Are you looking for a insurance company business plan template? Here is a sample business plan for an insurance agency firm and free feasibility report.
Interested in small insurance business planning tips? If YES, here is a practical guide on insurance business.
How to Start an Insurance Company – Life, Car, Health Insurance Etc
You need to read this blog post if you are thinking about how to start an insurance company. Normally, it takes someone with years of experience in the insurance industry to be able to have the full confident to want to start an insurance company and become their own boss.
Before you get excited about starting your own insurance company, have it in mind that it involves a lot of hard work, passion and determination to scale through the first five years of startup.
It is very challenging when it comes to running an insurance company as you will be dealing with employees and customers. It takes a good leader to be able to run a company of this nature or else, it won’t last the first five years.
Below is a complete guide designed to help you attain the goal that you need to start an insurance carrier company and become your own boss.
HOW TO START UP YOUR OWN INSURANCE AGENCY
- A Business Name
The first thing you need to do to start an insurance company is to come up with a name for your company. Your insurance business name must reflect the type of insurance products that you deal in if you choose to specialize on a single product.
If you choose to specialize in more than one product, you can pick a name that is easy to remember by your potential customers. This is very important.
- Registering your Insurance Company
Starting an insurance company involves that you have to register it. The legal entity you choose to register your company depends on you. From experience, I can only say that the best entity you should register an insurance company would be as a LLC.
When you register your insurance company as a Limited Liability Company, your personal asset will not be affected in case of failure to pay debt. The only properties that will be affected will be properties own by the company.
This is why most financial institutions are registered under a Limited Liability Company. If you do your research further, you will discover that an LLC is the best option for registering your company under.
If you are starting the insurance company with a partner, you can register the company as a Limited partnership company.
- Get a License
How do you become an insurance agency? You will need a license before you will be able to solicit and sell any insurance product. Make sure that you study the licensing laws of the state that you live in and get licensed. You will need a separate license for each type of insurance product you plan to sell.
Have it in mind that the process of obtaining an insurance license do not come easy. There are some laid down criteria that must be met before you will be issued a license.
Before you will be qualified to apply for an insurance license, you will need to write an examination. This exam is something you can sit and write in one-sitting if you are really serious about starting your insurance company.
This exam is something you must be serious with or else you will need to come back another year to come write it again if you fail. You must prove that you want your insurance company started by performing well in the licensure examination.
- Insurance Products
How do insurance companies make a profit? The next thing that should be on your agenda is deciding the type of insurance products you want to deal in. The insurance industry as I know you should be aware is a very wide industry with so many niches.
You can choose to deal in life and health insurance, auto insurance, property insurance, liability insurance etc. Auto insurance is perhaps the easiest to sell but not as lucrative as life insurance.
When determining how to start a life insurance company, you have to remember that your main source of income will be commission and residuals from the policies. The higher the policy amount, the greater the commission. You might want to keep this in mind while deciding what type of insurance to specialize in.
How much does it cost to set up an insurance company? Starting an insurance company requires capital to invest in it. Draw up an insurance company business plan enumerating the capital you need to get started, monthly expenses, projected future commissions and profits. Finance is the lifeblood of any business.
Common sources of finance are banks, financial institutions and investors from the industry. Some expenses you will need to cover include advertising, salaries, commissions, professional fees, rent, taxes, office supplies etc.
- Advertising your Insurance Company
You need to be able to identify and contact potential clients for your insurance company. The survival of an insurance business depends on a smart advertising and marketing strategy. Hard-selling skills are the hallmark of good insurance salesman.
You can recruit salesmen to help in marketing your insurance products to potential clients and bring you leads. You can run advertisement extensively over the internet, in the yellow pages and also in your local newspaper. The bulk of your expenses will be on advertising. So, be prepared.
The information should get your insurance company off the ground and start soaring!
INSURANCE AGENCY BUSINESS PLAN SAMPLE
Are you looking forward to hoisting your own insurance company?
To start an insurance company, you would need to write a well-detailed business plan first! This can be a daunting task for some persons, but not to worry, where you find yourself now is the best place to be in such situation; as the page unfolds, you will get to look at an insurance company business plan sample I have written, so you can decide to pattern your own verbatim.
Perhaps you know the entrepreneurial fortune that goes with the business, or maybe I would have to enlighten you even more, either ways starting an insurance company is a superb initiative, especially now when uncertainties are driving people into the insurance firms for a safe haven.
An insurance firm gets premiums in return from customers that get an offset of risks; the company offers them safety of mind. So in the eventuality that any accidents occur, the company is responsible for bringing the customer to his feet again.
Business plans help you start up your business, and can get you the required capital, in terms of loan, if well done.
The plan below is a sample business plan for GEMINI Insurance Plc.
TABLE OF CONTENT
- Executive Summary
- Who We Are
- Business Objectives
- Core Values
- Services Offered
- Summary of Market Analysis
- Strategy and Approach to the Market
- Financial Plan
Who We Are
GEMINI Insurance Plc, is a business organization that provides coverage, in form of compensation resulting from loss, damages, injury, treatment or hardship in exchange for premium payments. We keep you covered in case of emergencies, so that you go about your activities without having to panic.
It is built up by dedicated professionals in the field, each with a minimum of 13 years’ experience. They have guaranteed expertise, and have proven themselves in different dimensions and aspects of their profession.
GEMINI Insurance Plc is committed to ensuring that quality protection is received by her clients via the insurance products we provide. We are looking at a picture in which our clients have utter faith in our ability to deliver on promises, in which we beat their imaginations, and sustain a mutual respect for each other’s interests and values.
Our objectives are precisely the following:
• To soar high enough as to becoming the leading insurance product provider in the market.
• To blend into our business environment by providing the kinds of insurance products that best suit the environment, as well as enunciate policies that protect a friendly relation with our clients.
• Boost services and sales by maintaining a competent brokerage, and attract more clients.
• We target to have turned in 15% returns in the first half of the year.
We uphold some qualities that we highly emphasize, and they are;
• Hard work
Our services cover the following business lines:
• Health Insurance
• General insurance and special risks
• Life insurance and annuity
• Asset Management
• Aviation insurance policy
• Agricultural Insurance
• Financial reinsurance
With our keen professionalism, we have established a strong reputation in the aspect of insurance. We are a unique organization that discharges our duties with updated technologies.
SUMMARY OF MARKET ANALYSIS
Upon adequate feasibility studies of our geographical location, we deduced that 38% of members of the population are seniors that have age over 43 years. Also, there are a good number of family businesses that can be found in the nucleus of the city which happens to be close to GEMINI insurance company’s location. Questionnaires have indicated positive prospects we can get by selling our services to middle income earners.
So far, the market of insuring senior citizens has shown such stability and motion towards profitability. In the foregoing light, we have segmented the market.
We divide the target market into three categories as follows:
1. Seniors: Seniors would have the routine home inspection services, which caters for their updated welfare. Their health can be insured in case of any emergencies, and they are a chunk of the population that are vulnerable of ailments.
2. Medium and Large Scale businesses: For the second group of people, they are into business and sometimes work with sophisticated equipment and machineries; so important are these machines that the rise or fall of the firm rests on them. An insurance company like GEMINI Insurance is all they need to protect them and lay on the safer side of the business bed.
3. Staffs are also placed on insurance schemes, just in respect of uncertainty. It is also a display of ethics and professionalism on the part of the organization to do so.
4. Low-income Earning Families: Low income families can hardly survive the loss of the member that wins their bread. They had best stick to an insurance company that would assist the beneficiary with money to survive with, in exchange for a premium.
STRATEGY AND APPROACH TO THE MARKET
In the last decade, the insurance industry has experience a massive down surge of individuals. One reason is; companies and brokers inclusive. One reason for this is because the prices of automobiles have begun to touch the skies, and another reason is the cost of affording an insurance product.
GEMINI Insurance plc has considered these factors and have decided to adopt a strategy in conjunction of an auto company, to subsidize and afford clients opportunity to leverage on the autos.
Also we have decided to beat down the price of purchasing some of our insurance products and particularly life insurance. This is in view to resuscitate the patronage of insurance companies, as well as generate profit for the company.
Startup Cost $127, 700
Insurance Policy, Permits, and Licenses $12, 300
Cash Flow In Flow Out Flow
$210, 530 $187, 330
Profit and Loss $23, 200
INSURANCE COMPANY BUSINESS PLAN – SAMPLE 2
If you desire to start an Insurance Agency, then you have selected a service that has gained greater relevance in today’s world. From Supermarkets to Banks to residential complexes, Insurance coverage is becoming the rule rather than the exception, with Insurance becoming compulsory by law for certain individuals and businesses to have.
If you are seeking to establish an Insurance Agency, then the following points of reference in drawing up a business plan will assist you in that regard:
Insurance Agency Sample Business Plan for Keen Assurance Brokers
Table of Content
- Executive Summary
- Vision Statement
- Mission Statement
- Management Structure
- Products and Services
- Market Analysis Summary
- Competitive Advantage
Keen Assurance Brokers is a startup business that seeks to utilize and maximize the opportunities that exist in the provision of insurance brokerage services to individuals, businesses and corporate bodies.
Keen Assurance Brokers Headquarters will be situated in the main business district of Lagos, Nigeria, with future plans to create a network of branches that will traverse both local and international markets and financial sectors.
Keen Assurance Brokers enters the highly competitive global and national insurance industry with one objective in mind: to give our customers including individuals, businesses and Corporate Organizations value-added insurance services, cutting across life assurance, assets, specialist as well as general insurance packages and programs.
Our vision is to be the number Insurance providers to individuals, businesses and large corporates. Keen Assurance Brokers will render this service based on the pillars of engagement such as integrity, hard work, service, excellence and teamwork.
The mission of Keen Assurance Brokers is to create a more protected personal and business environment for individuals and businesses by offering property, casualty, and life insurance to intending and existing premium owners, through diversified and pragmatic portfolios, that will be tailored to specific and general needs.
Keen Assurance Brokers will be started by Ken Carson, a seasoned insurance practitioner, as a home run business. It will commence operations as a sole proprietorship, with Ken playing diverse roles as Manager, customer engagement representative, portfolio manager as well premium negotiator.
Keen Assurance Brokers, under the supervision of Ken Carson, will seek registration as a Limited Liability company when the need to hire more employees arises as well as when the operations of the insurance agency requires more space in an office.
Keen Assurance Brokers, while keeping an eye on the overall vision statement, will begin with soliciting individuals to take up personal and life insurance plans.
PRODUCTS AND SERVICES
Keen Assurance Brokers will engage with her target markets with the provision of the following insurance packages and portfolios:
A. Homes and Residences
• Homeownership Insurance.
• Cooperative Insurance.
• Insurance for seasonal/temporary Locations.
• Flood/Natural disaster Insurance; specifically, for homes in drought-prone areas
B. Valuables and Personal Assets.
Under this category, Keen Assurance Brokers will provide coverage for items such as jewelry, antiquities, share certificates, heirlooms, electronic and home appliances as well as other such assets as declared by the owners.
C. Personal Liability
Keen Assurance Brokers can undertake to indemnify the individual against unforeseen circumstances/events that bear a direct link or association with him/her.
D. Life Assurance
Keen Assurance Brokers will tap into this promising segment of the Insurance sector to provide applicants with top-of-the bill life assurance premiums, tailored to the peculiarities/demands of the potential insured.
E. Disability Care
Keen Assurance believes that the individual should not be disadvantaged due to a disability suffered at work or play. Keen Assurance Brokers will endeavor to assure such victims with insurance packages that will give them a new lease on life.
Keen Assurance Brokers will provide these services based on the trends and experiences garnered over the years. In providing these services, Keen Assurances will also:
• Liaise with customers on their insurance needs to determine an appropriate course of action.
• Assist existing clients with insurance claims, understanding their insurance policies and normalizing their premium payments.
• Offer consultancy services by referring clients to additional providers who can reduce their exposure to risks and adverse situations.
MARKET ANALYSIS SUMMARY
Nigeria, with a population pushing into the 150 million mark, is ripe for the propagation of personal life insurance packages. Lagos State alone boasts of a population nearing 25 million people. Keen Assurance hopes to break into this insurance segment with the provision of top notch insurance services.
The market is primly poised for this; demographic information obtained from the National Population Commission show that a breakdown of population segments shows that youths and the young at heart, make up close to seventy percent of the population.
In addition, the growth rate for the country is put at 3 percent per annum. All these figures point to the fact that existing and potential markets are guaranteed. Keen Assurance Brokers will have to devise methods and means to attract the interest of these market groups with relevant insurance packages.
As a marketing strategy, Keen Assurance Brokers will target potential and existing home owners under and above 40 years of age, new parents, aspiring parents, temporary renters as well as other groups that have high potential for having a need for insurance.
Keen Assurance Brokers will rely on its compact size and operations to focus squarely on providing personal insurance services, availing her customers with insurance bundles that are reflective of their realities and needs.
Keen Assurance Brokers will also serve as a bridge between bigger insurance companies and our customers, who will trust our expertise and sense of judgment in obtaining favorable insurance packages across different sectors of the economy.
Keen Assurance brokerage will reach out to potential and existing customers with word-of-mouth advertising and referrals. In addition, Keen Assurance brokers will also place targeted ads in relevant insurance journals and newsletters.
Keen Assurance Brokers will be financed by personal funds of the founder. It is planned that by the second year of operations, the business will be able to secure a bank loan for purposes of expansion and growth.
The startup funds of the owner for the business is put at N1 million USD. This will take care of the costs of setting up a website, procuring marketing materials like call cards, brochures, T-shirts etc. A part of the sum will be used in setting up a small space as a home office.
Revenue is projected to come from the payment of premiums and consultancy fees charged for creating linkages between individuals and other lager insurance brokerage firms.
This business plan will form the basis for the interaction between Keen Assurance Brokers and the target market demographic. It will also be liable to adjustments, in order to accommodate the dynamic nature of the Insurance industry at both national and international levels.
This is a sufficiently detailed business plan of an insurance agency. It sure serves all the necessary purposes any one can require.