Agents Making Little to No Money... How / Why?

[BrokeLoser]

On the one hand you could say some are negative on this forum but most are realistic.

The reality is this like it or not 90% of those who attempt insurance sales will fail.

They will fail for a myriad of reason but mostly lack of capital, skills and work ethic are the main culprits.

Sales training is somewhat useful but is an empty calorie in most cases because the student doesn't apply what he learns.

Capital is critical because if you can't market you cannot sell. It does indeed take money to make money and without a well formed marketing scheme clients will not beat a path to your door.

Finally you must work your ass off at least in the beginning. In my opinion P&C is probably the worst way to make money in the industry because it is very service intensive and in most cases mobile work is difficult. Life, Health, annuities etc are higher compensation but one must have a marketing plan to succeed. if you work your ass off you can make 250,000 plus if you don't you will make less.

The average agent still only makes 40,000 because he does alot of things on a daily basis that do not generate sales. Remember anything other than marketing and sales work is not productive. If you can farm out administration and concentrate on income producing activity. You can either farm out to automation, CRM's etc or you hire someone. The key is to focus on what makes you money, learn along the way and develop expertise. In that way you can learn in one what took some 10 years to learn.

Can you succeed yes... will it be easy at first no but if you get over the hump it will become seemingly effortless eventually because you will love what you do.

Lots of good info in your post and much appreciated. I hope I haven't been misunderstood; I appreciate everyones advice good and bad. This thread has gone bad at points, as they usually do. At the end of the day I'm really just trying to figure out where I'd fit in in the insurance business. Are the people that are making sh*t for money bad sales people? Do they just have a poor work ethic? Both? Are they just your typical complacent "sales guy"?....OR...is this just a business that tends to yield a poor return....regardless? Thanks again for contributing.
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One of my points, though I may not have been clear, is if you have a mentor and a way learning the ropes, you are far better off as an independent and not focusing on P&C. The more immediate and much better money is in L&H.

Not mentioned much but very important is the learning process. You have to read, research and study products. You will never be just a salesman in this business and survive. You have to do the right things for the right reasons, and knowledge of your products will lead you down the right path.

You see, you say the money is in the L&H while others here would say to focus more on P&C. Is this a simple matter of preference?
Stupid question: Can captive Farmers agents work as an independent for other carriers for L&H?

Thanks again Chuck!

 

[somarco]

Find your passion if you want to succeed.

 

[GetInsurance]

Farmers allows you to sell health, but life must go through their company and they pay about half of what you would earn as an indie. As fas as the diff between the P&C guys and the L/H guys, totally preference and skill as well. People MUST have auto and home insurance while L/H is optional. Skills needed for success. IMO, lack of success/profits is based on laziness and work ethis more than anything else. You can be a terrible salesperson, but if enough people know what you do, you'd have to be doing something terribly wrong to have zero production.

 

[BrokeLoser]

Farmers allows you to sell health, but life must go through their company and they pay about half of what you would earn as an indie. As fas as the diff between the P&C guys and the L/H guys, totally preference and skill as well. People MUST have auto and home insurance while L/H is optional. Skills needed for success. IMO, lack of success/profits is based on laziness and work ethis more than anything else. You can be a terrible salesperson, but if enough people know what you do, you'd have to be doing something terribly wrong to have zero production.

Half commission?
Wow, they haven't even talked about the L&H side with my buddy yet...maybe thats why. Thanks!

 

[patch36]

When I was a farmers agent we could sell any other lines as long as Farmers didn't offer them or the client didn't qualify. It was a large gray area. The new contract, I have been told by several agents, does not allow the new agents to sell any other lines except what Farmers offers.

P&C has gotten to be such a commodity and client loyalty goes out the door with price, at some point. P&C ties you down to an office and the huge amount of customer service work is a problem. I don't see many newer agents making it. The old timers have better contracts and a staff to do all the work for them.

You have to sell Life as a Farmers Agent to get subsidy help and relief. You have to get your Series 6 & 63 to be a career agent. If you can find a veteran agent who will let you park in their office for a small rent, you might make it through the probationary period which I believe is 5 years, called the Run to Daylight. It is a tough way to build a business and make a living. The DM's bank on most of the agents washing out. The DM's personally get all the Life Policies you write and they dole out the P&C and get a cut of that too.

 

[djs]

Finally you must work your ass off at least in the beginning. In my opinion P&C is probably the worst way to make money in the industry because it is very service intensive and in most cases mobile work is difficult. Life, Health, annuities etc are higher compensation but one must have a marketing plan to succeed.

This is a bit subjective and needs to be laid to a timeline to make sense out of it.

Keep in mind, most P&C agents have office staff to deal with the day to day admin work. If they don't they can only get to a certain size, and will probably eventually fail.

With P&C, it is mostly about renewals, not new business. It takes a while to build a book of business that pays decent renewals though. After you hit that point, life is pretty simple, or at least simpler.

With life and health, the renewals are nice, but in reality, you probably always need to be finding new clients. You need to keep some of the first year commissions coming in. Yes,you can roll your book every two to three years, which helps (and may help the client), but it's still not the 'easy money' of P&C renewals.

The big difference to me is that with P&C, to be successful, you will end up managing people, office, staff, have a payroll, etc. With life and health, some agents do, but you can be pretty successful on your own.

Stipends / bonuses / subsidies aside, you can make more money in the first few years with life and health compared to P&C. At some point, mostly due to the need to leverage other people (staff), this seems to switch.

Dan

 

[moonlightandmargaritas]

With life and health, the renewals are nice, but in reality, you probably always need to be finding new clients. You need to keep some of the first year commissions coming in. Yes,you can roll your book every two to three years, which helps (and may help the client), but it's still not the 'easy money' of P&C renewals.

Hit the nail squarely on the head there Dan.

 

[djs]

Hit the nail squarely on the head there Dan.

Problem is, when I swung again, my thumb was still in the way!!! :(

 

[moonlightandmargaritas]

With life insurance, it's like 100-120% fyc, then zippo (term anyway). And of course we know what's happened with term premiums...

Health will go down from 20-25% fyc to 5-7% on renewal.

P&C is like a level 10-15%?

 

[BrokeLoser]

With life insurance, it's like 100-120% fyc, then zippo (term anyway). And of course we know what's happened with term premiums...

Health will go down from 20-25% fyc to 5-7% on renewal.

P&C is like a level 10-15%?

This thread is back on track...very informative guys, thanks for that.
"And of course we know what's happened with term premiums..."
What happened?