Commissions at an Independent Agency

Nov 4, 2016

  1. RickA0110
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    RickA0110 New Member

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    I have been working as an agent for just over 2 years now. I work for an Independent Agency and our lead carrier is Erie. This is my first job so I don't have any prior experience in the industry and I want to make sure I am not being taken advantage of. Right now, I get 40% of the commission on all the accounts I write. Is this average, low, or high? To me it seems low, considering I get less then half of the commission for all policies I write. But for all I know, it could be good. I just want to be sure I'm not getting ripped off.

    Does anybody know the average commission percentage for agents working at an independent agency?
     
  2. hesse
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    hesse Guru

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    40% on both new and renewal?
     
    hesse, Nov 4, 2016
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  3. RickA0110
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    RickA0110 New Member

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    Yes. 40% of the commission not the premium
     
  4. GoPokes
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    GoPokes Guru

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    What kind of insurance are you selling?
     
    GoPokes, Nov 4, 2016
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  5. Schwetty
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    Schwetty Super Genius

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    most agencies that I have seen give much larger for new business, but much less on renewals.
     
  6. myinsurebiz
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    myinsurebiz Guru

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    What type of insurance? Do you get free leads? Do you have an office


     
  7. ifailedshapes
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    ifailedshapes New Member

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    Do you have a base salary or hourly wage?
     
  8. VolAgent
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    VolAgent Guru

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    Don't forget, the office, staff, software, insurance, marketing, supplies, etc. aren't free. Unless you are directly paying for any of this, then the cost is baked into your commission split. Also, the agency owner has to make a profit. If the profit doesn't justify the headache (and yes you are a headache, no matter how good you are) then the agency isn't going to do it.

    Finally, if you are also getting 40% of the renewal commission, that is pretty nice. You income will only grow as you build a book of business with the agency.
     
    VolAgent, Nov 21, 2016
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  9. RickA0110
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    RickA0110 New Member

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    Property and Casualty.
     
  10. Rick Deckard
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    Rick Deckard Guru

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    A lot of folks myself included are worried about the back end and basically doing all the work and then handing it over to someone else for just a fraction.

    If you can swing for something like 50/40 or 60/40 after your 12-24 months start up period when you are likely to get a small salary.

    Year 1: $36k salary, 40/25 split...I kind of understand if someone will actually teach you the ropes.

    Assume you sell a $500k book.

    Year 2: $24k salary, 50/30

    Year 3: 60/40 with no salary...

    You should have a $1MM+ book. That would be about $40k in back end money plus you will likely bring in another $500k-$1MM...that's another $30k-$60k depending on how hungry you are but a 6 figure income by year 3 should be achievable, $75k if you fall woefully sort.

    Anyone disagree here?
     
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