Will These Numbers Work in FE

[Pulling Pitch]

I started out with AFLAC in 1994 and then moved to Mutual of Omaha in 1996 before returning to an old JOB that made me an offer I couldn't refuse in 1997. Now I'm looking at returning to the insurance business full time, but I must be certain these numbers will work before making the leap.

I must clear 75K a year after expenses. I have a 105% contract with a great FE Company. I feel my numbers are conservative and leave room for the good and bad weeks.So here's my math.

Sell 5 policies per week with average annual premium at $50 per month/per policy with a 9 month advance. 5 x $50 = 2500 X 1.05 = $2625 with a 9 month advance would leave me with $1968 per week.

Leads- I can get 1000 mailed for $425. Mail a 1000 per week, 46 weeks per year.

$1968 - $425 lead cost = $1543 with an additional $100 per week for postage, E&O, ect leave me at $1443.

$1443 per week = $69,000 working 48 weeks, leaving room for the holidays/vacation.

Throw in a few med supps per month and the back 3 months of the advance should put me over or right at the 75K mark.

I'm willing to work a 50 hour week, what ever it takes.

I realize there will be some charge backs. How does my plan look? Am I missing something.

Thanks

 

[jdeasy]

Only you know your numbers. The numbers will work if you get the 5 policies sold per week. How many people do you need to meet with every week in order to sell 5 policies?

Most areas are going to get a 1% return on those mailers. So, if you get cards back per week can you meet with 7 of them? Being able to meet with 70% of respondents is top of the line good. Is that enough appointments to sell 5 policies?

That would be a 50% close rate on your leads returned. The very best of the best FE agents close 40% of their leads. The really, really good ones close 30%.

Of course you might be an area that gets better than a 1% return.

Rather than look at the money end, you need to deterine how many appointments it would take you to sell 5 policies and then how many leads it would take to get that number of appointments and then how much to mail to get that number of leads.

 

[Newby]

Also it sounds like you are limiting yourself to ONE company only. I don't know who that magic company would be that you could write EVERYONE through them. Why don't you have at least three?

 

[YouGotMyMoney]

Also consider whats your going to pay out in taxes as a 1099 vs a w-2, when your figuring out how much biz u need to write to "clear 75k".

 

[Rearden]

6 weeks off a year? Are you European? =-)

Work an extra 4 weeks.

I have learned to move away from the systematic expectation of outcomes. Focus more on the number of appointments you want to average a week, and pay attention to the money over the longer picture (month-to-month, or quarter-to-quarter).

The right behaviors (appointment-setting, door-knocking, asking for referrals) are the thing to focus upon.

 

[0b1kanobee]

The very best of the best FE agents close 40% of their leads. The really, really good ones close 30%.

REARDON.........what is your percentage?

Does this mean that the average agent can't do FE and NOT be in the red?

Anyone else have any input on these numbers? Kinda scary that really really good agents close 30%. This doesn't leave much room for anything less.

 

[BenS]

Like JDeasy said, sounds like it's going to depend on what kind of returns you get. If you're in an area that has an awful mailer return, I don't see how you are going to meet with enough people to sell 5 policies a week on a 1000 piece/week plan.

If your response is poor, you could dig yourself a hole really quick. I just signed on with an IMO that provides 20 leads/week for the same price as you are paying for the 1000 piece mailer. Of course my contract is 15 points lower than yours. But, if you're willing to work 50+ hours like I am, you could make up that contract difference in volume.

Either way, it seems that you're going to need to be in front of at least 15 people a week to do well in this business. Try to have a few months living expenses set aside and just concentrate on selling. The rest should take care of itself.

 

[Rearden]

Like I said, I'm moving away from focusing too much on numbers.

I close around 30%.

I focus on making sure I maximize my gross for each lead, and close the leads that should be closed. Bottom line is I don't want to leave money on the table after closing a deal.

Had a guy who just had purchased $160-a-month worth of FE insurance 3 weeks before I came a-knocking. He bought another $60-a-month from me.

The guy who was in prior to me should have closed the whale a little higher. I don't want to be that guy -- I want all that I can get while still being able to keep them on the books.

 

[jdeasy]

REARDON.........what is your percentage?

Does this mean that the average agent can't do FE and NOT be in the red?

Anyone else have any input on these numbers? Kinda scary that really really good agents close 30%. This doesn't leave much room for anything less.

I don't understand what you are questioning. It takes a really good FE agent to have a closing ration of 30%. I'm not talking about closing ratio to your appointments. I'm talking about closing 30% of all leads received.

I don't recruit, but I might if I could get agents that have a proven 30% close ratio. There is only one agent on the EFES lead program that is around 40%. Sometimes his even gets down to 35%. There are many good agents in the 20% range.

You asked Reardon what his % is. He has said he gets between 80 and 100 leads a month. He would have to write 25 to 30 apps per month to have a 30% ratio.. That's hardly being in the red.

 

[0b1kanobee]

I'm not talking about closing ratio to your appointments. I'm talking about closing 30% of all leads received.

I thought you meant actual appointments not all leads received. I was just trying to do some quick math in my head and trying to figure out what was going on. Seemed like if you weren't "really really good" you were SOL.

I don't see how you guys run so many appointments in a day. I was on an appointment today and was there for 2 hours. Last week I was on one for almost 3 hours. I need to speed it up. I tend to talk too much.