Captive Agent Looking To Go Independent in TX-Any Tips Please!

[Stng5Pnt8]

Long story short, I have been offering P&C Insurance for nearly 20 years. Started in the non-standard market in TX as well and eventually took the leap and opened up shop 6-7 years ago with a captive carrier in TX.

Too many changes, majority are backhand slaps to the agency force and really feeling like it is time to plan my exit strategy before things become worst.

Any tips on what options out there may be the best? My wife worked for a good 5 years at my agency as a licensed sales agent because leaving to care for our baby. She still maintains her P&C and Life/Health license, we have a nanny for the baby now and she is ready to get something going again. Thought it may be more beneficial having her open up her own independent agency. May also help so we have a cushion when I leave, or I could just go all in myself and have her as a producer. Either way is fine.

Any tips? Don't like the Goosehead model, Smart Choice seems ok but I've heard the delays with quoting and just as bad as Superior Access. I've heard of clusters you can sign up with, I would hate to however sign up and then be held hostage and feel like I am once again an employee 1099 contractor as with my current captive agency model.

Any suggestions would be greatly appreciated.
Thanks!

 

[marindependent]

The first step for many is to go work for P&C agency and learn from them. That is the cheap and efficient first step. You might not make any money as a producer at State Farm but you will quickly learn how things are done. Or you can try and set up your own agency and spend 3 years making mistakes. From the sounds of it, you might have already done part of this working with other agencies.

The next step is to spend months researching and creating a business plan. What types of clients do you wish to serve? What types of products will you offer? How will you market? Will you have an office? Will you have an online presence? What will be your specialty? Will you have employees? How much seed money do you have?

People can blast Superior Access all they want, but its a cheap entry point and most new standalone agencies fail. There are a lot better options out there, for sure, but until you have 250 clients you really do not have much leverage and speaking with lots of clusters might not prove useful.

What you might be looking for [my words not yours] is a cluster to teach you how to run an independent insurance agency. That is a wholly different search than the best cluster for access or commissions.

 

[Stng5Pnt8]

The first step for many is to go work for P&C agency and learn from them. That is the cheap and efficient first step. You might not make any money as a producer at State Farm but you will quickly learn how things are done. Or you can try and set up your own agency and spend 3 years making mistakes. From the sounds of it, you might have already done part of this working with other agencies.

The next step is to spend months researching and creating a business plan. What types of clients do you wish to serve? What types of products will you offer? How will you market? Will you have an office? Will you have an online presence? What will be your specialty? Will you have employees? How much seed money do you have?

People can blast Superior Access all they want, but its a cheap entry point and most new standalone agencies fail. There are a lot better options out there, for sure, but until you have 250 clients you really do not have much leverage and speaking with lots of clusters might not prove useful.

What you might be looking for [my words not yours] is a cluster to teach you how to run an independent insurance agency. That is a wholly different search than the best cluster for access or commissions.

Thanks for the reply. I already have a $3.8mill P&C book already and $500k commercial book, built from scratch.
I started out and spent over 14 years running several independent agencies and 20+ agents. My main concern at this point is shifting from captive to independent and getting into a contract that is cheap on the front end and costly in the long run.

 

[AZDave]

Many groups to look at and they are all created differently. Maybe @shawnmwalker or @BADTROUT will chime in...

Your location in TX may help or hurt. Of course everyone wants profit, and the good Groups will only take you on with a profitable agency.

I would take a good look at Canyon Lands Insurance.

But if the agency is just for your wife, your options may be limited.

Good Luck! It is a big decision!

 

[cador]

A couple years ago I ran into an agency out of Colorado, called Colorado Ins Agency. They had what seemed to me a pretty great deal for a Personal Lines Agent wanting to open his own gig (I'm a Commercial Agent and wasn't really interested, although the more I checked into it, sure peaked my interest).
Great markets, they did ALL the servicing and renewing for you, you didn't need to hire anyone or open an office, just sell. If I remember the commission correctly was 12 first year, and 6 renewal. For what they did, I thought it sounded like pretty good deal.
The agency had good reviews, and good website, and good reviews on the corp employees and service. However, it was the most unprofessional interview/meeting process I've experienced in my 50 plus yrs. The Sales Director, or whatever they called her, forgot about our first zoom meeting, so we rescheduled and was 30 minutes late to that pne, and during the entire 2cd meeting she was yelling at her 4/5 yr old the whole time (was unbelievable, and kinda funny at the same time), very strange. Wonder if they ever knew they had such an *** marketing agents for their co (looks like she's with another co doing the same thing according to Linkedin).
I do not remember any upfront fees or such as I've heard from the other Co's doing the same, may be worth checking into.

 

[shawnmwalker]

Would love to chat with you When you decide to make the move. Where in TX are you? That will impact the groups that will talk.

DFW is a bit of a hard market right now. Some groups wont tell you that! They'll just say, "sign here"

Call me we can figure out what you are trying to do and help appropriately.

Last but not least.....Find a group that Does so much more than ACCESS. Access is the first of many deliverables! It would be a shame to join a group, just to get access and not additional support.

Find a group that does MORE. - YouTube

 

[shawnmwalker]

@cador,

Many agents from other agencies (Maybe even the one you listed) have come to PGI elated with the Deliverable and freedom we have offered them after experiencing what you have described.

 

[shawnmwalker]

AZ Dave is right.....

Trout is a good guy! The Canyonland Ladies are great Ladies. I think they just hired Woody. He too is a great guy.

 

[BADTROUT]

@Stng5Pnt8 I think the most important thing is for you to determine a fit based on an aggregation of answers you get from many sources. One of the best things you can do is compile a list, of things you should ask. I can get you started with these. Any network you interview will answer some or all of these and it will allow you to compare.

There is no one perfect network and as mentioned by @AZDave and @shawnmwalker there are many outstanding people and places to hang your hat but only you, by asking the right questions will be able to determine which is the best. I hope this helps! It's a canned list so if you notice anything missing let me know.

1. Do you have a good carrier mix across the lines of business I want to use in my agency?

2. Are those carriers competitive in my region specifically?

3. Do you have any production requirements?

4. Do you provide an agency management system?

5. Do you provide a comparative rater(s)?

6. Do you have a non-compete or non-solicitation if I decide your network isn't for me? If so... why?

7. Do you have any exit fees?

8. Can I sell my agency at some point?

9. If I sell my agency, do you take a cut?

10. HOW do I access the carriers? Do I submit everything to you, or do I get access with binding authority?

11. How long is my contract for, and do I get ownership right away, or over time?

12. What are the startup fees and are you willing to work with me if I need to make payments?

13. What is the commission rate?

14. Do you have a cap on the commission split or do you take your split forever?

15. What share do I get of the contingency bonuses (If any)?

16. What is the criteria for participation the contingency bonuses (if applicable)?

17. Do you offer guidance and training during the startup phase of my agency and a spirit of mentorship throughout the relationship?

18. Are you open to me contacting some of your member agencies before I sign the contract?

19. May I have an attorney, or third-party consultant review my contract with me?

20. How much industry experience does your network leadership have?

21. Do you offer customer service support for my customers, or is that support up to me? If applicable, how much commission do I have to give up in exchange for this support?

22. May I contract with other carriers outside of your network?

23. How long have you been in business and how many agencies do you have in your network?

24. I think the MOST important thing someone can do other than reading the contracts of many networks is to speak to the owner/CEO/president of each network to get a feel for the culture. Let's face it, some people you like the minute you meet them, and then there are others well, not so much... If you find they don't have the time to talk to you... message me your contact info and I will make time for you.

One thing to note... This is just as much an interview of you to be a good fit for a prospective agency network. No network wants to be the quick unthought-through decision and asking these questions will strengthen the relationship with your chosen group. There are subtle nuances each network option will bring to the table and each will stress some areas over others. At the end of these questions though as you are reviewing each of them carefully, I hope you find your answer far more clear than when you started.

If you find this helpful, do me a favor and remember where you got it, and drop me a line to tell me what you ended up deciding and how you are doing! Good luck on your adventure!

 

[shawnmwalker]

That's a good list, Trout. Everyone, Ask those questions!

A few other good questions:

1. Is my agency name on the Dec page or is it going to read the agency name of the Group?
2. E&O?
3. Am I directly contracted with carriers or do I just get a user name and Id under a house code? (If it is a User name and Id- your Agency name is not on the dec.)
4. Can you provide a Service Center for me, so I can just sell?
5. Do I have to be locked into the service center for the life time of the contract? Can I opt out?
6. In the carriers eyes, under this contract, who owns the business?
7. Can I take my business and my codes with me if I decide to leave?
8. For groups that suggest, you can come and go as you please...Can you show me examples of what occurred when the last agent left you? How that occurred, and how they successfully took their book of business with them? (Agency management reports could show how that book was there one day and gone the next, or at least going quickly....)

Remember folks there are four prongs to figure out as you court the groups. Find a few that do all four, then take a few to the finish line:

• Transparency between the home office and the Agency: There is a lot of extra comp on the table, you want to know where it all is and how you get your hands on it. you want to join a group that shares that....CONTRACTUALLY!
• Training and Support: Join a group with the ability to train and support you in 1:1 settings forever. (We have 6 Full time personal lines trainers and a lot on the Commercial side.)
• Carrier alignment: Everyone thinks this is the easy one to figure out so they ask, "Can you get me access to carriers?" The answer is "yes" and they move on to another prong. Don't! Many of Trout's questions above are great and relate to this prong. Many of my questions above relate to this question. This is not a quick and easy prong. Go deep here.
• A killer contract- We have 4 killer contracts. They are all great. But to Trout's point, one contract is not for all.