Considering Becoming an Agent, Seeking Advice

[J.R.]

1) What are actual commission rates (industry averages, specific to Farmers, specific to any company in the industry, achieved by independent agents) on home and auto policies sold as (a) new business (b) renewals?

2) What is fair commission for me (as a licensed agent working under a
senior agent) to earn on home and auto (a) new business written (b)
renewals.
What is a typical compensation scheme for someone just starting off?
What is my take, and what is his take?

3) What are actual life commissions, and what would be fair to ask for
as my take?

Thanks again!

I have seen you bring this up before so hopefully this advice will help. I have NO PRIOR KNOWLEDGE of the P & C world but that is actually in your favor because I don't know. Start off at 100% or whatever you think is right. Im not sure if auto pays the same as life, but who cares....you're negotiating..

Negotiating 203 teaches us that you reach for the moon and either stop at your realistic goal and know when to walk away.

Agent: What level would you like to be at?
You: 100%
Agent: I can't do that!
You: What can you do?
Agent: 10%
You: Wow! how did you come up with that number?......What are you expectations of me?
Agent: yadda, yadda, yadda.
You: It seems like...... repeat yadda part.
Agent: That's about right.
You: What do I get in return?

And it goes on until both parties reach their goal... Personally, I would focus more on learning from him as your boss/mentor vs. the commission level you start off with. You can always negotiate that as well after a probationary period.

 

[Frank Stastny]

Hey J.R.

I don't mean to be unkind, but do you have a feeling he is putting us on? He keeps asking the same questions over and over and over again.

I think everyone in this thread has given him great advice and suggestions and he just keeps asking the same questions.

EspeciallyInMich,

It's real simple. You go to your boss and have a face to face with him. You need to be asking him these questions, not us any longer. We have given you our best suggestions and advice.

Now it's time for you to get a pair and go in and talk to him. If you can't handle that then how are you going to deal with prospects and prospecting?

Cut the best deal you can with him. If he doesn't give you what you want then walk. If you are willing to settle for what he offers then be happy with it and get on with the business of selling insurance.

It sounds like you expect us to do that for you. I am very leery of someone who is constantly asking others to do their "work" for them.

If you want to know what other agents who work for the company are getting then go find some and ask. We don't know! That is your job, not ours. I like to think this board is composed of agents who are willing to help each other, not baby sit.

Sorry if that sounds a little harsh, if it does, it is probably because it is. You have already stated that you are only in it to make a lot of money fast. If you are really serious about this, the kind of "serious" it is going to take to be extremely financially successful in a short period of time, then I believe you would have already taken care of this part by yourself.

 

[J.R.]

Hey J.R.

I don't mean to be unkind, but do you have a feeling he is putting us on? He keeps asking the same questions over and over and over again.

I think everyone in this thread has given him great advice and suggestions and he just keeps asking the same questions.

EspeciallyInMich,

It's real simple. You go to your boss and have a face to face with him. You need to be asking him these questions, not us any longer. We have given you our best suggestions and advice.

Now it's time for you to get a pair and go in and talk to him. If you can't handle that then how are you going to deal with prospects and prospecting?

Cut the best deal you can with him. If he doesn't give you what you want then walk. If you are willing to settle for what he offers then be happy with it and get on with the business of selling insurance.

It sounds like you expect us to do that for you. I am very leery of someone who is constantly asking others to do their "work" for them.

If you want to know what other agents who work for the company are getting then go find some and ask. We don't know! That is your job, not ours. I like to think this board is composed of agents who are willing to help each other, not baby sit.

Sorry if that sounds a little harsh, if it does, it is probably because it is. You have already stated that you are only in it to make a lot of money fast. If you are really serious about this, the kind of "serious" it is going to take to be extremely financially successful in a short period of time, then I believe you would have already taken care of this part by yourself.

You can lead a horse to water but you can't make em drink!

What you can do is have some delicious [SIZE=-1]venecin. [/SIZE].

 

[senior-advisor-indiana]

Frank, what if you do not have a pair because of an accident? It's not me, its a friend. Should I tell him to take a different career path unless he can get a surgery done to make his pair?

 

[SME]

Thanks again for your replies. I was wondering if anyone can answer the specific questions below - any data you can provide would definitely be helpful. Or if you can refer me to another avenue to ask these questions, that would be fine as well.

1) What are actual commission rates (industry averages, specific to Farmers, specific to any company in the industry, achieved by independent agents) on home and auto policies sold as (a) new business (b) renewals?

2) What is fair commission for me (as a licensed agent working under a
senior agent) to earn on home and auto (a) new business written (b)
renewals.
What is a typical compensation scheme for someone just starting off?
What is my take, and what is his take?

3) What are actual life commissions, and what would be fair to ask for
as my take?

Thanks again!

I'm going to try and give you a little more of what I think you are looking for. Personally I have not sold P&C for several years. But at my last agency I had an agent start around the same time I did and he told me about his contract. So here is what I know.
1.) He stated that the average P&C commission was between 10 and 15%. Which is about the same as health. I have no idea about renewals.
2.) He and I both had a base salary based on our experience. I think his was $28,000 as he was newly licensed and had no experience. Commissions were 15% of the commission recieved with increases depending on the size of your book of business. At the top was 35%. I believe that renewals were the same. You have to remember that he will be paying your salary, equipment and benefits so he will be taking a financial hit on you for at least a year. By keeping a higher percentage of your commissions he will be recouping those costs.
3.) Life commissions range from 70-100% of first year premiums depending on the carrier and product.

For simplicity purposes I would recommend that you request a flat commission percentage for all lines. The easier it is to understand the easier it will be to get approved. Also you don't know yet what lines you will like best or sell the most of so having things even across the board will allow you to find out without hurting your income. Get EVERYTHING in writing, signed, dated, and notarized. Make sure that you understand how incentives, bonuses, and trips will be handled. If you work your a** off selling a ton with one company and then the senior agent gets the reward for it you won't be very happy. Hope that helps.
Steph

 

[Frank Stastny]

Frank, what if you do not have a pair because of an accident? It's not me, its a friend. Should I tell him to take a different career path unless he can get a surgery done to make his pair?

Tell him to join a castrati chior, he will make a fortune singing in the soprano section.

Or, he could hang a couple of oranges around his waist. Missouri isn't Texas but we do things here in a "big way" here also.

 

[EspeciallyInMich]

I'm going to try and give you a little more of what I think you are looking for. Personally I have not sold P&C for several years. But at my last agency I had an agent start around the same time I did and he told me about his contract. So here is what I know.
1.) He stated that the average P&C commission was between 10 and 15%. Which is about the same as health. I have no idea about renewals.
2.) He and I both had a base salary based on our experience. I think his was $28,000 as he was newly licensed and had no experience. Commissions were 15% of the commission recieved with increases depending on the size of your book of business. At the top was 35%. I believe that renewals were the same. You have to remember that he will be paying your salary, equipment and benefits so he will be taking a financial hit on you for at least a year. By keeping a higher percentage of your commissions he will be recouping those costs.
3.) Life commissions range from 70-100% of first year premiums depending on the carrier and product.

For simplicity purposes I would recommend that you request a flat commission percentage for all lines. The easier it is to understand the easier it will be to get approved. Also you don't know yet what lines you will like best or sell the most of so having things even across the board will allow you to find out without hurting your income. Get EVERYTHING in writing, signed, dated, and notarized. Make sure that you understand how incentives, bonuses, and trips will be handled. If you work your a** off selling a ton with one company and then the senior agent gets the reward for it you won't be very happy. Hope that helps.
Steph

Steph, Thanks for your very constructive advice. I really appreciate it!

To the rest of you... thanks for nothing. I have no need to defend my masculinity to a bunch of idiots who can hide behind their computer screen. If you notice I asked for some specific questions to be answered, not your opinions.

If anyone else has anything to add to Steph's experience, I'd be glad to hear it. Thanks.

 

[senior-advisor-indiana]

You are in big trouble for those comments. You better start some editing.... or else...

 

[nate124]

You asked questions... people gave you answers.... Geeze, this guy doesn't appreciate anything! This board is full of successful insurance agents. If you don't want opinions from them, who do you want opinions from?? Agents who have failed??

If you are going to be successful in this business you need to learn to listen to people who are successful, learn what worked for them, and adapt it to your personality and selling style. This forum really gives anyone who will listen the opportunity to do that.

I agree with Indiana... start doing some editing, or don't bother posting on here anymore. Don't be surprised when your next question goes unanswered!

 

[SME]

In his defense he did not recieve specific answers to his questions. This is a new agent who wants to know where to start. He has no basis to start negotiating with his boss and was looking for a place to start. How can you negotiate what your commission should be if you have no idea what the industry standard is? It's all good and well to give theories or negotiating techniques but without justifiable numbers you will never know if it is a fair offer.
What he wanted to know was very basic, how much should he expect to start at and how much is the going rate for his experience. I think this is a very difficult question for this board to answer as so many of us are independent and not captive. After reviewing the board I see that many people gave him advice but not the solid numbers he was seeking.
There is a tendency here for people to get on thier high horses and decide that thier way is the only way. Some people are captive, some independent. Some self employed some not. But we all have to start somewhere, and what he wanted to know is if he starts here where will he be in 2 years? Are his expectations reasonable? What should his expectations be? Maybe solid answers don't exist as everyones experiences are different. Personally I think it is because it is so easy to forget where we started, and how we get to where we are. Try to look back at your first insurance job and think about all of the things you wish you would have known then. Are they the same questions he is now asking us?