Getting Direct Carrier Appointments for New IA

[aopc]

I am on my way to getting my P&C license. Although I do not have prior experience as an agent, I have a pipeline with new business already established and will be taking over a small book of business ~$500k premiums/annually, exclusively in commercial auto.

As a new IA, how difficult will it be to obtain direct appointments with carriers that provide commercial auto? Specifically, will carriers be looking for certain minimums, such as time in business, # of policies, and/or total premium amounts in order to qualify for and obtain an appointment? What is the average length of time to get an appointment for someone starting with a small book of business? What are the average producer minimums for direct carrier appointments?

I have also read that networking with carrier reps is extremely beneficial. Any tips for a newbie on the best way to find and network with carrier reps, either online or through joining industry groups and attending industry events?

Many thanks for any insights!

 

[fed up]

Many insurance carriers are switching to make their agents independent so many carriers are looking for independent agencies right now. Not sure if they are dropping the need for experience over the need to have more placement. Nationwide Insurance agents were flooded with requests to sign as independent agencies with different carriers once their company plan took effect.

 

[shawnmwalker]

AOPC,

You are entering at a tough time in a tough nitche. What kind of Commercial Auto? Commercial trucking/ long haul trucking- an even bigger up hill climb that will be close to impossible.

The 500k in WP is small so not much to leverage there for new appointments. Your Experience is nill and carriers are worried about a guy like you blowing them up after getting killed for the last decade.

I had a friend tell me. When you are losing money by the truck loads, you don't got get a fleet of bigger trucks. You go get the tonka trucks.

There is much more to be said on this thread.

Networking with reps is good. BIG I meetings. Good luck! Sorry to deliver bad news.

Commercial Auto Insurers Report Worst Losses in Decade: AM Best

 

[fed up]

You are entering at a tough time in a tough nitche. What kind of Commercial Auto? Commercial trucking/ long haul trucking- an even bigger up hill climb that will be close to impossible.

Commercial Auto is generally NOT commercial trucking and losses can be reduced by requiring customers to submit information from MVR;s for anyone on the policy and then listening to the insurer about adding that driver.

 

[shawnmwalker]

So if we silo the two out. (Commercial auto and commercial trucking), which I am fine with. It is still an up hill battle just not as drastic as commercial trucking.....see link above.

As it relates to Long Haul trucking- Again, loosing money by the truck load...get smaller trucks...not newly licensed agents (writing a tricky line of business that is making no money) with little idea what they are doing, helping you loose more money. Trying to get the carrier to get bigger trucks, because they don't understand that selling a widget (A Policy) in insurance does not always = Profit, like in other industries.

How insurance companies make money and what they do when times are good and bad:

 

[aopc]

AOPC,

You are entering at a tough time in a tough nitche. What kind of Commercial Auto? Commercial trucking/ long haul trucking- an even bigger up hill climb that will be close to impossible.

The 500k in WP is small so not much to leverage there for new appointments. Your Experience is nill and carriers are worried about a guy like you blowing them up after getting killed for the last decade.

I had a friend tell me. When you are losing money by the truck loads, you don't got get a fleet of bigger trucks. You go get the tonka trucks.

There is much more to be said on this thread.

Networking with reps is good. BIG I meetings. Good luck! Sorry to deliver bad news.

Commercial Auto Insurers Report Worst Losses in Decade: AM Best

Really appreciate the insight. Unfortunately, the niche is commercial trucking/long-haul trucking. However, the pipeline I have is robust and could double the existing ~500k WP I have in waiting by the end of the year. Another advantage that I will have is that I will have access to the telematics data. Loss ratios for the current book are also astoundingly low <5%, which will be attractive to carriers. The uphill battle is not unexpected and I'm willing to put in the time to build up the book. Just trying to get a sense of how long and what it will take to get carriers to work with me, so that come renewal time next year, I'll have the carrier appointments to renew the book I've built up at good rates. Any advice on the best way to achieve this despite the experience handicap? I'm hoping that by renewal time next year, the year of experience I'll have acquired will put me in contention to work with carriers.

 

[shawnmwalker]

AOPC,

I wish you the best of luck but it is probably not going to go well. I hope it does, Honestly. I hope you rub it in my face when it does, nicely.

But the 500k WP book comprised of Long Haul trucking is small. It is probably written through brokers and not direct appointments …maybe one, and not a strong one....but it is a book that is contending with agencies that are not in the same league as as you will be. If it had the markets it needed it would be dramatically larger.

There are certain lines of business that have very limited carriers that like to play in certain markets. Imagine writing a policy for the BMW dealer down the street. There are very limited carriers that want to do that. (Like 4) Imagine wanting to write the E&O policy for a $450 million Insurance agency (HUGE Prem, sure) but only 4 carriers want to do that.

Same with Long Haul. (Very limited carriers want to do it and they don't want to do it with a new agent even if his pipeline is huge- money and truck loads/ widgets) If the agency had the real tools it needed it would be a lot larger than 500k. If it does not have the tools it needs it is competing against those that do. More importantly, experience, Truck loads of money, what was said above, etc.

I am not sure how this opp came about? Who you re talking to? What you are buying or inheriting. But you deserve to have a frank conversation with some folks about what you are getting into.

 

[aopc]

AOPC,

I wish you the best of luck but it is probably not going to go well. I hope it does, Honestly. I hope you rub it in my face when it does, nicely.

But the 500k WP book comprised of Long Haul trucking is small. It is probably written through brokers and not direct appointments …maybe one, and not a strong one....but it is a book that is contending with agencies that are not in the same league as as you will be. If it had the markets it needed it would be dramatically larger.

There are certain lines of business that have very limited carriers that like to play in certain markets. Imagine writing a policy for the BMW dealer down the street. There are very limited carriers that want to do that. (Like 4) Imagine wanting to write the E&O policy for a $450 million Insurance agency (HUGE Prem, sure) but only 4 carriers want to do that.

Same with Long Haul. (Very limited carriers want to do it and they don't want to do it with a new agent even if his pipeline is huge- money and truck loads/ widgets) If the agency had the real tools it needed it would be a lot larger than 500k. If it does not have the tools it needs it is competing against those that do. More importantly, experience, Truck loads of money, what was said above, etc.

I am not sure how this opp came about? Who you re talking to? What you are buying or inheriting. But you deserve to have a frank conversation with some folks about what you are getting into.

That's a great question. I own a commercial trucking company. We are poised to double this year and are looking to vertically integrate since we already do most of the work in house (endorsements, claims handling, etc). Given this, do you recommend working with a cluster or MGA first to reach a certain size before chasing carrier appointments? If so, what is the threshold that would make us attractive for carrier appointments to obtain the most competitive rates?

 

[shawnmwalker]

AOPC,

I have met many in your exact situation. They have the same thought. But braking into this specific line is not going to go the way you think it is. It is hard to understand as a new agent to the industry, but the tons of business you have readily available does not tempt the 4 carriers (# is an example) that are actively writing in this specific line of business... Because they know every widget/policy sold (Right now) could actually be costing them money. Or the more widgets we get form the new agent AOPC is costing them more money.

Someone is then yelling down a hallway, "Who the HeLLLL appointed AOPC! Get that guy in my office, he is dead to me!" J/K of course.

 

[EugeneM]

Going to be hard to get directs. Respectively the chances of a newly licensed agent getting a long haul direct appointment is slim. It is 100% a niche and you typically want to be familiar with the entire package. GL, Phys damage, cargo etc... it takes a lot of knowledge. I would be looking for a mentor. Learning the industry properly is a lot more important than retaining 100% of the commission. At least initially.

STAY AWAY FROM TRUCKING RRG's. Do not write business with anyone under a B+ rating.

Don't expect anything easy about getting appointed. The vetting process is extremely rigorous. Most sought after carriers like Berkshire for example are not in any hurry to appoint new agents. Its BHHC so they already feel like they are properly represented in the states unless you can get their attention. No shame in using a wholesaler until you build up more volume.