Creating an insurance incentive plan for your team may be top on your list for this year. However, it can be complicated – understanding what motivates your team and how to craft a plan that matches your insurance agency’s goals can seem a bit daunting.
You may have tried an insurance incentive plan in the past but it didn’t motivate your team and the whole thing may have lost steam somewhere along the way. Let us help you create an insurance incentive plan that is flexible, motivating, and most importantly can work for everyone at your agency.
Insurance Incentive Plan Components
Where many insurance agencies get tripped up in forming an insurance plan is making some assumptions that every team member is motivated by the same thing – Money! We actually find that producers are motivated by money, but your service team may care more about contributing to a team goal.
When creating an insurance incentive plan you want to consider the following:
- Are you looking to motivate your team toward a one-time target or goal? (example: writing with a certain carrier, selling life policies to hit a carrier commitment, or working toward an agency goal, such as hitting a certain premium)
- Can you easily report on it to update the team weekly?
- Is it clear how everyone can help hit the goal?
- Do you have training for team members that want to help grow the agency but need skill development?
- Is it clear who on the team will communicate and motivate the team?
In our agency assessment program, we have an entire step that focuses on team insurance incentive plans. Understanding what motivates your team and engages them is an area we specialize in at Agency Performance Partners.
To create your plan, you need to identify the following:
- What do you want to motivate your team to achieve?
- How can you make it fun?
- Who will report results weekly? (this is absolutely critical)
- What percentage of the revenue from this focus do you want to share?
Recommended Insurance Incentive Plan
During our Agency Assessment Program, we suggest our signature insurance incentive plan. 90% of our clients actually use our plan and maintain it weekly with the support of our reporting team.
Let us walk you through what we set up:
- We start on the 1st day of the quarter and use the book of business report in your agency’s management system to get your premium in force. This is the QTR Starting Premium.
- Each week we review the book of business premium on force and share the difference. This is the QTR Current Estimated Premium.
- We then take the Current Estimated Premium – QTR Starting premium to get the Growth Premium .
- We then identify an average commission rate (this agency had 12% for their average). We take the Growth Premium x the Estimated Commission to get the Estimated Revenue Growth.
- The agency shares 10% of the Estimated Revenue Growth to anyone who is not on the sales team (since hopefully they have a commission plan).
- The bonus pool shows each week what the amount of money the team will split is.
- The team members must be in good standing to get the bonus and part time team members get ½ a bonus pool share.
- Note you can use revenue for clearer numbers – when accounting is included in your management system and you are using it this will give you a more accurate picture. Since not all systems allow this, we used a more complicated example so you can see how our recommended insurance incentive plan works.
We find this works because it allows the team to see clearly how their work impacts agency growth. Also, since it’s not just new business or retention, this plan truly focuses on growth.
Growth comes from the following:
- Stopping cancellations
- Audits
- Placing business with core carriers
- Cross selling
- Reducing remarkets
- Upselling
- Referrals
- New business
- Getting Google reviews
With this plan, everyone can contribute, and the team starts to see how everything they do impacts agency growth.
Conclusion
Creating a successful insurance incentive plan doesn’t have to be overwhelming. By understanding what motivates your team and aligning those motivations with clear, actionable goals, you can craft a plan that drives growth and fosters teamwork across your agency.
The recommended plan outlined above ensures every team member has a role in achieving success, from stopping cancellations to generating referrals. With transparent reporting, ongoing motivation, and an emphasis on growth rather than isolated achievements, you can create a sustainable program that energizes your team and benefits your agency long-term.
Ready to get started? Let Agency Performance Partners guide you in creating an insurance incentive plan that truly works.
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