I'm Not Sure this is Fair..

[itsjustrachel]

I've spent the last week or two reading through a lot of threads because I am completely new to the insurance industry. The broker that I am going to be working for paid for my pre licensing classes, background check and licensing exam. I will receive training from the insurers we work with and there is one CSR working in the office (I'm not sure if she will be servicing my accounts). We had a brief conversation a few weeks ago and he said that I would make 25% on new business and 50% on renewals. From what I have read on this forum that seems to be really low for new business. I appreciate what he has done for me but I also want to be treated fairly. Any thoughts?

 

[pcbinsurance]

And remember.....25% isn't really 25%. It's 25% of the 10-14% they typically make.
You should ask for 50% of that.

 

[itsjustrachel]

That is exactly what I was thinking. What is the lowest I should accept? 40-45% or stay firm with the 50%?

 

[Sales71]

That is exactly what I was thinking. What is the lowest I should accept? 40-45% or stay firm with the 50%?

I am sure its not commission only pay. How much is your hourly pay?
Are you working for a captive agent or broker? is it Allstate?

 

[itsjustrachel]

No salary or hourly pay..it's for a broker.

 

[Josh]

Something doesn't add up. They're paying you less for new business than renewals?

 

[Tucker444]

From what I can tell 40% seems to the most used number I see.

With that said I don't think you should judge a deal you make based on threads here.

There are a lot of factors that play in to coming up with what percentage is paid.

Location
Line of Business
Carrier Premiums Paid to the Agency
Your Experience
What do you "bring" to the agency (Opportunities)
How much support is provided to you. (CSR, Marketing, Accounting, Advertising, Travel Expense ect...)
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Something doesn't add up. They're paying you less for new business than renewals?

I know...BUT I just signed with a wholesaler who does this.

They pay more on renewal. Not so much of a spread but non the less I was surprised.

But in talking to them it made sense.

Like us the first year is always the most expensive in obtaining new business.

The renewal (hopefully) is less time consuming for us and them.

Incentives you to not move business and to build a longer term relationship.

 

[b61mack]

You probably got in backward, 50/25. That sound more like it. I wouldn't worry about the %.

 

[itsjustrachel]

He definitely said 50% on renewals...either way I have known him for many years and I am excited he is giving me the opportunity but I don't think I can make enough money to survive with only 25% on new business. I don't mean to sound ungrateful.
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You're right Tucker, I don't bring much to the table except my work ethic which is what prompted the broker to put me through the classes. I guess I will just ask for an explanation for the low percentage and see if he is willing to increase the percentage over time. I appreciate all of you offering your help..good food for thought.

 

[Josh]

To some degree it depends on what lines. If you're good at hunting down larger cases, 25% can add up, especially with the renewals.