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Hello to all... I am new to this forum, but not new to the insurance industry. I am currently a Farmers Insurance agent (5 years) and am frustrated and angry with the company. My frustrations? You name it... the lack of ethics within the corporate management to idiot DMs to the increasing micro management to the incompetence of policy services to the archaic billing system to the POS dashboard. To top it all off, we had a huge rate increase this year which is reeking havoc to my book of business. Anyway, I am considering either buying an independent agency or starting one. My Farmers contract value isn't more than 40k, so buying one is probably a pipedream. I would like some feedback from others who have been Farmers agents and are now independents. For example, how do I get to be an independent? Just get appointment with a few companies and open my doors? How hard is it to get appointed with companies like Allied, Safeco, Travellers, Progressive, etc.? Are you happier as an independent? Is it easier to write business? Any feedback would be helpful and appreciated.

milleniumgirl

Rather than starting your own agency, many agencies are looking for good producers (my definition of a good producer - one that really knows/understands insurance, knows and understands their clients needs, and won't recommend or sell the client something that they don't need, want or can't afford).

You'll see another thread about non-compete agreements. Make sure that the clients you bring in belong to you - that is, if you leave, you can take your book of business with you.

I started as a Farmers agent and am now independent. I have appointments with every company you listed and more. To get appointed you must contact the marketing reps for each company. They will want a business plan, loss runs for the last 3 years, and production reports. If you have a low loss ratio and have a history of high production it is not hard to get appointed.

Yes, I am happier as an independent. I don't have any of the problems you mentioned now.

Is it easier to write business? Yes, once you figure out what each individual company's u/w rules are. You will be able to offer much better pricing and coverages.

Having been an independent agent for more years than I care to mention and having been on the direct writer side (regardless of the company) I will say independence is wonderful however, to get apppointed is not as easy as it appears.

What was said about a biz plan, loss history and such is great, but you will be starting at zero... you will be very lucky to get appointed with ANY standard carrier (you can broker til your hearts content) but to pick up a Safeco or an Allied when you have no book of business to roll they will want to know just how it is you can reach the numbers that "each" of them wants you to attain.

Again, being independet is wonderful but trust me, instead of dealing with one headache of a company you could be dealing with 10 or more. Trust me (and other independents) every company has some nightmare within themselves, be it billing, underwriting, tech support or what have you, each will have their own area that needs help.

I agree with the other person that said, become a producer, it is much easier to see just how well you will do on some one elses dime then to do it alone if you have not had that back ground. I'm all for having your own agency but really think this thru.

I would call a few of the companies you named and talk to the rep and ask, just what is it I would have to do to be appointed with you, what numbers etc. At least you will be more prepared in making your decision.

Good luck to you.

P.S. I have to ask, I have heard that Farmers has some of the most liberal contracts in the industry, i.e. you can write with other companies and such...is that not the case? If it is, heck get some side appointments and keep that $40K in biz you have already.

Again, I will you luck.

Sundance is so right. Have you head of a company called Brooke Franchise? You may want to check into them. They can help you overcome a lot of the barriers to entry you will be guaranteed to face! They have helped a lot of captives get into the independent side! Good luck!

Hi! As the brat of a former Farmers agent, who successfully left the direct writing world to become an independent broker, the rewards so outweighed the sacrifices that we had to do for awhile in order to successfully mire this minefield. I believe that if you survey the average independent broker that has left the direct writing world with any carrier, they will tell you that they do not regret this decision one bit. My personal experience was awhile ago (10+years), however, I believe this truth still exists.

My suggestion in order to make the transition is to go with an aggregator of some kind (Networked Insurance Agents, Insurance Noodle, etc.) in order to gain the traction with a specific carrier as far as a fit for your new independent agency.

It may take you some time (i.e. possibly a couple of years), but I think the sooner that you start this process, the sooner you can make the eventual break with Farmers.

I hope that helps you make a decision that works best for you.

Carrie M. Allen, ARM
Marketing Rep/Commercial Division
Arrowhead General Insurance Agency, Inc.
San Diego, CA

We have a great opportunity for ownership, access to preferred companies, start-up capital, support, and a web-based management system in order to assist you and others like you to start an independent agency while maintaining 100% ownership. If you are interested in getting some additional information, please contact me at the email or phone number below.

Be very careful with the Brooke Franchise, I entered it and quickly exited it. It wasn't as independent as I thought. You have no control over anything

And so now having read all these posts...are you sure you want to change? *hahaha

Just kidding, we all of course have our own opinions and experiences, good, bad and/or indifferent.

Just be sure to DO THE HOMEWORKbefore you take the exam (so to speak).

I would second the opinion on Brooke..be very carefull..they will control every move you make..plus require a huge francise fee of + 100,000,

There are several ways for an experienced, ethical, hard working person to become a truly successful independent agency owner...

What I and others have found is that most smaller agencies want to grow, and are willing to take on the right person as a producing partner, with the opportunity to own the whole agency in the future.

When you buy an agency you are effectively buying a cash flow, and properly structured, the place should not only pay for itself but leave some for you to live on as well.

Do the math. Say you find a the right agency, agree with the selling owner to put 10% down and pay the balance over 15 years at 6% interest.

If the agency cash flow (commissions) is $365,000 and you buy it for 1.5 times, you'll spend about $550,000 for the book. Put $50,000 down and make payments of $4220 a month. That still leaves you with over $25K a month to run the agency. Plenty.

Good luck.

Swymmer

Thank you for all of your insightful opinions and information.

To respond to some of the posts...I started out as a "scratch" agent with Farmers, so I am experienced in producing and know how to build an agency. However, do I really want to do that all over again? Long nights cold-calling...not really. After owning my own agency, I also don't really think I could work for another agent as a producer. I have become spoiled in that we do things "my way" in my office.

I think that if I become an independent, I would probably buy a book. I would also expect some of my clients from Farmers to eventually follow me, as our customer service is much better than what is offered in my area.

As far as the Brooke franchise goes, I don't think I would be interested in buying a franchise without a book of business to go along with it. Unless, that is, if it had a well recognized and respected name. I may live in po-dunks-ville, but I have never heard of or seen a Brooke agency.

Just in case I didn't complain about Farmers enough in my first post..the thing that really incenses me about Farmers is that you are considered an "independent" agent. However, you aren't independent at all. You rely on the company's technology, management, and are at their mercy with regard to everything from rates to discounts to underwriting. You are Independent, but if Farmers has the product, you have to write it through Farmers.

Anyway, thanks once again for all of your advice. I really appreciate it!

Well, it's the same thing with owning a Brooke Franchise. You don't even get your mail. It goes to them and they send it to you if you need it. Seriously, I bought a book of business from a brooke owner that had left. i was there 2 days and left. you have no control. over the money, the carriers they are contracted to do business wiht. Basically, you are an office manager. that's it. be VERY careful with that. Advice to you is, dont' do it. Check out Allstate or State Farm or even Nationwide.

Good luck

I also was a Farmers agent for 5 years. I left and became an independent agency owner this year. You can get appointments if you have a sound business plan and good production numbers. I was told how hard it was to get appointed. But carriers are also looking to grow their business and need new agencies to reach their goals. I was able to get an appointment with every carrier I went after. Good luck, and if you make the switch you won't regret it.

http://www.grandcanyonquotes.com

I left a captive to go independent 6 months ago. It's a big mountain to climb rebuilding that income but you make it happen one day, one week at a time. Talk with Reps before leaving Farmers to be sure you can get contracts. BE SURE to ask them to keep your name private. You need a marketing game plan. That is the biggest issue I feel but if you've been an agent for 5 years or so you have the idea of that probably already. Set a goal to write a certain amount of premium each week, whatever your income goal is.
The best part? Having no corporate environment telling you what to do.
I really don't understand why the independent side gets such a bad rap. When I was on the captive side all I heard was how terrible it is. It's great! It's not easy necessarily either. But the independence is terrific.