Warren Buffet, one of the world’s smartest investors, one said, “Risk comes from not knowing what you’re doing.” Knowledge is the key to reducing risks. That’s why you need to know why the current market may be ripe for insurance agency mergers. Of course, there are a lot of variables to look at. But, here are three key reasons now might be a good time to merge your insurance agency with another.
Young Insurance Agents are Changing the Game
The insurance industry has been very slow to change. It’s about time for a revolution. Younger insurance agents are starting to work with no storefront. They are opening agencies entirely online. By themselves. This is something that will come as a shock to most insurance agencies who have been operating at a physical brick and mortar location for years. Perhaps the more tech-savvy owners may have seen it coming. Like every industry, the leaders are those that can adapt to the times and use the newest technology to stay ahead of the game. By finding new, young agencies ran by tech-savvy, intelligent people to merge with, you’re paving the path to growth in the coming years. Just be sure to continue learning about upcoming trends.
Relationships are Important Again
In a world of slashed prices and cutting costs, insurance agencies have long been competing on price. However, as millennials begin to grow up and become the main market of interest for businesses, we need to focus more on relationships. Millennials are less price sensitive than baby boomers. They care more about experiences, honesty, and proper treatment. A survey given to young agents found that 94.1% believed success in the insurance business is mostly about relationships. By merging with an agency already good at developing strong customer relationships, you’re gaining a competitive edge.
Social Media is Becoming a Major Player in Marketing
The vast majority of insurance agencies out there have a poor use of social media. They’ve been around for dozens of years and have always done things the same way. The same marketing outlets, the same message, the same people. With newer players in the insurance industry going entirely virtual and using little to no paid advertising, older players are going to take a huge hit. However, if you can find an agency using social media successfully, you can propose a merge. They may be able to benefit from your physical advertising expertise, and you can benefit from their digital marketing efforts.
Merging may not always be the best decision, but now might be a great time to do so. Merging with a younger insurance agency who has a handle on advanced digital marketing strategies can boost your growth rate and, ultimately, your bottom line. Find someone who is capable of creating meaningful, lasting relationships with their clients and uses social media effectively. The two of you can work together to diminish each other’s weak points and bolster your strengths.