Getting First Preferred Carrier Appointment

[Jacqueline]

I was wondering if the rest of you have run into this problem. I am a small, 1-person scratch agency that literally had to start out with nothing at all. No money, no access to credit, nothing. Kind of hard to have anything when, due to age discrimination, nobody will give you a job so you are not poor, despite your education and very real need to support yourself and your family. So going the self-employment route as an independent agent was kind of the theater of final resort for me. The rep from AIG gave me a chance. He is now glad that he did because I do sell alot of auto policies for AIG.

It took me 5 1/2 months to get my first appointment and it was with a non-standard carrier. I have done well with this carrier (AIG) and I have recently picked up a non-resident license to be able to sell auto insurance in a bordering neighbor state as well. This coming May it will be 2 years that I have been in business. Since it is very hard to build a book of business when you have only one or two non-standard carriers and NO preferred carriers -especially since the non-standard customers rate shop every 6 months - if they even keep their policies for that long without letting them cancel for non-payment pf premiums. I re-applied for appointment with Donegal, Travelers and Safeco which are preferred carriers.

I have not heard anything from Safeco, and both the Donegal rep denied me appointment and Travelers sent me an email saying they could not offer me appointment, but wished me "continued success with my agency". Yeah right - what chance of getting to be successful and make a living do you have when you can't offer the choices your customers need?

As for the Donegal rep, he came off like the typical "good old boy" who refused to give me any concrete answer as to why I was not qualified for an appointment and what I have to do in order to be qualified for appointment in the future. In fact, he in so many words told me that the auto and property insurance field was a well-connected privileged white male "old boy clique" that I didn't belong in ( I am a disabled middle-aged woman) or fit in with. He was very nasty and rude to me on the phone.

The fact that all I wanted was a chance just like someone had once given him and everybody else who got a chance, didn't seem to matter. It's bad enough that Progressive and AIG have now taken to charging agents $8.00 for CLUE's and MVR's for quotes that don't convert to sold policies, which smaller struggling agencies can't afford to bear. It's bad enough to have to hear people b*tch that so and so online has cheaper quotes because they're a direct writer. But to have to put up with crap like that from carrier reps like the guy from Donegal, too? Have any of you run into this brick wall in trying to get established and grow your agencies? How can I get a real fair, fighting chance to make it and earn a decent living? An equal opportunity shouldn't be too much to ask. If I make it, great. If I blow it then it's on me - but I at least deserve an equal chance by getting the appointments, with the rest being totally on me.

I am not a young woman with a whole lot of other options as I am middle-aged and disabled. I am going on 40 and don't have another 20 years to wait for finally getting a chance when I'll be too old and won't get considered anyway due to age discrimination then.

[Porter]

Getting preferred appointments with no prior broker experience will take time. Have you tried to get appointments with a wholesaler to access preferred companies like Safeco and Travelers? If not do it. Once you start building a preferred book through a wholesaler then they will start coming around. Another thing, contact the marketing reps at the beginning of the year before they fill their annual quotas. Non-standard companies will appoint anyone so get as many as you can right now.

Good Luck!

[sanddog1]

Wow what a story I am sorry for you and your dilemma. Many of us have been in the same boat. The good news is there is an answer. The bad news is.... it's not what you want you to hear. You see everyone wants to make $100,000 net out of the gate.
It's not going to happen period. I will be direct, as I have said a billion times, go work for a broker who will allow you to buy back your developed book of business. Or buy a current book of sold business not personal lines book but a good commercial mix. You will never get and appointment with Travelers, Allied, Safeco, Chubb, Hartford, CIG, OMI and many more. They want experience they do not want to look over your shoulder. And you need to submit a minium of 400,000 in written premium per year, you can not. Buy a book or join a brooker

[Jacqueline]

Getting preferred appointments with no prior broker experience will take time. Have you tried to get appointments with a wholesaler to access preferred companies like Safeco and Travelers? If not do it. Once you start building a preferred book through a wholesaler then they will start coming around. Another thing, contact the marketing reps at the beginning of the year before they fill their annual quotas. Non-standard companies will appoint anyone so get as many as you can right now.

Good Luck!

Do you know which wholesalers offer access to Safeco and Travelers? I will contact them gladly.

As to other non-standard cariers, the only other one in my region whose rates can compete with AIG's is Capitol ( a small non-standard auto carrier based in eastern PA). The Capitol rep was intimidated by another local independent agent (whose book is massive) into NOT appointing other agents (I guess this other agent doesn't want others to have the opportunity to compete fair and square for business). Basically this other agent threatened the Capitol rep with pulling his entire book from Capitol if the rep appoints any other agencies in town. So I have three options: Viking, AIG and Victoria (Nationwide's non-standard carrier who also charges $8 for CLUE's and MVR's just like Progressive and AIG).

The ONLY one I have that does not charge agents for CLUE's and MVR's is Viking but unfortunately their rates don't come close to AIG's. The non-standard market will shop over as little as $10/mo in premiums because the majority of non-standard customers are also low income so every dollar they can save on paying in premiums means the world to them.

[wlunday]

Insurance Noodle allowed access to Safeco Preferred Auto (only) for a buddy of mine that was expanding from a Life / Health Agency to multi-line. He did not get access to homeowner's or commercial, though.

If you want to write small commercial accounts, try Agent Secure. They have a good list of carriers, but they do charge a fee (not too much).

Good Luck!

Swymmer

[alardler]

A couple more things for you to consider. Are you a member of the state Independent Insurance Agents of America or PIA associations? As a member benefit, you have access to programs with standard market carriers without the hassle of premium committments. Also, have you considered joining The Iroquois Group - again access to standard markets without the same premium committment if you got the appointment directly.

As for other non-standard auto carriers, have you looked at Deerbrook? They are a subsidiary of Allstate and have a sister company, Encompass, which is a standard carrier for auto/home/etc. They have a regional office in Reading, PA with local marketing reps all over PA.

As for the charges for CLUE, etc, have you checked your state laws to see if you can charge your clients for these fees if they do not place their coverage with you? In Virginia, as long as you post a sign for your clients explaining what the charges are and for how much, you can pass these fees onto your clients. Many agents I know here who cater to your same client base will ask for this money upfront while they process the quote, then give it back to the client (or apply it to the premium) if they write their coverage through them. Wouldn't hurt to find out.

[CATHIEA]

First of all, congratulations for making the first step - independance. Now quit whining about the cost of doing business, etc. I was a bit older and a single mother when I started my agency from scratch 8 years ago. The first thing you want to do is decide what direction you want to take the agency - not how much money you can make or what it's costing you. If you don't have prefered or commercial experience what's wrong with writing non standard auto? Until she retired, the largest independant agency in AZ was a female owned non standard agency. You need to have every market that will give you an appointment - because different risks will fit different companies and eventually every company has the best rates in town. When I was the marketing rep for Victoria in AZ in 1990 there were 19 non standard carriers available - Victoria's rates were consistantly #18 - Progressive was 19. Within 6 months Victoria had the lowest rates on the street. I've seen companies come and go over the years along with agents who chase the lowest rate - I've even fired a couple of producers for that reason. Chasing the lowest rate costs the agency money.

Pick a place - find your niche and do it well. Non standard agencies have to be run lean & mean - especially if you're in an area that doesn't allow agents to charge fees. Don't run mvr's on quotes - base the quote on what the client tells you - just explain that if they're lying the company will find out and the price WILL change. Stay away from car dealership business - the numbers of apps might seem tempting but this business runs off the books in days not weeks. Join the PIA and the Big I in your area - go to their monthly meetings and meet your competition - it's also a well known fact that there are always going to be a couple of marketing reps at these luncheons. Listen to what other agents are doing and learn from their mistakes - without having to make them yourself.

[Jacqueline]

A couple more things for you to consider. Are you a member of the state Independent Insurance Agents of America or PIA associations? As a member benefit, you have access to programs with standard market carriers without the hassle of premium committments. Also, have you considered joining The Iroquois Group - again access to standard markets without the same premium committment if you got the appointment directly.

I heard alot of bad things about Iroquois Group, so I really refrained from considering that as a feasible option.

As for other non-standard auto carriers, have you looked at Deerbrook? They are a subsidiary of Allstate and have a sister company, Encompass, which is a standard carrier for auto/home/etc. They have a regional office in Reading, PA with local marketing reps all over PA.

I heard about Encompass. But I don't know how to contact anyone there. Never heard of Deerbrook before, but will check them out.

As for the charges for CLUE, etc, have you checked your state laws to see if you can charge your clients for these fees if they do not place their coverage with you? In Virginia, as long as you post a sign for your clients explaining what the charges are and for how much, you can pass these fees onto your clients. Many agents I know here who cater to your same client base will ask for this money upfront while they process the quote, then give it back to the client (or apply it to the premium) if they write their coverage through them. Wouldn't hurt to find out.

I can get away with passing those fees onto prospective customers if they don't buy. The tricky part is that the law here in PA states that agents cannot charge additional fees for writing business. But when someone comes in for just a quote, and they don't buy, that's not considered writing business, so I can charge $8 to pass on the costs.

The problem is that it tends to alienate alot of people who come in for quotes. I don't know how many sales I have lost because the people just walked out and refused to pay and went elsewhere for their quotes. I have had alot simply storm right out saying, " The others don't charge for quotes. I ain't paying for just a stinkin' quote!" and simply leave, pissing and moaning the whole way out the door (as if I'm getting rich off that). They don't hear me when I say, repeatedly loud and clear, that if they buy the policy, I refund them their $8 for the quote. What doesn't help matters is that like Progressive, AIG has also hit the direct writing scene offering no-obligation free quotes if people call their 1-800 number. So of course, when people see the AIG sign out front, they expect the same free quotes that AIG Direct blabs about on their TV commercials and direct mailers. They don't hear me when I try to explain the situation. Or that I will refund the fee if they buy. All they hear is $8 up front for a quote. Since Progressive started that crap, AIG and Victoria have jumped on the "soak the agent" bandwagon.

Pretty soon, ALL non-standard carriers will be doing it. The worst part about it is that AIG is, right now, the most affordable insurance around for the non-standard insureds in PA. A few do not charge agents for MVR's and CLUE's, such as Viking and Capitol. I am appointed with Viking so now I am quoting everybody through them, but their rates are not as low as AIG's. AIG's rates come in way lower than Viking's here in PA. And I am in northwestern PA which is a really economically depressed region due to all the job losses this area has had. So there's alot more working-poor people with crap credit who are no longer wanted by the preferred carriers because they are rated based on their credit.

The majority of the non-standard market is low income, so not only are they unwilling to pay for just a quote when they can go to other agencies better established than us with alot more of an income cushion than what we have who can afford to eat that $8 per quote fee whereas we simply cannot. It is really hurting our business and killing sales for us that we would otherwise get.

The non-standard customers are also the ones who are so cheap that they will drop you in a heartbeat if another agent across town can get them insurance through a different carrier for as little as $10/mo cheaper, which is really why I hate doing non-standard and have been trying to get appointed with a competitively priced preferred carrier so I am not restricted to just selling to the non-standard market. Also, the non-standard customers tend to let their policies cancel for non-payment of premium before the end of their policy terms. It is next to impossible to build any kind of book on the non-standard customer base, unless you're the biggest gig or only gig in town, which we unfortunately, are not.

I didn't really want to start out in the non-standard end because things are hard enough when you're starting out. But none of the preferred carriers will even consider anyone for appointment unless they already have a BOB of $500,000 already placed with another preferred carrier. At least, this is what I am being told by the preferred carriers' reps who actually DO get back to me when I call and have to talk to their stupid voicemails - which they almost never return calls

[bgc952]

Try signing up with one of the companies who will allow you to run your MVRs for a smaller fee than the carriers. I use iix.net and pay a little over $3 per MVR for California reports.

[bgc952]

Make that iix.com

[rodgwag]

Try starting a multi-state agency with no capital, a large mortgage in California and a daughter having heart surgery. Anything good is hard. So now that you have vented, get out there and make it happen.
The world is full of broke whiners.

[Jacqueline]

Try signing up with one of the companies who will allow you to run your MVRs for a smaller fee than the carriers. I use iix.net and pay a little over $3 per MVR for California reports.

Do they have to be approved by the carriers?

[dev1nsan]

Why are you running mvr's and clues on quotes in the first place it's a quote ( estimate based on the information the customer gives you ). Your not the only one in this situation, I've wondered how to get the preffered appointment myself, because most of them want you to be appointed with atleast one prefered already and see how your doing with that. I've sort of given up on trying to get a prefered carrierer and am working on getting my life lisence. Try working with one of those wholesale.

[hipokets]

Have you tried a group like "Combined Group"?

[coolnmellow]

I own a small agency in California and Superior Access gave me a Hartford and One Beacon Sub Direct appointment plus access to over 70 other carriers for only a $25 monthly subscription fee. The sub direct appointments give me a producer code and access to the carriers website. I can bind coverage and print my ID cards and certs. I also make great commission. Try them and if you try you will really increase your income. Good Luck!