Thoughts for the Prospective Insurance Consultant

Here are some issues for the insurance expert considering a career move to the world of independent insurance consulting:

Are you a self-starter? Being an entrepreneur requires self-motivation and dedication. Nobody will be looking over your shoulder making sure you are doing what you need to do to succeed. Nobody will force you to prioritize or set strategies. It’s all up to you. Can you be self-disciplined?

Do you have financial resources to fund the startup and for your support? While the cost of entry is low compared to many businesses, you’ll still have to buy a computer, office equipment, reference materials, and supplies. You’ll have phone and Internet bills. You’ll have marketing expenses like web-site design, brochures and the like. The first year you’ll be spending time building relationships, prospecting, marketing, speaking, and writing. Clients may come slowly at first. Can you find part-time income or live on savings? Can your spouse support the family? Can you purchase health insurance through your spouse’s employer?

Can you dedicate yourself to marketing yourself? Being a consultant means you are in the marketing business. At the beginning, you will spend most of your time marketing. As your practice grows you’ll need to constantly work to build your pipeline of future work. Writing and speaking to groups is also a part of marketing a consulting practice. Even as a seasoned consultant you will spend more than 20% of your time marketing.

Can you track multiple projects without missing details? Consultants must have many balls in the air at once - client projects, marketing activities, and business management functions. You must be organized and know how to prioritize roles and activities. Most consultants have no staff. If it’s going to get done, you must do it.

Can you communicate ideas in person and on the phone? Verbal communication is vital to a consulting practice. Can you explain ideas, concepts, and coverage to those who know little about insurance? Can you deal with fellow professionals, negotiate, and persuade? Are you able to speak in front of a group in a seminar or board meeting?

Do you enjoy writing? Much of today’s communication is by email. Proposals and reports are a big part of the work of an insurance consultant. How is your grammar and knowledge of the language? Do you enjoy putting ideas on paper? Writing articles and white papers is one of the best ways to increase your exposure to the outside world. Can you type? Are you skilled at using word processing software?

Do you have a network of contacts you can draw on? Marketing is telling your story to people who will get value from your work. Prospects must hear of your work and availability. This is best done by word of mouth. Building a network is important. Having a network already in place make the work much easier.

Are you a student of insurance? It’s obvious that insurance consultants must be insurance experts. You must be conversant with the wide variety of coverage issues and exposures. You must research new policies and be able to interpret complex coverage issues. Most states require that you obtain a license as an insurance consultant. You may need to pass a test. You may have to obtain continuing education to meet license requirements. CPCU, ARM, and/or CIC designations are invaluable both in the knowledge gained and in credibility to clients.

Does your non-compete agreement keep you from contacting former clients? If you have a non-compete with your current (former) employer, will it prevent you from soliciting past clients? Some specifically forbid selling insurance. Some are broad enough to include all insurance work. Will your employer negotiate the requirement away?