ROI on AP Vs Lead Cost & Chargebacks!

[RonRoberts]

I wrote an AmAm last week that is approved and issued.

What product did you write with AmAm and why? I have been trying to find a reason to write AmAm but every time I price a product they are usually higher than any of my other carriers.

 

[jdeasy]

What product did you write with AmAm and why? I have been trying to find a reason to write AmAm but every time I price a product they are usually higher than any of my other carriers.

Easy Term. That's about all I write with them anymore. I do 4 or 5 of those a year.

 

[RonRoberts]

Easy Term. That's about all I write with them anymore. I do 4 or 5 of those a year.

One last one, when writing a simplified term are there no better options?

 

[jdeasy]

One last one, when writing a simplified term are there no better options?

There were better fully underwritten option for him, but he was dead set against an exam. He would have rated a table or two anyway, so the fully underwritten wasn't a hugely better deal.

I looked at Foresters and Americo's simplified term and, to my surprise, AmAm was the better deal.

 

[Road2nowhere]

CHARGEBACKS HAPPEN ANYTIME EVEN AFTER 5-6 YEARS. i CURRENTLY HAVE TWO CLIENTS THAT I WORKED WITH FROM 2004-2009, THEY HAVE BEEN FREINDS FOR 30+ YEARS. IN 2009 I MADE CHANGES WITH MY BUSINESS OF WHICH THEY DIDN'T LIKE. WHERE I ONCE GAVE FREE TAX ADVICE (OF WHICH I'M LICENSED TO DO) I DECIDED TO CHARGE A FEE FOR PROVIDING A WRITTEN TAX PLAN. FURTHERMORE, DUE TO THE INCREASE IN LIABILITY SUITS, I ALSO MADE A REQUIREMENT THAT ALL NEW CLIENTS MUST AGREE TO HAVING THEIR TAX RETURNS REVIEWED BY US PRIOR TO MAKING ANY RECOMMENDATIONS ETC....) THEY DIDN'T FEEL THAT THEY SHOULD NOW HAVE TO PAY FOR SOMETHING THEY ONCE RECEIVED FOR FREE REGARDLESS OF THE VALUE IT BROUUGHT THEM (TAX SAVINGS)! TWO YEARS LATER 2011, THE FIRST ONE SENDS A LETTER TO ONE OF THE INSURANCE COMPANIES THAT SHE HAD AN ANNITY WITH. THE LETTER INCLUDED TWO WORDS "SENIOR ABUSE" AND THAT ALONE RESULTED IN FORETHOUGHT ANNUITY CANCELLING THE CONTRACT AND REFUNDING PREMIUMS. THE INSURANCE COMPANY HAD ASKED FOR A WRITTEN RESPONSE, THEY EMAILED A COPY OF THE CLIENTS COMPLAINT ON A FRIDAY AFTERNOON AND THEY DEMANDED A REPLY BY MONDAY. I LATER LEARNED THAT THEY HAD ALREADY MADE THEIR DECIDSION BEFORE THEY REQUESTED A REPONSE FROM ME. FYI: THERE WAS NO WRONGFULL ACTS IN SALES OR TWISTING ETC...THEY DIDN'T WANT TO DEAL WITH A CLIENT PROBLEM AND SIMPLY REFUNDED THE MONEY AND CHARGED ME BACK $12,800. THAT WAS JUST THE START, THE CLIENT IS OBVIOUSLY HAPPY WITH THE RESULT OF HER COMPLAINT LETTER, SO DECIDES TO DRAFT ANOTHER ONE LISTING EVERY INSURANCE AND ANNUITY CONTRACT SHE PURCHASED THROUGH ME DURING 2004-2009 AND SENT THE LETTER TO THE DOI. THE DOI IN TURN GETS ONE LETTER BUT OPENS 6 SEPERATE FILES (ONE FOR EACH CONTRACT). WITHIN A SHORT PERIOD OF TIME, I HAVE TO RESPOND TO INQUIRIES FROM ALL INSURANCE COMPANIES (ALL WITHIN 3 DAYS). KEEP IN MIND THAT THEY LAST POLICY SOLD WAS IN 2008 AND IT WAS DEC 2011 WHEN SHE FILED THE COMPLAINT WITH THE DOI. SHORTLY AFTER MY REPLYING, TWO COMPANIES HAVE SIDED WITH ME AND DID NOT RETURN OR CANCEL THE POLICIES, THE OTHERS CANCELLED AND RETURNED PREMIUM + INTEREST TO THE CLIENT AND CHARGED ME BACK COMMISSIONS OF $7000, $16,500 WITH ANOTHER AND DONT FORGET THE FIRST 12,800 FROM HER FIRST LETTER FOR A GRAND TOTAL OF $36,300.00. SO THATS ONLY HALF THE STORY, YOU REMEBER HER DEAR FRIEND? AFTER CLIENT "A" TOOK A FREE RIDE, CLIENT "B" FILES A COMPLAINT LETTER WITH DOI OF WHICH IS ALMOST WORD FOR WORD THE SAME. HERE WE GO AGAIN! NOW THE SAME COMPANIES REQUEST MY REPLY FOR CLIENT "B" AND REPSOND IN THE SAME MANNER GIVING THE CLIENT BACK ALMOST EVERYTHING. ALL CONTRACTS WERE PURCHASED IN THE SAME TIME FRAME. NO WRONG DOING ON MY PART, EXCEPT NOW THE DOI HAND THIS OVER TO THE INVESTIGATIVE DEPARTMENT AS THE DOI FOUND EACH CLIENTS COMPLAINT TO BE JUSTIFIED. HOWEVER THE DOI FAILED TO IDENTIFY HOW THE DETERMINED THE COMPLAINTS WERE JUSTIFIED. SO YOU TAKE $36,300 OF CHAGRBACKS FROM CLIENT"A" ADD IN ANOTHER $20k (AS THE NUMBERS COULD CHANGE) AND I HAVE CHARGEBACKS IN EXCESS OF $56,000.00! OH IT GETS BETTER, I WANTED TO PROTECT MY LICENSE AND MY BUSINESS SO I HIRED AN ATTORNEY THAT IS WELL VERSED IN THESE TYPES OF MATTERS (AS I NOW LEARN THIS HAPPENS FREQUENTLY) OF WHICH SO FAR HAS BILLED ME FOR $15,000 BRINGING THE TOTAL EXPENSE TO $71,300. BUT WAIT THE STORY GETS BETTER. I HAD MOST OF MY ANNUITY CONTRACTS THROUGH VARIOUS MARKETING AGENCIES. ONCE THEY LEARNED THAT THE DOI HAD RECEIVED A COMPLAINT, EACH ONE OF THEM WROTE TO THE INSURERS AND CANCELLED MY CONTRACTS. WHERE I ONCE ENJOYED DOING BUSINESS WITH 25+ COMPANIES, I NOW FIND MYSELF LICENSED WITH ONE. THERE WERE NO ACTUAL DETERRMINATION OF WRONG DOING, BOTH COMPLAINTS WERE FOUND TO BE JUSTIFIED BY THE DOI, WITHOUT THE DOI HAVING TO PROVIDE HOW THEY CAME TO THEIR DECISION. SO EVEN A SEASONED VETERAN IN BUSINESS ALMOST 20 YEARS, CAN QUICKLY FIND THEMSELVES THROWN UNDER THE BUS BY A DISTURBED CUSTOMER. ALL MY TRANSACTIONS WERE WELL DOCUMENTED AND MET THE SUITABILITY REQUIREMENTS OF EACH CARRIER. FOR WHAT ITS WORTH, DON'T WASTE MONEY BUYING GIFT CARDS FOR CLIENTS TRYING TO SHOW HOW MUCH YOU APPRECIATE THEM , THINK TWICE ABOUT THE PEOPLE THEY REFER TO YOU AND MOST IMPORTANTLY DON'T SPEND A DIME OF THE COMMISSION YOU EARN ON A DEAL UNTIL THE SURRENDER PERIOD IS OVER. ONLY THEN CANYOU BE ASSURED THAT YOU WILL NOT BE CHARGEDBACK!!! ANY QUESTIONS??? I'M HAPPY TO ANSWER THEM, CONSIDERING I ONLY HAVE ONE PLACE LEFT TO WRITE BUSINESS.

 

[RonRoberts]

ROI-

I have just completed a spread sheet showing all my costs for FE & all my income since I started in Feb 2012. What I wanna know is when computing an acceptable ROI (I think at least 3 to 1 is good, hopefully 4:1) do u guys/gals count ALL your cost or just your lead cost? To this point, I have spent apprx $2200 on leads & I have over $13k in AP paid- so not counting what I still have pending. That amount IS counting starting with cheaper old leads so I wont be able to sustain that kinda ROI over time & its also counting fam & friends apps that obviously had no lead cost. But of course I also had E&O, stationary, gas, off supplies, etc costs. Im just trying to get a consensus of how most agents calculate their own ROI & whats an acceptable ROI for most?

Chargebacks-

I dont think Ill get a concrete answer for this, simple cause it most likely doesnt exists, but Ill ask anyway. Have any of u guys ever noticed when your chargebacks typically happen? I mean Im sure they happen anywhere from the 1st month to the 9th...but Im trying to see if the majority of them happen in a certain time frame like between mos 2-3 or anything like that?

Thanks in advance!

Does the $13000 in AP paid net of chargebacks, or does it include chargebacks?

What has your gross AP been on your $2200 lead cost and what has your total chargebacks been?

How about NTO's?

 

[rousemark]

CHARGEBACKS HAPPEN ANYTIME EVEN AFTER 5-6 YEARS. i CURRENTLY HAVE TWO CLIENTS THAT I WORKED WITH FROM 2004-2009, THEY HAVE BEEN FREINDS FOR 30+ YEARS. IN 2009 I MADE CHANGES WITH MY BUSINESS OF WHICH THEY DIDN'T LIKE. WHERE I ONCE GAVE FREE TAX ADVICE (OF WHICH I'M LICENSED TO DO) I DECIDED TO CHARGE A FEE FOR PROVIDING A WRITTEN TAX PLAN. FURTHERMORE, DUE TO THE INCREASE IN LIABILITY SUITS, I ALSO MADE A REQUIREMENT THAT ALL NEW CLIENTS MUST AGREE TO HAVING THEIR TAX RETURNS REVIEWED BY US PRIOR TO MAKING ANY RECOMMENDATIONS ETC....) THEY DIDN'T FEEL THAT THEY SHOULD NOW HAVE TO PAY FOR SOMETHING THEY ONCE RECEIVED FOR FREE REGARDLESS OF THE VALUE IT BROUUGHT THEM (TAX SAVINGS)! TWO YEARS LATER 2011, THE FIRST ONE SENDS A LETTER TO ONE OF THE INSURANCE COMPANIES THAT SHE HAD AN ANNITY WITH. THE LETTER INCLUDED TWO WORDS "SENIOR ABUSE" AND THAT ALONE RESULTED IN FORETHOUGHT ANNUITY CANCELLING THE CONTRACT AND REFUNDING PREMIUMS. THE INSURANCE COMPANY HAD ASKED FOR A WRITTEN RESPONSE, THEY EMAILED A COPY OF THE CLIENTS COMPLAINT ON A FRIDAY AFTERNOON AND THEY DEMANDED A REPLY BY MONDAY. I LATER LEARNED THAT THEY HAD ALREADY MADE THEIR DECIDSION BEFORE THEY REQUESTED A REPONSE FROM ME. FYI: THERE WAS NO WRONGFULL ACTS IN SALES OR TWISTING ETC...THEY DIDN'T WANT TO DEAL WITH A CLIENT PROBLEM AND SIMPLY REFUNDED THE MONEY AND CHARGED ME BACK $12,800. THAT WAS JUST THE START, THE CLIENT IS OBVIOUSLY HAPPY WITH THE RESULT OF HER COMPLAINT LETTER, SO DECIDES TO DRAFT ANOTHER ONE LISTING EVERY INSURANCE AND ANNUITY CONTRACT SHE PURCHASED THROUGH ME DURING 2004-2009 AND SENT THE LETTER TO THE DOI. THE DOI IN TURN GETS ONE LETTER BUT OPENS 6 SEPERATE FILES (ONE FOR EACH CONTRACT). WITHIN A SHORT PERIOD OF TIME, I HAVE TO RESPOND TO INQUIRIES FROM ALL INSURANCE COMPANIES (ALL WITHIN 3 DAYS). KEEP IN MIND THAT THEY LAST POLICY SOLD WAS IN 2008 AND IT WAS DEC 2011 WHEN SHE FILED THE COMPLAINT WITH THE DOI. SHORTLY AFTER MY REPLYING, TWO COMPANIES HAVE SIDED WITH ME AND DID NOT RETURN OR CANCEL THE POLICIES, THE OTHERS CANCELLED AND RETURNED PREMIUM + INTEREST TO THE CLIENT AND CHARGED ME BACK COMMISSIONS OF $7000, $16,500 WITH ANOTHER AND DONT FORGET THE FIRST 12,800 FROM HER FIRST LETTER FOR A GRAND TOTAL OF $36,300.00. SO THATS ONLY HALF THE STORY, YOU REMEBER HER DEAR FRIEND? AFTER CLIENT "A" TOOK A FREE RIDE, CLIENT "B" FILES A COMPLAINT LETTER WITH DOI OF WHICH IS ALMOST WORD FOR WORD THE SAME. HERE WE GO AGAIN! NOW THE SAME COMPANIES REQUEST MY REPLY FOR CLIENT "B" AND REPSOND IN THE SAME MANNER GIVING THE CLIENT BACK ALMOST EVERYTHING. ALL CONTRACTS WERE PURCHASED IN THE SAME TIME FRAME. NO WRONG DOING ON MY PART, EXCEPT NOW THE DOI HAND THIS OVER TO THE INVESTIGATIVE DEPARTMENT AS THE DOI FOUND EACH CLIENTS COMPLAINT TO BE JUSTIFIED. HOWEVER THE DOI FAILED TO IDENTIFY HOW THE DETERMINED THE COMPLAINTS WERE JUSTIFIED. SO YOU TAKE $36,300 OF CHAGRBACKS FROM CLIENT"A" ADD IN ANOTHER $20k (AS THE NUMBERS COULD CHANGE) AND I HAVE CHARGEBACKS IN EXCESS OF $56,000.00! OH IT GETS BETTER, I WANTED TO PROTECT MY LICENSE AND MY BUSINESS SO I HIRED AN ATTORNEY THAT IS WELL VERSED IN THESE TYPES OF MATTERS (AS I NOW LEARN THIS HAPPENS FREQUENTLY) OF WHICH SO FAR HAS BILLED ME FOR $15,000 BRINGING THE TOTAL EXPENSE TO $71,300. BUT WAIT THE STORY GETS BETTER. I HAD MOST OF MY ANNUITY CONTRACTS THROUGH VARIOUS MARKETING AGENCIES. ONCE THEY LEARNED THAT THE DOI HAD RECEIVED A COMPLAINT, EACH ONE OF THEM WROTE TO THE INSURERS AND CANCELLED MY CONTRACTS. WHERE I ONCE ENJOYED DOING BUSINESS WITH 25+ COMPANIES, I NOW FIND MYSELF LICENSED WITH ONE. THERE WERE NO ACTUAL DETERRMINATION OF WRONG DOING, BOTH COMPLAINTS WERE FOUND TO BE JUSTIFIED BY THE DOI, WITHOUT THE DOI HAVING TO PROVIDE HOW THEY CAME TO THEIR DECISION. SO EVEN A SEASONED VETERAN IN BUSINESS ALMOST 20 YEARS, CAN QUICKLY FIND THEMSELVES THROWN UNDER THE BUS BY A DISTURBED CUSTOMER. ALL MY TRANSACTIONS WERE WELL DOCUMENTED AND MET THE SUITABILITY REQUIREMENTS OF EACH CARRIER. FOR WHAT ITS WORTH, DON'T WASTE MONEY BUYING GIFT CARDS FOR CLIENTS TRYING TO SHOW HOW MUCH YOU APPRECIATE THEM , THINK TWICE ABOUT THE PEOPLE THEY REFER TO YOU AND MOST IMPORTANTLY DON'T SPEND A DIME OF THE COMMISSION YOU EARN ON A DEAL UNTIL THE SURRENDER PERIOD IS OVER. ONLY THEN CANYOU BE ASSURED THAT YOU WILL NOT BE CHARGEDBACK!!! ANY QUESTIONS??? I'M HAPPY TO ANSWER THEM, CONSIDERING I ONLY HAVE ONE PLACE LEFT TO WRITE BUSINESS.

Wasn't able to read your post due to it being all caps and the lack of paragraphs. .. Painful to the eyes!

 

[jdeasy]

Wasn't able to read your post due to it being all caps and the lack of paragraphs. .. Painful to the eyes!

You beat me to it. Damn dude!! Paragraphs are your friend. And, he is way off base anyway. There would not be a chargeback on FE after 5 years except for maybe one month of renewals. I think he was talking about annuities, but I didn't read far enough.

If he is talking annuities he's still in the wrong forum.

 

[RonRoberts]

Wasn't able to read your post due to it being all caps and the lack of paragraphs. .. Painful to the eyes!

You beat me to it. Damn dude!! Paragraphs are your friend. And, he is way off base anyway. There would not be a chargeback on FE after 5 years except for maybe one month of renewals. I think he was talking about annuities, but I didn't read far enough.

If he is talking annuities he's still in the wrong forum.

You guys are funny. I actually thought the same thing but ended up fighting my way through it. It was interesting and the sad thing about it is that most insurance companies if not all of them will leave the agent high and dry...not to mention these great associations that we can pay our hard earned dollars for their lobbying abilities...yeah right.

 

[TDFnCali]

Does the $13000 in AP paid net of chargebacks, or does it include chargebacks?

What has your gross AP been on your $2200 lead cost and what has your total chargebacks been?

How about NTO's?

It included chargebacks & as of right now I have 1 chargeback & 1 NTO (that Im trying to save still). Those #'s has drastically changed now that its been a few weeks.

But now my lead cost is A LOT higher weekly that Im getting all new leads & theres no more old leads to buy in my areas. Ironically, my PPL has gone down a lot, my new leads so far have not been very good...if it continues at this rate, I will need to find a diff source!