Agentco Vs Smart Choice in NC- My Final 2 Candidates

[Bertolinoins]

I project 3-5-10 years down the line of having my own direct appointments. Not paying 15k a year and being stuck with someone forever. But I agree, I'm re-evaluating SIAA for that reason. Iroquois group I'm sticking away from since there is a 2 year noncompete with direct appointments.

Thanks for the help though with that, I think I just stayed away from SIAA because this is a poor man's lovechild between independence and business ideas. Not many funds to back this up from the beginning so I was more willing to give up some commissions (since I'm making money) rather than money I can't stand to lose from the small starting pool.

Any other suggestions?

I totally understand where you are. I started my agency in 2008 and opted to go with a California based cluster even though the cost of entry ($5000 + $850 per month) was very expensive for me at the time. The break even point for me was $300K in premium with profit sharing companies which I hit fairly easily in the first year. I understand the desire for direct appointments as I deal directly with all of my carriers and have my own agency code with 90% of them... but having the volume of a large group is very valuable. They can negotiate deals that a small agency could never imagine. We have some national carriers that are paying close to 32% on new business when you add in all of the kickers for growth they are giving to the cluster. The difference between the overides a small agency gets and a $200M+ cluster gets is night and day... and that difference can often more than offset the out of pocket costs. Not only that... they negotiate the good deals and meet with the sales reps so you don't have to.
- - - - - - - - - - - - - - - - - -

I project 3-5-10 years down the line of having my own direct appointments. Not paying 15k a year and being stuck with someone forever. But I agree, I'm re-evaluating SIAA for that reason. Iroquois group I'm sticking away from since there is a 2 year noncompete with direct appointments.

Thanks for the help though with that, I think I just stayed away from SIAA because this is a poor man's lovechild between independence and business ideas. Not many funds to back this up from the beginning so I was more willing to give up some commissions (since I'm making money) rather than money I can't stand to lose from the small starting pool.

Any other suggestions?

I totally understand where you are. I started my agency in 2008 and opted to go with a California based cluster even though the cost of entry ($5000 + $850 per month) was very expensive for me at the time. The break even point for me was $300K in premium with profit sharing companies which I hit fairly easily in the first year. I understand the desire for direct appointments as I deal directly with all of my carriers and have my own agency code with 90% of them... but having the volume of a large group is very valuable. They can negotiate deals that a small agency could never imagine. We have some national carriers that are paying close to 32% on new business when you add in all of the kickers for growth they are giving to the cluster. The difference between the overides a small agency gets and a $200M+ cluster gets is night and day... and that difference can often more than offset the out of pocket costs. Not only that... they negotiate the good deals and meet with the sales reps so you don't have to. I am not saying SIAA is the way to go... but I would explore all of the options available to you with an open mind on the big picture.

 

[Guest]

Basically, any non-standard carrrier will put you on if you are still breathing, they just want an E&O cert. BUT remember, most non-standard carriers pay as earned, meaning you get you commission each month the client makes a payment, so yes, you might get a $2 commission check.

Alos, Basically, No preferred Carrier will put you on unless you are part of a cluster.

 

[NCAgent]

So here is the concern then. I am lacking the funds to start with SIAA. I can go to someone if I need to and SIAA looks interesting. Can you pay them monthly for that larget start up fee?

Agentco looks interesting because they apparently have the ability to let you work as a producer for a bit and then buy your book of business rather than use them to get appointed. you get a 50/50 split for renewals and new business. Maybe I'll do that for a bit for funds and then start with SIAA as my own agent later down the line for better rates.

Thanks for the help guys, I think I just need to work under someone for a while and start this when I have more money to get a better start up process.

Does SIAA require you to do anything for the book of business? Can you just leave or do you need to pay money to do it or how else since you are paying a lot of up front money?

 

[djs]

Actually, in some areas, there is a glut of insurance agents and even non-standard carriers are starting to get picky on who they put on. Picky as in they may ask for a marketing plan and a pulse, to go with the E&O.

For SIAA, you will have to contact the general agency in your area and ask them how it works. The general agencies tend to differ in some areas as far as I can tell.

The one for me might take payments on the upfront fees, but they won't bring you in without experience.

Dan

 

[Guest]

Alot of your questions must be answered by the MA for SIAA in your area. I know mine did a certain amount for a down payment and the balance paid over a certain amount of years.

I will say we get higher commissions than if you were on your own, and we get lots of overrides!

I do own MY Book of Business.

 

[infoe]

So here is the concern then. I am lacking the funds to start with SIAA. I can go to someone if I need to and SIAA looks interesting. Can you pay them monthly for that larget start up fee?

Agentco looks interesting because they apparently have the ability to let you work as a producer for a bit and then buy your book of business rather than use them to get appointed. you get a 50/50 split for renewals and new business. Maybe I'll do that for a bit for funds and then start with SIAA as my own agent later down the line for better rates.

Thanks for the help guys, I think I just need to work under someone for a while and start this when I have more money to get a better start up process.

Does SIAA require you to do anything for the book of business? Can you just leave or do you need to pay money to do it or how else since you are paying a lot of up front money?

Man don't take this the wrong way but if you don't have 10k SIAA needs saved up then starting p&c scratch is going to be tough...if you just don't have that in your budget then that's a completely different story.

I have funds set aside for my agency start and wife has savings if it's an absolute necessity i'd much rather not have to go through a cluster and fork over 10k, but It's not realistic to get all the same appointments with out them. If SIAA will put me on in the market that I want...I will be a happy camper.

 

[NCAgent]

Man don't take this the wrong way but if you don't have 10k SIAA needs saved up then starting p&c scratch is going to be tough...if you just don't have that in your budget then that's a completely different story.

I think I am misunderstanding what you're saying so sorry if I'm being dumb. But I don't have 10k to fork over to SIAA and then (I believe) a monthly fee as well. I have ~10k but that's more for making sure I can survive for the next 4-6 months while working 100% commission.

But I don't think many people starting an insurance agency has 10k to put away just to have the ability to get appointments before E&O and everything else. E&O is on average 2500 for new people. So you're saying that most agents have approx. 13k stored up before counting for living expenses for 6 months when starting an agency? I know the closer to that the better you are starting off but I think this is an exception to how many agents start rather than the norm.

Please correct me if I am wrong, I'm not intending to be facetious.

 

[infoe]

I think I am misunderstanding what you're saying so sorry if I'm being dumb. But I don't have 10k to fork over to SIAA and then (I believe) a monthly fee as well. I have ~10k but that's more for making sure I can survive for the next 4-6 months while working 100% commission.

But I don't think many people starting an insurance agency has 10k to put away just to have the ability to get appointments before E&O and everything else. E&O is on average 2500 for new people. So you're saying that most agents have approx. 13k stored up before counting for living expenses for 6 months when starting an agency? I know the closer to that the better you are starting off but I think this is an exception to how many agents start rather than the norm.

Please correct me if I am wrong, I'm not intending to be facetious.

np man, PM incoming.

 

[TeePee]

I didn't think NC used SR22s much. In 15 yrs in the business, I have had to do 2---from people moving into state.

Scratch agencies are tough, especially if you don't have the means to keep yourself going until the renewals come in. Ceded business is tough. But if you throw enough crap on the wall some will likely stick, although you need to weigh that with the service work ceded business brings.

 

[NCAgent]

I didn't think NC used SR22s much. In 15 yrs in the business, I have had to do 2---from people moving into state.

Scratch agencies are tough, especially if you don't have the means to keep yourself going until the renewals come in. Ceded business is tough. But if you throw enough crap on the wall some will likely stick, although you need to weigh that with the service work ceded business brings.

INORITE. Ceded business sucks a whole lot, I agree. However, a lot of people I know are ceded for being young drivers and maybe a ticket. Underwriting is a pain for a lot of these people and the price, fogetaboutit. I can keep myself going until renewals but not if I'm dropping 10k down to even get appointments then a monthly payment of around 100 bucks. But then other places will let me work with them for a lot less but then I'm stuck with them or wait 2 years before I can go on my own... And there are ZERO indy's in my area looking for a 1099 producer. I've called and communicated with over 60 places and they all are hesitant and refuse.