GAs/FMOs/IMOs & Commissions

[Thatguy]

110% CORRECT! I've lost a small fortune over 10 years recruiting agents who either had no work ethic, not coachable,etc. I now almost look for reasons NOT to contract a new recruit. If an agent quits after a few months the GA will lose $$. If you recruit all the time you can lose your a-ss. From my calculations the GA needs a min. 35% override to not lose $$ on an agent quitting after just a few months.

If anyone disagrees please prove your point here with numbers, because numbers will not lie.

I wish someone could prove me wrong because I like recruiting and training.

I say you continue to contract new recruits, but be completely honest and upfront with them about what you are willing and not willing to do for them. If you explain to them how the system works, and that there is method to the madness of not starting out at a 120% contract, they may see the wisdom in this. If they do not, and all they can see is the contract level, then perhaps they belong somewhere else. If a freshmen in college wishes to be be called "Dr." then perhaps they should go through the process of earning their doctorate before they are entitled to the privilege and honor of the title. If they insist on being called something they are not, I'm sure there are FMOs out there that will do whatever the agent wants in order to recruit them. Your organization may never be huge, but it will be consistent and productive. I'm sure I don't have to tell you this as your years of experience has already taught you the wisdom against mass recruiting and offering the entire farm to a freshman.

 

[pomfin]

These posts are good ones. I hope new agents understand why the contract was setup like that.
One question, if an IMO signed up a GA and the GA had charge back and owe money to insurance company. Do that balance to be rolled up the IMO?

 

[Thatguy]

These posts are good ones. I hope new agents understand why the contract was setup like that.
One question, if an IMO signed up a GA and the GA had charge back and owe money to insurance company. Do that balance to be rolled up the IMO?

Unfortunately, yes. The chargeback (for all the companies I am aware) does roll up to the ultimate agency of contract.

 

[magagent]

I did not ask for proof of your production.. The reason I asked when I got into this business I worked through GA/MGAs that made 50-60% override off me, I was brand new in the industry and I had no idea a .65% contract was terrible. When I was on a .65% contract, I was also responsible for buying and developing my leads and being responsible for my own marketing. When I had a question or concern (being a rookie I had lots of them), I never had phone calls or emails returned.

Thatguy, I am not saying that you are doing this , in my experience outside of making a .60% override off of me the GA and MGA's did absolutely nothing and brought no value to the relationship.

I also lost a "small fortune" in relationship to recruiting and trainning agents.

 

[pomfin]

I did not ask for proof of your production.. The reason I asked when I got into this business I worked through GA/MGAs that made 50-60% override off me, I was brand new in the industry and I had no idea a .65% contract was terrible. When I was on a .65% contract, I was also responsible for buying and developing my leads and being responsible for my own marketing. When I had a question or concern (being a rookie I had lots of them), I never had phone calls or emails returned.

Thatguy, I am not saying that you are doing this , in my experience outside of making a .60% override off of me the GA and MGA's did absolutely nothing and brought no value to the relationship.

I also lost a "small fortune" in relationship to recruiting and trainning agents.

I still feel that 50%-60% contract is not that bad for brand new agent who need help/training and the agency provides it. Look, many established/captive companies give 50% contract without lead, only training. You have to pay office expense too. I have an agent who was with Bankers Life and Casualty who got 50% contract there. How many of the agents like that? a lot of them. There are also MLM type of business like Primerica. Their new agent gets 30% contract. It sucks but you still have not much luck to recruit them. So higher contract is not the only criterea but the relationship and environment.

 

[Thatguy]

I still feel that 50%-60% contract is not that bad for brand new agent who need help/training and the agency provides it. Look, many established/captive companies give 50% contract without lead, only training. You have to pay office expense too. I have an agent who was with Bankers Life and Casualty who got 50% contract there. How many of the agents like that? a lot of them. There are also MLM type of business like Primerica. Their new agent gets 30% contract. It sucks but you still have not much luck to recruit them. So higher contract is not the only criterea but the relationship and environment.

I don't disagree with you, only if you are going to keep 50%-60% then you should be able to add some value. I don't object to higher override at all; I just think it should be substantiated.

 

[pomfin]

I don't disagree with you, only if you are going to keep 50%-60% then you should be able to add some value. I don't object to higher override at all; I just think it should be substantiated.

It should be mutually benefitial. I don't think the agency can get away with high over-ride without providing help to the agent. Otherwise, the agent leaves and the agency loss more.

 

[Thatguy]

It should be mutually benefitial. I don't think the agency can get away with high over-ride without providing help to the agent. Otherwise, the agent leaves and the agency loss more.

You would think this logic would be obvious to most people; alas, that is not the case. There are many agencies that throw people up against the wall and see who sticks. They take their 70% override off of the agent for about 4 months then the agent stops writing and then they do it to the next agent. It's good money, and there's nothing illegal about what they do. Caveat Emptor, do your research or you'll run into agencies like this. Now if the agency was keeping 70% and offering the agent all the tools needed to succeed, then I think that 50% of something is better than 100% of nothing. It is just my opinion that the value added should match the override retained.

 

[pomfin]

You would think this logic would be obvious to most people; alas, that is not the case. There are many agencies that throw people up against the wall and see who sticks. They take their 70% override off of the agent for about 4 months then the agent stops writing and then they do it to the next agent. It's good money, and there's nothing illegal about what they do. Caveat Emptor, do your research or you'll run into agencies like this. Now if the agency was keeping 70% and offering the agent all the tools needed to succeed, then I think that 50% of something is better than 100% of nothing. It is just my opinion that the value added should match the override retained.

You made good point. That is why such forum can help agents. A good agency has to care about their reputation. An insurance agent on this forum knows what is going on.