Hire a CSA/CSR that isn’t afraid to ask for the order and compensate them accordingly
When you’re in the hiring process for a service function, you should also look for people who aren't afraid to ask for the order. One of the reasons that the average independent insurance agency has only 1.6 policies per client is that they do a poor job of cross-marketing their business. That can be corrected with service representatives who are also salespeople. Begin by hiring people who aren't afraid to ask for the order and follow that up by making a significant part of those people's compensation based on either bonus or commission for new business. Use the interview process to filter out potential employees who are turned off by such performance pay.
Make sure that your CSA/CSR gets a producer’s license
A final point about the client service agent: in order to sell insurance, they must also be licensed to do so. Some states have special licensing for client service representatives, which is a limited insurance license. Without the full privileges of a producer license, CSRs cannot legally sell anything, including an additional premium endorsement. Since all people in your agency should be focused on selling this, a limited CSR license is not an acceptable type of licensure for your client service representatives. You should ensure that they get a producer’s license.
When is it time to hire a producer?
Ok, so when do you know it's time to hire a producer? That's simple. When you have client service agents that are handling one hundred percent of the client service in your agency, you have someone doing one hundred percent of the accounting and administrative tasks in your agency, when virtually one hundred percent of your time is spent as a producer, and when the agency's growth is beginning to slow: that is the time for you to consider hiring a producer.
I had a friend many years ago who was running a two-million-dollar agency. He had nineteen other employees in the agency but was the only producer. This is the ideal situation. It's difficult to replicate, but it's an ideal you can strive for.
In the independent agency system, the failure rate for producing insurance agents runs about ninety percent, and it usually takes about three years for new producers to pay for themselves. This is additional evidence that you should delay hiring producers for as long as possible.