For New Final Expense Agents: 4 Final Expense Contract Scams To Avoid

[DHK]

You're not thinking it through. And Tom needs to be clearer, he is referring to debt roll up. Chargeback risk is the same either way, but once it turns to debt roll up then the higher comp is definitely risker to the agency.

If the total payout is 120% and 50% went to the agent and 70% went to the agency, the agency is only out 50%. After all, they are simply returning the 70%, they only have to come up with the 50% the agent received. So the higher the comp to the agent, the more risk if there is a debt roll up.

That's right. I forgot about actually COLLECTING on it from the agent (or the agent producing more business). Important point.

 

[DHK]

Yea it is. Where does the money come from!?

The majority of the first two years of the policy's premiums is generally part of what the insurance company pays for acquisition costs.

 

[rousemark]

The majority of the first two years of the policy's premiums is generally part of what the insurance company pays for acquisition costs.

I have one company that pays 80% first year, 48% second year, 20% third at the street level.. Makes a lot more sense for the company and in the long run for the agent that writes persistent business..

 

[VolAgent]

I have one company that pays 80% first year, 48% second year, 20% third at the street level.. Makes a lot more sense for the company and in the long run for the agent that writes persistent business..

While I wasn't around in your day, I have to assume most of the high FYC comes from getting rid of the agency system and its over head plus moving most of the renewals forward. Really doesn't reward agents who keep business on the books beyond a year or two.

Yes, I realize that IMOs and the like get overrides, but in most agency systems doesn't the carrier also pick up all the cost for the office, staff, etc.?

 

[chasejordan1]

You're not thinking it through. And Tom needs to be clearer, he is referring to debt roll up. Chargeback risk is the same either way, but once it turns to debt roll up then the higher comp is definitely risker to the agency.

If the total payout is 120% and 50% went to the agent and 70% went to the agency, the agency is only out 50%. After all, they are simply returning the 70%, they only have to come up with the 50% the agent received. So the higher the comp to the agent, the more risk if there is a debt roll up.

The problem is "Tom" doesn't understand the numbers. Simple math he has a hard time with. Based on his plan and based on all the stars aligning he will only profit $17 per sale.

 

[VolAgent]

The problem is "Tom" doesn't understand the numbers. Simple math he has a hard time with. Based on his plan and based on all the stars aligning he will only profit $17 per sale.

I've leaving that one alone. I know David well enough that I knew he would understand when I pointed out what he was missing.

 

[HoosierLife]

I think y'all are discussing 2 different people.

 

[chasejordan1]

I think y'all are discussing 2 different people.

I understood. He was explaining something to DHK "David" I am just commenting on Tom.

 

[VolAgent]

I think y'all are discussing 2 different people.

Only one confused here is you.

 

[goillini52]

I think y'all are discussing 2 different people.

Are you starting to get a Southern accent Josh? Is Ben's accent starting to rub off on you?