P&C independent brokerages

tboneinsurance

New Member
10
Have a colleague looking to add some P&C to his practice. Is heavy in life, health, and financial planning, but is coming across a lot of opportunity for P&C business. Questions is, where does he start to to become contracted for P&C carriers? And, her the large names, like Nationwide, only available through a captivate setup? He wants to remain independent. Any advice or direction is appreciated.
 
Obtaining P&C appointments it not like life and health. He can start by contacting carriers to find out the requirements for getting appointed. Without an existing book of business and no prior P&C experience, he will find preferred appointments hard to get. In some areas, even non-standard can be hard to come by.

He may also want to start looking at clusters, aggregators and MGAs.

Nationwide has merged their EA and IA channels, it is all Nationwide now. Although with the roll out of their new platform, it is a complete mess in some areas.
 
Have ya'll heard of smartchoiceagents.com? they get you the markets without a volume commitment, and they endup getting about a third of your written commission, but, YOU own the business! Once you reach a volume of $50K, they spin you off and you get ALL of the commission. I've contracted with captive agents and now trying to decide if I should make the independent leap. Anyway, if anyone heard or partners with Smart choice give us the scoop.
 
As with any contract, read it carefully, make note of all your questions and make sure you are comfortable with all of the answers you receive. Develop some possible scenarios and propose them to the network representatives. Also, have the contract reviewed by someone familiar with contracts. Get written answers to your scenarios and questions. If you are a member of the IIA or PIA organizations in your State, they may offer a free contract reviews.
 
As with any group, smart choice will cost you dearly in the long run, for short term solutions. Every cluster/group/aggregator tells you that you own your book, but sell your business, perpetuate, or leave the group, and you find out just how true that really is.
Be very cautious before signing any contracts, and make sure you really understand all the implications.
 
Thanks for everyone's feedback. I appreciate it. So I guess, if I understand, I need to go direct to carrier? It sounds like going through a middle man inst possible/worth it. I've tried doing some research, I just can't find any solid information.
 
Thanks for everyone's feedback. I appreciate it. So I guess, if I understand, I need to go direct to carrier? It sounds like going through a middle man inst possible/worth it. I've tried doing some research, I just can't find any solid information.

While ideal, that isn't always possible. Some areas are extremely difficult in which to secure an appointment. Also, you will almost certainly have to start out with non-standard business that way.

There is a cost to get into this business, it is going to cost you some combination of money, time and effort. You can pick what you spend, but it will cost you some of each. And how you choose to get in will have an impact on how quickly you grow, what kind of agency you grow and your long term potential.

If you do with a cluster or aggregator, make sure to reach the contract thoroughly. Also, some contracts are better built for a long term arrangement, while others are a short term fix.

Personally I would prefer a contract with a high upfront cost, long time-frame, low ongoing cost and the ability to buy out at my choosing. I would rather pay now versus giving up a substantial portion of revenue long term because I want to grow to be large.
 
Back
Top