There’s never been a better time to start a new insurance agency than today. This may seem like a strange comment, given the current state of the economy and the continuing soft insurance marketplace.

Yet, if your organization is sales focused and your entire team has access to the right tools, external factors such as the economy and the soft marketplace have less impact on success than at any time since I’ve been involved in the insurance industry.

There are a number of technologies that have been under development for a while that have finally made it into the mainstream. These technology developments have made it easier for the right forward-thinking people to start a new agency and become successful.

Technology enablers

Market access

This is the biggest issue and stumbling block that people come across when they think about starting an agency. You have to have a product to sell, and the product an agency sells originates with an insurance company. In the past, it has been difficult to obtain an appointment with an insurance carrier. Today, it has become much easier for anyone to access insurance company products through a variety of platforms, groups, and associations. Several websites now allow agents to quote, bind, and issue policies online. Various types of market aggregators provide access to insurance company contracts as well as marketing and management help.

Cloud computing

I first started talking about accessing computer resources and data through an Internet connection over 10 years ago. Back then it was called Application Service Provider, or ASP. Most agents were very skeptical, especially about the concept of having their data stored at an offsite location. Time has changed many minds.

An example of cloud computing is the Amazon S3 services that provide computer space you can rent in Amazon’s data center. Another example is offsite data backup. Today, a large percentage of insurance agencies use some form of cloud computing. Most management system vendors have an option that allows agency staff to access policy information from anywhere they have Internet access.

Software as a service (SaaS)

This technology is closely related to cloud computing. Cloud computing enables software as a service to become a reality. These types of applications are rented, not purchased in the traditional sense. A widely know example is Salesforce.com, a prospecting and customer relations platform that some agencies use to manage their marketing and sales process. You can’t “buy” the software; instead you pay a monthly fee per user to access its platform using virtually any device with an Internet connection.

The new small agency doesn’t purchase expensive hardware and software that they have to spend valuable time learning to manage. They access the most powerful platforms through an Internet connection by simply paying a monthly fee per user.

Free and open source software (FOSS)

Free (or low-cost) alternatives to traditional, expensive paid software have been gaining acceptance for a number of years. The options for and sophistication of free or low-cost software continues to grow. Google Apps, Zoho.com, and Evernote.com are just a few of the applications that might replace traditional (expensive) software. One new small agency is using Google sites (free customer websites) to build client portals that house client policy documents along with other account information. There may be very good business reasons to purchase and use software, but the new small agency is willing to look at alternatives.

Mobility

Mobile technologies extend the capabilities of certain applications. The number of applications available on several mobile platforms is astounding. Collectively, new small agencies embrace the use of smartphones and productivity-enhancing apps. One example is an agency producer using an iPad for a proposal presentation to a client. One iPad app allows the producer to take notes on the PDF file, have the client sign the application and the proposal, and email the completed document back to the office so the policies can be issued. Mobile technologies turned the concept of an “office” completely upside down. One new small agency we are familiar with doesn’t have a physical location, yet has six employees who manage clients in 35 states.

Social technologies

It’s hard to read any industry publication without hearing about social networking and media. While the new small agency may not completely understand the benefits provided by social technologies, they are not afraid to experiment with them.

New small agencies face risk. At the same time, they use the technologies mentioned here to slash costs, improve efficiency, and increase the availability of critical applications and information.

It’s a great time to start a new agency.