Sub-Agency?

[MINewBeginning]

Being new to P&C industry, and cannot obtain direct appointments, nor have a book of P&C business, and have no binding authority if I choose the cluster route.

Can I establish a P&C agency, under an existing P&C agency, with my own name?

If doing so, will it allow me to have binding authority and able to provide instant quote?

 

[nyc2phi]

Yes you can do this. You would have to find a broker willing to work with you.

You would not have direct appointments to your agency but if the carrier and broker allow you, you will get a sub-code to be able to do quotes. It is up to the broker whether or not they would allow you to having binding authority

 

[MINewBeginning]

Yes you can do this. You would have to find a broker willing to work with you.

You would not have direct appointments to your agency but if the carrier and broker allow you, you will get a sub-code to be able to do quotes. It is up to the broker whether or not they would allow you to having binding authority

Awesome thanks. I guess finding an existing agency whose willing is the hard part.

 

[Bertolinoins]

Awesome thanks. I guess finding an existing agency whose willing is the hard part.

Yes, you have to think about what is in it for them. As an agency owner I would look at it this way:

IF you are successful, you will get your own direct appointments within 18-24 months before I actually make any significant money. The loss of that business may kill the growth factors with the main carriers and harm my contingency for several years.

IF you are not successful, I am sifting through bottom tier business hoping it doesn't kill my loss ratio or bite me in other ways (charge backs, E&O, etc).

There is usually not enough upside in these situations for agency owners to go for it, which is why the various aggregators and MGA's don't give binding authority and want to keep 33% of the commission along with the contingency. Nobody can afford to handhold for free or let a newby run wild.

 

[EugeneM]

A lot more willing brokers then you think. TBH you will find one before three calls. I would be super picky who you work with a lot of bad agencies out there.

Shoot high hit up the sickest brokers in your area and work your way down. Dont get stuck producing for a captive agent or anything