New A.I in Michigan - Idea's Realistic?

[rogersinsgroup]

I've been an agent (sub agent, not direct appointed) with an Allstate start up and a newer Farm Bureau (where open 9 months before I joined) I've been with FB for 3 years now. So I have a pretty good idea on how to run an agency, market, etc.

Currently I write about $300k a year in p/c 80% is personal lines. At first it was higher, but I originally got nice residual commission (now it's down to 30%), 100% commission (due to the FB bonus structure for new agents) and a salary (only 1k a month, but better than nothing, where I"m at now). Currently I'm at 75% new 40% residual (dropping to 30% in July) and no salary. Needless to say I need to write a lot more to make the same...

With all that said, I am going AI and am working on appointments now and looking for office space. I just need a small office to start, under 200sf as cost is very high on my important list (I will go to the client more often than they come to me).

Just me selling at first, would love to have a sales person (commission only): so if your looking in Mi, pm me or see my other thread (starting shortly).

My idea:

$400k in sales (more if I have a sales person)
-Old internet leads categorized by x-dates, that I didn't get with FB (have well over 1,000 old ones)
- X-date commercial accounts (via phone and hitting the pavement)
- Maybe hire a commercial tele-marketer, that has been referred via here: $250 monthly budget.
- New Internet leads about $150 a month in budget
-Rent for small office (utilities included) $400 a month
- Internet and phone/e-fax: $100 a month
- Printer I won't use much, as most stuff can be e-signed and.or emailed over to clients: $50 a month
- E&O $2,000 paid in full on 0% apr company card $500 a month till paid off (I hate cc debt)
-Company car (ie my current cars): $600 a month in loan payments

Fixed monthly expenses $2050


Income: $50,000 based on a 12.5% average commission for items written through my cluster

Personal income after expenses and various other items I forget or are over budget on is about $2,000 (24k take home 1st year). I spend about $250 in gas now (summer car v. winter 550 hp SUV $450 in gas then). I live at home, spend about $450 a month in restaurants and another $200 a month in entertainment.

My big question here is, does this all seem realistic for a new A.I with just me selling? I know I'll have to service a TON more than I do now.

 

[indienoise]

If that suv is an srt8 jeep, take some advice from a car guy and be rid of it before the electrical problems begin. You'll need to pare down a bit. I'm in my third month on my independeny agency, and if things continue to go well I may be able to draw a little bit of salary in the next month or two. You might be able to sooner if you are really strong at sales. Either way, plan on waiting for your first renewals hit before you pay yourself just to be certain. If you are using a cc to pay e&o, sounds like you don't have any cash reserves, which is a bad idea. I invested about 6k of my own money to get started and that was NOTHING. Just bank accounts, state fees, e&o, a couple of appointment fees etc. I already had my own hardware as i was an independent contractor at my old agency. I am using my initial commissions to buy ams, marketing, rater, etc. Don't underestimate your need for a management system.
I couldn't have done this if I didn't already have another source of income i am maintaining. I consider myself lucky.

But yeah, cut expenses. If you do as well as you hope, you can always get it again later.

 

[rogersinsgroup]

Inide, big car guy myself, it's actually a P-Cayenne TT (with lots of upgrades from the p.o) I do love the srt8's though, so much fun.

When you say your third month, do you mean selling, or third month total (I'm told appointments can take a long while (8 to 12 weeks) during the summer months. Which puts me at about 2 months after I resign from my current agency, to just sell a policy. Then another 30 to 60 days to get commission on it, which of course will go back into the agency, not me. I do have cash saved, about 6k and can get some money from family, if I really need to. I just would rather pay the e&o on the card that doesn't affect my personal c.reports (since it is through the corp) and not pay interest and keep 2k extra in cash on hand.

With that said I can go about 4 months after resigning (5 if they pay my last commission check, without holding it for "chargebacks") on my savings as is.

I"m going to use EzLynx for a rater and a CRM as well...def need one. I already have hardware, except a printer/scanner/fax.

What have you written so far, just curious?

 

[indienoise]

A large part of my business is nonstandard, those appointments were quick to get, but in South Carolina nonstandard = regional carriers, so that may be a bit different. Progressive did take about 3 or 4 weeks. I'm pretty much just personal lines.
The market in South Carolina is a little different than some states, I'm hoping to reach a balance between nonstandard and preferred accounts. Half and half would be good.
Since I'm not with a cluster, signing up with an mga and a wholesaler for preferred markets and e&s was also quick. My agency was registered with the state march 23rd and I was writing before the end of the month. Some carriers did take longer but had all on board by the first of May. If I went with a cluster, I probably would just now be writing business. I am only part time because im running another business as well, but I've got about 60k on the books so far. Pretty well on track for the 250k I'm shooting for in my first year.

Are you looking at joining a group, or hoping to wing it on past experience and a strong business plan?