Sample Business Plan on Insurance Agency Business Plan
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EXECUTIVE SUMMARY
The Business Concept
ABC Insurance, LLC (a.k.a. the Company throughout the plan) is an insurance services company that is buying an existing All State insurance business in STATE named The ABC Insurance Agency. The ABC Insurance Agency has a very large existing book of business that the Company will acquire and it will continue to operate the business under the ABC Insurance Agency name. The Company is located in CITY, STATE.
The ABC Insurance Agency currently manages $8 million of Property and casualty (P&C) insurance products and insures people from all walks of life. It insures homes, cars, rental properties, lives, health, commercial exposures, etc.
Through The ABC Insurance Agency name, will continue to sell and service a wide range of insurance and financial products. It will provide the best insurance options based on individual needs. The Company will provide a superior level of follow up to exceed the client expectations in the area of new options, discounts, proper coverage and answers to all their questions.
Excellent Market Opportunity
ABC Insurance, LLC will take advantage of several factors to drive its growth. The demand for insurance never goes away. Many of the Company’s products are required by law, are good for the consumer and make individuals feel safer.
The Company will bring a fresh perspective to The ABC Insurance Agency by concentrating at first on retaining current clients and then obtaining new ones. It will bring 18 years of life insurance experience and sales expertise as well as knowledge of working with people
Profitable Growth
ABC Insurance, LLC expects to gain a profitable market share within a very short period of time. Determinations have been made for the size of the market, amounts of budgeted advertising and promotional dollars, the number and kinds of distribution channels and the competitive landscape.
Projections call for The ABC Insurance Agency to generate revenues of $1.07 million in its next twelve months. It will achieve strong growth over the next several years, reaching $1.3 million in revenues and more than $248,000 of net income by the fifth year.
The Opportunity
The Property/Casualty Insurance Market
The property/casualty, or P&C, (auto, home and commercial) insurance market is an important part of not only the U.S. financial industry, but it plays an important role globally in the financial services sector.
The world insurance premiums for non-life (property/casualty) business totaled $1.7 trillion in 2007, up 7.7 percent from $1.5 trillion in 2006. The United States accounted for 39 percent, or $651.3 billion of this total.1
The financial services sector comprises a large part of the financial services landscape in the United States. The assets of the U.S. financial services sector grew by 9 percent to $60.4 trillion in 2007, of which the insurance sector accounted for $6.3 trillion (10 percent).3 More than one-third (37 percent) of employment in the U.S. financial services sector in 2007 was with insurance carriers and related activities.
One reason that P&C insurance business is so competitive is the number of players in this sector. Estimates put the number of P&C insurance companies at 2,648 compared to 1,257 life/health insurance companies that were operating in the United States in 2006. Many of these companies were subsidiaries of larger global financial companies.
Other key statistics of the P&C insurance industry include financial assets of $1.4 trillion in 2007. In 2007 alone, property-casualty insurers’ investment in municipal bonds totaled $368.7 billion. The figure below shows that the top 10 U.S. writers of property/casualty insurance wrote some $243 billion in direct written premiums in 2007.