I agree with the comment that the small agencies, who have nothing to do with these improprieties, have been let down. Possibly by our associations, but primarily by the Carriers who participated in the STEERING of business and then subsequently CAVED to Spitzer without a fight for a compensation/incentive plan that has been determined to be legal and appropriate by all states.
\”Welcome the visitors\’ room of the Independent Insurance Agents and Brokers of America. Wait a monent while we que up our newest video, the one of our CEO telling members that despite the dues they are paying, the Association thinks that changing a critical part of an agency\’s compensation will go well; based on what has been said by Travelers, and Chubb, who voluntarily settled out-of-court to avoid criminal prosecution, and jail time.\”
You say that the smart agencies will do alright. IIABA; what\’s your definition of a smart agency? Why do you believe that your plans will allow your members to better plan for their business year; especially when your \”business partners\”(?)decide next year that they don\’t want to write that business any more. What about all of the rest of your members, or have you already decided that you don\’t need them any more too.
You don\’t appear to be worried by these dramatic changes, because you are already receiving payments from Travelers and Chubb, and unlike your members, you just have to talk the company line……and, keep on collecting.
As a member, I don\’t see this association representing my interests, and in addition your dues are too expensive. I can not afford an association who doesn\’t look out for me, and then turns around and accepts money from the same carriers who caused the problem in the beginning – I call that blood money!
I going to check out other agents associations to see if they are presenting my interests, not some insurance company.
.
With the advent of data base bridges to carrier rating engines you will see the smart agency be able to command a hefty guarantee from its carriers if they want to keep the business. Good books of business will flow to the most perk laden carriers with a minimum amount of effort on the part of the agent. Watch in the future when carriers refuse to provide download because this info can be used to switch carriers in the future. Carriers will say that all the info is available on the carriers website. Remeber the agent has the relation with the customer and controls the business.
As is so often the case (in spite of the $$ I pay to our association) Mr. Rusbuldt does NOT speak for me. I do not buy that these plans are potentially beneficial to our firm, or to any agency that properly field underwrites its\’ business. In very short order agents will recognize them for what they are, the simple continuation of a trend that was long ago established by ‘our partners\’?, the insurance companies.
When you lose a battle, you try to make the best of it. Pick up your sword again Mr. Rusbuldt, you work for us!
Oh, by the way, if these contracts end up paying on the same basis (same criteria) as the old contracts – WHY THE CHANGE?
I\’ve seen Travelers contract. The growth criteria/factor is some voodoo computation that NO AGENT has the information to make an informed guess at (presumably because of their sensitivity to the fact that ‘that was exactly what Spitzer had a problem with\’). It can\’t be quantified in these new contracts. Please don\’t say that we\’ll know in advance where we\’re at, when we can\’t make the computation ourselves!
This article is crap. I have seen the plan and I am guaranteed to get much less this next year than this year and no matter what we do it will not change. If fact their are parts of it that are \”secret\”. Don\’t expect our trade organizations to help us. They have been bought off by the companies. Where were they when this all started. Its crap.
Thanks, Big I Bob. You are getting a snow job or you have an interpretation shortfall. Please don\’t let your next statement be that Geico wants to work with independent agents.
Big I Bob belongs in somebody\’s nightmare, as he is in a dreamworld all his own. This is the kind of BS we get for paying our dues. The companies will use this legal payment problem to squeeze agents and the bottom line will be: less overall compensation to the agent. Meanwhile the company CEO\’s will be highlighting the great profits and additions to their bottom line at their annual meetings. Companies want to be considered PARTNERS to the agent. Well, guess what? with partners like this, sole proprietorship is looking better and better. The whole system is getting sicker and no one is proposing logical and fair solutions.
Maybe I missed it in the article, but what is the alternative pay structure? I\’m not an agent, so I\’m not all that familiar with the compensation piece.
The alternative plan is the same in all respects to the ‘outlawed\’ former plan, except it\’s called something different and it\’s the modern version of a shell game.
Agents have always been paid commission (at the time of sale) and ‘over-ride\’, ‘contingent commission\’ or ‘profit sharing\’ at year end. The year end payment used to be solely calculated based on the profitability of the business written by the agent, for the company. The idea being, if an agent was very selective about the business they placed with a carrier (insured\’s company was well managed, invested in loss control, cared about and protected their property and employees) they stood to benefit at year end by doing so. A good ‘field underwriter\’ was rewarded. THEN, over the years, the companies contracted everyone and their brother – added growth bonuses – retention bonuses/penalties, etc. etc. THEN, companies made ‘sweet heart\’ unethical arrangements with the large brokers (actually, this has been happening for many years) to STEER business. They got caught, got spanked, and the small agent is paying the price. The small agent who\’s on the insureds\’ doorstep and truly attempts to look out for his insured\’s best interest (and who never had the size to make such ‘sweet heart\’ deals with the carriers) is the one most negatively impacted by the sins of the large brokers. Now, with looming ‘compensation disclosure\’ the cost of compliance will shut a lot of their doors, kill competition and benefit the large brokers again.
Where is Teddy Roosevelt when we need him – he understood the corrupting nature of ‘MONOPOLY\’.
Remember fellow agents, the association represents the big boys too – need I say more?
I always here agents complain about the National Carriers day after day after day. If you are so fed up move your business to the Regionals and Super-regionals who will most likely continue with business as usual unless mandated by law. Hit \’em where it hurts.
I agree with the comment that the small agencies, who have nothing to do with these improprieties, have been let down. Possibly by our associations, but primarily by the Carriers who participated in the STEERING of business and then subsequently CAVED to Spitzer without a fight for a compensation/incentive plan that has been determined to be legal and appropriate by all states.
\”Welcome the visitors\’ room of the Independent Insurance Agents and Brokers of America. Wait a monent while we que up our newest video, the one of our CEO telling members that despite the dues they are paying, the Association thinks that changing a critical part of an agency\’s compensation will go well; based on what has been said by Travelers, and Chubb, who voluntarily settled out-of-court to avoid criminal prosecution, and jail time.\”
You say that the smart agencies will do alright. IIABA; what\’s your definition of a smart agency? Why do you believe that your plans will allow your members to better plan for their business year; especially when your \”business partners\”(?)decide next year that they don\’t want to write that business any more. What about all of the rest of your members, or have you already decided that you don\’t need them any more too.
You don\’t appear to be worried by these dramatic changes, because you are already receiving payments from Travelers and Chubb, and unlike your members, you just have to talk the company line……and, keep on collecting.
As a member, I don\’t see this association representing my interests, and in addition your dues are too expensive. I can not afford an association who doesn\’t look out for me, and then turns around and accepts money from the same carriers who caused the problem in the beginning – I call that blood money!
I going to check out other agents associations to see if they are presenting my interests, not some insurance company.
.
With the advent of data base bridges to carrier rating engines you will see the smart agency be able to command a hefty guarantee from its carriers if they want to keep the business. Good books of business will flow to the most perk laden carriers with a minimum amount of effort on the part of the agent. Watch in the future when carriers refuse to provide download because this info can be used to switch carriers in the future. Carriers will say that all the info is available on the carriers website. Remeber the agent has the relation with the customer and controls the business.
As is so often the case (in spite of the $$ I pay to our association) Mr. Rusbuldt does NOT speak for me. I do not buy that these plans are potentially beneficial to our firm, or to any agency that properly field underwrites its\’ business. In very short order agents will recognize them for what they are, the simple continuation of a trend that was long ago established by ‘our partners\’?, the insurance companies.
When you lose a battle, you try to make the best of it. Pick up your sword again Mr. Rusbuldt, you work for us!
Oh, by the way, if these contracts end up paying on the same basis (same criteria) as the old contracts – WHY THE CHANGE?
I\’ve seen Travelers contract. The growth criteria/factor is some voodoo computation that NO AGENT has the information to make an informed guess at (presumably because of their sensitivity to the fact that ‘that was exactly what Spitzer had a problem with\’). It can\’t be quantified in these new contracts. Please don\’t say that we\’ll know in advance where we\’re at, when we can\’t make the computation ourselves!
This article is crap. I have seen the plan and I am guaranteed to get much less this next year than this year and no matter what we do it will not change. If fact their are parts of it that are \”secret\”. Don\’t expect our trade organizations to help us. They have been bought off by the companies. Where were they when this all started. Its crap.
Thanks, Big I Bob. You are getting a snow job or you have an interpretation shortfall. Please don\’t let your next statement be that Geico wants to work with independent agents.
Big I Bob belongs in somebody\’s nightmare, as he is in a dreamworld all his own. This is the kind of BS we get for paying our dues. The companies will use this legal payment problem to squeeze agents and the bottom line will be: less overall compensation to the agent. Meanwhile the company CEO\’s will be highlighting the great profits and additions to their bottom line at their annual meetings. Companies want to be considered PARTNERS to the agent. Well, guess what? with partners like this, sole proprietorship is looking better and better. The whole system is getting sicker and no one is proposing logical and fair solutions.
Maybe I missed it in the article, but what is the alternative pay structure? I\’m not an agent, so I\’m not all that familiar with the compensation piece.
The alternative plan is the same in all respects to the ‘outlawed\’ former plan, except it\’s called something different and it\’s the modern version of a shell game.
Agents have always been paid commission (at the time of sale) and ‘over-ride\’, ‘contingent commission\’ or ‘profit sharing\’ at year end. The year end payment used to be solely calculated based on the profitability of the business written by the agent, for the company. The idea being, if an agent was very selective about the business they placed with a carrier (insured\’s company was well managed, invested in loss control, cared about and protected their property and employees) they stood to benefit at year end by doing so. A good ‘field underwriter\’ was rewarded. THEN, over the years, the companies contracted everyone and their brother – added growth bonuses – retention bonuses/penalties, etc. etc. THEN, companies made ‘sweet heart\’ unethical arrangements with the large brokers (actually, this has been happening for many years) to STEER business. They got caught, got spanked, and the small agent is paying the price. The small agent who\’s on the insureds\’ doorstep and truly attempts to look out for his insured\’s best interest (and who never had the size to make such ‘sweet heart\’ deals with the carriers) is the one most negatively impacted by the sins of the large brokers. Now, with looming ‘compensation disclosure\’ the cost of compliance will shut a lot of their doors, kill competition and benefit the large brokers again.
Where is Teddy Roosevelt when we need him – he understood the corrupting nature of ‘MONOPOLY\’.
Remember fellow agents, the association represents the big boys too – need I say more?
in the end it\’s all about the big boys, let\’s not fool ourselves
I always here agents complain about the National Carriers day after day after day. If you are so fed up move your business to the Regionals and Super-regionals who will most likely continue with business as usual unless mandated by law. Hit \’em where it hurts.