Is Joining a Cluster Really my Best Option?

[Pacman2012]

I'm looking to go independent in the near future and doing my research. I've been a top captive agent for AAA for a short time and a top producer st state farm for 3 years before I turned down theiragency offer . I eventually want to go independent and I'm not sure if my captive track record will get me direct appointments immediately but I have experience writing a business plan (state farm) and I have proof of my p&c sales numbers. If I can't get a direct appointment from a preferred carrier I'd prefer to go substandard, build a book and then get the appointments. Is there anything wrong with my logic? I was offered to work as a producer for a broker I know but I feel that'd be a waste of time as I've already been a producer and want to move forward not sideways. Any advice or sub standard carriers I could get appointments through in north Texas? Thank you very much

 

[AgentWillN]

It all depends on the cluster and the contract you make with them. Shop around for the right cluster that fits your needs.
With your experience however, I can't imagine anyone turning you down if you decide to go directly.

 

[Pacman2012]

It all depends on the cluster and the contract you make with them. Shop around for the right cluster that fits your needs.
With your experience however, I can't imagine anyone turning you down if you decide to go directly.

I thought they might and i have figures to back everything. Do you know of some of the companies I could go to? I just don't like the idea of coming out of pocket 10-20k and then giving someone a cut of my commissions for the privilege of writing business.

 

[AgentWillN]

There are plenty of Clusters that you could choose from. Some are more local, others National. With that being said, you may want to do a simple Google search to see what is available in your area.

 

[Pacman2012]

There are plenty of Clusters that you could choose from. Some are more local, others National. With that being said, you may want to do a simple Google search to see what is available in your area.

Sorry I was asking more specifically for companies directly to get appointments with. Bothstandard or non standard . I know of a few like progressive and liberty mutual, but I can't seem to find any non standard or too many outside of those few I found

 

[Sales71]

Sorry I was asking more specifically for companies directly to get appointments with. Bothstandard or non standard . I know of a few like progressive and liberty mutual, but I can't seem to find any non standard or too many outside of those few I found

Even if you get a direct contract let say with Nationwide they would want you to do 250k in new premium in your first year. Very hard to do when your starting out no clients and no referrals yet. Going with a cluster, alliance will lower the premium commitment to a manageable amount . No free lunch but with the Alliance you can grow fast than on your own.

 

[Pacman2012]

Even if you get a direct contract let say with Nationwide they would want you to do 250k in new premium in your first year. Very hard to do when your starting out no clients and no referrals yet. Going with a cluster, alliance will lower the premium commitment to a manageable amount . No free lunch but with the Alliance you can grow fast than on your own.

Woah. Did not know that. Well it sounds like almosh everyone I hear from has started through aa cluster. No regrets? Also I hear alliance thrown around quite a bit. Good place to start looking?

 

[shawnmwalker]

Well you have a decision tree here. I'll lead you down one path, but it is biased.

"Begin with the end in mind"- 7 habits of Highly effective people.

Decision #1:

What end of the Ins Spectrum do you want? if you answered P&C keep reading. If ''Other" wait for the others to respond

Decision #2: Captive or Independent.

Captive:
Pro: They will teach you a lot but inevitably you will go Indy at some point in your career. Another Pro, they will subsidize your life for a time.
Con: The District Manager will push too hard or force life on you or cut your commissions or change your contract, or, ext, ext. Your Captive will take rate increases and kill your production and you will have one price point while others dissect your book one policy at a time.

Independent: :
Pro: Control expenses. Get higher commission. Higher conversion. Higher retention. All of those factors equal more money.
Con: Starting out. Getting knowledge. Your personality type could sink yourself.

Decision #3:

Once you decide Indy is for you, in the next week or 22 yrs from now. The question will be how to do it. Your options include:

Buy an agency.
Join a group.
Become a producer for an agency.
Get direct appointments.
Get an agency that provides the back end service so you can hunt full time.

You decide which one is best for you.


Decision #4: What group should I join?

There are a lot. Consider the following. NOT ALL GROUPS ARE CREATED EQUAL! They range from good, better and best.

Any group claiming to be best of class should provide the following:
1. Transparency
2. Training and support
3. Carrier Alignment
4. and a great Contract
Give me a call, shoot me am IM. Good luck and have fun with your choices.

 

[Pacman2012]

Awesome advice! Thanks! I sent you an IM

 

[shawnmwalker]

You are at Decision #3.

Start and Agency or go to a Group/ Cluster.

I don't address why joining a cluster is best, I just jump to that choice. Let me take a second and explain from my perspective.

IF YOU JOIN THE RIGHT GROUP OR CLUSTER

You will make more money, short term and long term.

You will bonus from dollar one.

You will have ownership and exit options.

Min requirements are diminished dramatically.

The power of the group gets you unprecedented access to carriers, overrides, additional comp you will never see for a significant amount of time if you go solo.

Bonuses are often paid on a matrix of variables. (Growth, profit, and Size of book) The larger the book the larger the variable. So not only do you bonus from dollar one, but instead of a bonus one day on a 250k book at .72% you now bonus at 8.2% from the get go (example only, not too far off)

The math always works.

Have fun, enjoy making decision #3. If you find you want to explore the Group route call me.