Building an Agency from Scratch.

[Mega producer]

I am trying to build a FE agency from scratch, recruiting newly licensed agents. I have street level comm with Americo, UHL, Oxford and Assurity. I have requested an MGA contract from my IMO.

What level should I settle for, 120%, 130% etc, and what would be a fair comm level to place the new agents, considering lead cost is $390 per 1000 mail dropped. Leads will be free to the agents.

Please respond if you have experience in agency building.

 

[Mega producer]

NO. am not. I am not really active in health insurance, except medicare plans.

 

[Stratos]

I would do a business breakdown of projected annual sales.
Example if your agents do a 1 million is annual premium, at
120%, your office will bring in 1.2 million, then you have to take away dropoffs, cancelation, etc. Then figure that you will spend between $25 and $30k a year per agent in leads.

1 million in sales..
At 120%
$1.2 million to the office.
-$840,000 - Commissions paid out at 70% contracts
__________
= $360,000 left
- $180,000 in Lead dept
_________
$180,000 left
- $120,000 in Cancelations, dropoffs, etc. at 10%
___________
= $60,000 left for you.

Now those number are just approximate.
I guestimated that you will spend $30k in leads per $200,000 of AP written.

Of course I could be way off....

 

[retread]

Also, Mega...what kind of agency do you want to start?

Meaning, a call center where the agents work for you?And you take the lion' share of compensation or are wanting to just be a GA , help secure top contracts for agents....like Health Choice One?

Interesting way you juxtapose a telemarketing organization using LOAs (call center in your description?) to the distribution channel utilizing an MGA who recruits GAs (the standard model)... I think the "call center" concept you use describes the setup that produces the problem agents we are faced with.

Although most view a "call center" as a telemarketing organization using a predictive dialer and unlicensed telemarketers cold calling for leads, your description is quite revealing... the shady operations we all know and loathe. I know of one such group, or "call center" that operates in the manner you describe. Have others on the forum witnessed this structured model? IOW, how common are they? (I'm not referring to UA, NAA, etc.... although this is a close resemblence)

 

[Mega producer]

Thanks stratos for your contribution, I most certainly will do the numbers.

Folks, my question is Final expense, (FE), I have no interest in health insurance, or Mega life, or telemarketing.

 

[retread]

These call centers are everywhere....

Which type call centers are you referring to? Telemarketing for Leads to re-sell to agents, or Recruiting LOAs to sell insurance? (apparently you didn't understand my former question)

 

[retread]

Both

Interesting! I guess because Lead Telemarketing call centers advertise prolificly they seem ubiquitous, and the others cloak their existence because they run shady operations. Am I close?

 

[retread]

I'd say so..Some call center's don't advertise in the paper...just hire by word of mouth.

I have a problem with describing a local agency that hires LOAs and provides a cubicle to place calls which they followup with sales calls, a "call center". It seems to me to be misleading.

Call it what it is: a local agency. A "call center" hires unlicensed people to place telemarketing calls. That's all these people do: place phone calls.

Just because a group of guys are given the use of a small desk to place calls does not make it a "call center". An agency must use licensed agents. If you don't want to call it an agency, then call it an "agent center" or something. Why drum up a term that doesn't describe the function clearly?

 

[jsrconcepts]

I run a Final Expense Operation Completely over the phone, My LOA Agents Get Free Leads and a Great Contract and work from their home. There is nothing wrong with contracting LOA Agents as long as you have a Real Corporation. I would say there is no way possible to do Final Expense on the Street with giving agents Free Leads and a 70 + Point Contract. It isn't Real.

If Training is Provided
I would say Free leads 60 Point Contract.
Pay for their own leads 80 Point Contract.

No training
I would Say Free Leads 60 Point Contract.
Pay for their Own Leads 90 Point Contract.

You have to remember that your Corporation neeeds to make money.

You can't give free leads and a High Contract, You will start losing money fast.

You can give a High Contract and they pay for their leads, then you just create an extra Income from a 10 to 15 percent Overide.
- - - - - - - - - - - - - - - - - -
LOA Agents are Fully Licensed, they just are Contracted Differently. Instead of Signing a GA Contract they sign an LOA Contract. That is the Best way to build an Agency if you are giving Free Leads, Hands Down.

 

[retread]

I run a Final Expense Operation Completely over the phone, My LOA Agents Get Free Leads and a Great Contract and work from their home. There is nothing wrong with contracting LOA Agents as long as you have a Real Corporation. I would say there is no way possible to do Final Expense on the Street with giving agents Free Leads and a 70 + Point Contract. It isn't Real.

If Training is Provided
I would say Free leads 60 Point Contract.
Pay for their own leads 80 Point Contract.

No training
I would Say Free Leads 60 Point Contract.
Pay for their Own Leads 90 Point Contract.

You have to remember that your Corporation neeeds to make money.

You can't give free leads and a High Contract, You will start losing money fast.

You can give a High Contract and they pay for their leads, then you just create an extra Income from a 10 to 15 percent Overide.
- - - - - - - - - - - - - - - - - -
LOA Agents are Fully Licensed, they just are Contracted Differently. Instead of Signing a GA Contract they sign an LOA Contract. That is the Best way to build an Agency if you are giving Free Leads, Hands Down.

Just make sure the agent knows what he is signing. It should be mandatory to make sure newly licensed agents know how a distribution channel works so that they know where they fit in.