This annual list of the best insurance franchises was revised and updated on February 16, 2022.
The insurance industry’s job is to protect customers against the uncertainties of the future. It fills a similar role for business owners and investors, as it’s generally regarded as a safe sector with slow, steady growth. Being a necessary service and a stable investment, the insurance industry has flourished, with 5,929 insurance companies in the US in 2020.
$1.3 trillion worth of insurance premiums were written in the United States in 2020, up from $0.9 trillion a decade earlier. This reflects the huge amount of money going through insurance companies, as they protect every part of people’s and businesses’ lives, from health to homes to legal issues. The industry has grown even during some tough economic times, as the security that insurance provides is one of the needs that people will cling to when money is short.
The growing power of the US insurance industry is reflected in the fact that it contributed more to the economy than banks did in 2015, for the first time in the industry’s history. It employs 2.7 million people all across the US, serving customers in every single community.
Just over half of insurance premiums are for property or casualty insurance, the other half for life or annuity insurance. Franchises tend to operate in the first part of the industry, offering insurance for vehicles, homes, and even businesses. This business was worth $652.8 billion in 2020, meaning that there’s plenty of market share to be had. Some franchises also provide health insurance, a vital necessity for most Americans and a trillion-dollar industry in itself.
The insurance industry has generally weathered the COVID-19 pandemic in reasonable shape. Revenues were down thanks to the pandemic’s negative effect on the economy, but this was mitigated by some specific features of this downturn. Claims on motor insurance fell, as people used their cars less, resulting in fewer accidents and car thefts. Even health insurers, who might have been expected to suffer from large payouts, have been left in good condition as people attended hospitals less for non-urgent issues, to avoid exposure to COVID. The fear stirred up by a new disease increased public interest in life and disability insurance. And with the pandemic receding, the economy is growing, and the insurance industry with it.
Franchised insurance businesses are generally focused on individuals, providing motor, home, health, and other individual forms of insurance, making their position safer. These are necessities for many people, and that provides a market that isn’t going away, even if it might contract in difficult times. The pandemic has pushed insurers toward more home working, cutting costs and creating more flexible working models, and franchises are already well placed to adopt this model. Cutting down on office overheads could help franchised insurers to get ahead of the competition in difficult times.
This isn’t to say that there aren’t significant costs. Insurers are increasingly concerned about cybersecurity and efficient security systems, and getting these elements right can be critical. Insurance relies on securing both personal data and financial transactions, and a company that can’t protect these is in real trouble. It’s important to understand the quality of the software you’ll be working with as part of a franchise, and what will be expected of you to keep data secure.
This is a heavily regulated sector, but one that’s primarily regulated on a state-by-state basis. You’ll need to look into the regulations where you plan on working, and how any franchise works to meet those standards. National franchises have to adapt to local circumstances.
Because of the way it approaches risk, the insurance industry has historically failed to meet the needs of some communities, and this is where some of the franchised insurance companies flourish. By appealing to underserved communities, franchises can carve out a specific and successful niche for themselves. An industry employing 2.7 million people has sometimes been surprisingly slow to recognize those people’s different backgrounds and needs, and this has created a space where carefully marketed franchises can thrive.
The Top Insurance Franchises of 2022
1. Brightway Insurance
Brightway Insurance was recently featured as one of the “Most Innovative Franchise Brands in 2019” by Franchise Business Review, based on feedback from franchisees. The company recently rolled out a recruiting and competency-testing tool that helps franchisees find and hire good agents using benchmarks formulated based on the chain’s best agents.
Brightway offers insurance for property, vehicle, life, business, and umbrella policies. Each location hires local insurance experts who have their own relationships with multiple insurance carriers. Each customer may have policies from multiple carriers, but all are handled centrally in the Brightway system, simplifying customer service.
Founded by David and Michael Miller in 2003 and franchising since 2007, the number of locations has risen steadily in recent years to the current total of 289 (up from the previously reported total of 208), of which one is company-owned and all are located in the US.
2. Fiesta Auto Insurance and Tax
Fiesta Auto Insurance and Tax is another insurance chain geared towards serving the growing Hispanic market with a focus on blue-collar workers and communities. By developing strong relationships with more than 40 different insurance carriers, Fiesta searches for the best possible pricing for each customer. Franchisees for this chain will do best if they speak some Spanish, or hire people that do. Its system is paperless and works through its web-based software.
Besides offering a wide range of insurance products (auto, home, business, rental property, boat, motorcycle, etc.), the chain also offers full personal and business tax services.
Founded by John Rost in 1998 and franchising since 2006, the number of locations has climbed steadily in recent years from 90 in 2012 to the current total of 246 (up from the previously reported total of 226), of which none are company-owned and all are located in the US.
3. Pronto Insurance
Pronto Insurance was acquired by RPS/Arthur J. Gallagher & Co., a global insurance brokerage, a year ago but its core business model remains the same: auto, home, and business insurance with a special focus on serving the growing Hispanic market. It has expanded operations from its home state of Texas to both California and Florida, using location intelligence platform SiteZeus to help it identify the best new markets for its services.
Additional insurance policy types include motorcycle, renters, RVs, boats, roadside coverage, mobile home, condo, and watercraft. Business insurance types include general liability, artisan contractors, errors and omissions, commercial property, workers’ compensation, and builder’s risk.
Founded by the Varela family in Texas in 1997 but only franchising since 2009, the number of locations leaped from 172 in 2017 to 277 in 2019 but has since declined to 209 (down from the previously reported total of 233), of which 166 are company-owned and all are located in the US.
4. Estrella Insurance
Estrella Insurance has received a lot of criticism lately for its blatantly sexist ads in Miami for its insurance services, but it doesn’t seem to be holding back the chain’s growth at all, even though its latest ads that were plastered all over Miami-Dade Transit buses have now been completely removed due to the backlash.
This company offers a variety of insurance policies to cover autos, motorcycles, boats, homes, rentals, health (indemnity plans, HMO, POS, PPO, and HAS), and businesses (commercial automobile, general/business liability, business owner policy, commercial/business property, professional liability, worker’s compensation). It works with more than 30 different carriers. Like Pronto and Fiesta, Estrella focuses especially on the Latino market.
Founded by Nicolas Estrella in Miami in 1980 but only franchising since 2008, the number of locations has grown steadily in recent years to the current total of 175 (up from the previously reported total of 166), of which two are company-owned and all are located in the US.
An Important Note About Our Methodology
The franchises on this list were ranked according to the number of units in the franchise system. If you are a prospective franchisee searching for franchise opportunities that meet or exceed certain performance benchmarks for sales, profits, and return on investment, please check out this list of America’s Most Lucrative Franchises.
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