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The Independent Agency SWOT Analysis: Quick Reference Guide

Written by Shelby Hudson

December 14, 2021

The Independent Agency SWOT Analysis: Quick Reference Guide

In the insurance industry, you know that it is common to find yourself looking for the best shortcut to revenue acceleration with questions like:

  • How often should I post on social media?
  • Which platform should I focus on?
  • Should I send an email newsletter monthly or weekly?
  • How can I get the best results?

 

Yes, these are essential questions, but make sure you aren’t asking them prematurely. Tactical questions like these are not helpful without the context of having a broader, more comprehensive marketing strategy.

Before tackling the above questions, you need to have a grasp on the following:

Who is Your Market?

Once you have defined who you are trying to market to and connect with, you will ask secondary questions about their motivations, needs, goals, and problems.

What is Your Message?

Once you are familiar with your market, you can craft and test what messaging they will best respond to.

What Media Should You Use to Reach Them?

After answering the above, you will be able to ask this question and, with research, be able to test and choose the most effective marketing platforms.

Once you direct your marketing to the right demographic for your target market, you can find a strategic match that generates the most viable leads. You will find that these clients have a high client lifetime value, profitability, and equity.

Answering these questions accurately can have a significant impact on the future of your insurance agency.

 

The S.W.O.T. Analysis

To truly hone in on the best marketing strategy and get the best results for your insurance agency -conducting a S.W.O.T. Analysis can be the solution. This provides a clearer view of your insurance agency’s market position and the best way to respond.

When conducting a S.W.O.T Analysis, you need to ask four questions about your insurance agency:

What are our strengths?

These are qualities that put your insurance agency ahead of the competitors.

What are our weaknesses?

It is vital to note weaknesses both in the areas you can improve and where you cannot compete.

What are the emerging opportunities?

These are external forces that your insurance agency can leverage to reach your goals.

What are the emerging threats?

These are external forces that you must protect your agency against.

Inherent Insurance Agent Strengths

One of the most important strengths to note, especially when faced with competing with digital channels, is that you have real people. There is no competing with a genuine human connection.

When clients call a far-away cubicle at a national carrier, they don’t expect a relationship – just efficient service delivery. Whereas, you have real people at your insurance agency, and you can build real relationships with these people and offer genuine advice and solutions.

Your expertise helps clients make informed decisions based on their medical and financial needs. Representing more than one carrier, you have multiple policy options for them and help them navigate the complicated insurance maze.

One of the most overlooked strengths and opportunities of being an insurance agent is your existing book of business.

 

Weaknesses?

Be honest with yourself and identify the weaknesses faced by insurance agents. One of which is that being an independent insurance agent is a bit more costly than going the direct channel.

Although underwriting costs less, the delivery system is the leads efficient. There are infrastructure costs for sales and distribution that overlap and direct channel models’ discipline is not there.

Being expensive is not inherently wrong, though, only if you are competitive on price. However, this is a typical competition among insurance agencies and brokerages. This is why it is so important to find a way to add value to the insurance experience as it passes through human hands.

Another fundamental weakness is the lack of trust people seem to have with insurance agents – or any salespeople for that matter. This is why building trust with your prospects and clients is of vital importance. When you are selling something intangible, such as insurance, trust is the foundation of the relationship you are building with each client.

Great Opportunities

It is an excellent opportunity to share information with clients in the relationships you build with them. Ensure they are knowledgeable about their coverage, gaps in their coverage, and what they can do to fill those gaps. Many people are not actively aware of knowing if their coverage is “right for them” without prior knowledge. Building relationships with clients and taking advantage of the opportunities to provide clients with the information they need deepens your trust with them.

You can also further your integrity with your client base by attending community events, supporting local charities, and openly celebrating your team.

Prominent Threats

The rapidly changing nature of the insurance business is one of the biggest threats. There are large-scale digital competitors, and even the nature of risk is changing. With new technological advances, consumer behavior changes and disrupts common types of coverage people take for granted.

You can no longer expect the year-over-year behavior of the industry to be the same, and it is essential to have an excellent client-retention strategy on hand. It is now easier than ever to find and contact a new insurance agent, so you need to ensure you keep your insurance agency’s customer service top of the line.

Conclusion

While this is just a baseline for a S.W.O.T. Analysis for insurance agencies, it is crucial to fill out a much more personalized one catered to your insurance agency. Click here to download our S.W.O.T. Analysis template to fill out either digitally or in print. If you want more help strategizing for your insurance agency in the upcoming year, contact the professionals at Agent Pipeline at 800.962.4693.

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