Question

Topic: Strategy

Lead Generation Or Insurance Agency

Posted by Anonymous on 8/14/2007 at 9:08 AM ET 250 Points
Morning,

I have aquired a domain that would be perfect for generating flood insurance leads in Texas. It generates quite a few hits just based on the name. I currently have a fairly large insurance agency in Houston and purchased this domain thinking I could generate leads for my own selfish reasons. However, my son approached me about possibly selling these leads to other agents in Texas for a small fee ($3 to $5) and a small upfront fee to reserve a zip code ($20). Each Zip code would allow up to 3 agents to run with the lead. Keep in mind the average commission for selling a Flood Policy is around $50. With all the Rain and Hurricane scares here, it tends to be a hot item. My dilemma is that with selling Insurance policies, there comes quite a bit of Customer Service time and claims reporting. Is it worth it or would it be more profitable and less paperwork to go with a lead generation business.

Note: my son is a web designer and SEO guru.

Many Thanks,

RBQ
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RESPONSES

  • Posted by Jay Hamilton-Roth on 8/14/2007 at 9:38 AM Accepted
    What percentage of the prospects actually purchase flood insurance?

    Your son's suggestion will produce income for the lead no matter if they close (your $3-5 fee means the crossover point is 16-10% conversion). It also sounds like the cost for servicing the claims is quite high, and the $50 may not cover your time.

    It sounds like the best thing is to build web traffic to your site (and consider duplicating the site for other states) so you get more leads and make more money.


  • Posted by darcy.moen on 8/14/2007 at 1:47 PM Accepted
    I have two clients in Texas who are in the disaster restoration business. These clients are affiliated with a national organization of Professional Disaster Restoration experts who are always seeking Insurance companies, brokers and Adjusters at City, State and national levels, as well as individual folks who may have suffered a claim requiring disaster restoration services.

    It might be worth while chatting with my clients and I about the shared pool of potential customers as both of you are in the same area of business, but non-competing markets. Might be some good leads going both ways and resources to share.

    Check out:

    https://www.bellacleanersonline.com

    and

    https://www.nutonecleaners.com

    and contact me via my profile if you need a personal introduction to Ray and Josh.

    Darcy Moen
    Customer Loyalty Network
  • Posted by michael on 8/14/2007 at 8:32 PM Accepted
    I only sold insurance for 7 years (early 80s) and I know things have changed, but isn't it about getting ONE policy in the household (disaster insurance) so you have access to get the rest (life, home, auto, disability, health, umbrella etc)?

    If that's the case, don't look at it as only $50. A smart agency will pay the $3 knowing the lifetime value of that customer.

    Michael
  • Posted on 8/15/2007 at 9:42 AM Author
    I sincerely appreciate your comments and advice. Jon, Jay, Darcy, and Michael... all good points. Randall, I'll give you a call. Insurance has become more impersonal with the younger generation. We are shifting our gears to adapt to this change. I spent the entire day yesterday running numbers and have decided we'll run with the polices opposed to leads. www.ameriflood.com has good program in place, simliar to the aspects of our business model... FYI.
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