How Technology Can Boost Your Profits and Insurance Agency Valuation

In today’s marketplace, every small business runs on technology. Coffee shops use credit card readers that plug into iPads. Pest control companies schedule appointments through online calendar systems. And boutique marketing agencies leverage cloud-based project management tools and CRMs. Modern technologies help businesses streamline operations and improve efficiencies, which can mean big savings on the bottom line. Yet, many insurance agency owners are still tied to cumbersome antiquated systems that not only slow their business growth, but in many cases frustrate their customers. Whether you want to boost profitability for your own benefit or increase your insurance agency valuation in anticipation of a sale, here are three mission-critical technologies to consider:

Your Agency Website – More and more people are using their smartphones and tablets as their primary means of accessing the Internet. Your agency’s website not only needs to be designed for mobile devices, but should make it easy for clients to find useful information, download important documents, and connect with your team. Similarly, you want to make sure that your site is well optimized for search engines, and develop a strategy to improve your rankings. If you have not updated your website in at least three years, it’s worth calling in an expert to take a fresh look. Refreshing the design and functionality can not only set you apart from the competition, but also help keep clients happy by offering added convenience.

Your CRM System – Relying on Microsoft Outlook (or worse, Gmail or Yahoo) to manage your calendar and keep track of tasks is like driving in second gear. Yes, you can get to where you’re going, but at half the speed with twice the aggravation. Cloud-based CRMs targeted to small and mid-size companies offer an affordable solution for client management, and many can be integrated with third-party systems to shift your insurance agency into the fast lane. Pricing generally ranges from $10-$40 per user per month, and many vendors allow you to scale up or down as needed. Check out service providers like Zoho, Hubspot, SugarCRM and Mothernode to find a CRM that’s the right fit for your team.

Your Operations – Automating routine processes can streamline operations and reduce the risk of human error; yet, many agencies still waste time doing paperwork by hand or re-entering data. In fact, a 2016 survey of more than 4,300 independent insurance agents revealed that only 16 percent used bridging to quote new personal lines, resulting in redundant data entry. Examine your work flows to see where staffers are dedicating man-hours to manage multiple systems—including entering client names manually in the bcc field for group emails, instead of using a tool like Constant Contact to manage mailing lists more efficiently.

Upgrading technology comes at a price, but the investment in your business can yield significant results. The right technologies can save your agency money and increase revenues, which are the primary goals of every business owner. If you plan to sell your insurance agency in the near future, prospective buyers also will want to see that you have strong systems in place. Similar to a homebuyer, they want a property that is move-in-ready, not a business that needs renovations to bring the technology into the 21st century. The right investments in technology can help you grow your insurance agency and increase your likelihood of finding a buyer to acquire the business when you’re ready to make your exit.

For more guidance on how to increase profitability and prepare your agency for sale, call Springtree Group at (972) 395-8811 or contact us online. As a seasoned business intermediary that works with insurance agencies earning up to $5 million in annual revenues, we can provide the specialized expertise you need to help you achieve your business goals.