an open sign outside of an insurance agency

Starting a new insurance agency is exciting. You can’t help but think of all the money you can earn as the head of the agency. Before you bring in revenue, though, you need to make sure you get everything in order. Find out what you need to start your new insurance agency. Once you have the essentials in order, you can hit the ground running.

Business Plan

Before you start an insurance agency, you need to create a business plan. The plan should describe your company, provide market analysis, and go over your organizational structure. You also need to list the products and services you’ll offer, as well as your sales and marketing strategy. Finally, you must include your financials in your business plan.


You need to raise capital before you start your new insurance agency. The money you need depends on the type of agency you want to run. Some small insurance agencies only need $5,000 to start, while larger firms might require much more. Consider your costs, including rent or mortgage payments, licensing, insurance, staff, office equipment, and software, to determine how much you need to start your insurance agency.


You have to obtain a license before you can sell insurance. Depending on where you live, you might need a permit for every line of insurance you sell. Licensing requirements vary by state, but you can expect to go through pre-licensing education before taking the licensing exam.

Carrier Appointments

You will need insurance carrier appointments before you can start your agency. Insurance carriers will evaluate your business plan, location, automation, and business mix when making a decision. They will also review your experience selling insurance, as well as projections for the future.

While getting the first carrier appointment can be challenging, it does get easier as you build your business. Once you reach a certain number of carriers, though, you might have difficulty adding more. Insurance carriers are less likely to provide authorization to agencies that already represent lots of other carriers.

Insurance Agency Management System

You need to have an insurance agency management system in place before gathering leads and selling policies. Choose a system that automates tasks. For instance, you can get a system that includes prefilled ACORD forms, automated carrier downloads, and automated notes. You can also get a system that provides marketing options and more. The right system will help you reach leads and manage your existing clients. It will make your agency more efficient and help you build relationships through cross-selling and more.

Insurance Agency Website

An insurance agency website is also a must. You can use a website to get more leads for your agency and stand out from the competition. Your website can also provide relevant information to warm the leads before they reach out. Make sure that your website is 100 percent responsive, so it looks great on all devices. It should be specific to the insurance industry and explain each line of insurance you offer. Also, make sure the website is SEO-friendly, so it ranks high on Google.

Existing Book of Business (Optional)

When you start an insurance agency, you have the option to buy an existing book of business. Before you go through with a purchase, find out why the agency is selling the book. Often, agents sell books of business because they are retiring. If that is the case, make sure the agent hasn’t neglected clients due to the upcoming retirement. You also need to make sure the carriers line up with the ones you’re authorized to represent. You should also consider the current market value of the book. Is it a good deal, or will you overpay for potential business? When you’re just starting out, you may not know the answer to those questions. In those situations, having a mentor that you can lean on can be very valuable. Whether you’re evaluating a book of business, coming up compensation plans, or just trying to figure out which steps you should take next, being able to lean on the experience of successful agency owners who’ve gone before you can be an amazing resource.

You also have the option of generating your own business. This can take a bit longer, but you can hit the ground running with the right insurance agency management system and website.

Start Building Your Insurance Agency Today

Opening your insurance agency is hard work, but it can pay off in dividends if you do it correctly. Make sure you follow all the steps to position yourself for success.