Chuck Harrod is pretty new to insurance: He and his wife of 31 years were farmers before he became a Farmers agent. The Harrods grew tomatoes for Walmart, supplying 2,500 super centers across the country and transporting 10-12 truck loads a day with the help of 130 employees. Business was great until Walmart phased out the program and began buying directly from Mexico.
Harrod’s nephew, who’s like a son, was a Farmers insurance agent in Springfield, Missouri. Harrod was going to buy his agency when his nephew decided to move, but the deal fell through. The advice he got was that if he didn’t care where he lived, he should move to Florida.
“My wife, Jennifer, and I interviewed with Farmers in August 2019 and as soon as I got home I started studying for the exams,” Harrod recalls. “That November we moved to Florida, we passed the exam in December and we opened the agency in April. We’ve been in business for ourselves before, and being agents is just like running any other business.”
In some ways, Harrods admits it’s a lot easier running the insurance agency than selling tomatoes. For one thing, they no longer have 130 employees, only four. It’s been pretty fast-paced and demanding, though, while they learned their way around.
All four of the Harrods’ employees are licensed producers. They make up the sales team that offers auto, home, umbrella, RVs, motorcycle insurance--basically all personal lines. They are also in the process of getting into life insurance while trying to pace themselves. Most of the new business they get is through insurance leads and referrals.
When he first started, Harrod found SmartFinancial while looking through the Farmers vendors. “We started with internet leads for a while and had some success but we paused,” he says. “Our Account Manager then reached out to us and let us know about the call transfers. In Florida we have to be careful because some homes are not eligible so we carefully set the right filters, and the return has been good since day one.”
Harrod’s call volume varies based on the agency’s ability to handle the calls. One day, they may take five, another day seven and just the other day they took 6. “There have been days we had as many as 10, but it’s usually between five and six calls,” he says.
The agency’s close ratio changes every month but Harrod’s Account Manager helps him figure out how much the leads cost per policy. For the current month they closed 35% of the live calls and were refunded for leads on policies that don’t qualify.
“We have a good team, and our Account Manager at SmartFinancial is helpful,” Harrod says. “Our cost per policy is about $116 per policy, but we also get a lot of referrals so we’re actually doing better than that. We expect to break even for the first year and make money in the second, third, fourth, and fifth year as long as we retain the customer. Everything after that you get to keep.”
For now, the Harrods only buy home insurance calls with many auto insurance cross-sales. They have a good follow-up strategy too. “When we do a quote, we try to close it, but if it doesn’t happen, we do follow up without being aggressive,” he says. “We take no as a no, but we do reach out after six months on the auto or 11 months later for home. We have all the information in our system to be able to do that.”.
As for a script, Harrod prefers to just be authentic by trying to find some commonalities in order to make a connection. “I just sold home and auto to a watermelon farmer,” Harrod cites as an example. “We made a connection about farming and wrapped it up quickly. If I see if someone has a garden we talk about that. I check the lead’s location on Google maps and try to find something to have a discussion about.”
For now, the Harrods’ agency is as big as they want it to be, and new business keeps coming in. In fact, the agency ranked sixth in Florida last month and eighth for the top 10 for policies written per agency. When you consider that they have written 209 policies written in 21 work days last month, it’s pretty impressive!.
“We’ve been pleased with the results of working with SmartFinancial,” Harrod says. “It’s given us a lot of new clients. We’re taking more calls than normal and we’ll keep taking as many as we can handle in a day.”
6 Golden Insurance Rules from Chuck Harrod
1. The biggest key is to put the customer first and do the best for them. I advised a client to add extra hurricane clips to her roof and knocked $1100 off her policy. She was really tickled. Don’t worry about losing on the premium and go for the long-term retention and referrals. This is what we try to do with every single client. People really do appreciate it, and they give you good reviews.
2. If you break even the first year of buying leads, you’re in good shape. The trick is to retain these clients and make more from commissions each year.
3. Cross-sell when you can. We buy home leads, but we never pass up an opportunity to sell auto insurance to those leads.
4. Each agency is different, so you have to find what works for you the best. Weed out what doesn’t work for you. Buying only home leads is the route we decided to go with, but many people do well with buying the auto leads.
5. Never burn a bridge. We tell prospects who don’t buy from us to reach out if they need anything. We thank them for the opportunity to quote them, hoping they may remember we were nice people.
6. Rejection is not a problem: Just move on to the next one.