Biggest Mistake You Could Be Making When Starting an Independent Insurance Agency

Starting an independent independent agency can be exciting and terrifying all at once. While the rewards can be fruitful in the end, knowing how to successfully start the process is vital. Gain insight into the new agency ownership experience with this series of posts from IIANC member and agency owner Daniel Rohrbaugh. Check out his previous posts here: 5 Things to Know When Starting an Independent Agency or A Day In The Life of an Agency Owner.

“What is the biggest mistake you could be making when starting an independent insurance agency?” is a topic that most scratch agents could talk about for hours. Sometimes you need to go through experiences yourself to better understand what works best for your agency. However, there are a few things that can be learned from others. One tip that I can pass along is…

Don’t try to do it all yourself to save money. Sounds easy, right?  Let me explain.  

You Can’t Do It All Yourself

I started Raleigh Insurance Group with no employees, and it was about 16 months before I hired my first part-time helper. At first, I didn’t have work for an employee to do since I was still trying to get set up with carrier appointments, Lexis Nexis code, etc. But, my mistake was not hiring someone once I was able to bind coverage with carriers. A part-time helper could have assisted with making outbound phone calls to prospect for new business, entering customer data to help with quote proposals, preparing invoices and binders to send mortgage lenders, and other administrative tasks.

I now have a couple of employees to handle these tasks, but I did not know how much of a return-on-the-investment it would provide. I was naïve in thinking that I could not afford to have an assistant. Technology can also offer opportunities for help in your agency like a Virtual Assistant, fully remote employee or retiree, etc. 

Having an AMS Is Key

Also, it was a little over a year until I purchased my first Agency Management System.  I thought I could neglect to purchase the software and save money. However, once I decided to entertain the idea of a management system, I realized how affordable one could be. I started with a web-based version that simply stored client information. The provider gave me a 60-day free trial, and the basic version was around $40 per month. Once I needed more out of my management system, I researched more options and eventually upgraded. 

I recommend that you decide what you need to run your agency, whether it’s personnel, software, etc., and start building. Research what options are available, but ask other agents, contact IIANC, conduct web searches, read magazines, or listen to podcasts. 

Start small with a long-term vision. 

IIANC Note: If you’re thinking about starting your own independent insurance agency (or recently did!), IIANC offers tools and resources to help you succeed. Check out our Agency Activate program ($497 but free to IIANC members) for a step-by-step guide comprised of on-demand video modules that you can watch and revisit at your own pace. Customizable planning documents and worksheets will help you activate your agency in less time and minimize costly mistakes and expenses. With Agency Activate, you can successfully navigate the critical first steps of starting an agency. Learn more here.

About the author

Daniel is originally from Lexington, NC, and moved to Raleigh when he attended North Carolina State University. Daniel worked for a State Farm Insurance Agency for nine years before starting Raleigh Insurance Group in 2016 ( He and his wife, Laura, have been married for ten years and they have a son and a daughter.

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