5 Signs You Have a Valuable Life & Health Book of Business

5 Signs Your Book of Business is Valuable

How To Determine the Value of a Book of Business

Are you selling or passing on your book of business? Or maybe you’re just wondering if the current state of your book of business is valuable. Many insurance agents are in this situation because the average age of an insurance agent right now is about 59.

So, agency owners are beginning to plan for what’s next. They’re thinking: who will I pass my book of business on to? Is it ready to sell or pass along to a family member? Most importantly: How valuable is my book of business?

The value of your book of business is determined by several factors—some are in your control and some may not be. The 5 signs we are going to focus on today are things that are in your control that you can begin working on immediately.

5 Signs Your Book of Business is Valuable

1. Your data is extremely organized.

Ask yourself: how quickly could another agency pick my book of business up and begin working with it? For example, if that agency got a call from a client immediately after purchasing your book of business, could he or she readily answer any of their questions about their account?

When a book of business is housed mainly in spreadsheets, paper files, or a cumbersome CRM, this can be difficult. An agency management system that’s searchable based on keywords, that ties related records together in a clear way, and that is accessible anywhere is incredibly important here.

This starts with clean data. Clean data requires the right tools, the right processes, and the discipline of your employees to do adhere to both of these relentlessly. It’s up to you to decide how you’re going to enter data, and stick to it.

For instance, you can’t have one person entering “UHC” and another entering “United HealthCare”. This is a very simple example, but it makes the point well.

Industry-specific agency management systems cut back on this tremendously with drop-downs for fields, but everyone still needs to be on the same page when it comes to data entry and maintenance.

It can be a daunting task to “clean” your data, but it will always be worth it!

Overall, being able to show a potential buyer how easy your data is to maneuver and work with is a great selling point.

2. Your contact records are very thorough.

Whether it’s an individual client or a group, how thorough are their records and how diligent are you in ensuring their information is always evolving and up-to-date?

A contact’s record is never static; it should always be evolving. Each time you speak with your client, you should have something new to add. Sometimes it may just be a few notes from your conversation, but you’ll rest assured knowing that the next time you speak with them, you have something to look back on to pick up where you left off. Or, even better, the next person who picks up this record can orient themselves with this client on a more personal level. This effort will pay off!

“Good enough” books of business include detailed contact information (phone number, email, address), family information (spouses, children), and a record of all contact made with that client including attached notes and documents.

AgencyBloc Individual RecordAgencyBloc Individual Record

On the other hand, valuable books of business take it a step further and include lead source data, completed and upcoming activities, email open and click history, aggregate carrier information, agent E&O and licenses, lead forms, and more.

Basically, the more the merrier. Data is truly powerful. The more complete picture you have about all of your contacts, the better your client and prospect relationships will be and, ultimately, the better your business decisions will be.

In terms of selling your book or passing it on, again, the more the merrier. The complete picture of your clients and prospects is a whole lot more appealing to buyers than the bare minimum.

3. Your data is “smart.”

How much can you “show” about your data? Can you quickly show your most profitable lead sources? Do you have graphs showing your agency’s carrier and product makeup, group vs. individual business, top producers, and top carrier products?

These are just a few items potential buyers might be interested in. Being able to pull up your book of business and easily navigate through these different graphs shows that you have been proactive about analyzing your data and, in turn, growing your business. AgencyBloc’s Dashboard Analytics allow agencies to look at all of these items and more.

AgencyBloc Dashboard AnalyticsAgencyBloc's Dashboard Analytics

4. You have a high retention rate.

If your clients are loyal to you and continue to buy from you, this will be appealing to buyers. The average retention rate for insurance agencies is 84%, but the best agencies shoot for a range between 90-95%. If you have a high retention rate, buyers will definitely be interested in working with your clients.

Having achieved a high retention rate is a great start on your part, but having a client communication plan laid out (item #5 on our list) is a major added bonus for buyers. With this, they feel more equipped to maintain that high retention rate.

Something else to consider is cross-selling. An extremely valuable book of business is one where cross-selling opportunities can be easily and quickly identified. This blog outlines how to identify and act upon cross-selling opportunities immediately.

5. You have a client communication plan.

Whether the potential buyer plans to use it or not, can you show that you’ve used a consistent client communication plan?

Do you have touchpoints identified and emails automated to go out to clients for important events like birthdays and policy renewals? This is something insurance agencies ask about a lot: how can I better communicate with clients to increase my retention rate? When is the appropriate time to reach out clients?

Lastly, could the buyer pick up this plan to ensure they give your clients the same level of service you’ve provided? If so, this will make the transition smoother for your clients and the buyer.

Creating a Valuable Book of Business

There is so much more that goes into selling or passing on your insurance agency, but these 5 items we covered are a few things to check off to be sure buyers will be interested or your family member who is taking it over will be equipped to begin immediately where you left off.

Overall, creating a valuable book of business relies on your discipline with your data. Ensure you have a safe, sustainable place to house your data and run your book of business from. Doing this makes your life easier when you’re still selling and servicing, and it also increases the likelihood your book will sell when the time comes.

If you want to dive deeper into creating a valuable book of business, check out our eBook: A Valuable Book of Business: Preparing for sale, transfer, or growth in your agency.

Want to Learn More About Agency Management Systems?

AgencyBloc is an agency management system that helps life and health insurance agencies grow their business with an industry-specific CRM, commissions processing, and integrated business and marketing automation. Schedule a live, one-on-one demo to see if it might be the right fit for your agency.

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Kelsey Rosauer

By Kelsey Rosauer on March 5, 2019 in Database Management

Kelsey is the Brand Manager at AgencyBloc. She plans and creates educational resources to help insurance agencies organize, automate & grow their business. Favorite quote: "I am convinced that life is 10% what happens to me and 90% how I react to it." —Charles R. Swindoll  More articles


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