Distribution Growth


Growing the distribution of your insurance products depends on two essential factors: Bulking existing insurance product distribution funnels and recruiting new ones.

If growing your distribution funnels was easy, everyone would have successfully done it by now. But today’s insurance companies – from carriers to MGAs/MGUs and agencies – face steep challenges, many of which have historically handcuffed their growth to their compliance obligations OR taken substantial regulatory risks. Some of the biggest challenges:

  • Knowing which partners are licensed in which states and for what lines of authority (LOAs), or for which states and LOAs their agency partners may need in order to expand
  • Keeping those licenses up to date, staying abreast of new regulations from state departments of insurance or state legislatures, and managing required continuing education
  • Growing without exponential operations costs and employees, while also preventing your talent base from suffering from overwork and burnout

Best Practices

The time to prepare for growth is before it happens. 

Ensure your infrastructure is ready to scale so you don’t create a messy experience for your existing partners or newly recruited relationships. You want to be both quick and easy to do business with. And you need to prioritize regulatory compliance and ease of use – not sacrifice one for the other. Having the right technology in place can make your distribution growth goals a reality. 

Be sure to communicate any growth strategies and accompanying incentives to your distribution partners early and often, and be sure those incentives are in compliance with the states and regional regulatory bodies in whose jurisdiction you’re operating.

Distribution Growth FAQs

1. How do different insurance businesses grow their distribution channels?

For carriers, growing the channel often means contracting with more agencies and MGAs. For agencies, recruiting producers directly is the name of the game. All insurance stakeholders benefit when the producers in their distribution channels can grow their businesses.

2. How are businesses solving for compliance currently?

Most insurance businesses operate under two frames: Either they’re growing their employee pyramid as it correlates to the number of agents they onboard, or they’re taking ever-increasing risks as far as maintaining compliance. Using tech solutions can better align compliance and growth instead of one presenting a hurdle for the other.

3. Why does expanding an insurance business incur more regulations?

At a certain point, most agencies, carriers, and MGAs will be recruiting partners and agents across state lines. Because each state adds its own layer of unique regulation, the complexity only increases the further an organization expands its circle of operations.