Commission Split on Life Insurance with Customer?

[Newby]

You know this thread has just drew the outline of a perfect crime.

Scam artist lays trap with huge commission case. Shops for a crooked agent to take the bait.

Crooked agent takes the bait and kicks back half the commission to the scam artist thinking he is scamming the system but finds out he is the mark when the chargeback hits.

Can't report it because he was scammed while he thought he was the one pulling the scam.

There's the start of a good murder mystery novel there.

 

[PaperHanger]

I think this clip says it all for the op...classic Larry David stuff

https://youtu.be/SqTIrYK4BX4

 

[DHK]

I had posted a reply back few days back to this thread but somehow it did not appear in the thread.

I see we have tough crowd here, but I respect your blunt honestly.

I also see people have created assumptions on the commissions without inquiring about the details of policy. I am looking at a policy which will have approx 18K premium. I am also planning to overfund the PUA with 300K for first 2 years. I also plan to fund PUA going forward with 50-70K annually in years 3+. As I would like to do first 2 years together (back date policy), the commission would be ~20K in the first year itself. On going yearly commission would be ~$2.5K.

I know I will get flamed for saying this, but this is a very handsome reward for any agent for couple of days of work.

The question on commission split in the first year was asked by me with entire sincerity, as I did not find the answer to it anywhere on internet. The reason I asked it was because commission splits are very common in real estate and I did not want to overpay on policy by not knowing how WL works.

I know that there are many wise people in this forum who might understand cost value of money better than I do, but I am trying to learn and do the best I can. I am also doing my due diligence to make sure I get the best policy at best available terms

Thanks alot for your guidance. I honestly appreciate it!

Here's what I suggest then:

Get licensed yourself and buy some E&O. Get appointed with Guardian (you can do so as a broker). Design your own policy and buy it.

You can keep all the commissions and you don't even NEED another agent.

This plan would be 100% legal.

Oh, and you can even sell some "on the side" to others that you know, especially since you're already familiar with all the terminology.


But here's the thing: Yes, it may take me a "couple of days" NOW... but I've been in this industry a little over a decade. I'm bringing a decade of experience into the relationship... and THAT is what I am compensated for... not just a "couple of days of work".

----------

And how are YOU so sure of what the commissions are going to be?

I smell a troll... and I don't use that term lightly.

 

[pfg1]

I think there might be more to it. When I was in the mortgage business years ago, every time I worked with an Indian client they would haggle and beat me to death on everything. I realized that is their culture, they don't realize that in the US we don't operate the same way they do. I'm not trying to be prejudice or racist at all... its normal and common in that culture. Given his user name, just a guess but maybe that could be part of the situation.

Bottom line, its NOT legal to do. Asking an agent to take that kind of risk - well maybe some will take it, but I'm sure most won't. Like DHK said, get licensed and write the case if you want the commission $.

 

[Dweezil]

I had posted a reply back few days back to this thread but somehow it did not appear in the thread.

I see we have tough crowd here, but I respect your blunt honestly.

I also see people have created assumptions on the commissions without inquiring about the details of policy. I am looking at a policy which will have approx 18K premium. I am also planning to overfund the PUA with 300K for first 2 years. I also plan to fund PUA going forward with 50-70K annually in years 3+. As I would like to do first 2 years together (back date policy), the commission would be ~20K in the first year itself. On going yearly commission would be ~$2.5K.

I know I will get flamed for saying this, but this is a very handsome reward for any agent for couple of days of work.

The question on commission split in the first year was asked by me with entire sincerity, as I did not find the answer to it anywhere on internet. The reason I asked it was because commission splits are very common in real estate and I did not want to overpay on policy by not knowing how WL works.

I know that there are many wise people in this forum who might understand cost value of money better than I do, but I am trying to learn and do the best I can. I am also doing my due diligence to make sure I get the best policy at best available terms

Thanks alot for your guidance. I honestly appreciate it!

With whatever you do would you give your customers back 50% of your income on every transaction?

 

[ATM]

Folks,
Please forgive me if this question is not appropriate by any means.

Here is my challenge... I am an individual planning to buy life insurance for my personal family protection. I have been doing lots of research. I do not need much guidance and know pretty much what I need. I am looking for a specific policy from Guardian which is kind of close to my needs.

I am planning to buy a large policy but I hate losing first 2 years on investment in agent commission and other fees. Its sadly the ugly side of whole life insurance as consumer loses in first 5 years.

Is it ok for me to ask the agent to split his commission with me in the first year to soften the burden? This large fee/loss has kept me on the side lines for last couple of years and its just too hard to bite the bullet and take a substantial loss.

Please advice how to proceed. I dont want to offend someone and dont know if it is something that will be acceptable to the agent.

thanks

So you believe that you can be expert enough by doing some homework to pick the best policy for your needs v. seeking the advice of a qualified professional?

I'd suggest that you simply go about taking the life insurance licensing exam, contract with the company you wish to purchase a policy from, then you will earn 100% of the commissions.

In a year or two when you discover that the policy you thought was right isn't you can file a complaint against your agent and seek damages. You're E&O coverage will pay you again after you pay a small deductible. (Make sure to get a small deductible E&O policy).

 

[rrajeshh]

Thank you DHK!

I am sorry to have offended so many people in this forum which was never my intention. I know that is the only reason they are calling me what they are calling me. Never mind!

I am considering the route explained by you to look at getting a license.

I never meant to say that experience of a wise insurance agent should not be valued and should not be paid well. What I was trying to say was that I have not found one agent in last year whose has given me the guidance in the way you might have guided your clients.

Its never about commission but more about paying for services one receives. Most agents I have contacted were interested in just selling me some policy. I have ended up learning by reading books, reading forums, talking to people with policies and several agents to learn what I might have learnt. I also had one agent tell me that he wished he himself did know as much before he got policies for his family.

I am sure most agents in this forum as much more senior and know better.

Thanks again!

Here's what I suggest then:

Get licensed yourself and buy some E&O. Get appointed with Guardian (you can do so as a broker). Design your own policy and buy it.

You can keep all the commissions and you don't even NEED another agent.

This plan would be 100% legal.

Oh, and you can even sell some "on the side" to others that you know, especially since you're already familiar with all the terminology.


But here's the thing: Yes, it may take me a "couple of days" NOW... but I've been in this industry a little over a decade. I'm bringing a decade of experience into the relationship... and THAT is what I am compensated for... not just a "couple of days of work".

----------

And how are YOU so sure of what the commissions are going to be?

I smell a troll... and I don't use that term lightly.

 

[smokin goose]

I had posted a reply back few days back to this thread but somehow it did not appear in the thread. I see we have tough crowd here, but I respect your blunt honestly. I also see people have created assumptions on the commissions without inquiring about the details of policy. I am looking at a policy which will have approx 18K premium. I am also planning to overfund the PUA with 300K for first 2 years. I also plan to fund PUA going forward with 50-70K annually in years 3+. As I would like to do first 2 years together (back date policy), the commission would be ~20K in the first year itself. On going yearly commission would be ~$2.5K. I know I will get flamed for saying this, but this is a very handsome reward for any agent for couple of days of work. The question on commission split in the first year was asked by me with entire sincerity, as I did not find the answer to it anywhere on internet. The reason I asked it was because commission splits are very common in real estate and I did not want to overpay on policy by not knowing how WL works. I know that there are many wise people in this forum who might understand cost value of money better than I do, but I am trying to learn and do the best I can. I am also doing my due diligence to make sure I get the best policy at best available terms Thanks alot for your guidance. I honestly appreciate it!

That's your problem. You think it's only a couple days of work. It's likely been years of work for the agent to get to the point he is now.

You're wasting your's and your agent's time. Be a man and make a decision. Buy the damn policy or don't.

 

[Newby]

You know this thread has just drew the outline of a perfect crime. Scam artist lays trap with huge commission case. Shops for a crooked agent to take the bait. Crooked agent takes the bait and kicks back half the commission to the scam artist thinking he is scamming the system but finds out he is the mark when the chargeback hits. Can't report it because he was scammed while he thought he was the one pulling the scam. There's the start of a good murder mystery novel there.

Did I really type DREW?

I meant Drawed.

 

[Jerard]

Did I really type DREW?

I meant Drawed.

I think that's how they say it in Georgia. Go Gators!