Need Help with Choice Please.

[Josh]

The problem is that it's not on a straight commission and that is not what the SF would be paying her to do. The SF would be paying her to build their book of business, not for her to create her own. If she doesn't like it then she needs to go work at another place, but to keep records of the clients someone else paid you to get for them and then to go poach them is unethical, especially with a captive agent and even more so when they are paying a salary, regardless of how small it is.

If she has this conversation with the SF agent upfront and they SF agent agrees to it, that's an entirely different critter, but if that's her intention the SF agent would, if they're in their right mind, not agree to hire her. If she wants to grow her own book she needs to go to an indy agent and say as much, then ask to work on a commission only basis with renewals and the understanding being that she's growing her own book to take when she leaves.

Regardless of a non-compete, that conversation should happen upfront. Even without a non-compete, if you don't feel comfortable asking the employer about it then you probably shouldn't do it. Does that make sense?
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Also, Red Blooded American, do you really think using that word, particularly in such a public place, is appropriate?

 

[arnguy]

I would never work for no renewals, thats where the *** money is....

Ouch, racist on board!

 

[xrac]

The problem is that it's not on a straight commission and that is not what the SF would be paying her to do. The SF would be paying her to build their book of business, not for her to create her own. If she doesn't like it then she needs to go work at another place, but to keep records of the clients someone else paid you to get for them and then to go poach them is unethical, especially with a captive agent and even more so when they are paying a salary, regardless of how small it is.

If she has this conversation with the SF agent upfront and they SF agent agrees to it, that's an entirely different critter, but if that's her intention the SF agent would, if they're in their right mind, not agree to hire her. If she wants to grow her own book she needs to go to an indy agent and say as much, then ask to work on a commission only basis with renewals and the understanding being that she's growing her own book to take when she leaves.

Regardless of a non-compete, that conversation should happen upfront. Even without a non-compete, if you don't feel comfortable asking the employer about it then you probably shouldn't do it. Does that make sense?
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Also, Red Blooded American, do you really think using that word, particularly in such a public place, is appropriate?

Are you saying that you would not contact any former customers you had if you had worked for someone else if you left that other place? I think that that is a given and is why employers have non-competes. I think the employer knows it and I think the employee knows it. To be employed by someone else and to be at their mercy and not have a plan B is not smart in my opinion.

When I started my first business I did not have a non compete and I was paid a salary at my job. When I started my business I made contact with former clients and let them know what I was doing. The client then has the choice of whether they preferred working with my old company or preferred to work with me.

In my opinion clients are always on the open market. If I had an agency and I hired someone to work for me I would expect them to do similar as I have advocated and I would have a non-compete with them. If I wanted some other arrangement then I would offer benefits, key-man coverage, vesting, etc. This SF office is not offering a career. They are wanting someone they can use to further their own business. What they offer doesn't sound like a great deal to me.

Maybe I am wrong but I do not think there is anything unethical about looking out for oneself. Have you ever gotten the shaft from an employer after being a dedicated loyal productive employee. I certainly have.

 

[senior-advisor-indiana]

Ouch, racist on board!

I think he meant bigger. Lol

 

[Josh]

Are you saying that you would not contact any former customers you had if you had worked for someone else if you left that other place?

Yes and I have actually done just that.

To be employed by someone else and to be at their mercy and not have a plan B is not smart in my opinion.

Agreed, but you can't just steal their customers when you leave. If you don't like that, then don't go work for them, but that is not what they are hiring you to do. If you are 100% upfront with them that you plan on taking the customers with you when you leave and they are onboard with that then we have a different situation, but the notion that someone is going to take the risk of paying a salary with zero guarantee of a return AND teach someone the business is what an agent is getting out of the deal.

When I started my first business I did not have a non compete and I was paid a salary at my job. When I started my business I made contact with former clients and let them know what I was doing.

The non-compete is just a way of attempting to enforce ethics. If you and your former employer had the understanding that you would be doing that when you left, then that's an entirely different situation. If you and your former employer did not discuss that and you were squirreling away a client list so you could go through it when you leave then I think that is extremely unethical.

In my opinion clients are always on the open market. If I had an agency and I hired someone to work for me I would expect them to do similar as I have advocated and I would have a non-compete with them.

At least your consistent, but you might change your opinion if you actually were running an agency. It makes zero sense to train someone and provide them with any level of support if they're going to use your client list to start their own shop or further their own interests. Considering this is car insurance, if someone were to leave a SF office and start their own shop and accidentally run into a client here and there that would be totally different, but to use a client list from a company you used to work for as a targeted marketing list when it's not a hugely profitable business to begin with demonstrates extremely poor judgement. Even if an agent worked at a SF agent for a year and did well, if they made $30k and then left and took "their" book with them the SF agent would probably end up losing money for hiring them.

If I wanted some other arrangement then I would offer benefits, key-man coverage, vesting, etc.

The benefits the agent are getting is a salary, training, and support. If they'll hire someone with zero insurance experience and pay them a salary of any amount that's more than most of the industry will offer them.

This SF office is not offering a career. They are wanting someone they can use to further their own business. What they offer doesn't sound like a great deal to me.

If it doesn't sound like a good deal then the person shouldn't take it, but you hit the nail on the head, they are wanting to hire someone to grow their business. They are not looking for someone to grow a book of business under them, take a piece of the action, and then let the person take "their" little book with them when they leave. Again, if an agent wants to start from scratch on a straight commission basis and cuddle up with an indy agent using that proposition that's one thing, but you're royally screwing a captive agent to do what you suggest. Captives also are under tight scrutiny for their persistency and growth and that can impact their bonuses severely, even if an agent left and took 1% of the book with them when they left that could cost the agent a $50k bonus aside from the commissions.

Maybe I am wrong but I do not think there is anything unethical about looking out for oneself. Have you ever gotten the shaft from an employer after being a dedicated loyal productive employee. I certainly have.

I have been shafted by more than one employer after doing a fantastic job for them, but that doesn't mean that if I were to go back to the business of working for someone else I would take it out on them.

 

[xrac]

.....At least your consistent, but you might change your opinion if you actually were running an agency. It makes zero sense to train someone and provide them with any level of support if they're going to use your client list to start their own shop or further their own interests. Considering this is car insurance, if someone were to leave a SF office and start their own shop and accidentally run into a client here and there that would be totally different, but to use a client list from a company you used to work for as a targeted marketing list when it's not a hugely profitable business to begin with demonstrates extremely poor judgement. Even if an agent worked at a SF agent for a year and did well, if they made $30k and then left and took "their" book with them the SF agent would probably end up losing money for hiring them.gent are getting is a salary, training, and support. If they'll hire someone with zero insurance experience and pay them a salary of any amount that's more than most of the industry will offer them......

In a non insurance business I hired someone that didn't have a great deal of experience. After being with me a few months he swiped my business plan off my computer and gave it to someone else and helped them start a competing business. Was helping someone else use the stuff I taught him help start a competing business unethical. I don't think so. Was contacting my clinets after he left unethical? He didn't take a one because they wanted to do business with me. I don't think so. Was swiping my business plan off of my computer unethical? You darn tooting it was.

MedicarePlanSolutions, you have stated your thoughts and position clearly and obviously we disagree. I still think it is good for any agent to maintain a contact list. What happens to the agent who walks in one day to find that he has no job and must leave immediately? Every contact, every lead, every business contact, every phone number is on that computer that he is locked out of.

 

[Josh]

In a non insurance business I hired someone that didn't have a great deal of experience. After being with me a few months he swiped my business plan off my computer and gave it to someone else and helped them start a competing business. Was helping someone else use the stuff I taught him help start a competing business unethical. I don't think so. Was contacting my clinets after he left unethical? He didn't take a one because they wanted to do business with me. I don't think so. Was swiping my business plan off of my computer unethical? You darn tooting it was.

That was dirty pool on his part, especially if he was thieving a business plan and you were helping that much. That is an entirely different scenario.

MedicarePlanSolutions, you have stated your thoughts and position clearly and obviously we disagree. I still think it is good for any agent to maintain a contact list. What happens to the agent who walks in one day to find that he has no job and must leave immediately? Every contact, every lead, every business contact, every phone number is on that computer that he is locked out of.

They go and find another job. Just because they fire someone and that person believes they were wronged doesn't give them the right to take all the cash out of the register so to speak. If an agent is worried about that and would be willing to steal a client list that someone else paid them to generate then they should start off independent to begin with. It burns, I get it, I've been there, done that, have the grudge to prove it, but that does not mean running through a client list someone else paid you to develop is ethical.

There are agencies that will happily take an agent with no experience and train them in the business and provide that help on a commission only basis with the understanding being that when the agent decides to walk they keep their clients, if that is what someone is looking for they should go and do that, not go steal money from a SF or Allstate type agency. That's the take away from this, if you want to own your book do that deal up front, go work with an agency that is willing to do that, don't steal a SF or Allstate or any other captives book because you left them.

 

[Lori1058]

Thanks for the excellent feedback. I sense that selling for the SF agent is a great way to learn while I earn.

Lori

 

[b61mack]

you should use the search function, on this forum, and search... state farm. have a lawyer read any, non-compete... it could have a mileage restriction, when you leave. i had one company that wanted me to sign a two year, 100 mile, non-compete... for a commission only job...yeah right...

 

[Lori1058]

you should use the search function, on this forum, and search... state farm. have a lawyer read any, non-compete... it could have a mileage restriction, when you leave. i had one company that wanted me to sign a two year, 100 mile, non-compete... for a commission only job...yeah right...

After weighing the pros and cons of this situation, once again I'm undecided... Although working for the agent (not the company) would perhaps be a great way to learn the business I really don't like the idea of not being able to build a customer base each day in my career.

If or when I would stopping working for the agent, legally, I will have no customers. I would simply sell in exchange for a one time commission on the deal with no residuals during my employment.

I realize this is a tough business especially for the newcomer, but since I am a very good salesperson I'm confident of being able to succeed and build strong residuals.

What are my employment options, if any, other than being independent if I want to keep my customers?

Thank You.