Looking for People's Opinions

[pcguy]

I've been a long time lurker here on the site and appreciate people's knowledge and experience. I've read a bunch of posts from people in similar situations but mine's a little different and looking for any advise.

I've been a successful commercial P&C agent for over 10 years with 1 agency. In the past year and a half or so the management has begun to slip and the service staff have become lazy, costing me accounts. I've been promised ownership in the agency for 3 years now with no sign of it actually happening. Seems to just be a giant carrot to keep me there. I've expressed my concerns with the service staff and my complaints have gone ignored. The icing, I believe I have a low commission payout (vs. industry avg.)

I've recently been presented an opportunity to purchase an existing captive book/office comparable in size to my current book. Under perfect circumstances I would probably not consider a captive, but since I don't own my current book, I'd essentially be starting over if I went to another independent agency. Plus, I'm really at a point where I'd like to run my own office and get more incorporate the LA&H and financial planning side.

I've also considered asking to have my current employment status terminated and sign a contract with the same agency as a 1099 with control of my book (and higher commission split) and ability to hire my own staff and broaden my product base.

Sorry for the wordy post but hoping someone can offer some pearls of wisdom or another alternative. Thanks!

 

[jacksprat]

I've been a long time lurker here on the site and appreciate people's knowledge and experience. I've read a bunch of posts from people in similar situations but mine's a little different and looking for any advise.

I've been a successful commercial P&C agent for over 10 years with 1 agency. In the past year and a half or so the management has begun to slip and the service staff have become lazy, costing me accounts. I've been promised ownership in the agency for 3 years now with no sign of it actually happening. Seems to just be a giant carrot to keep me there. I've expressed my concerns with the service staff and my complaints have gone ignored. The icing, I believe I have a low commission payout (vs. industry avg.)

I've recently been presented an opportunity to purchase an existing captive book/office comparable in size to my current book. Under perfect circumstances I would probably not consider a captive, but since I don't own my current book, I'd essentially be starting over if I went to another independent agency. Plus, I'm really at a point where I'd like to run my own office and get more incorporate the LA&H and financial planning side.

I've also considered asking to have my current employment status terminated and sign a contract with the same agency as a 1099 with control of my book (and higher commission split) and ability to hire my own staff and broaden my product base.

Sorry for the wordy post but hoping someone can offer some pearls of wisdom or another alternative. Thanks!

First, I just heard of a friend paying 3X yearly commissions for a captive book. The insurance company had very little to no competitive advantage in the area where the agency located. Products were not good. (a well known national company) Things did not work out and the company pulled the license buying back the book at 1 1/2X. A sad situation.

As for 1099, had an employee who (wanted to go it alone) failed to account for all the expenses that need to be paid from commissions. Such as, both sides of SS tax etc..

Have you talked with the agency principle about the service? Hard to believe the owner would tolerate bad service. In this cut throat business, service is the big difference most times.
.

 

[pcguy]

I have discussed the situation with more than one of the principals on a number of occassions and on each was told they would look into it. Nothing has come of it. I believe its primarily a result of the staff prioritizing the principals accounts over the other producers, so the principals don't see the issues we do. It turns into their word vs. ours and it's easier to believe what you want than replace staff.

Also, without going into a lot of detail, in recent years the office has more personal drama than a soap opera. I ignored the drama until is started costing me commission. Now it's effecting me personally and need to figure out what to do.

 

[xrac]

I have discussed the situation with more than one of the principals on a number of occassions and on each was told they would look into it. Nothing has come of it. I believe its primarily a result of the staff prioritizing the principals accounts over the other producers, so the principals don't see the issues we do. It turns into their word vs. ours and it's easier to believe what you want than replace staff. Also, without going into a lot of detail, in recent years the office has more personal drama than a soap opera. I ignored the drama until is started costing me commission. Now it's effecting me personally and need to figure out what to do.

Office situations where staff cater to higher ups and ignore underlings or where patty cake is going on between staff and management can be demoralizing. I left a good position at least partially due to those kind of things.

 

[jacksprat]

Drama. Yeah unfortunate part of office culture. We had to threaten to fire all involved one day, and then things improved a bit.

It seems some "go getter" types are also a little over the top personalities.


Back to the bad service. I know it may be hard, but maybe you could have a talk with the lost accounts to give an "unsolicited" review of the lack of service letter. That is, if you have (or had) a good relationship with the lost accounts.

The 1099 thing may be an alternative if you have a good grasp of the financial situation.

I don't know the area your in or if you are young enough to start an agency, but this is the softest market for us in a long time.

As for captive, we have always been independent. It took us a good four to five years to build the agency to where we were able to hire help.
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[pcguy]

Office situations where staff cater to higher ups and ignore underlings or where patty cake is going on between staff and management can be demoralizing. I left a good position at least partially due to those kind of things.

Yes, patty cake and grab a**. I'm still young and do understand the financial aspects of being 1099'd, so I could probably handle it. I just don't want to get into a situation where I've cut off my nose to spite my face.

I also had an opportunity to speak with the friend of a friend who's a local Nationwide sales manager. It sounds as though Nationwide is positioning themselves to appear as independent agents and giving more latititude to use other markets. That makes them a little more interesting than a strict captive like Allstate and State Farm.