An upside of manually processing quotes is striking up conversation with potential customers. If a quote doesn’t convert to a policy, I get to ask why.
The most common response is:
“Your quote was more expensive than others. I got it cheaper elsewhere.”
Now that I know price is the biggest factor I’m losing sales, surely there’s something I can do about it? Of course. I can work with a cheaper insurer or cut my commission. But I’ve chosen not to do either of those things.
Why Would I Want To Sell A Cheap Product?
I take pride in offering a good policy, and working with an underwriter who has a reputation for paying out claims.
Jack’s metric for success isn’t just commission—it’s trust. I won’t offer a cheap policy that doesn’t pay come claim time. Perhaps I’d earn more money in the short-term, but there’s something more important at stake here. Building a business I’m proud of and earning customers’ trust.
When I think of the investments I’ve made to launch my business, did I hire the cheapest developer to build Jack? The cheapest copywriter? No way.
I didn’t have the biggest budget, but I still invested in talent—in my business. Fiverr could have saved me money, but I paid for a premium service because I wanted an experienced team I could trust. I wanted quality. It’s a no-brainer.
Why is it different with insurance? Why is cheaper considered better when buying a policy?
This thought process is an unfortunate by-product of the popularity of comparison sites. They’ve encouraged a buying behaviour of judging insurance solely on price. You don’t look at policy features, company reviews or customer service. You look at a table of prices and select the cheapest.
Comparison sites have been around for over a decade. Jack has been around for 2 months. Challenging a behaviour that’s been ingrained in buyers for over 10 years is proving difficult.
Taking A Smaller Commission
The alternative to not selling a cheap policy—but still competing on price–is to cut my commission.
In some instances I have done this. When someone’s made it clear they’re keen to buy but the price is slightly out of their budget, I bring my share down.
But that’s not a solution. I’m not earning bags of money from each policy I sell. For £100,000 of cover I earn a modest £26. For higher levels of cover, I can net between £40-70 commission.
I’m in this for the long-term. I want to build Jack into a sustainable business, therefore I must operate as a business and earn money.
Commission is what enables me to keep working on Jack. Not just for Jack to exist, but to blossom into the business I’ve always dreamed of. Right now it’s a tiny version of what I envision it to become.
That’s not going to happen if I don’t earn money to pay myself and reinvest into the business. Nor will it happen if I sell a cheap policy that lets people down when it comes time to making a claim.
That Was A Nice Rant. Now What?
There are two, big challenges I’m facing with building an insurance business.
The audience I serve is still relatively new. Insurers haven’t been targeting freelance designers and developers, so information on how insurance applies to them and what problems it solves is sparse. I’m working on addressing that
For those who understand the role insurance plays, I’m fighting with the price-driven buying behaviour. Jack isn’t overpriced. We might charge an annual premium of £160 for £100,000 of cover while a competitor charges £120. That’s only a £40 difference, yet it matters when people are simply looking at price. What about the more important factors? Better cover with additional features, customer benefits or quality of customer service
I don’t think there’s a quick fix, but I know it falls on me to better communicate the value of insurance. Like I said, it’s tricky challenging a well-ingrained buying behaviour.
I do know I’m not going to sell a cheap policy. 73% of people don’t trust their insurance provider and I don’t want to contribute to that statistic. In fact, I want to work towards turning that statistic around.
Let’s begin with the good news. I’ve put 20 freelancers on cover already, which is over £5700 Gross Premium Written. This is 20 freelancers Jack is helping build a bulletproof business. Yay!
Secondly, I’ve been shortlisted for two awards at the Digital Insurance Awards 2016. ‘Young Insurance’ and ‘The Rookie Award’. High fives all around.
The whole point of this blog, however, is to cover the challenges I face as well as triumphs. I’ve received a few emails from people complimenting me on my transparency, specifically when writing about building Jack.
Now I’m into Jack’s full second month of trading… and it’s hard. I’m realising just how challenging it is to market and sell insurance, especially as a newcomer to an established industry.
People are used to instant quotes and cover. I have to manually process everything (for now)
People expect cashback perks and financial incentives. I have a modest list of benefits
Most people choose their provider based on price (a by-product of comparison sites). I don’t sell a cheap policy, so I’m missing out on sales. But I’m OK with that, I don’t want to sell cheap stuff—I want to sell a good policy from an underwriter with a reputation for paying claims /rant
People are primed to buy insurance just once a year. I don’t have a database of renewals to tap into
Things have slowed down in my second full month of trading.
This is because I’ve burned through my ‘immediate network’. It’s a lame term to describe my friends in the industry, Twitter followers, email subscribers etc. Those who have watched as I’ve built Jack and were ready to get on-board from the start (thanks, guys!).
Now leads are generated from paid resources, ads and organic search. That’s fine, but these leads require more of the ‘hard sell’.
In hindsight, I’d have approached things differently to make post-launch easier. I wasn’t nearly as active in the build-up to launching Jack as I could have been.
A Different Approach
If I could start all over again I’d do the following:
I wouldn’t think about what I’ll be selling down the line or the business I’m going to build. I’d pick a group I want to serve and spend a solid year focusing on that audience. No getting distracted with selling or developing a business—I’d channel all of my energy into helping, researching and speaking to that audience.
I’d start with people (freelancers)—not the idea (business insurance).
I’d go to conferences, attend meet-ups, blog regularly and participate in communities. I’d do only this for a whole year. No product to sell, no business to pitch. Just listen, research and grow.
I did some of these things to a degree, but lacked the consistency needed to produce the best results.
By the time Jack had launched, I had 4000-odd Twitter followers (not all freelancers) and 200 email subscribers. There are many things I could have done to double, triple or quadruple these numbers, yet I focused on building my business instead of relationships.
That’s stupid—you can’t grow a business without relationships. Post-launch would be a little easier had I started with people.
Justin Jackson is a perfect example of starting with people. Justin didn’t launch a paid product for an entire year. Instead he focused on creating content, participating in communities and helping an audience of product people. Now he has a sizeable network ready to buy whatever he’s selling.
Hindsight is a powerful thing. I wish I’d set aside a year to research, help and build an audience of freelancers. What’s a year in the grand scheme of business?
Maybe you’re just starting out. Perhaps you don’t have an audience, idea or product yet. My advice would be to pick a group you know you can serve, and spend a solid 6-12 months researching, helping and growing that audience.
Don’t get distracted with selling, just focus on helping and serving the network you’re building.
You’ve shipped something new, people are eager to check it out. They’ll tweet about your product, share on Facebook or maybe mention you on their blog.
You might even get ‘Hunted’ or featured on Designer News. The really smart people will have built a list of loyal followers to launch to.
If you’ve done things right in the build-up, launch day will do the work for you when it comes to driving traffic.
Jack experienced a surge of traffic during launch week, which in turn brought leads. Lots of ‘em. Some of those leads became my first customers.
But what happens when launch traffic dries up? You need to find a way to keep a steady stream of traffic (and leads) coming in. How do you do that once the initial buzz has died down? That’s what I’m trying to figure out.
Understanding My Audience’s Preferences
My goal is to make insurance simpler. I may be biased, but I think Jack’s quote system ticks that box. It asks the questions it needs to get you a quote—nothing more.
All insurers have different question sets for cover. Some demand endless forms to be filled in, while others require a few key details. We work with an insurer who falls into the latter category, but it comes at a cost (quite literally). Higher premiums.
Recently I added another insurer to my roster. While their premiums are cheaper, they request a lot more information upfront—some of which doesn’t feel relevant for freelancing. It doesn’t jive with the simple, freelance friendly process we’re creating at Jack.
But maybe I’ve got this all wrong. Perhaps freelancers are willing to spend an extra 15 minutes when buying insurance to save money.
Should I compromise on Jack’s ethos to give my customers access to cheaper premiums, or do they value convenience and simplicity more?
This is a difficult question.
Balancing Everything As A Solo Founder
All of my processes are manual. In the future I’ll be automating tasks, but for now I’m doing and handling everything myself.
I manually issue quotes and cover. I personally follow up on last week’s quotes, or remind customers to fill in their risk questions. Y’know, the general admin of running an insurance company.
Some days are quiet in terms of leads coming in, but with busy periods these processes can eat into my day. It’s not uncommon to get to the afternoon and I haven’t managed to do the work that’ll attract more business.
I haven’t sent that newsletter, written that blog post, published those adverts, updated social media etc.
Starting A Business In An Industry That’s Hundreds Of Years Old
A lot of insurers have been around for a long time. They’re decades old. They’ve had years to hone their processes and improve their product.
Jack is one month old, yet I’m competing against insurers who have decades of experience.
This can work in my favour—the industry needs fresh thinking and ideas. But at the moment, with starting a company from scratch, Jack is a little lean compared to its competitors in terms of features, tools and benefits.
How do I convince people to get onboard with a new business?
These Are Good Problems To Have
Keeping traffic flowing post-launch
Finding out what’s important to my customers
Balancing bringing in new business with binding new business
Getting people onboard with a new company
It’s taken me a long time to launch Jack, so I’m happy to be having these ‘problems’. It’s fun figuring this stuff out.
I’ve been in business long enough to know that it never does get easy. Challenge accepted.
Who’s got a quote? Have they received the risk questions? What deals have I won? All of this is logged in Pipedrive.
My sales funnel looks like this:
Lead In > Contact Made > Quote > Risk Questions
Since Jack launched I’ve processed 70+ quotes, all of which are at various stages in the funnel. On average it takes 5 days to close a sale. I’d be lost without a means of tracking quotes.
Cost: £120 per year
Scott has been a dream to work with. Not only did he design and build Jack’s quote form, but he created a CRM tool to integrate it with. He’s one talented guy. Hire him.
This is where all of the quote data lives. I’m notified when new quotes come in and each one is assigned a unique code.
If the customer wishes to progress to the next step, I can send the risk questions from the CRM tool. The unique code tracks who has answered them.
We built this on a shoestring budget. It’s super lightweight and very much a MVP, but it does what I need it to do—no bells and whistles.
Next year I’ll be processing quotes and issuing cover instantly online. In the meantime, there are a couple of extra steps involved with manually processing cover.
Every customer has to sign a ‘Statement of Fact’ document once they purchase insurance. I forward this to the insurer.
Imagine a digital insurance company needing you to print, sign and return a form in the post? Ain’t nobody got time for that.
Fortunately, DocuSign takes the pain out of signing documents.
Cost: £183.60 per year
Lastly, if everything goes to plan the insurer (and I) need to get paid.
I’ll earn between £35 - £52.50 commission depending on the premium. Premiums for web designers / developers are quite small, so I’m averaging about £40 per sale.
Cost: $12 per month
Jack’s only been live for a couple of weeks, so I’m still testing the water as to what apps work for me. If you have any alternative suggestions or know of any tools that would make my life easier, let me know on Twitter.
Last week I launched my insurance company, Jack. I’d been in closed beta for 3 weeks prior, sourcing feedback from people who’d volunteered to test the onboarding process (thanks, people!).
Launch Week Analysis
I’ve shipped enough products to know that launch day rarely lives up to expectations. In the past I’ve romanticised launching, overestimating interest in my product and inflating figures.
A few underwhelming experiences have taught me to expect very little. A launch is generally one, big gamble.
Note: Insurance is a challenging asset to sell. You can only catch people once a year when their renewal is due. It isn’t a spontaneous purchase, so I wasn’t expecting a flurry of sales. Despite that constraint, I’m happy with how Jack’s launch has went.
Fail To Plan, Plan To Fail
My tactic for past launches: throw a tweet out into the ether, hope somebody sees it. But this isn’t a side project—this is my business and I needed to have a plan.
For each day of the week, I gave myself a channel to focus on. Email, social media, blogging etc.
Bank holiday. Write off.
As I work for myself I’m oblivious to bank holidays. I had planned to launch on Monday, but found out the day before it would be a bank holiday in England and Northern Ireland.
I did send a few emails, but it was useless. Nobody was sitting at their computer on Monday.
Tuesday was all about email.
Before I launched Jack, I put up a landing page and wrote a couple of paragraphs on my vision for insurance, which were followed with a call to action to be notified of launch.
120+ people opted in. This is a good number for an insurance product. Having 10 people pay attention would have been a success.
Alongside Jack’s existing newsletter of 60-odd people, I sent a launch announcement to this list. Only 51 people trickled through to the site.
Despite a poor performance, it’s true what they say about email being a captured audience. People who came from my list spent the longest time on the site. They visited the most pages, and the conversion rate for getting a quote was significantly higher than other channels!
I also emailed every beta tester to say thank you and notified them we had now launched. A few of them tweeted to their followers, which had a snowball effect of their followers tweeting about Jack.
You may be thinking, “This doesn’t sound like you launched with much of a bang”. You’re right. I purposefully staggered my launch over the week. Why?
At this point in Jack’s life, I have to manually process every quote that comes through. It’s time consuming.
I want people’s first interaction with Jack to be a positive one. They can get an instant quote elsewhere—I don’t want them waiting hours for mine. It was important not to overburden myself with work.
14 (genuine) quotes
Next I turned to social media.
Twitter has lost its influence. Remember the days you could piggyback off Twitter to launch a business? Now the engagement rate is insufferably low.
But that’s where my audience is. Alongside a launch tweet, I experimented with two Twitter Ads on a budget of £20. In retrospect I should have experimented with more ads, but assign each ad a smaller budget.
“Insurance for freelancers serious about building a bulletproof business.” ― Twitter Ad 2
I’m no copywriter, I think that much is obvious. When it was clear the second ad wasn’t getting much traction, I dropped it.
The first ad had 62 clickthroughs and gained Jack 2 followers—1 of which got a quote.
Why did the second ad perform poorly? My guess is that the visual lacked impact. Showing a teaser of the conversational quote form on the first ad seemed to work well. The copy “Insurance for…” isn’t very engaging, either.
I also tried Facebook and Instagram ads.
The reach from Facebook and Instagram was a little wider (5380 impressions) and had more clickthroughs (131). The conversion rate for getting a quote was higher on Twitter, though.
Tristan from Ignite gave me some advice for running social media campaigns. He advised creating a lot of different ads, but boosting them for as little as £1 or £2 to gauge what works. I’ll be trying this tactic going forward.
Social media has been kind to us. A lot of wonderful humans have spread the word about Jack, but it definitely doesn’t have the impact it once did.
(Note: Even though I set these ads to run on Wednesday, Facebook took 24 hours to approve them. This is why the traffic numbers don’t add up.)
7 (genuine) quotes
Thursday’s approach wasn’t about yielding instant results. I created a press pack and reached out to 10 publications I’d love to feature Jack.
This was the first time I’ve done this. Writing a Twitter bio is hard enough, but a press release is a whole other level of self-promotion. Maybe I’d have benefited from reading Ryan Holiday’s book on PR.
I’m not sure how successful this will be. Due to a lack of responses from the people I contacted, I have a feeling there’s a skill to it that I haven’t mastered and this was a waste of my time.
Mark, who works in my office, has built a list of online locations to help give your startup “the launch it deserves”. He was kind enough to give me early access. I made my way through this list and submitted Jack to relevant sources.
Despite Thursday not being about instant results, I doubled my traffic from day one. That was down to being featured on Designer News.
10 (genuine) quotes
Friday didn’t go to plan. I intended to drive traffic by writing a blog post.
There’s a lack of information about insurance for freelancers. I have a lot of ideas for content that will help to make sense of insurance, but do so in freelance speak—not insurance jargon.
Personal responsibilities got in the way, though, and I didn’t arrive at the office until after 1PM. I then had quotes to process and follow-up on, which kept me busy for several hours.
Fortunately, I was still riding on the coattails of the Designer News feature.
13 (genuine) quotes
What Worked Well?
Being laser-focused on a niche. Insurance for plumbers? Yeah, I can do that, but you should know the benefits of targeting a niche by now. That’s why Jack focuses on freelance designers and developers.
Talk about finding your niche and being personable! Never thought I'd be impressed by a business insurance website. https://t.co/0cwfKG6PxS
Because of this, word spread quickly and consistently through the freelance world. Knowing exactly who my audience was, I knew where to post about Jack and who to reach out to.
Would it have had the same impact if I was also pursuing estate agents and tradesmen? No, I don’t have a clue about estate agents or tradesmen. By targeting everybody, you’re really targeting nobody.
I’ll leave generalisation to the big insurers. They have the marketing budget to get in front of everybody.
What Didn’t Work Well?
I dropped the ball in my personal life.
I lived on instant noodles for 5 days, not making the time to prepare my (usually healthy but time-consuming) meals. I’m suffering now. I’m bloated, lethargic and have a cold coming on.
My social life was impacted, too. I let people down last week. I hadn’t anticipated how busy I’d be or how tired a day of staring at a screen and processing quotes would leave me. I had an angry voicemail from my Gran for not visiting her.
Sell, Sell, Sell
As I said, insurance is a tricky thing to sell in that it’s purchased once a year. The stars have to align in terms of timing. Unless you’re a freelancer who isn’t insured and has never thought about it before.
With that said, I think launch week was a solid start. Some of these quotes will evolve into customers in the coming days, weeks and months.
44 (genuine) quotes
Channels with highest conversions:
Direct (what does this even mean, Google Analytics?)
The Emotional Impact
Unleashing your idea into the world is intense. I felt a number of things. Excitement, fear, elation, deliriousness…
What if people hate Jack? What if it’s a success and my life changes? Am I ready for whatever this throws at me?
It’s taken me a long time to get to this point. My journey began in 2005 when I inherited my Dad’s insurance business. Although things are getting better, I noticed insurers weren’t investing adequate resources into their design and technology. As a result, I wanted to build an insurance company with design and technology at the heart of it. It took years to get the ball rolling with this. I experienced lot of rejection and setbacks. Irrespective of how Jack pans out, it’s a triumph in itself to even get to this point.
Despite the lengthy build-up towards launch—not to mention the intensity of launch week itself—the reality is the hard work begins now.
I’m blogging about how I’m building my insurance business. Never miss an update by signing up to the newsletter.