What is the Magic Number in Insurance Prospecting?

Prospecting never ends, it's important to keep prospecting to fill your pipeline, even when business is good. Prospecting is always ranked top priority by successful insurance agents.Many successful agents are not good in doing presentation, not very well versed with the products and not able to organize things effectively but they are all great prospecting experts.

At the beginning of your insurance business, you may have to spend 80% of your time doing prospecting. Once you build a good book of business say with 200 to 300 clients, you need to review your business strategies. It is time for you to switch from being a hunter to a farmer. Hunting is the search for brand new customers. Farming is an expansion of business with the existing customers. It is prospecting within your own clientele.

Farming is a cost-effective way to increase your sales. You can find gold in your backyard. By placing more emphasis on farming, your prospecting time can be reduced to 20%. Less prospecting efforts are required once you reach the magic number or the critical mass. Once you have 200 or 300 customers in your book, you have less worry about getting new customers.

If you nurture your existing clientele and provide them with good service, you existing customers will give you good supply of referrals for you to secure new business.Taking care of your existing customers especially the top 20% of your customers is very important. This is because the top 20% of your customers bring you 50% of your income and they deserve your attention.

You need to follow up the top 20% of your customers 4 times a year to increase the case size, upgrade their coverage and get referrals. Eventually, you want to develop them into becoming centers of influence. To groom more centers of influence, you need a referral system to tap into the potentials of your clientele. An effective referral system that stresses customer service helps increase customer retention and profitability at a minimal coast.

Once you hit the magic number, you may revisit prospecting methods you currently use to identify areas for improvement. Prospecting activity never ends but changes. You may consider using another prospecting method to supplement the existing one.You may also study different methods of prospecting that you have yet to use such as cold calling, direct mail, internet leads, blogging, website marketing, seminar selling etc.

By trying and testing various prospecting methods, you can evaluate which prospecting methods work best for you and how you should invest your time or money.Reaching the critical mass or the magic number is possible. It is up to you how soon you want to reach there. Find something you like about prospecting and enjoy doing it. We always excel at things we like to do the most.

Prospecting is like fishing. You never know whether you are going to catch any fish. However if you love fishing and appreciate the virtue of staying patient, you will definitely get your catch. Find your niche. Find your market. Know who you are targeting and go after them. Help them discover the problem they have and offer recommendations to get the problem fixed. Repeat the process and soon you will hit the magic number.

Prospecting can be a science where there are steps to follow. It can also be an art where you get better at with practice and it allows you to be creative when you need to find ways to approach certain markets. Prospecting never ends, it gets a bit easier as you go along.