Any Truth in these Numbers?

[PandCforMe]

I just switched over to the P&C insurance industry with a large captive company. I am going through my training and licensing right now and thoroughly enjoy it and think this career is for me. Question is-during the hiring process I was told typical salary for years 1-2 was around 55-65k, and then years 3-5 if your book is built adequately you should near the $100k mark in salary. I know there are a TON of varying factors that contribute to your success, but I was curious to see how some industry veterans viewed these numbers? Are they feasible? Thanks for any input

 

[Josh]

Feasible? Yes. Realistic? With the support of a large captive and a consistent marketing effort, sure. In taking a look at the numbers, often times recruiters will use smoke and mirrors to talk about commissions with companies like Aflac and Colonial Benefits. Often times with captive shops like Allstate or State Farm, those numbers are more based on reality and reasonable. Aggressive at times, sure, but on the balance more agents are going to have their experience line up with the projections on a captive P&C gig than with most other companies.

Best way to ensure your success now is to start building a pipeline and put together a marketing plan that involves many different strategies. If I were in your situation I would take the time to learn from the experiences of what other folks are doing to bring business in. The more you can rely on your own marketing efforts (networking, cold calling, "grassroots marketing") the better. Agents and agencies that rely on internet leads tend to have the most volatile production.

 

[PandCforMe]

Thanks for the info Josh I appreciate the honest feedback. That was my only concern is that I know recruiters like to exaggerate at times. I've already developed a marketing plan and I'm trying to be the biggest sponge I can patrolling these forums. Seems like there is no right way to succeed, but many many right ways. I just need to find the mix that works for me. Thank you again

 

[Josh]

If you do enough of the right things you can't stop from having some success. In the process, you'll learn how to have even more success.

 

[nyc2phi]

Depends on the captive company...

Who are you talking about ? ? ? ?

 

[djs]

Simply put, these numbers are aggressive, very aggressive, but achievable.

They are also very regional, so its hard to say how realistic they are. Best option is to talk to a few that are 2 years in and some that are 5 years in and find out.

What recruiters tend to do is talk in terms of gross income, ignoring a lot of expenses that you have to pay (like all of them). It makes the numbers sound good, but when you start subtracting out rent, E&O, office supplies, staff, etc, it comes down pretty fast.

Actual net income (in your pocket to spend as you wish) averages lower than these numbers in most areas, but I've known agents to hit the type of numbers you are talking about, but its the aggressive agents who do it.

Dan

 

[PandCforMe]

Depends on the captive company...

Who are you talking about ? ? ? ?

Sorry for the late reply, but Liberty Mutual is the company
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Simply put, these numbers are aggressive, very aggressive, but achievable.

They are also very regional, so its hard to say how realistic they are. Best option is to talk to a few that are 2 years in and some that are 5 years in and find out.

What recruiters tend to do is talk in terms of gross income, ignoring a lot of expenses that you have to pay (like all of them). It makes the numbers sound good, but when you start subtracting out rent, E&O, office supplies, staff, etc, it comes down pretty fast.

Actual net income (in your pocket to spend as you wish) averages lower than these numbers in most areas, but I've known agents to hit the type of numbers you are talking about, but its the aggressive agents who do it.

Dan

Thanks Dan, if I'm part of a captive company are all these costs still applicable? I definitely plan on being aggressive and it seems like trial and error until I find the right marketing mix for me

 

[Matt37]

Those numbers are def. possible.. but you would need to target specific markets and have really good contacts within those markets.

What I mean by that is focus on a niche and get the markets neccessary.. If I were you and just getting into the game.. I would go right to WC.. that market is going hard quicker than anything else.

I am getting WC nonrenewals on some of my contractors with like 5% loss ratios!!! And I am not talking premium spikes, I am talking nonrenewals!!! But again you've got to find a market to team up with.

When I got into P+C I knew I wanted to do transportation and worked with two other agents and we developed a market that was very competitive.. we wrote $3 million in premium year 1 between the three of us.

P+C is not life and health.. every class in P&C has certian carriers/agency that dominate the market place with specialty markets.. many of them have exclusives.

 

[nyc2phi]

The reason I asked is becasue I already knew what captive company you were talking about.

I am a LM agent in PA. LM is great company and a great place to start in the insurance industry. Hitting 50-60K is the average first year income but it pretty easy to much more then that in the first year. Only issue is we don't get renewals on what we sell which is why we get so much up front.

You also do not have to worry about any office expenses. In fact you get reimbursed for your miles on going to appointments.

Feel free to reach out if you have any questions about LM.

 

[djs]

Sorry for the late reply, but Liberty Mutual is the company
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Thanks Dan, if I'm part of a captive company are all these costs still applicable? I definitely plan on being aggressive and it seems like trial and error until I find the right marketing mix for me

The only way to know about costs is to ask upfront. Ask several people. I know almost nothing about how Liberty Mutual deals with their agents, so I can't answer this.

Do you need your own office?
Your own car?
Phones?
E&O coverage?
Marketing expenses?
Dues and fees for things like BNI and the Chamber?
City/County license fees
Insurance license renewal fees
Fax costs
Overnight mail costs (much less now than previously)
Do you pay staff?
Do you have to have staff?

Find out, it's good to know to set expectations up front.

Dan