How Hard Are Direct Appointments to Get?

[indienoise]

What state are you in?

If I remember correctly from a previous thread, this individual is from tx. South Carolina is not as heavy on nonstandard, but it's close. Nonstandard makes up 60-70 percent of my business. If all i could get at first is nonstandard, it would be ok. I would have volume to show in pretty short order.

Due to the nature of my customers, even though they are mostly nonstandard, my loss ratio is pretty good as well. I dont know what it is currently but around this time last year it was around 35-40%.

 

[djs]

.... The reality of the situation, which I realize may be a little unique, is if there is not an AOR change that takes place, the business will be lost to both of us. The amount of business from this satellite office is not enough to be worth his while to establish his own office here (I provided everything tangible - office space, equipment, and my own leads/referral sources, the only reason I accepted these arrangements was my lack of experience at the time - I hadn't planned on leaving when I started, but things do change). He would be leasing a new office, purchasing new furniture/equipment, and hiring a new employee (who would have to be bilingual, by the way) for about $40k/year in gross revenue (not profit) IF all the customers stayed with him (none of them have any idea who he is), all about 25 miles from his own office......... which is why I'm more than happy offering a commission split to the current principal as a concession. What would you do if you were him?

.... Really, my biggest unknown is whether I can still get appointed with the same carrier through their independent channel. ....

Forgive me, but these statements don't add up.....

Their is 200K in premium at the office. Not large, but a decent start. If I was the current agent, I would either hire someone to maintain the book or if I couldn't do that, I would sell it. Of course, that would mean yes, you could buy it if you want. This is much easier than client driven AOR changes.

If the current policies are in a captive agent arrangement, it is doubtful the carrier will allow an AOR to an independent agent, though it may be possible. You would have to ask, but generally, internal to the carrier, this is 2 different businesses anyway.

 

[indienoise]

Forgive me, but these statements don't add up.....

Their is 200K in premium at the office. Not large, but a decent start. If I was the current agent, I would either hire someone to maintain the book or if I couldn't do that, I would sell it. Of course, that would mean yes, you could buy it if you want. This is much easier than client driven AOR changes.

If the current policies are in a captive agent arrangement, it is doubtful the carrier will allow an AOR to an independent agent, though it may be possible. You would have to ask, but generally, internal to the carrier, this is 2 different businesses anyway.

I dont know the finer details, but being that nationwide is pushing their independent distribution channels (allied), and titan and victoria are already available to independent shops, i could imagine some sort of areangement hopefully taking place. Though I realize I would still have to abide by my non compete to the effect of not soliciting nationwide policyholders on the behalf of other carriers for a set time. I could live with that.

Also, i have no clue how the whole aor change thing works, so i apologize if i wasnt clear, but the idea the whole time has been to facilitate the change with a buy-out of some sort. Assuming nationwide allows it to go from an exclusive to a non exclusive agency. Which is kind of silly anyway given the whole brokerage arrangement with qualifying exclusive agents.