Captive or not?

Mar 27, 2007

  1. Agent12
    Offline

    Agent12 New Member

    Posts:
    8
    Likes Received:
    0
    hi guys,

    i have a question. for a new agent to the insurance industry, what would you guys recommend, signed exclusively with a reputed insurance company and go captive or go independent and contract with various carriers?

    i'm debating whether or not to go captive. i plan on selling life, annuity, p and c.

    i have to factored in the demographic area where i will do most of my selling. the customers are very sensitive to price. they rarely cared about whom they buy their insurance from.

    here are my considerations: state farm, aflec, american family, allstate and farmers.

    thanks in advance.

    Tom
     
    Agent12, Mar 27, 2007
    #1
  2. johnrocks
    Offline

    johnrocks Guru

    Posts:
    430
    Likes Received:
    0
    Personally I "think" I would give captive a year or so if you don't have ins. exp. The training would/should be invaluable and the financial output on your part won't be nearly as great.
     
  3. natem2112
    Offline

    natem2112 Super Genius

    Posts:
    112
    Likes Received:
    0
    The choice is really up to you. But we would need to know a bit more about you, "in order to dole out advice".

    You say the customers rarely care about who the buy their insurance from, well, get used to this mindset, it doesn't change.

    They should really only be caring about one thing, what type of agent they buy from, and do they trust them?

    You listed a few companies and also mentioned you wanted to sell a whole list of products like life, annuity, property & casualty ect.

    Companies you also listed are state farm, aflec, american family, allstate and farmers.

    I'm assuming you are in a Midwestern state because you mentioned Am Fam, but I am puzzled by your Aflac mention, they only offer supplemental products and have an extremely high turn over, more due to the nature of the products then the company though.

    So to help us help you:

    What have you been doing for the past 10 years?
    Have you been in sales before?
    What kind of sales?
    Are you good with people?
    How are you with rejection?
    Why the insurance industry?
    Anything else we should know?

    This is a board where you truly will get unbiased advice from agents from all walks of life. Most are established agents and have an idea of what it takes to start something from scratch and build it, which by the way is what 99% of the insurance companies will expect you to do.

    The ball is in your court my friend.;)
     
  4. Frank Stastny
    Offline

    Frank Stastny Guru

    Posts:
    7,069
    Likes Received:
    19
    State:
    Florida
    I'm not sure there is a "good" answer to your question. There are advantages and disadvantages to both.

    If you have no experience and don't know the all of the deatils and options of the policies, you are going to have to get training somewhere. If you become captive you should receive some help with those things. Should being the operative word.

    You are talking about selling both P&C and L&H. A very ambitious undertaking for one just starting out. Most agents usually specialize in one to three types of insurance and try to learn them well. You may be the exceptional agent who is capable of quickly picking up everything one needs to know about both lines of insurance in an extremely short period of time.

    Agents can do their client a great dis-service by not being extremely well informed about the products they sell.

    I've never sold P&C but isn't there a fairly substantial investment the agent has to make? I don't know any State Farm agents who work out of their home office. (State Farm may pay for all of that.) With L&H it is pretty easy to get started as there isn't any large out-lay of money to begin selling.

    I would think your first decision would be, do you want to be a P&C or L&H agent when you first get started. (You can always expand into more areas when you get more experience.) When you make that decision then decide what products in either category you want to begin with.

    Next on your agenda should be where can you get training in the products you want to begin with of you decide to go independent. And, how long can you live without an income since it will take a while to begin making sales and receiving your commission.

    I have found good training in L&H to be kind of "thin" even as a captive agent. And, as Natem said, we need to know more about what your goals are and how much experience you have if any.

    I knew nothing about insurance when I started. Still have a lot to learn and I've been at it for more than a few years.

    If you go captive you will most likely have to sign a contract that will state, among other things, that if you leave before you are vested your renewals stay with the company. That means that you can work for two or three years as a captive agent, feel that you now know enough to go independent only to find out that you will be starting over with no income.

    Once a captive agent starts making money the company pretty well owns the agent. Most cannot afford to give up the money they are receiving and start all over again. With some companies the time it takes to become vested can be many years.
     
  5. johnrocks
    Offline

    johnrocks Guru

    Posts:
    430
    Likes Received:
    0
    You know I remember when I was a "young thang" there would be people that did it all. I even remember a full service insurance AND real estate agency.. This was of course before computers in every office but they seemed to juggle it all pretty well, times have really changed.
     
  6. Cenla Agent
    Offline

    Cenla Agent Guru

    Posts:
    1,026
    Likes Received:
    7
    State:
    Louisiana
    I have seen a few insurance AND real estate agencies in smaller towns lately.
     
  7. salpro22
    Offline

    salpro22 Guru

    Posts:
    1,966
    Likes Received:
    29
    State:
    Texas
    "Ok, so we are going to sign you up for the Max Plan w/ a $2000 deductible, suite solutions package B, a lovely 3 bedroom, 2 bath house completed furnished, as well as signing you up w/ a new homeowner's plan, auto plan, motorycle plan, boat plan, and identity theft protection. Is there anything we missed?" "I just need you to fill out this short packet of information containing 48 pages and you will be ready to go..ok"
     
    salpro22, Mar 28, 2007
    #7
  8. Agent12
    Offline

    Agent12 New Member

    Posts:
    8
    Likes Received:
    0
    Sorry for the delayed response, I've been away from my computer completing my courses for my upcoming exam dates.

    I've been a recruiter for a small staffing agency for almost 1 and a half years now. With this, I've done many field work that includes building to building solicitations, field meeting with top executives and HR personnels and employee interviews. I also have done some telemarketing in my earlier years.

    I see a money potential in selling insurance, and since I've done selling and cold calling before I knew insurance would be right for me. It's a matter of time and how will I know a company's products.

    I appreciate all the warm comments and contributions, you guys all have gave. I find this forum very useful and helpful to my new career path.

    With little or no experience in the insurance industry, I might decide to go captive for a while before become an independent agent. I can picture how materialistically useful and helpful a captive agent can benefit from invaluable insurance company's training sessions. I like the idea. I think this is the plan, I will go captive with one of the three reputed insurance companies.

    Again, thanks for everyone's input, it's greatly appreciated!

    Tom
     
    Agent12, Mar 28, 2007
    #8
  9. joshril
    Offline

    joshril Guru

    Posts:
    1,326
    Likes Received:
    3
    State:
    Oregon
    I hear NASE and UA have a good captive agent program....
     
    joshril, Mar 28, 2007
    #9
  10. Frank Stastny
    Offline

    Frank Stastny Guru

    Posts:
    7,069
    Likes Received:
    19
    State:
    Florida
    UA (United American) was a dynamite company in the early and mid 90's. Their Med Supp policies were very competitive and in Missouri they were the only issue age company selling Med Supps.

    Because of failure in upgrading the health questions on their apps their premiums on Med Supps soared out of sight.

    Last time I checked they were selling "health" policies to small business owners and individuals looking for an inexpensive policy.

    Some of the health agents on the board I'm sure can give you more specific information. UA may not be your best choice today.
     
Loading...