Ok after 18 years in this business I am tired of business as usual.
I am a one man shop, I tried having others produce but I didn't like it. I built a good group health and life book and I also have been a licensed P&C person (broker/agent licenses). I have...no let me change that, I used to be happy being an outside producer for existing P&C agencies. I would only produce for one agency and they received any / all of my P&C business.
The reasons were simple, they received 55 percent of the commission, gave me markets and they worried about the volume requirement for each different company. That worked fine until the mergers began. About 7 years ago the local big fish agency ate the agency I was producing for and informed me they don't use producers, everyone is salaried. I had two choices sell my book or they take it. Ok, nice that they gave me a choice and I sold.
So I went and found a large agency located in another city that told me they were committed to using producers and we can do some business together. Over the past seven years I have placed a lot of commercial accounts with them (small amount of personal) and things were going well. Today I received a letter telling me that as of November first 2004 they will no longer have any inside or outside commission producers. This time there isn't an offer to buy my book.....they are keeping it.
So I've been burned twice and won't go the agency route again. Now I must find markets and would love to find companies that are available for open broker business. I already found one for my speciality stuff. It is an insurance company that I already have business placed with the last agency, they accept BOR letters and no volume requirements. Over all these years I lost thousands and thousands in commission because I could have placed the business myself and would not have needed to split the commission. Plus once they told me what the commission rate was I realized that I wasn't getting the full split at the last agency.
I am getting tired of searching for broker friendly markets. Does anyone know of a source for a list of insurance companies that have open broker arrangements?
Over all these years I've heard the insurance company line of why they need volume requirements, appointments and such but it is just that, a line. Insurance companies have a social compact and because of that they enjoy freedoms from rules that other companies must abide by. Therefore it should also be a compact that all States, Cities and Counties have access to the markets, different companies, best rates, service, etc. I feel the insurance companies are failing to achieve such a goal. A small town in the middle of Montana will not have the same markets available to their citizens as will a larger city. The reason is the insurance company volume requirements. How can a small town agency/broker fulfill the volume requirements that insurance companies require for an appointment. That small agency/broker would probably be lucky to keep one company satisfied.
Two doors down from where I live is a Fed Congressman (was a State guy) and he and I have talked about this problem. The Fed's and the State's are aware of the problem with markets. He has said the problem has reached some discussion groups. The insurance companies will either open up on their own or they may see legislation. I'll probably be old and grey before I see it.
I don't even want to get into the hard market soft market stuff. What crazy knee jerk methodology using stock market returns to peg a price of their item. Stock market is roaring and hey, voila...soft market. Why in the world haven't they figured out how to trend their business using a different method so that we don't go through the hard market soft market cycle?
Sorry for the length but I had to get some things off my chest.
Broker Friendly
Moderators: Josh, independent guy
I did check them. They have zero HO markets in my State. I do a lot of construction business and tried a hypothetical quote. I received a message that said, no market available at this time. I have not signed on to Noodle and was doing a hypo as a consumer would do it. From what I read there are more markets available to producers than to the general consumer.
Over the years because I was a producer for each agency, the agency had me on their E&O for P&C. For my life/health side I did and paid the E&O under various Asso. agreements that life insurance companies had with E&O carriers. I'm now stuck in one of those crazy P&C twilight worlds. No previous coverage under my name and the carriers are not even willing to quote. Coming off a hard market don't ya know? I did find one that was willing to give a look but only with an appointment and a minimum premium of $3,000. Interesting offer but how can you get an appointment without E&O. My eighteen years of experience means nothing just as the times I had clients with 20 years of construction experience that decided to go Inc. with a Corp. name etc. and the insurance companies wanted to consider them a new business. Now I understand why they get PO'd about this stuff. I'm waiting for a return call from someone that sent to several E&O carriers for me. I included a cover letter stating the methods I use to track business / policies, etc. my experience and years of P&C business without a claim. We'll see.
So I am sitting here without E&O, can't get appointments, don't want to do any BOR letters, errrrrrrrrr! The good thing is that a fire has been lit and I'm hustling new for new group health.
Maybe I should start a magazine geared toward open brokerage business.
Over the years because I was a producer for each agency, the agency had me on their E&O for P&C. For my life/health side I did and paid the E&O under various Asso. agreements that life insurance companies had with E&O carriers. I'm now stuck in one of those crazy P&C twilight worlds. No previous coverage under my name and the carriers are not even willing to quote. Coming off a hard market don't ya know? I did find one that was willing to give a look but only with an appointment and a minimum premium of $3,000. Interesting offer but how can you get an appointment without E&O. My eighteen years of experience means nothing just as the times I had clients with 20 years of construction experience that decided to go Inc. with a Corp. name etc. and the insurance companies wanted to consider them a new business. Now I understand why they get PO'd about this stuff. I'm waiting for a return call from someone that sent to several E&O carriers for me. I included a cover letter stating the methods I use to track business / policies, etc. my experience and years of P&C business without a claim. We'll see.
So I am sitting here without E&O, can't get appointments, don't want to do any BOR letters, errrrrrrrrr! The good thing is that a fire has been lit and I'm hustling new for new group health.
Maybe I should start a magazine geared toward open brokerage business.
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InsuranceMaster
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- Joined: Mon Jul 12, 2004 5:43 pm
Well, my first act is to get affordable E&O (if there is such a thing). I've received one quote for $2500 plus fees. I have another place that I'll send for more quotes. I don't like spending $3,000 for a one man operation....errrrrrr.
I have one place that does open broker business. I was talking with a P&C rep today. Now that is something I always laughed about. Sorry if you are a rep. The P&C companies claim that they need volume requirements to stay profitable. Yet, they have people that run around the country and take agency people to lunch. Nice job if you can get it but I think it is an old costly way of doing business.
I really would like to sit down and use my econ. major to have a P&C head prove how volume requirements make or don't make the P&C business more profitable. I really think I could shoot their reasons full of holes. It is all about power, control and fear of change. Take 1,000 applications and they all arrive in the company office waiting to be routed to the underwriter. It doesn't matter if you had 10 offices sending in 100 apps each or one office. The cost to underwrite is basically the same.
They want to worry about having a .09 ratio as opposed to a 1.2. They could easily make up that ratio through open broker business. Offer open broker business, no volume requirements, and offer a straight 10 percent. That would open up markets to everyone and the smaller locations could have access to the same markets as the large cities. I believe a small office would give up the points if they didn't need to worry about the volume requirements and loss of contract. If you are a large office and need the extra 5 points, then you can contract with volume requirements.
Today I was talking with an insurance company rep. She admitted that smaller rural areas don't have as much access to markets but agents can cluster to satisfy volume and give the rural areas access to markets. Yes that is true but that cost of giving access is bore by the agent/broker in cluster fees. She did agree. She also said that for an agency to have a contract all salespeople must be employees. I guess the insurance companies don't like 1099 people. Hm? Could and agency agreement make agencies statutory employees of the insurance company? I think that agreement of control would make an IRS agent raise an eyebrow.
I looked at one cluster's website and they charge $150 a month fee. For that fee you get a lower volume requirement.
I think Noodle has a good idea for the smaller officer or brokers. I'll take their 80 points and give them 20. After all that is much better than agencies will give. The best I ever had from an agency was a 50/50. Another couple Noodle type arrangements on the Net and you WILL start to see change.
If you want to see the big difference in thought patterns just go to some industry meetings. Go to a life insurance meeting and it is energetic, talking about how to increase your sales etc. Go to a P&C meeting and it is often not about increasing sales. I often thought that P&C people don't want to sell policies. Isn't that their job? A job to access risk and assign premium to that risk? Ouch....fingers hurt so I'll stop ranting. :ph34r:
I have one place that does open broker business. I was talking with a P&C rep today. Now that is something I always laughed about. Sorry if you are a rep. The P&C companies claim that they need volume requirements to stay profitable. Yet, they have people that run around the country and take agency people to lunch. Nice job if you can get it but I think it is an old costly way of doing business.
I really would like to sit down and use my econ. major to have a P&C head prove how volume requirements make or don't make the P&C business more profitable. I really think I could shoot their reasons full of holes. It is all about power, control and fear of change. Take 1,000 applications and they all arrive in the company office waiting to be routed to the underwriter. It doesn't matter if you had 10 offices sending in 100 apps each or one office. The cost to underwrite is basically the same.
They want to worry about having a .09 ratio as opposed to a 1.2. They could easily make up that ratio through open broker business. Offer open broker business, no volume requirements, and offer a straight 10 percent. That would open up markets to everyone and the smaller locations could have access to the same markets as the large cities. I believe a small office would give up the points if they didn't need to worry about the volume requirements and loss of contract. If you are a large office and need the extra 5 points, then you can contract with volume requirements.
Today I was talking with an insurance company rep. She admitted that smaller rural areas don't have as much access to markets but agents can cluster to satisfy volume and give the rural areas access to markets. Yes that is true but that cost of giving access is bore by the agent/broker in cluster fees. She did agree. She also said that for an agency to have a contract all salespeople must be employees. I guess the insurance companies don't like 1099 people. Hm? Could and agency agreement make agencies statutory employees of the insurance company? I think that agreement of control would make an IRS agent raise an eyebrow.
I looked at one cluster's website and they charge $150 a month fee. For that fee you get a lower volume requirement.
I think Noodle has a good idea for the smaller officer or brokers. I'll take their 80 points and give them 20. After all that is much better than agencies will give. The best I ever had from an agency was a 50/50. Another couple Noodle type arrangements on the Net and you WILL start to see change.
If you want to see the big difference in thought patterns just go to some industry meetings. Go to a life insurance meeting and it is energetic, talking about how to increase your sales etc. Go to a P&C meeting and it is often not about increasing sales. I often thought that P&C people don't want to sell policies. Isn't that their job? A job to access risk and assign premium to that risk? Ouch....fingers hurt so I'll stop ranting. :ph34r:
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PersSvceAgent
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- Joined: Mon Sep 13, 2004 1:53 pm
I'm a one man shop with Personal & Comml of about 8 years. The E&O ins mkt is tough to find conservative cost. I over stated my 1st volume expecting to place comml ins but markets weren't available, as first experience w/IAAT affiliates costly. You may seek higher deductible $2500 instead of $1000 as it helped lower my cost about 10%. Then be sure to have the E&O loss control Course done a month before renewal; it helped another 10% or so the next year.
Tired of paying others 35 to 45% of the commission on accounts I work hard to establish; but what can you do?. It takes about 3 years per client to obtain comml business. I'll try I-Noodle in Texas but the SIIA cost thru a Master Agency was as costly as was Agent Secure, another broker affiliated w/IAAT. I'm hoping for $100K of sustained growth each yr., as I get settled in with a cluster.
I forgot to mention, my agency size is about $200,000 GP w/o comml busn and I paid E&O cost of $1500 this yr. vs prior yr of $1900. Good luck--keep postin comments. Stewart @PSI Agency
Tired of paying others 35 to 45% of the commission on accounts I work hard to establish; but what can you do?. It takes about 3 years per client to obtain comml business. I'll try I-Noodle in Texas but the SIIA cost thru a Master Agency was as costly as was Agent Secure, another broker affiliated w/IAAT. I'm hoping for $100K of sustained growth each yr., as I get settled in with a cluster.
I forgot to mention, my agency size is about $200,000 GP w/o comml busn and I paid E&O cost of $1500 this yr. vs prior yr of $1900. Good luck--keep postin comments. Stewart @PSI Agency
I am running into the same problem as everyone else, and I am getting concerned about the possibility of not being able to do business in the P&C market. I am in Virginia and I understand Insurance Noodle only offers personal lines in AR, IL, IN, and MO. The S.I.A.A. route is $9000.00 up front and a 15 year contract and you only start off by getting about 60% of your commission. I am currently looking into a company called "Smart Choice", I will let you all know what I find out. If anyone has any suggestions, I would love to hear them. Is there anywhere I can get an appointment just to keep my license active till I figure this thing out?
Brady Gillenwater
brady@inna.net
Brady Gillenwater
brady@inna.net
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InsuranceMaster
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Jim Masiello
- Insurance Journal Fan
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Brady - SIAA is not a cluster! Also, you misstated the facts, which by the way are protected by a Confidentiality Agreement.
SIAA pays 90% of the commission and in addition the member agency receives commission and profit sharing overrides and premium growth bonuses. in 2003, SIAA paid over $8.1 MIllion from these sources to its member agencies!
The 60% is actually 65% and that is for a short period of time prior to direct appointments and is a requirement under the SIAA Quality Control program to assure the quality and profitability of the new member agency business!
Thank you!!
SIAA pays 90% of the commission and in addition the member agency receives commission and profit sharing overrides and premium growth bonuses. in 2003, SIAA paid over $8.1 MIllion from these sources to its member agencies!
The 60% is actually 65% and that is for a short period of time prior to direct appointments and is a requirement under the SIAA Quality Control program to assure the quality and profitability of the new member agency business!
Thank you!!
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Insurance4YourBiz
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You could try http://www.superioraccess.com. I use them as a last resort for some small commercial and some personal lines. I must warn you that their customer service is lacking and often their on-line price indications are way off.
As for E&O, its a cost of doing business. When I paid mine last year it really hurt, but I wouldn't want to be without it.
As for E&O, its a cost of doing business. When I paid mine last year it really hurt, but I wouldn't want to be without it.
Just want to comment about E&O....the best pricing (and coverage offered) in my opinion is thru Big I. I'm sure that PIA also has a similar offering so I'd contant them.
Lastly, contact either assosiation as they normally have some type of agreement with companies that you can license with.
And yes, E&O is just a part of doing business....expensive but ever so necessary!
Good luck...
Lastly, contact either assosiation as they normally have some type of agreement with companies that you can license with.
And yes, E&O is just a part of doing business....expensive but ever so necessary!
Good luck...
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eInsuranceMarkets.com
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If you are in commercial lines why not try http://www.combinedgroup.com? While they have limited states, they do offer many commercial lines. And some of their lines are automated where you can get an instant quote that is actually correct, unlike SuperiorAccess.
Hope it helps.
Hope it helps.
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SuperiorAccess
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<span style='font-size:14pt;line-height:100%'>Superior Access Responds</span>
As a Principal of Superior Access,please allow me the opportunity to speak on behalf of our fine organzation. For the agent that recommended us to a distressed agent in need of markets, thank you. We truly appreciate both your business and the referral. More than 50% of our new subscribing agents are referred to us by other satisfied agents that have found Superior Access to have the largest offering of accurately priced personal and commercial lines market in the industry today. The greatest testament that any company can give of itself is that its customers are sending them other customers.
Superior Access has automated and offers its agents realtime quotes from dozens of companies in 50 States and has never had a complaint about inaccarate rating when all questions are answered accurately. If you have found otherwise, please inform me personally so that I can remedy the situation immediately. Superior Access strives first and foremost to serve its agent customers. Gentlemen, please do take the time to allow us to better serve you by forwarding any specifics in response to this post.
My e-mail address is mike@sais.com. I am one of the owners here and I know I speak on behalf of my partners, our managers and employees when I say, we value every agents business and will spare no effort in making sure that they get what they need from us. Please feel free to e-mail me and tell me what you need.
Mike Mayo
E-VP, E-Business, Superior Access
As a Principal of Superior Access,please allow me the opportunity to speak on behalf of our fine organzation. For the agent that recommended us to a distressed agent in need of markets, thank you. We truly appreciate both your business and the referral. More than 50% of our new subscribing agents are referred to us by other satisfied agents that have found Superior Access to have the largest offering of accurately priced personal and commercial lines market in the industry today. The greatest testament that any company can give of itself is that its customers are sending them other customers.
Superior Access has automated and offers its agents realtime quotes from dozens of companies in 50 States and has never had a complaint about inaccarate rating when all questions are answered accurately. If you have found otherwise, please inform me personally so that I can remedy the situation immediately. Superior Access strives first and foremost to serve its agent customers. Gentlemen, please do take the time to allow us to better serve you by forwarding any specifics in response to this post.
My e-mail address is mike@sais.com. I am one of the owners here and I know I speak on behalf of my partners, our managers and employees when I say, we value every agents business and will spare no effort in making sure that they get what they need from us. Please feel free to e-mail me and tell me what you need.
Mike Mayo
E-VP, E-Business, Superior Access