New Producer Questions

[Storm Silva]

Hello, I just recently got my Property and Casualty License and have put up by my brokers bond with the state. I've been going through and getting broker agreements with insurers and ran into a few insurers who don't work with brokers. So I have two questions, what insurers should I not waste my time contacting/ don't work with brokers? I am not interested in getting appointed as a captive or independent agent for the insurer. My next question is if I am supposed to get the best deal for my client what do I do when the best policy is with a direct writer. Do I charge a brokers fee and then just tell the client to go sign up with them? Do I get a special power of attorney and sign them up for them? What is the industry standard?

 

[Mike007]

For the most part, its almost impossible to get direct appointments from Insurance Companies. You have to get your appointments from a middleman, also known as Clusters, Aggregators, or Franchises. But even with that, most of them require you to have at least 2-5 years of experience in the industry working for someone else. Clusters & Aggregators are established insurance brokers that have the sales number to acquire Insurance Contracts. They won't just easily give away contracts to random people either without experiences.

Most of these organizations requires a buy in fee, ranging from $1,500 to $10,000 and a monthly fee after that to maintain your E&O insurance and the Quoting System. This fee is anywhere from $300-$500 a month. And most will require that you have an office that is not your own home. Once you get the contract, you can offer insurance to the public.

If you just got your insurance license, you are not ready to start your own agency or broker. You may need to find a job and work a couple of years for someone else to understand the ins and out of insurance first. Without proper training and guidance, you can get yourself in very hot water.

What is your work background? Based on your post, it seems you have very limited knowledge in this field.

Understand this, if you become an Agent/Broker/Independent Agent, you are practically becoming a Business Owner. An Entrepreneur. It is not easy. It is extremely hard, difficult, and expensive.

 

[EugeneM]

Welcome to the world of insurance - finding the right markets is a fun part ^_^ I agree with Mike, mentor is going to go a long way.

 

[Storm Silva]

Thank you for the advice. Working for myself isn't something new for me I come from a real estate background and investment advisory background. The reason I got my insurance license was to cross-sell to my clients from the real estate side and I wanted to have a full vertical integration of the real estate business. So there is no other way to get a brokers agreement directly, what aggregates would you recommend for homeowners and auto markets. Also, I plan on moving over to the commercial side of insurance pretty fast because most of my real estate clients are investors, contractors, and agribusiness. Is the commercial side easier to get direct broker agreements with?

 

[fed up]

Slooooooowwwww Down. Pump your brakes. If you have come from the real estate side you may find a conflict with selling a house or property and then NOT being able to insure it because of the condition; that could lose you the sale as well. You should look to cross sell with an agent in insurance who cross sells you for mortgages and property. Taking a "This is easy, I'll just......" approach will certainly have your E&O busy. And commercial is a whole other ball of string. You can be real good at one side of the business and find you have no like for the other. Selling a commercial policy often involves many different policies to cover one property. Think about this example: A small gas station. Building, pumps, food and beverage, alcohol, tobacco, any canopy over the pumps, pollution, workers comp. I am sure I have missed a few others. I hope you get my drift. Try to excel at one P&C or commercial before you try both

 

[EugeneM]

It is not "easy" to get direct appointments for commercial. Most will want volume commitments and experience. Sounds like you have a legit stream of referrals, send what you run into to a wholesaler. They can help guide you somewhat. Would be a good way to get your feet wet. Some can quote without appointing you until you are ready to bind something. You are in luck CA premiums are super high, they have some bad territory debit mods (20-25%) for comp. Find a carrier that doesn't have these debit territory and its easy wins

 

[Markthebroker]

Slooooooowwwww Down. Pump your brakes. If you have come from the real estate side you may find a conflict with selling a house or property and then NOT being able to insure it because of the condition; that could lose you the sale as well. You should look to cross sell with an agent in insurance who cross sells you for mortgages and property. Taking a "This is easy, I'll just......" approach will certainly have your E&O busy. And commercial is a whole other ball of string. You can be real good at one side of the business and find you have no like for the other. Selling a commercial policy often involves many different policies to cover one property. Think about this example: A small gas station. Building, pumps, food and beverage, alcohol, tobacco, any canopy over the pumps, pollution, workers comp. I am sure I have missed a few others. I hope you get my drift. Try to excel at one P&C or commercial before you try both

Don't bother. I've tried with the same type of advice with her. She is bullheaded and determined to fail.