New Indie Agent Commission % Questions

[iRAISE]

I have been lurking on this board for a while and decided to hire as a new agent under an Independent Broker. He has a nice lineup of companys/products. I'll start doing P&C at first and can go into other products later.

My only concern is the commission split. He wants 50% of everything I write (I get 50% of all renewals also). He will cover all office expenses and is negotiable on out of office expenses also (LeTip club, advertising, etc.) He will provide support and mentorship. I will not own my book, but he says hes negotiable on this in the future (need to get more details on this).

It is a straight commission job (no salary/guarantee) and thats fine with me.

I like this broker and think we are a good fit (another interview later today).

I will be pretty much on the road full time and will pay my own car/gas/road expenses. I'll drop in his local office 1 or 2 times a week to check in, get training, meets ins reps, drop paperwork, etc. I like this arrangement and think it will work great for me.

I will definately try to get a better percentage. What do you PROS suggest I get/ask for?

Anything else I should ask for/get?

I appreciate any ideas/help!

 

[Norwayguy]

First off I am not a p&c agent so I may see things differently. We both know that this Broker is going to take a cut of your business the only question is how much. My first question is how are the accounts being generated? ie are you doing mailings, advertising word of mouth etc who is paying for that cost? Also from your post it sounds like you don't forsee being in his office very much who will be providing the customer service to the policy holders will it be you or is your only responsibility sales and his office staff has to service the client etc...those are all things to think about in this relationship you mentioned he will cover 100% of office expenses and some out of office items such as advertising and I think you said LeTIP (not sure what that is). Without know who is paying for the service work and if you are building the book based on using his resources and clients then 50/50 might be reasonable if you can't get him to increase the split maybe a car expense allowance might be in order but just realize these are the costs of being in this business. You must think this type of arrangement is best because he brings access to markets you might not be able to get on your own and not having to provide for the overhead.

 

[iRAISE]

Thx for the ideas and questions NG,

Norwayguy;165214]First off I am not a p&c agent so I may see things differently. We both know that this Broker is going to take a cut of your business the only question is how much.

I'll be writing P and C. Most of the commissions (he offers about 20 different lines) are 15% commish and I get 7.5% (50/50 split). He says this is fairly standard with no salary or guarantee. Does anyone have any experience with this type of set-up?

My first question is how are the accounts being generated? ie are you doing mailings, advertising word of mouth etc who is paying for that cost?

I'm on my own here. No leads. This really doesnt concern me. I have built 2 businesses and huge client data bases before and have a strong marketing plan and will work 50-60 hours a week until I can generate a decent income, or i will just go back to the car business.

Also from your post it sounds like you don't forsee being in his office very much who will be providing the customer service to the policy holders will it be you or is your only responsibility sales and his office staff has to service the client etc...

I will be responsible for most of my own client support at first, but he said we could work out a plan later for office support (as I grow). Also my wife works parttime and could help me, as needed

those are all things to think about in this relationship you mentioned he will cover 100% of office expenses and some out of office items such as advertising and I think you said LeTIP (not sure what that is). Without know who is paying for the service work and if you are building the book based on using his resources and clients then 50/50 might be reasonable if you can't get him to increase the split maybe a car expense allowance might be in order but just realize these are the costs of being in this business.

Service work? You mean servicing the existing clients I sign? Support?

Letip is similar to BNI, they are business networking clubs that work well for insurance type businesses. I was a member when I sold cars and did well. Hes negotiable on paying for this kind of stuff if he sees they work. Hes not willing to commit on many things up front until he sees my commitment. I think thats fair.

You must think this type of arrangement is best because he brings access to markets you might not be able to get on your own and not having to provide for the overhead

I like working on my own. No quotas, a-hole managers or corporate crap to deal with. Me and my laptop, building a HUGE book and taking care of my customers 24/7.

I think when this guy sees what I can do then he will give me more support/money/help. I do feel hes a solid guy and good businessman. Hes a small agency right now also. I would be a huge asset if/when I do well.

The 50/50 split seems low to me though. No leads, salary, guarantee, not even a gas card. So i'm gonna be livin off savings for several months. I don't want to lose this opportunity but i don't wanna take less than what is fair. Take the 50/50, get trained and go from there or?

I tried him on at a bigger % (had our second interview today) and he seemed uninterested unless I was willing to take a smaller % on renewals. Take the job? I want to learn and build. Is this a good way to do it?

 

[insurancemet]

I think you will probably get more response from the Auto Insurance Forum section since probably more P/C agents there.