal skills to gain alongside your degree Whether you’re working in insurance as a broker, claims manager, underwriter, or loss adjuster, all roles involve negotiating with clients or on their behalf. At the heart of this is providing good customer service and communicating well with other employees. While you’re earning your degree, you could work part-time in any role that requires great customer service to gain valuable experience. You’ll need to good numeracy skills, particularly for actuary’s work, but all work in insurance needs this. This can be gained through your education or even shop work where you handle numbers to a certain extent. Other desirable skills include being organized, having attention to detail, and analytical skills. Insurance is a great industry for graduates to get into. It has plenty of progression opportunities, varied roles and pays well, especially if you have the skills needed for the job and a degree in insurance....

How to become an insurance agent.
Should Graduates Get Into The Insurance Sector? Some insurance is mandatory, some is life-saving, and some is there as a “just in case”. The reality is that there’s insurance for pretty much everything, and the industry is booming, making it a great career option for graduates, regardless of what they’ve studied. Graduating with a degree in insurance is ideal, but it isn’t necessary, as there are some basic skills that are desirable too, such as numeracy, good communication, and analytical skills. Anyone can work in insurance It really doesn’t matter what you got your degree in: anyone can go on to work in insurance. So, if you spent years studying psychology and then decide it isn’t for you, switching to insurance is a good move. Plus, your degree shows that you can commit to your education, which employers will value and be likely to invest back into your career. The reality is that insurance is everywhere, and your degree will always be relevant in one way or another. Everyone needs and has some sort of insurance, from medical and home insurance to car and pet insurance. This means that specializing in another area is very likely to be relevant to the insurance sector in one way or another. Do you need to go to university to work in insurance? The short answer here is no, but it can do wonders for you if you do. Many universities offer degrees in insurance, so if you know it’s the sector you want to get into, get your degree in it and let the insurance companies compete for you, offering you higher pay based on your education, and they’ll be sure to progress you once you prove yourself to them, as you’ve already acquired the knowledge and skills. This will help you to pay off your student loans. The best student loan consolidation companies can save you money on interest and change your term length to suit you based on how much you’re earning and can afford to pay. Once you work your way up to higher paying roles, you can pay your debts off quicker, and the investment into your insurance degree will be well worth it. Ideal skills to gain alongside your degree Whether you’re working in insurance as a broker, claims manager, underwriter, or loss adjuster, all roles involve negotiating with clients or on their behalf. At the heart of this is providing good customer service and communicating well with other employees. While you’re earning your degree, you could work part-time in any role that requires great customer service to gain valuable experience. You’ll need to good numeracy skills, particularly for actuary’s work, but all work in insurance needs this. This can be gained through your education or even shop work where you handle numbers to a certain extent. Other desirable skills include being organized, having attention to detail, and analytical skills. Insurance is a great industry for graduates to get into. It has plenty of progression opportunities, varied roles and pays well, especially if you have the skills needed for the job and a degree in insurance....

... Liquidity Ratio, And Why Should It Be Important For An Insurance Agent?
Evaluating your operating statement provides an excellent snapshot of your agency’s financial health. It’s almost embarrassing to say, but many insurance agents don’t pay attention to the operating statements (profit & loss statements) produced by their expensive agency management systems — and most don’t even print their balance sheets because they don’t recognize the importance of the information they contain. A few minor alterations to your operating statement (eliminating such non-cash items as bad debt and depreciation and amortization from the P&L; and adding such non-operating cash needs as debt principal payments) will give you your cash flow situation at any time. And that’s just a small step short of actually being able to project future cash flow at least one month in advance. Wouldn’t that be nice to know each month! Even more important, the liquidity ratios that can be drawn from your balance sheet truly tell you the health of your business at the moment that the balance sheet is drawn. Although an operating statement is useful as a budgeting and year-to-date tool for profitability and cash flow, the balance sheet’s purpose is the same as a complete physical exam: To determine both your general health and specific indicators of the functions of your system. A balance sheet provides the data to test the liquidity of your business. All you need are the formulas and benchmarks to convert this data to meaningful results. Here are the formulas and liquidity ratio benchmarks that you should apply monthly to your Balance Sheet. Running a balance sheet without applying these ratios is like collecting data but never evaluating it: CURRENT RATIO The general liquidity ratio measures your agency’s short-term health. If current assets can’t meet current liabilities (within 12 months), you need to strengthen your liquidity. Formula: Current Assets/Current Liabilities Benchmark: At least 100% ACID TEST The acid test is a primary liquidity measure used to determine whether the firm can meet its current obligations. Formula: (Cash + Receivables)/Payables Benchmark: At least 90% RECEIVABLES TO PAYABLES A poor receivables-to-payables ratio indicates a poor collector. Formula: Trade (Co.) (or All) Receivables/Trade (premiums) (or All) Payables. Benchmark: Less than 75% TANGIBLE NET WORTH (TNW) The 'book' value of your company (not the Book of Business value, which is excluded). Formula: Total Owners Equity (Treasury Stock subtracted) less Intangible Assets (such as Goodwill, Purchased Renewals or Expirations, Covenants) and any loans to officers or owners that arent likely to be repaid. Benchmark: Should be a positive number unless the agency is in the process of being perpetuated (causing negative TNW). But in that instance it should be a positively growing number each year toward an eventual positive number. WORKING CAPITAL Measures the extent to which the excess of current assets over current liabilities can cover operating expenses. Formula: Current Assets less Current Liabilities. Benchmark: Take the Average Daily Cash Expenses of the agency Total Expenses of the prior year, less non-cash items (Bad Debt and Deprec & Amort divided by 365) and divide it into the Working Capital. 30 days should be the minimum required. Forty-five to 60 days defines a cash-healthy agency. These formulas will assist you in determining the health of your agency. You should run them on your balance sheet every month and gauge your progress. If you have problems in one or more areas of liquidity, take remedial action. Dont be afraid to get a 'Check-Up' for your agency regularly. If bad things are happening, there are solutions. Its far worse to wait until you cant make payroll or cant pay the carriers to find out about your liquidity problems....

Reaching Out To Sell Someone
  REACHING OUT TO SELL SOMEONE by Monica Langley If you think telemarketing is only a bunch of people yakking on the telephone, think again. It lets agents prospect for business from Rapid City to New York City, and all points in between. Though he hustled for new business as a matter of course, Dallas agent James Smith wasn't really pressed to do it-until he suddenly lost $400,000 in premiums. One client went bankrupt and others switched carriers because of ownership changes. Recalls Smith: 'I had to make a comeback fast.' So what did he do? He turned to telemarketing, the insurance industry's-and everyone else's-version of reaching out to find someone to sell, and then doing it. Smith put a telemarketing operation in place at Leick, Marshall, Neal & Associates, and he's been ringing up business opportunities ever since. Says he: 'Telemarketing was the answer, and it's really paid off.' One recent effort: one of the agency's telemarketers telephoned Bob Price, president of a Dallas-based manufacturer of car-wash equipment, at the very moment he was considering a change in his insurance carrier. 'Normally I wouldn't listen,' Price says. 'But the caller was professional and I was receptive at the time.' Smith followed up after the telemarketer's call, and is currently working on a quote for the policy, which would call for an annual premium in excess of $100,000. The precisely timed call to Price was about as coincidental as the sunrise, which is what telemarketing is all about. More than a bunch of people hawking goods or services over the telephone, telemarketing involves finding where potential markets are, then selling to prospects known to be ready to buy, or at least thinking about it. In effect, telemarketing uses the telephone and a lot of accompanying electronic wizardry to replicate the success of the Ford Mustang, a car made for its youthful market in the 1960s that set a still-unbroken record for acceptance by buyers of a U.S.-made vehicle in its first year. More and more insurance agents are finding that a deftly orchestrated telemarketing effort can bring in significant amounts of new business. Northside Insurance services in Roswell, Georgia, for instance, will generate $1 million in new sales in personal lines this year, all because of telemarketing. Jones, Hill & Mercer in Savannah sold $500,000 in premiums on commercial lines in just this year's first quarter. Telemarketing can be a powerful and versatile form of direct marketing. With lead generation a top priority for most agents, telemarketing can be the cost-effective means of finding qualified prospects. With the high cost of face-to-face meetings, agents who telemarket meet only with prospects who are most likely to buy insurance. Telemarketing helps increase sales not only by adding new policyholders, but also through cross-selling and upgrading existing customers. Says Smith: 'Telemarketing is an easy source of new business leads. And it frees up producers from spending their time prospecting and lets them do what they are supposed to do-sell.' Explains Donald Jackson, a direct-marketing consultant: 'It's not waiting for the phone to ring or for a referral to come walking in the door. It's using the lists and telephone to go after the prospects you want most.' Why telemarket? It's strictly the law of big numbers. By using the phone to track leads, an agent or telemarketing representative can make perhaps 20 sales presentations in an hour, compared to only one if making a personal visit. On a winter evening this year, for example, three telemarketers secured 86 leads in less than two hours at A.H. Meyers Insurance. The New Jersey firm gets 13,000 leads in a year by telemarketing. Indeed, the only disadvantage to telemarketing seems to be that an agency can generate more leads than its producers can follow up on. 'We had to send out letters saying we couldn't deliver the quote we had promised them over the phone,' says Robert Ziegler, vice president of administration at MRW Group in Huntington, New York. Nevertheless, a new satellite office has written $1.8 million in business through this telemarketing effort. While independent agents for the most part haven't incorporated telemarketing into their sales program, they are showing interest in it to generate leads. The American Telemarketing Association is seeing a boost in membership from insurance agents. And at the Texas PIA convention in May, telemarketer Jessica Bradshaw of Dallas says she was deluged with serious inquires about retaining her firm. PIA is committed to telemarketing and has a telemarketing staff that makes some 50,000 calls a year. PIA uses the telemarketing to sell errors and omissions and health insurance to its members, as well as advertising for this magazine. 'We believe in telemarketing,' says Mitchell Glass, PIA's vice president of telemarketing and member services. PIA uses telemarketing to support its direct marketing efforts, which generates annual sales of more than $100 million. Glass says a major reason independent agents have shied away from telemarketing is 'because they think of themselves as service providers, not salesmen.' But Raymond Spies, president of Development Associates in Eau Claire, Wisconsin, which specializes in telemarketing training, warns: 'If independent agents want to survive in this marketplace, they have to telemarket.' Telemarketing is a combination of systematic activities, which typically involves four basic steps: approaching leads with a letter or brochure about the agency, phoning to solicit policy expiration dates, following up by telephone or direct mail and scheduling a face-to-face appointment. The 'pre-approach' letter tells the potential customer about the agency and says the agency will be calling shortly to ask about their current insurance policy. The purpose is to introduce the name of the agency into the household or business and to present the idea of comparing rates' and coverages before renewing. Smith of Dallas says his firm's response rate is 50 percent if a call is preceded by a letter, but is as low as 15 percent without some introductory correspondence. The telemarketer, who frequently isn't a licensed agent, then calls the prospect to briefly describe the benefits of the agency's coverage and to generate their interest. A primary purpose of this call is to solicit the x-date, which is based on the assumption that the best time to persuade someone to change coverage is when the current policy is about to expire. Additionally, telemarketers can obtain the name of the present carrier and such rating information as the number of rooms in a home. At this stage, management of the newly acquired prospect data is critical to how successful the telemarketing program will be. It is preferable to compile the prospects by their x-dates so that at the start of each month, producers can call up the names of prospects whose policies will expire shortly. One popular way to organize the prospect data is a software package called the Automated Sales Center, sold for $1,295 by Automated Insurance Marketing in Marlton, New Jersey. In addition to managing the data, the program can generate pre-approach letters and track monthly x-date volume. After the phone calls, letters are sent out thanking prospects for the answers and promising to reach them 60 to 90 days before their current policies expire. In the meantime, some agencies send newsletters and other materials to establish name recognition. Ziegler sends a calorie counter to prospects, so when an agent calls on the prospects, who often forget they've responded to earlier calls, an agent can remind them that he sent the gift. Then, shortly before the x-date, the agent contacts the prospect to set up an appointment. A minority of agents, however, make their sales strictly on the phone. While these steps to carry out a telemarketing program seem straightforward, agents must fine tune them to fit their own goals and limitations. Jerry Hargrove, vice president of Northside Insurance who has implemented a strong telemarketing operation, says it took him three years of trials and tribulations to make the program work predictably. He decided to set up a telemarketing operation once his agency moved to Roswell, an upscale Atlanta suburb. Telemarketing became the key to Northside's plan to become the 'insurance source' for that market. First, he outlined the territory on a map, targeting 35,000 homes. Three agents began working four hours a night, five days a week on the phone. In just five years, Northside Insurance has grown from eight people to 33, and Mr. Hargrove says 90 percent of the business is sold over the phone. As Northside's experience indicates, telemarketing can work whether the agency is big or small. Size only dictates how the telemarketing operation will be structured, such as whether it's full-time or computerized. The first decision is who will actually implement the telemarketing program. Jackson, the marketing consultant, suggests that the most cost-efficient way to break into telemarketing is by hiring an outside firm rather than trying to hire, train and operate a new operation internally. His advice to agents is to calculate how many leads you need each week so producers can follow up. 'Then put a program in place to ensure follow-up so leads aren't wasted,' Jackson says. Agents can hire local telemarketing firms that work for any kind of business or firms that specialize in lead generation for insurance agents. Tel-America Telemarketing of Franklin Square, New York, will do telephone prospecting for agents, typically for a six-week period, for an hourly charge of $30 to $34. Sidney Communications of Pittsburgh can be retained for a lead-generation program at a hourly charge of $26 to $38. Additional sources for telemarketing assistance are certain insurance carriers. For example, State Auto Cos. offers telemarketing training to independent agents who sells its products. Crum & Forster sells a direct mail program designed for telemarketing by insurance agents called 'Xdate Xpress.' Once an agent selects a target market, Crum & Forster will send out letter to prospects telling about the firm and to expect a telephone call from the agent shortly. The company charges up to $875 for 1,000 names and letters, and doesn't require that the agent offer its products. It also provides a how-to-telemarket kit, with information ranging from the design of a telemarketer's desk to the best time to reach certain professionals. The New York metro branch of Aetna Life & Casualty is offering a new telemarketing program that is designed to provide free, no-pressure insurance information to consumers that still nets prospects for area independent agents. Prospects receive a brochure in the mail that invites them to call an 800 number for recorded information on 20 types of insurance or a particular independent agent. After providing information on a certain insurance product selected by the caller, the recording then offers to connect the caller with a live agent (who mailed the brochure) by punching 1. Wishphone, the Huntingdon Valley, Pennsylvania, company that operates the service for Aetna, says 25 percent of the callers ask to be connected to an agent. The charge for the service, including personalized brochures, 800 service and life-call transfers to the agency, is $199 a month. If an agent decides to telemarket inhouse, he typically will need to purchase a prospect list. There are several list vendors, who offer names and numbers based on various criteria starting with geography and including household income or type of business. IMR of Morristown, N.J., sells commercial lists to agents who specify geographical area, risk profile and account size. For example, an agent can ask for only commercial prospects whose annual premiums would exceed $25,000. The price of the list is about 60 percent for each name, says IMR's Ralph Gray. If an agency decides to set up its own telemarketing operation, it's important to find a phone representative who is persuasive, has good phone manners and can handle lots of rejection. PIA's Glass recommends personality tests to applicants to look for certain traits including empathy and persuasiveness fueled by ego gratification. PIA, which offers a personality-testing service through Personnel Survey & Research Group in Princeton, conducts the tests before hiring its own telemarketers. The testing is worthwhile, says Glass, because the tests enable the agent to better predict who will stay on the job. There is a high turnover rate generally in telemarketing, because workers can't handle the excessive number of rejections. 'The way to avoid burnout is by using a soft-sell approach and being polite,' says telemarketer Chris D'Agostino with Arthur Noll Agency of Bloomfield, Connecticut. 'You don't try to push insurance down their throats, because the goal is to get long-term clients.' D'Agostino makes 400 to 500 calls a week, and secures about 45 x-dates on commercial policies in that time. 'My job is to get the agent in the door,' he explains. Jackie Wilkes, the telemarketer for Scott Insurance of Lynchburg, Virginia, says she sets up about 15 appointments a week for eight agents. She is a licensed agent herself 'so I can answer substantive questions like what exclusions apply on a policy.' Studies have shown that a telemarketer has 8 to 15 seconds to grab someone's attention, says Spies, the consultant. He cautions that a telemarketer shouldn't 'read' a script, although some kind of outline is useful to insure hitting important points and asking pertinent questions. Despite getting callers that hang up or brag about their current carrier, agents find that the odds are good that telemarketing will pay off. Take David Carlson in Cedar Rapids, Iowa. In a recent telemarketing campaign with 1,000 x-dates calls, 200 prospects for commercial lines were interested enough to have the agents contact them. Agents arranged 53 appointments and eventually sold 13 policies for a total of $421,000 in new business. The cost? About $3,000. Telemarketing will be an even greater sales success once there is widespread availability of picture phones, predicts Glass, who envisions two-way dialogs that include body language as well as words. He concludes, 'Telemarketing really is the future of sales in the insurance business.' Reprinted with permission from Professional Agent. Monica Langley, a lawyer and a former member of the staff of The Wall Street Journal, lives in Knoxville with her husband. She gathered all the information for this story by telephone. ...