The insurance industry is vital to the U.S. economy, accounting for more than $1 trillion in output and employing more than 2.5 million people. The sector has been growing steadily for years, and despite the COVID-19 pandemic, it is expected to continue to grow in the coming years. So if you’re thinking about starting a business in the insurance industry, now might be the right time. Here are five things to consider before taking a leap.
The Industry is Growing
As mentioned, the insurance industry has been growing steadily for years, which is expected to continue. In fact, according to experts, the global reinsurance market is expected to grow by between 3% and 5% in 2020, despite the pandemic. Increased demand for insurance products and services and favorable conditions in the capital markets drive this growth.
Resilient Industry
The insurance industry is known for its ability to weather economic downturns—and as we all know, 2020 has been a particularly tough year for businesses across sectors. So, insurance is worth considering if you’re looking for an industry that will be resilient in difficult times. Many Insurance companies fared relatively well during the last recession—a fact that bodes well for those thinking about starting an Insurance business now.
Opportunities for Innovation
While the insurance industry may not be known for being cutting-edge, there are opportunities for businesses to innovate and address unmet needs in the market. For example, with the rise of the sharing economy (think Airbnb and Uber), there is a need for new insurance products that cater to this growing sector. There are also opportunities to use technology to make buying and using Insurance products easier for consumers—something that will become increasingly important as millennials and Gen Zers enter the market.
It’s Always On Demand
Unlike many industries, insurance is one where demand never really goes away—it only increases with time. This means that insurance businesses have a constant stream of consumers looking for products and services from them, which is a good thing when the economy slows down.
Consolidation
Finally, the last thing to consider about starting an Insurance business now is that there may be consolidation in the market. Despite its resilience and growth potential, the industry has seen several mergers and acquisitions over the years—and this is likely to continue as companies seek ways to reduce costs and become more efficient.
The insurance industry is growing, resilient, and ripe with opportunities for innovation—making it an attractive option for entrepreneurs looking to start a business in 2020. If you have a passion for risk management and want to be your boss, starting an Insurance company might be right for you. However, if you don’t know where to start, consider these tips to get you started.
Choose the Right Market
The insurance industry is home to various markets, each with its own needs and requirements. For this reason, choosing the right market for your business is essential. Here are three popular options:
Medical Malpractice
The health industry is filled with various problems. One known problem is medical malpractice. This kind of malpractice covers mistakes and negligence done by medical practitioners, caregivers, and even manufacturers of pharmaceuticals.
Dental Insurance
Another market that’s growing rapidly is dental insurance. This insurance covers all oral care services, such as teeth cleanings, fillings, root canals, crowns, and more.
Life Insurance
Finally, life insurance is also famous for entrepreneurs who want to start an insurance business in 2020. This type of policy ensures the lives of others—usually family members or business partners—against financial loss when someone passes away unexpectedly (often due to illness).
Marketing
Your business must stand out from the rest. That’s why marketing is essential in insurance. Here are three of the most popular options when it comes to marketing insurance:
Content Marketing
Most people don’t know how insurance works, so content marketing has proven to reach and educate your target market effectively. By creating helpful articles and videos that answer common questions about insurance, you can position yourself as a trusted source of information in the industry.
Online Advertising
Another popular option is online advertising because it allows businesses to target specific demographics on various platforms like social media and search engines. You can create ads highlighting your unique selling points (USPs) or offer special promotions for potential customers considering getting insurance from you.
Networking Events
Finally, networking events may also be worthwhile for your business. These events allow you to network face-to-face with other professionals in the industry, share knowledge, and potentially attract more prospects.
Marketing your business is crucial in standing out, especially if you’ve chosen a particular market. If you don’t want to go through the thinking process, consider utilizing robust insurance marketing tips on the internet. You’re likely to find one to help your business succeed in 2020.
Overall, there are many different things to consider when starting an insurance business in 2020. However, knowing your market and eventually working on effective marketing strategies can help ensure your business is a success this year.
