Agency Partner Seeks Age Old Wisdom!!

[cosanostra]

As agency owners, my brother and I hired an outstanding agent last year. Our new hire produced approx. $250,000 last year. He is approaching his 12th month of employment with our company. We are an independent P&C/Life and Health agency of approximately $3M in written premium. Our new hire has also lured another of his friends to work for us who is just as productive. As you can see, we would like to keep him around and encourage more successful hires from his introductions. So we are wondering two things?

What are some standard thresholds for agency owners to set for their producers to be a partner? (E.G.....at $500,000, you will own 10% of the shares of our company) Is it set at a percentage of the existing book?

Also, we we feel that we should in some way, reward and encourage more introductions from our successful agent. We feel that ownership of the company is also a fair way to accomplish this. What are some ways to do this?

 

[briko3]

How in the world does he prospect to generate those kinds of sales? Curious minds want to know! Ok, maybe just my mind wants to know. Sorry I couldn't help with your actual question.

 

[1manshow]

Only a % ownership in "his" portion of the book from past experiences I've seen. Which also includes contingency % on his book.

 

[ABC]

What a good issue to have.

I would not even discuss ownership until he has 3 years with you.

In the mean time reward him with money and a good support staff. Then consider giving him a piece of the commissions from the people he is recruiting.

To be honest with you I have not had this issue come up because the people I have hired have not last 3 years.

 

[insuranceexec]

As agency owners, my brother and I hired an outstanding agent last year. Our new hire produced approx. $250,000 last year. He is approaching his 12th month of employment with our company. We are an independent P&C/Life and Health agency of approximately $3M in written premium. Our new hire has also lured another of his friends to work for us who is just as productive. As you can see, we would like to keep him around and encourage more successful hires from his introductions. So we are wondering two things?

What are some standard thresholds for agency owners to set for their producers to be a partner? (E.G.....at $500,000, you will own 10% of the shares of our company) Is it set at a percentage of the existing book?

Also, we we feel that we should in some way, reward and encourage more introductions from our successful agent. We feel that ownership of the company is also a fair way to accomplish this. What are some ways to do this?

Is that 250K in premium or commision dollars? What type of business did he write?

 

[DJM]

Well the obvious would be pay him more. Or increase his renewal commission level. Tell him you will give him bonuses for recruiting also.

 

[cosanostra]

Sorry, I must clarify. He produced $250,000 in premium, not commission and is currently on 50/50 P&C, 60/40 Health and 70/30 commission splits.

Any more ideas on incentives?
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