Commission Split

[SecondCareer]

I am beginning to talk to a few indepenant agencies in the Chicagoland area and was wondering what would be some average commission splits in P&C. It would be mostly personaI but some commercial as well. I would be straight commision, no benefits, cell phone, etc. I would produce all of my own leads but would have some training. I know this is a common thread but was looking for a little advice.

 

[Markthebroker]

Talk to @BADTROUT, and look out for sharks on here.

 

[BADTROUT]

Hello! Splits vary so much depending on your region and how many carriers your agency has, or how long they have been marketing in the area. For a 20 year agency with a broad selection of carrier options, your job will be easier I would expect something less than 60/40. For a newer less established agency or market foothold, I would expect more.

If I were to move into Illinois with my agency even with established carriers the time and cumbersome nature of opening a new territory would have me expecting to pay a producer 75/25.

Your level of experience is critical as well. If this is new to you, the value of having mentorship is critical but doesnt come free or cheap so expect that to lower your commission exectations.

Best of luck, and feel free to reach out with details and I can certainly let you know if an offer you get is fair or not.

Sometimes 50/25 is a good deal, sometimes it's practically criminal.

 

[SecondCareer]

I don’t have the most experience so I will be having some mentoring, and it will be a relatively new agency. Not sure on how many carriers they will have.

 

[Dreamiekid]

I don’t have the most experience so I will be having some mentoring, and it will be a relatively new agency. Not sure on how many carriers they will have.

If you're new, why not start off as a captive or a hourly job in a agency. You can learn it faster and then when you feel like you can run solo then try straight commission.

 

[Jazz10]

If you are providing all your own leads and referral sources I would not take less than a 50/50 split. I would not expect an agency to give you more than that since they will be paying for your E&O and supplying you with their carriers. Also make sure they do not have a no compete clause and you can take your clients with you should you decide to open your own shop in the future.

 

[SecondCareer]

One place is predominately commercial, which I don’t have much experience in at all. They will provide extensive training. They provide all service and incur all other expenses. Would that change the commission structure? Not sure if commercial is different than personal.

 

[Danimal]

Hello! Sometimes 50/25 is a good deal, sometimes it's practically criminal.

When you say 50/25 you mean the producing agent gets 50% of the agency’s commission in year 1 and 25% on renewals?

 

[BADTROUT]

When you say 50/25 you mean the producing agent gets 50% of the agency’s commission in year 1 and 25% on renewals?

Yes sorry, that's what I meant... NB/Renewal

 

[Mike007]

It just depends on the agency. The truth is there are no set contracts. It just depends on who you talk to. Check your local help wanted ads. The younger the agency, the less production an agency makes, the more willing they will give you a larger piece of the pie. The more established, the less they will give you.

It just depends on the owner of that agency. Based on my experience and what I've seen in my area, it's going to be around 50%-80% for new business. Renewal business range from 40%-70% if you are doing all the work and zero benefits from the agency.

In my opinion, don't take anything lower than 50% new business, 50% renewal business.