8 Ways Insurance Agencies Make Money: Insurance Agency Fees
We know that this one is hard sell, but you really should hear us out. Let us explain to you why we think insurance agency fees are not such a bad idea.
You can’t judge something like fees too hard because they are there for a good reason.
When you own an agency with a good-sized book of business, you have to accept the fact that not all clients are profitable. One policy can pass over a lot of people’s desks and you have to pay all of them for that time. You can’t do that if that process alone puts you in the red.
And so many other industries use fees for the very same reason. For example, when you bought your car, you paid a dealer fee.
By no means are we telling you to charge clients an arm and a leg for simply allowing their policy to exist, but even if it’s minor it will add up. Let’s do some math. If you charge $50 per file and you have 1000 files, you end up with $50,000. It definitely adds up.
Don’t make the mistake of hoping a client becomes profitable. No matter how much you want it to, hope isn’t going to pay the bills.
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