Rory Baker A challenge common to independent insurance agencies is that they want greater access to insurance carriers, leveraged market opportunities, and growth potential; but achieving those objectives in isolation can be challenging.
This is where lots of agency owners start to wander, what is an insurance aggregator?
The answer is the business model of helping independents grow their reach and solidify their marketing placement in the insurance space.
What is the Concept of an Insurance Aggregator?
The best way to think about what is an insurance aggregator is if you have a group of independent agencies that work together and not completely on your own.
An aggregator consolidates the production volume of several agencies within a single umbrella organization. The concept comes from being able to put agencies that work together within a group to share workloads, which permits the group to often create pathways in which situations are encountered that would not be possible for one agency standalone.
Ultimately this leaves the agencies fully owned, while gaining access to resources, and relationships through that aggregator structure.
Why Agencies Explore This Option?
Growing an independent agency can be quite the challenge. This is especially for newer or smaller businesses because carrier appointments are hard to come by.
This is both why agency owners are exploring what an insurance aggregator really is and how it can help them achieve their goals.
Potential advantages may include:
- Expanded carrier access
- Additional business support
- Growth resources
- Industry training opportunities
- Enhanced market presence
These advantages will enable agencies to spend less time grappling with operational challenges and more time serving clients.
More Than Carrier Access
For many, the answer to what is an insurance aggregator begins and ends with carrier appointments. In reality, it has mass value expended far beyond the typical.
Some aggregators will add in educational material, some help with marketing, and others build tech functionality, while some create opportunities for networking. Such services can improve the efficiency of agencies and help build more robust business strategies.
With guidance and industry expertise being just as valuable to growing agencies as carrier relationships.
Choosing the Right Fit
There are no two aggregators which work the same.
Here’s why agency owners should let this sink-in before joining any organization:
Contract Structure
It is essential to know the ownership rights and business independence before executing an agreement.
Compensation Opportunities
Various organizations have their own way to do commissions, bonuses, and profit-sharing programs.
Support Services
Providers provide different training, technology, and operational assistance.
These are the criteria agencies use to evaluate whether a given model fits into their long-term goals.
A Tool for Strategic Expansion
The question for numerous agency owners is not what does an insurance aggregator do, but can joining one help nurture future growth?
Associations like Smart Choice Agents have provided numerous independent agencies with both the ideas on how to find expanded carrier access along with more effective methods of building business.
A partnership of the right type can open doors that could take decades to develop alone.
Final Thoughts
The insurance industry continues to be extremely competitive. An independent agency frequently requires resources, carrier relationships, and support systems to compete effectively.
Having knowledge of what is an insurance aggregator is valuable information to know for one way that agencies expand their operations. Because they combine collective bargaining power with individual ownership, aggregators provide a vehicle through which agencies can chase the next opportunity while keeping control of their business.
