FMO or Not?

[John C. Osborn]

As an FMO with both Humana and UHC I'd recommend going with a local FMO because through their organization you have the opportunity to learn about market trends and you have support when something occurs. Also, they if it is a worthy organization they will have product meetings, handle contract processing and on one or more occassion I have made sure the lone agent gets paid from the big insurance company because when the FMO generates enough volume of business they get additional support people to keep their hierarchy happy. Many times as a "direct" agent you will not receive an option on a higher contract based on production (not always the case), get the answers to questions about competition and they will force feed you the info for only their company as opposed to getting the info you need to be productive in the field. Rember the market is constantly changing and the FMO/MGA is responsible for getting things prepared so you can be up to date on those changes. A company is responsible for their profitability which is not always in the best interest of your clients. JCO

 

[jdeasy]

I just passed my LA&H state exam,AHIP and obtained my E&O insurance. Should I go through a FMO or directly to a large corp.Humana or UHC?

It looks like you need to go the FMO route. Go with one that offers training and support. That's what you need right now. Get an upfront release so that you can move elsewhere once you have enough training to make it.

One other thing, stay as far away from Humana as possible.

 

[retread]

what would you recommend Retread?

1) If at possible, go direct with the carrier. Ask if there are any production requirements and make sure you know where to go for help if you have any commission problems.
(Just remember: You are on your own... and carrier Sales Managers, whether district or regional, can be scoundrels, too. They are working their way up the corporate ladder, so don't look to them for any help... you won't get it.)

Sometimes carriers will contract independent agents on a temporary basis, such as Medicare Advantage Organizations MAOs... that ramp up for a "sales season", and then pull back when it is over. Ovations (UHC) does this with their ICA contracts.

2) If a direct contract can't be arranged, scour this forum (search) for any scumbag FMOs and avoid them. There ARE some good FMOs out there, they are just hard to find. Unfortunately we have to work from a position of avoidance of known scumbags in most cases.

3) ALWAYS read the contracts offered you THOROUGHLY. DO NOT SIGN ANY CONTRACT THAT HAS BLANKS TO BE FILLED LATER. Get or make a copy of all the pages in the contract. Read it. Then read it again. Spend a few days thinking about it, and then read it again. (When I was new, a contract's signature page was shoved at me without any of the rest of the contract... be careful of these tactics).
Trust, but verify (a la Reagan).

It would be great if you had an attorney look over the contract, but most attorneys don't know much about the insurance distribution channel. They will only look at the commercial law aspect. A contract may be legal and still have provisions that will hook you. There are too many UNDISCLOSED side agreements between the NMO/IMO/FMO and the carrier that you are not privy to.

4) Demand full disclosure of your hierarchy, and check them out.

Sometimes the FMO will have a "partner" FMO, and you will be nested under a pair of FMOs... as in the case with Senior Marketing Specialists/AIMC or Pinnacle Financial Services/Premier Senior Marketing, etc. You may have to dig for this info... it is often not voluntarily shared. Yes, you can have multiple FMOs you work under on one contract and not know it! FMOs may contract under another FMO.

The standard distribution channel runs something like this: A National Marketing Organization (NMO) will have many (often hundreds, if not thousands) Field Marketing Organizations (FMO) under them, who, in turn MAY have Managing General Agents (MGA) that have under them General Agents (GA) that may recruit Solicitor Only Agents (SOA). This chain is not always in place in every contract, but if you are an SOA, recognize that everyone above you will take a slice of your commission. Most new agents start out with an SOA contract because their performance is not known and need training. SOA contracts are the poorest. Never sign one that has a long term... and realize that if you leave your GA, you will leave your hard-earned business behind.

An Independent Marketing Organization (IMO) may or may not be in the fray. They may be the only one between a GA and the carrier... or they may in between an FMO and the carrier or NMO.

The distribution channel is not set in stone. As a matter of fact, you might sign up under a GA that is totally ignorant of his upline. It happens. IMOs, FMOs, MGAs, and some GAs are dedicated to recruiting agents. They are salesmen... some ethical, and some not, just like agents. Be ethical yourself, and don't associate with those that aren't, whether other agents or upline.

If you have some background in Sales, you may negotiate a GA contract on your own, but it may come with production requirements. The GA contract is often called "Street Level" because this is about the highest level you can enter at if you are new or one-man agency. If you recruit another GA, you will be known as the Managing GA (MGA).

5) Ask for a pre-negotiated release IN WRITING. If that is denied, (don't take their word, "OH, not a problem"... believe me, if you don't have it in writing, you don't have one) this raises a red flag. Proceed with caution.

6) When you are sure you can abide by the terms and conditions of the contract, then sign it and submit it. Be prepared to honor your committment to that contract.

7) If you get burned, let us know here. Post your results on the forum for all to see. Hope for the best, but expect the worst.

 

[AttillaTheOne]

This is last thougth on this subject from little old me.

I am an INDEPENDENT Career Agent with United Health Care.

I am EXCLUSIVE to their MAPD products.

I can sell ANY MEDICARE SUPPLEMENT PLAN I want BUT and this is a big Butt, the AARP Premiums here in NW FLA are great.
The commissions on the supps are OK before all you experts chime in. I know that but I am over 21 and not too mentally disabled as to make that decision.

I DO NOT receive REDUCED commission levels by being direct. I did two years ago PLUS had escrows held back which I will never see when I was with an unnamed FMO out of Mississippi.

I have more FREE leads from UHC than God has angels or Obama has Czars.

Thanks for listening.

I thank God every day I have this position as an ICA with UHC BUT...
when that widowed Nigerian Princess finally sends me the 14 million bucks, all of you can kiss my hairy white cheekbones!!!

God Bless Us One and All Tiny Tim!!!

 

[Yoda]

I feel sorry for any new agents that get sucked in by FMO's and general agents trolling this board for victims er i mean agents. Ask yourself this mr and mrs new agent.......if these FMO's and General agents are so lame and tight assed that they will sink er i me slink onto insurance forums like this to recruit what makes you think they are not going to be tight asses and lame when it comes to giving you any support. Thats the worst thing about this web sight is they allow leaches and bloodsuckers to use it to troll for agents did I say that yet?

 

[Josh]

I feel sorry for any new agents that get sucked in by FMO's and general agents trolling this board for victims er i mean agents. Ask yourself this mr and mrs new agent.......if these FMO's and General agents are so lame and tight assed that they will sink er i me slink onto insurance forums like this to recruit what makes you think they are not going to be tight asses and lame when it comes to giving you any support. Thats the worst thing about this web sight is they allow leaches and bloodsuckers to use it to troll for agents did I say that yet?

"web sight", is that really what you're going with? There are some fantastic FMO's on here, why are you trashing everyone? Especially trashing Frank, he's easily one of the nicest guys on here.

 

[Yoda]

MED SOLUTIONS SAID- "There are some fantastic FMO's on here,"
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Thats pure BS.! These guys are a bunch of vultures hanging out in this forum looking for fresh meat!

 

[G.Gordon]

MSP,

Any time you have beef with something Yoda says just remember my sig line..

 

[Guest]

Tristen,Thanks I researched Cutler&Assoc. and feel very confident with my decision to go through them. Where else does a company list the direct phone number to the owner on the "contact us" page on their website. Thanks again!

 

[Yoda]

GORDON SAID- "MSP,

Any time you have beef with something Yoda says just remember my sig line.."
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Siggies are for women and feminine men. Is that what you wanted to hear?