I’m writing this on my birthday as I watch the ocean in Laguna Beach, Calif. (It’s a tough job, but someone has to do it!) It’s a nice break from the winter weather back home in Connecticut.
The tide is constant — coming in and going out — but changing slightly every day. While looking at the waves, I find myself thinking about the passage of time: where I’ve been, where I am now, and where I’m going.
That leads me to the magazine’s cover story about agency succession and exit strategy. It’s especially timely in February, which also is Insurance Careers Month. Many of the agents I spoke with for the story advised fellow agency owners to start planning for perpetuation from the beginning. You’re not planning for failure, but you want to have an idea of what to do when life (death, serious illness or divorce, for instance) happens despite all your planning.
You also need to consider the issue of “disruption.” Will there even be an agency to pass along in 5, 10 or 15 years? There’s a lot of merger and acquisition activity going on now, but will that be the case in three to five years when you’re ready to move on?
I believe there is a place for independent insurance agents, despite all the talk about technology replacing humans. Artificial intelligence (AI) and machine learning will be able to do a certain amount of analysis, but I don’t think they will replace a nuanced conversation with trusted advisors who know their clients, the clients’ business needs and the clients’ family needs. AI has a way to go before it can understand the expression on your client’s face when he or she talks about starting a new business and you can see the hesitation in their eyes: Will I be able to make this a go? Will I be able to succeed and still take care of my family? Currently, AI can’t read the body language of a prospect who is a reluctant buyer. AI doesn’t yet understand enough to get at the reasons for the hesitation.
Supporting careers month
If you want to pass your agency to someone who will care about it as much as you do, you need to find men and women who are as enthusiastic about insurance as you are. And they don’t have to be recent college graduates. They may be people who are making a career change — either through choice or circumstance. I know many mid-career folks who have been laid off or who have relocated with a spouse’s job move. They may be parents of young children who need a different kind of job at this stage of their lives. There are former military members who are completing tours of duty and need a civilian job. There are military spouses who want to create their own careers. There may be someone with a disability who would make a great producer. Your successor may not look like you, but he or she can be just as committed to the agency’s success.
As you plan, be sure to take a look at the Insurance Careers Movement website. More than 850 industry organizations have come together to:
- Inspire young people to choose insurance as a career,
- Share what makes the industry a great one to work in, and
- Share best practices.
I’d like to know how you’re handling agency succession and an exit strategy. Have you thought about it at all? Are you waiting until you reach a certain age or the agency reaches a certain milestone, whether it’s the number of clients or revenue? Drop me a note at rdonlon@alm.com to share your thoughts.
And that is what’s top of mind for me this month.
Read more:
Insurance agency succession-planning realities
3 top succession strategies for agency owners: Which one’s right for you?