Becoming a Sub Agent: Good or Bad?

There is someone here in my local area who I believe operates as a General Agent, I'm pretty sure they are not an IMO, she is trying to recruit me as a Sub Agent for Aetna to sell Medicare products.

I'm licensed as a General lines agent, life and heath.

I contacted this person because I wanted to work with someone local to help me learn the business. So if I had an issue or problem, I'd have someone nearby to help me resolve it.

But there is something telling me that I may be giving up commissions being a sub agent . Is this right?

When she sent me the paper work, there was no commission schedule attached and if I did get one, at this time, I'm not sure what commission amounts would be good deal or a lousy one.

What should I be looking out for? Am I really going to need someone local to work in this particular industry?

Thank you for your thoughts or suggestions about this.
 
As a sub-agent you are likely being paid by the agent.

Unless you have no other options in life, this is a complete no-no. You won't own the business, you will earn less commission, and when you leave, you have nothing.

Other than that, it's probably a good idea.:no:

Rick
 
The only reason to consider giving up your commissions is if there is a salary involved or *maybe* if there is some *great* training.

That being said, if the company you're talking is truly a GA with Aetna they can probably give you the same contracts as Aetna and you could be direct pay with Aetna. If you are direct pay from Aetna and they're offering to pay you, that's probably a pretty good deal for you and them, but probably a little more to your advantage than theirs.
 
There is training, she said no assignment of commissions, but there is no salary. I'm only going to earn commissions from what I produce. But since I will be a sub agent it still looks like I will not own the book of business and I would like to, because the residuals could be nice. I'm not getting a good feeling on this deal.

What are my other options?
 
There is training, she said no assignment of commissions, but there is no salary. I'm only going to earn commissions from what I produce. But since I will be a sub agent it still looks like I will not own the book of business and I would like to, because the residuals could be nice. I'm not getting a good feeling on this deal.

What are my other options?

It actually sounds like a very fair deal. Your commissions probably wouldn't be any different if you contracted directly (but worth checking). The local training is good and if you're getting commissions and renewals from the carrier, it's not like you're "paying" for having the training. Like the difference between buying direct from a carrier vs using an agent, it's still the same insurance and the same premium.

If you don't like the deal she's offering, insurance just might not be for you.
 
I agree with Rick. Something is astray.

I wouldn't sign anything at this time. The first thing you need to know is your commission and renewal in writing, not just verbally. Study the contract very carefully as in read each word. If you don't understand something ask.

Find out what "training" consists of, as in specific details. It should include in depth product knowledge as well as detailed information on how to sell the product. This should include a lot more than just a "ride along" or two.

Learning how to prospect is probably the number one thing you should inquire about. Are they going to teach you how to prospect and use the phone or are they going to throw some well used direct mail leads at you and say "go get'um tiger"?

Give me a call if you would like.
 
Back in the day I was recruiting sub-agents, I set them up as PPGAs that were paid by the company and were immediately vested on their BOB. If she cannot do something similar, I would run as fast as I could. You work too hard to produce your BOB to just turn it over to your GA should you choose to leave.
 
Back in the day I was recruiting sub-agents, I set them up as PPGAs that were paid by the company and were immediately vested on their BOB. If she cannot do something similar, I would run as fast as I could. You work too hard to produce your BOB to just turn it over to your GA should you choose to leave.

I second rousemark. Ask for a 1st year commission and renewal schedule. If not immediately vested run run run.

Ron
 
There is someone here in my local area who I believe operates as a General Agent, I'm pretty sure they are not an IMO, she is trying to recruit me as a Sub Agent for Aetna to sell Medicare products.

I'm licensed as a General lines agent, life and heath.

I contacted this person because I wanted to work with someone local to help me learn the business. So if I had an issue or problem, I'd have someone nearby to help me resolve it.

But there is something telling me that I may be giving up commissions being a sub agent . Is this right?

When she sent me the paper work, there was no commission schedule attached and if I did get one, at this time, I'm not sure what commission amounts would be good deal or a lousy one.

What should I be looking out for? Am I really going to need someone local to work in this particular industry?

Thank you for your thoughts or suggestions about this.

Being a sub-agent isn't necessarily bad. Just like with a normal GA contract, there are things you want to make sure of:
  1. Get your commission schedule in writing (1st yr and renewals)
  2. Don't assign commissions, ever.
  3. Make sure you are vested in your renewals on day 1.
  4. Most would suggest a pre-release.
 
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