In today’s fast-paced insurance landscape, brokers are under constant pressure to improve customer service, optimize operations, and control costs. As a result, many are turning to outsourcing to offload non-core tasks and free up resources for more strategic priorities.
While outsourcing offers significant advantages, it isn’t a one-size-fits-all solution. Striking the right balance is essential to leverage outsourcing effectively without losing control over critical aspects of your brokerage.
According to Bradley Flowers, founder of Portal Insurance, outsourcing non-customer-facing tasks that don’t directly drive revenue is not only fair game but also a smart strategy. “As an agency owner, my guiding principle is simple: what are we doing that doesn't add immediate value to the bottom line? Once I identify those tasks, I ask myself if there's an external partner who can take over those responsibilities. This allows me to focus on what truly drives growth and profitability," he shared.
Outsourcing activities, such as bookkeeping, can be a highly efficient approach for brokerage owners, especially in the early stages when budgets are tight. Flowers noted that, while financial management is crucial, handling it personally would take time away from building a client base—and could ultimately lead to less effective results.
“By outsourcing to a company with professional CPAs and bookkeepers, the quality of the work I'm getting is better. Even if I scraped together enough funds for an in-house bookkeeper, that individual likely wouldn't match the expertise of a specialist who focuses solely on bookkeeping for insurance agencies.”
Data entry is another area where outsourcing can provide significant value. Sharon Bajwa, enterprise sales manager at Patra said: "In the brokerage world, there’s a lot of high-volume, repetitive tasks which typically used to be completed by humans, but now the industry is looking for other ways to complete these."
While outsourcing technology and building customizable solutions can be a huge asset for brokerages, Flowers cautioned against overusing technology, as it can become counterproductive.
"I had a friend who started his agency right after me. He signed up for every tool under the sun, wanting to test them all. But he had the discipline to eliminate the ones that didn’t serve his agency," Flowers said.
The takeaway? Knowing where to show restrain on technology and to trim the fat is crucial for streamlining operations and maximizing efficiency.
Emphasizing the value of partnering with firms that specialize in insurance industry solutions, Bajwa shared, “I’ve spoken with brokers who say, ‘I’ve worked with outsourcing companies before,’ but many providers are generalists,” Bajwa cautioned. Specialized partners who understand the unique demands of insurance can deliver more effective, customized solutions tailored to the needs of each brokerage.
To ensure a successful partnership, Flowers recommended that brokers carefully vet prospective outsourcing partners by seeking testimonials or directly contacting past clients.
“The number one thing I would do is speak to someone else who has worked with them—ideally a peer in the same industry. That’s the best way to gauge the effectiveness of an outsourcing partner. Some companies don’t have Google reviews or Trustpilot profiles, so peer referrals are critical,” Flowers explained.
However, understanding what to keep in-house is just as important as knowing what to outsource. Accordingly, Flowers advised that brokers keep all client relationship activities within the business to foster stronger, more personal connections.
"I’m a big proponent of keeping customer interactions—whether face-to-face or over the phone—in-house," he explained. By handling these interactions directly, brokers can build trust and gain deeper insights into clients’ unique needs, which is invaluable for long-term business growth.
For Flowers, the biggest misstep agency owners make when it comes to outsourcing is spending too much time working in their business rather than transitioning to working on their business.
Specifically, agencies making between $750,000 and $1,000,000 in revenue often hit a wall. This range, which Flowers referred to as "no man’s land," is a critical point where agency owners must shift from a hands-on, producer-focused mindset to a more structured, managerial approach – something many agencies struggle to achieve.
To avoid stagnation and elevate to the next level, both Flowers and Bajwa stressed the importance of agency owners proactively preparing for scaling. “Outsourcing isn't meant to replace your staff; it's about using the staff you currently have more effectively,” explained Bajwa. “By utilizing outsourcing, you gain an extra tool or support system.”
This approach helps prevent operational bottlenecks that could hinder growth. Flowers added, “Before hitting that revenue threshold, start building out your scaling plan. The key is to prepare to scale before you scale.”
