freakin’ overpaid kids today will never know the true struggle. You know what my first paycheck was? Dirt. That’s right, dirt. I opened the envelope expecting to see a nice fat check, and a bunch of dirt fell out. When I asked my boss what the heck it was, he said, “Dirt.
You’re lucky to get it. Go grow some food or something.” Then I asked why the envelope was only about 65% full, and he said, “taxes. Welcome to the world, kid.”
I don’t see the humor in cultural appropriation. There are those that actually earn dirt, ya know. You elites are all the same, making fun of those less fortunate. I’ll bet you are white and ohhhhh sooooo privileged, too. I’m outraged! You should be banned. I’m doxxing you! You need sensitivity training! Hate has no home here! My body my choice! Coexist! Tolerance and Diversity (except for people like you)!
When I graduated college and got my first job in the insurance industry, I had to work another part-time job just to make ends meet. And I hated it. Pay them a living salary because if they completed their college education with decent grades, they earned it, deserve it and need it. The cost of education is disproportionately higher today than in the past. I know because I helped pay for my daughter’s books and tuition. She worked two part-time jobs and took student loans for the rest. And yes it was a state college.
“The industry is paying younger insurance professionals larger salaries than what their value is, than what they’re bringing to the table”. This comment makes no sense. In a capitalist economy based on the laws of supply and demand, the value of a commodity is flexible and depends on its desirability and availability. Obviously the young professional has value or they would not be sought after. If you do not believe they have value and do not want to pay, then do without them and see how that works out for you.
This industry, for the most part, just refuses to leave the stone age and fails to take up and develop new talent. Looking at you captives and big brokerages. As if we still live in an economy where an individual can afford to even start the American dream on ~$30k/yr with the debt it would take to get a specialized degree (this isn’t a high school grad economy anymore, sorry). Especially in the big urban centers, the opportunity cost to enter the industry is too high and attracts mostly opportunists and people who have given up looking for a job that will afford 2019 living standards. PS: In a major Urban center you can make a better income bartending, and the benefits offerings are about the same. Terrible.
15-20 years ago, how many graduates had a degree in Risk Management?? The answer is little to none. Young people see an opportunity with the Insurance Industry, and they have way more book knowledge than most long-term agents, but they are being jerked around because the powers at large don’t want change. They have the street knowledge and they aren’t giving it up. Some of the best and most well-rounded agents that I have seen are younger and they have everything to lose. The old dogs are great but we all know their cost of living bonus is tied every year to inflating insurance rates- they make more money whether they sell or not! Must have been nice to have been born 20 years earlier!
According to the U.S. Bureau of Labor Statistics, prices for motor vehicle insurance were 122.46% higher in 2019 versus 2000 (a $612.28 difference in value). New agents can’t expect the same ride, so pay them!!
Young Insurance hopefuls don’t know everything, but they know when they are being ripped off, dismissed and held back. Companies do have to pay more to make up for this, and let’s be honest, they are making more than enough profit (private or public) to make that happen. They just don’t want to. This, to me, makes insurance carriers/brokerages just like many other industries in the US: self-destructive and ripe for disruption.
Less than a quarter of new employees whom we demand to get licensed within six months can pass the P&C exam here in California within that time frame and many can’t with multiple attempts trying to do so.
That’s a pretty sad statistic. Is that in line with the pass/fail rates statewide? If so, then maybe the DOI needs to take a look at how they word the questions. I served on a committee years ago that rewrote the exam questions in my state because failure rates all over the state were rising.
You don’t think your issues and the article are related? Its not about paying new employees more, the article clearly states the insurance industry is having a hard time attracting TALENT without paying higher salaries. I’m not going to guess exactly what your compensation packages are for these roles but would it be fair to say they are in line with food service/bartending/basic construction? Are you really surprised you can’t find committed professionals?
In the ‘ole days newbies grabbed the phone book and started dialing or they starved. Start them out with a high salary and the do no call regulations and I’m not sure how they grow, unless it’s in a high growth area like where many sales are probably laydowns. Risk management advice is sorely lacking in this industry, where price rules the point of sale.
JD has some valid points and underpaying the workers goes across all industries – when they lay off employees and the stock prices go up you know where the loyalty is; in reality a stock company owes loyalty only to the stockholders. It has changed to where they want the most ‘human resource’ they can get for the least amount of money. I just heard the other day that in these days of higher salary and wages that the average millennial only has $8,000 in equity, often due to student loan burdens.
Those of us promised to get wealthy on renewals who ended up getting *****ed by one of the large insurers don’t have a lot of sympathy for the companies or even the new hires; but in fact, we’d like to warn the new hires “caveat emptor.” The managers who made those wealth assertions are usually long gone themselves.
My first paycheck… $259.00 in Sept, 1990.. Rent on a 12 x 12 room $125.00 and a phone bill over $200.00. reality smacked me upside the head real fast. If not for what I had saved, I would have been done right away. I hired a kid with a B Ave out of NIU. He though his job was checking his phone and playing games on my computers on my payroll. Now, I make them earn it. Low base. High Commish – higher then most. They want it. They earn it.
FFA, we tried three different times on hiring young people. Put them into Producer Development, gave them a lot of training. They say a new producer doesn’t break even on remuneration for the first year or two and that is if they are selling something. These young people don’t want to get out and get after it. They do like to play on the computer. People don’t come through the door, hand you their policy and let you have the business. We took a bath on expense hiring these young people.
You can’t generalize. The young people YOU hired didn’t want to get out and go after it. I’m willing to bet there are plenty of others who would. The ones you hired may not have understood what it takes to succeed in sales, even if you told them how hard it is. Some people don’t realize how hard a task really is until they actually try it. Judging from the number of entrepreneurs out there, I think there’s no shortage of young people willing to hustle. The trick is finding them and convincing them to join the insurance industry.
I just hired another one. Came highly recommended by someone I trust with my life. He is 21, no insurance experience and only Gen Ed at a Community College. I was told he is hungry and willing to do what ever it takes to start a career. Fingers crossed with this one…
They can answer all the questions correctly, leave you feeling you have a cant miss type of employee. No way to look in their head and see if they have “it”.
This is a fundamentally flawed way to look at hiring, especially if all you are doing is reading a list of questions on a sheet of paper during your interview process. But I understand most companies do not allow the flexibility needed when conducting interviews.
June 10, 2019 at 11:29 am
FFA says:
Like or Dislike:
4
0
First time I hired someone I was 18. I am now 57. Some have worked out at the position I hired them for. Others, I shifted to other job functions that better suit their talents. Others, not so much.One kid I remember was excellent at the job but caught him tossing merchandise out the back door. One thing that remains consistent through the years, they either have the ability to do the job or they dont. No way to know unless you give them the chance. .
June 4, 2019 at 2:14 pm
jsmooth says:
Well-loved. Like or Dislike:
17
0
Here in the Midwest, the average agency is paying the new Producers around $40k, with benefits and the benefit of getting “house policies” and very nice commission after their first full year. After year three, they are making traditionally on commission only, but those that last that long are typically making around $70k. In the middle of the country, it’s great money.
There are some agencies who will pay quite a bit more for top talent, but it’s the kids who finished top of their class and show the drive necessary to excel. Supply and Demand, as someone stated earlier, is all this is. Good for them if they can make good money earlier than I did.
The only other comment I’ll make pertains to education… As a Sales Rep for a major Carrier, I have found many of the top Producers in the agencies I call on never stepped foot in a college. I do not believe, nor see in the field, where education makes “the” difference in being a successful Producer. It’s all about the internal drive of the person. At the company I work for, you can’t throw a rock without hitting someone with their MBA. Most of them are working in Customer Service or entry level Claims positions. Twenty five years ago, and MBA meant a WHOLE lot more that it does today. This may not be the case in big cities, but in the Midwest, and most of the South, your degree isn’t nearly as important to an agency owner. They want you to sell, not teach an economics course. I was fortunate to attend college while the interest rate was low and the cost was at least affordable. Today, these kids getting an advanced degree and then work for $30-40k per year is crazy. A gentleman in this company makes $44k per year, has an MBA and nearly $82k remaining in student loan debt. Half his monthly pay goes to student loans. At his interest rate, he’ll be paying until death. The point – Good for those kids able to find something paying well. It makes the industry look more appealing to the rest of the younger generation.
jsmooth, one minor disagreement about your education points. I agree that the drive to sell is important, and college doesn’t teach that. However, the ability to read, understand, interpret and explain insurance policies is also very important. Too many producers today seem to lack that ability or the desire to learn, at least judging from the questions I see. A college education helps immensely with that skill. So, while college doesn’t necessarily teach you how to fill a prospect pipeline or close deals, it can help sell more coverage (a good producer can explain a policy and convince someone that they need it,) and it also helps avoid E&O losses. It won’t prevent all of them, but it can make them less likely.
This is the big difference between small and large agencies and working on small or large business…. Small business just doesn’t care about your knowledge of coverage, to them it is price, price, price, price… In the larger world, the coverage is the main factor. These organizations need to know their risk profile, how they are performing, as well as how they stand against their peers… Kids coming from RM degrees from college are built to move into roles with the Marshs, Aons, & Willis’ of the world.
I would disagree with the pricing on smaller commercial accounts. I look to plug holes / gaps. Tell someone they can have blanket AI for $315.00 with P&C wording and waiver of sub packaged when their current guy is charging them per AI / P&N C wording the for $250.00 $10,000 to cover tools & equipment, they are no so concerned about getting a cheaper price. Then its just a matter of issuing cert after cert after cert. Get them their certs by close of business on the day requested. They are not leaving.
True on the college point. I would rather have someone clean of debt (and the entitlement way of thinking that goes along with that). Give me raw talent with a will to succeed and the gift to gab over some college kids with mounds of debt and their cell phone loaded with games and social media. Someone that is hungry.
With the college debt comes a sense of entitlement. “I went to College so I want more money to pay it off”. My nephew thought he was going to command $60,000 + upon graduation. He got a hard slap of reality. Found himself on ground floor of a start up making $10.00. After paying his dues on the bottom rung, he has climbed a few steps through his hard work and determination. Very proud of him sticking it out.
Some jobs do pay $60K right out of college, but they require the right skill set. One of my sons made that much his first year, but he had a degree in computer science and math, so he was able to get that much as a software engineer. A liberal arts major like me? Not so much. The demand for software engineers is higher than it is for liberal arts majors, so software engineers get bigger bucks. The old supply and demand story.
Glad to hear your nephew is working hard to improve his situation.
True on that point – the type of degree they get does help with the $$ they receive. My nephew got a Marketing Degree. He knew he had to pay his dues and now he is covering his expenses including the college debt looking, at getting married. His Girl Friend is fighting cancer and he has really stepped up, staying by her side through the whole ordeal. His future is pretty bright except for the cancer thing.
June 4, 2019 at 3:38 pm
MrD says:
Well-loved. Like or Dislike:
13
1
I am a smaller agency in southeast Texas. 5 employees and it is a constant hustle to keep up to staff. A CSR or Account Manager with experience in commercial lines has no problem looking you straight in the eye and ask for $50k – $60k per year plus benefits, days off, paid vacation and the opportunity to work remote from home. Then they don’t want to be bound by time restraints; reporting to work when they want and leaving when they want with the attitude of so what “as long as I get my work done”. Never mind that the CFO at one of your larger commercial accounts wants to talk to his account manager when he calls at 8:30 a.m. I agree that we as an industry need to pay these young people a living wage; it’s hard for them to make it. My daughter spent $100,000+ getting a degree and now teaches school for $44,000 per year. How do we expect them to carry that burden and live – we have to pay them. But, the new generation of employee has to understand that there are things they need to do as well; they can’t always have it the way they want it; they may have to show some drive and initiative and improve their situation by their own action; and there may be rules they have to follow. It’s a two way street. I want to employ you for a livable wage on which you can survive, but I want your dedication and hard work in return and for you to stop asking for the moon.
The employee’s work isn’t done if he or she isn’t able to take that CFO’s call at 8:30. That said, technology today allows that person to take the call from places other than the office. When my office phone is set on “out of office,” my calls go straight to my cell phone. I can talk with a customer from anywhere, though I do draw the line at the men’s room. There are certain activities that should not be multitasked.
my thoughts exactly. Current technology allows for employees to be able to work from most places at pretty much any time of the day. Employees should be afforded that opportunity if you want them to stick around. If the employee wants to work from home and have flexible hours, that’s fine but it also means they would be available to adequately serve the needs of the CFO at 8:30am, and if they’re not they’re not doing the job they were hired to do.
Yeah, pretty telling when their first example is solved by technology that is like 170 years old. Of course for many in the insurance industry that still qualifies as new technology.
Very good post MrD. One of my “mistakes” was originally hired as a CSR. Hadn’t hired a male before to do CSR duties, but we gave him a try. He was good at the computer and learned how to quote the carriers quickly. He did ok, but came to me saying he wanted to be a producer because dealing with prospects/custormers over the phone was boring and he wanted to be where the action was. We thoroughly discussed what was to be expected of him and sales were how he could make it. Turned out that he didn’t want to work that hard and expected the market to come to him. We tried to help him, but he couldn’t adapt to sales so we had to cut him loose.
My nephew didnt want to do sales. He was the marketing department. Now, company has grown and he is the head of the marketing department with 2 employees under his supervision.
FFA, being head of a marketing department means you have to produce sales in order to stay head of a marketing department. Hope he has competitive markets to compete with.
Agent, he seems to have his head on straight accepting the fact he has to pay his dues. I am not sure exactly what he does but I do know its got something to do with Web Sites. He has tweaked mine out from time to time. I know its helped as I have had comments from prospect calling in. I know he gets a base, commissions and over rides on his crew. Company is only 4 years old and he has been there for three years. His paychecks dont bounce. Seems he is going to stick with this until someone else comes along and makes his eyes pop out with a much bigger number. But for now, he is looking at the long haul. .
June 4, 2019 at 10:00 pm
Perception by upper molars says:
Like or Dislike:
3
0
One CEO of a major personal/comm lines insurance company told their board the average agent is good to them for about 7 years.
I believe that. I have worked direct sales on the carrier side before selling PL. The churn and turnover is unbelievable. The pace is frenetic and never ever stops. 90% of the people will eventually hit a “wall” where they simply cannot do it any more. Insanely high sales goals, no commission from renewals, commoditized insurance market, constantly shifting commission structures–no thanks! I transitioned over to commercial lines on the independent agency side and it is about 1000 times better.
Augustine, you are right. Commercial Lines is really where it is at with ability to put volume on the books, get the added commission from it. However, when I sell a Commercial Account, I always ask to quote the Personal Lines. That tends to lock things down better.
I do get a chuckle out of the PL agents I talk with. They think PL is so much easier then commercial. They spend as much time chasing down a $4000 account as I do a $10,000 account. My main carrier pays 20% on Commercial and 10% on PL. Simple math for me. Chase $400 or chase $2000. I dont need a college degree to do that (old school) math. .
It just evolves from there… Because it takes the same amount of work for a $10,000 account as it does $100,000
June 6, 2019 at 4:00 pm
FFA says:
Like or Dislike:
6
0
I keep looking for that $100,000 account. Have had a few over the years but none as of late. But, I keep stepping up to the plate and swinging. so…..
June 10, 2019 at 12:31 pm
Nancy Germond says:
Like or Dislike:
5
0
This is an interesting article. What the industry fails to recognize is that we should focus on hiring those stuck in dead-end careers. These employees 1) have work experience, 2) usually understand basic employment requirements like attendance and punctuality, 3) should have team skills.
We keep focus on college age not realizing, especially in smaller agencies, we’re going to have to teach many of those skills. This article I wrote outlines some of the deficits I see in today’s younger workers.
We’re missing the boat if we don’t raid other industries (like construction) with applicable skill sets.
I would add that the industry should consciously pursue military veterans. Disciplined, conscientious, hard-working, plus they’ve earned the opportunity. And let’s face it – after someone has tried to kill you on the job, an angry client just isn’t going to rattle you very much.
Agree veterans should be hired. They will show up on time, work hard to learn the profession and get the work done. Don’t hire any of the artsy fartsy kids who think they are entitled and are lazy.
It is the same thing, different day. I have been practicing insurance for over 30 years. Got all the designations, degree, and even a master’s to “make myself more valuable.” That is what every employer said for me to do. Where has it gotten me today: insurance companies and agencies stating that I am now overqualified. I remember the 2007 McKinney report stating from 2008-18, over half a million will retire from the industry and will drive those with experience to be in demand. Then the 2008 Stock Market crashed, and all those people had to work longer to make up their losses. Now they are finally retiring but no one wants to pay for the people they currently have, only for someone new. Yet these companies do not know that it is cheaper to keep someone than hire and train a new person. No matter how many research studies confirm it time and time again, all industries do not care. I see people not having any loyalty and having better opportunities if they jump around. I do not like doing that but decided to test the job market. Each one ask why I have been with the company for so long (over 10 years) like it is a bad thing. I like what I do but some days, not being appreciated for what I have to offer really makes it hard.
freakin’ overpaid kids today will never know the true struggle. You know what my first paycheck was? Dirt. That’s right, dirt. I opened the envelope expecting to see a nice fat check, and a bunch of dirt fell out. When I asked my boss what the heck it was, he said, “Dirt.
You’re lucky to get it. Go grow some food or something.” Then I asked why the envelope was only about 65% full, and he said, “taxes. Welcome to the world, kid.”
LOL. Awesome comment. I think satire will be lost on a great deal of the folks posting on these boards…
Hidden due to low comment rating. Click here to see.
He could have at least kicked in a little fertilizer …
Great one Rob!
When I graduated college and got my first job in the insurance industry, I had to work another part-time job just to make ends meet. And I hated it. Pay them a living salary because if they completed their college education with decent grades, they earned it, deserve it and need it. The cost of education is disproportionately higher today than in the past. I know because I helped pay for my daughter’s books and tuition. She worked two part-time jobs and took student loans for the rest. And yes it was a state college.
“The industry is paying younger insurance professionals larger salaries than what their value is, than what they’re bringing to the table”. This comment makes no sense. In a capitalist economy based on the laws of supply and demand, the value of a commodity is flexible and depends on its desirability and availability. Obviously the young professional has value or they would not be sought after. If you do not believe they have value and do not want to pay, then do without them and see how that works out for you.
You can’t have your cake and eat it too!
This industry, for the most part, just refuses to leave the stone age and fails to take up and develop new talent. Looking at you captives and big brokerages. As if we still live in an economy where an individual can afford to even start the American dream on ~$30k/yr with the debt it would take to get a specialized degree (this isn’t a high school grad economy anymore, sorry). Especially in the big urban centers, the opportunity cost to enter the industry is too high and attracts mostly opportunists and people who have given up looking for a job that will afford 2019 living standards. PS: In a major Urban center you can make a better income bartending, and the benefits offerings are about the same. Terrible.
15-20 years ago, how many graduates had a degree in Risk Management?? The answer is little to none. Young people see an opportunity with the Insurance Industry, and they have way more book knowledge than most long-term agents, but they are being jerked around because the powers at large don’t want change. They have the street knowledge and they aren’t giving it up. Some of the best and most well-rounded agents that I have seen are younger and they have everything to lose. The old dogs are great but we all know their cost of living bonus is tied every year to inflating insurance rates- they make more money whether they sell or not! Must have been nice to have been born 20 years earlier!
According to the U.S. Bureau of Labor Statistics, prices for motor vehicle insurance were 122.46% higher in 2019 versus 2000 (a $612.28 difference in value). New agents can’t expect the same ride, so pay them!!
Young Insurance hopefuls don’t know everything, but they know when they are being ripped off, dismissed and held back. Companies do have to pay more to make up for this, and let’s be honest, they are making more than enough profit (private or public) to make that happen. They just don’t want to. This, to me, makes insurance carriers/brokerages just like many other industries in the US: self-destructive and ripe for disruption.
Less than a quarter of new employees whom we demand to get licensed within six months can pass the P&C exam here in California within that time frame and many can’t with multiple attempts trying to do so.
That’s a pretty sad statistic. Is that in line with the pass/fail rates statewide? If so, then maybe the DOI needs to take a look at how they word the questions. I served on a committee years ago that rewrote the exam questions in my state because failure rates all over the state were rising.
By all means, let’s make it easier to pass the subject they are basing their livelihood on. No challenges, no results.
They did that with the American Bar Exam in CA. Their CA Supreme Court did it: https://www.nytimes.com/2017/07/13/business/dealbook/california-bar-exam.html
…maybe you should screen your applicants better? A novel thought, I’m sure.
Sounds like you do a terrible job training them and have a systemic problem in your company.
You don’t think your issues and the article are related? Its not about paying new employees more, the article clearly states the insurance industry is having a hard time attracting TALENT without paying higher salaries. I’m not going to guess exactly what your compensation packages are for these roles but would it be fair to say they are in line with food service/bartending/basic construction? Are you really surprised you can’t find committed professionals?
In the ‘ole days newbies grabbed the phone book and started dialing or they starved. Start them out with a high salary and the do no call regulations and I’m not sure how they grow, unless it’s in a high growth area like where many sales are probably laydowns. Risk management advice is sorely lacking in this industry, where price rules the point of sale.
JD has some valid points and underpaying the workers goes across all industries – when they lay off employees and the stock prices go up you know where the loyalty is; in reality a stock company owes loyalty only to the stockholders. It has changed to where they want the most ‘human resource’ they can get for the least amount of money. I just heard the other day that in these days of higher salary and wages that the average millennial only has $8,000 in equity, often due to student loan burdens.
Those of us promised to get wealthy on renewals who ended up getting *****ed by one of the large insurers don’t have a lot of sympathy for the companies or even the new hires; but in fact, we’d like to warn the new hires “caveat emptor.” The managers who made those wealth assertions are usually long gone themselves.
My first paycheck… $259.00 in Sept, 1990.. Rent on a 12 x 12 room $125.00 and a phone bill over $200.00. reality smacked me upside the head real fast. If not for what I had saved, I would have been done right away. I hired a kid with a B Ave out of NIU. He though his job was checking his phone and playing games on my computers on my payroll. Now, I make them earn it. Low base. High Commish – higher then most. They want it. They earn it.
FFA, we tried three different times on hiring young people. Put them into Producer Development, gave them a lot of training. They say a new producer doesn’t break even on remuneration for the first year or two and that is if they are selling something. These young people don’t want to get out and get after it. They do like to play on the computer. People don’t come through the door, hand you their policy and let you have the business. We took a bath on expense hiring these young people.
You can’t generalize. The young people YOU hired didn’t want to get out and go after it. I’m willing to bet there are plenty of others who would. The ones you hired may not have understood what it takes to succeed in sales, even if you told them how hard it is. Some people don’t realize how hard a task really is until they actually try it. Judging from the number of entrepreneurs out there, I think there’s no shortage of young people willing to hustle. The trick is finding them and convincing them to join the insurance industry.
I just hired another one. Came highly recommended by someone I trust with my life. He is 21, no insurance experience and only Gen Ed at a Community College. I was told he is hungry and willing to do what ever it takes to start a career. Fingers crossed with this one…
Maybe you should have spent time and money on learning how to recruit, interview and hire.
They can answer all the questions correctly, leave you feeling you have a cant miss type of employee. No way to look in their head and see if they have “it”.
This is a fundamentally flawed way to look at hiring, especially if all you are doing is reading a list of questions on a sheet of paper during your interview process. But I understand most companies do not allow the flexibility needed when conducting interviews.
First time I hired someone I was 18. I am now 57. Some have worked out at the position I hired them for. Others, I shifted to other job functions that better suit their talents. Others, not so much.One kid I remember was excellent at the job but caught him tossing merchandise out the back door. One thing that remains consistent through the years, they either have the ability to do the job or they dont. No way to know unless you give them the chance. .
Here in the Midwest, the average agency is paying the new Producers around $40k, with benefits and the benefit of getting “house policies” and very nice commission after their first full year. After year three, they are making traditionally on commission only, but those that last that long are typically making around $70k. In the middle of the country, it’s great money.
There are some agencies who will pay quite a bit more for top talent, but it’s the kids who finished top of their class and show the drive necessary to excel. Supply and Demand, as someone stated earlier, is all this is. Good for them if they can make good money earlier than I did.
The only other comment I’ll make pertains to education… As a Sales Rep for a major Carrier, I have found many of the top Producers in the agencies I call on never stepped foot in a college. I do not believe, nor see in the field, where education makes “the” difference in being a successful Producer. It’s all about the internal drive of the person. At the company I work for, you can’t throw a rock without hitting someone with their MBA. Most of them are working in Customer Service or entry level Claims positions. Twenty five years ago, and MBA meant a WHOLE lot more that it does today. This may not be the case in big cities, but in the Midwest, and most of the South, your degree isn’t nearly as important to an agency owner. They want you to sell, not teach an economics course. I was fortunate to attend college while the interest rate was low and the cost was at least affordable. Today, these kids getting an advanced degree and then work for $30-40k per year is crazy. A gentleman in this company makes $44k per year, has an MBA and nearly $82k remaining in student loan debt. Half his monthly pay goes to student loans. At his interest rate, he’ll be paying until death. The point – Good for those kids able to find something paying well. It makes the industry look more appealing to the rest of the younger generation.
What do you call top talent? Someone with experience or someone with the gift to go out and get business?
I prefer the gift to go get it. If it was experience, he would already have a job doing it.
jsmooth, one minor disagreement about your education points. I agree that the drive to sell is important, and college doesn’t teach that. However, the ability to read, understand, interpret and explain insurance policies is also very important. Too many producers today seem to lack that ability or the desire to learn, at least judging from the questions I see. A college education helps immensely with that skill. So, while college doesn’t necessarily teach you how to fill a prospect pipeline or close deals, it can help sell more coverage (a good producer can explain a policy and convince someone that they need it,) and it also helps avoid E&O losses. It won’t prevent all of them, but it can make them less likely.
This is the big difference between small and large agencies and working on small or large business…. Small business just doesn’t care about your knowledge of coverage, to them it is price, price, price, price… In the larger world, the coverage is the main factor. These organizations need to know their risk profile, how they are performing, as well as how they stand against their peers… Kids coming from RM degrees from college are built to move into roles with the Marshs, Aons, & Willis’ of the world.
I would disagree with the pricing on smaller commercial accounts. I look to plug holes / gaps. Tell someone they can have blanket AI for $315.00 with P&C wording and waiver of sub packaged when their current guy is charging them per AI / P&N C wording the for $250.00 $10,000 to cover tools & equipment, they are no so concerned about getting a cheaper price. Then its just a matter of issuing cert after cert after cert. Get them their certs by close of business on the day requested. They are not leaving.
True on the college point. I would rather have someone clean of debt (and the entitlement way of thinking that goes along with that). Give me raw talent with a will to succeed and the gift to gab over some college kids with mounds of debt and their cell phone loaded with games and social media. Someone that is hungry.
Why would you assume someone with a huge college debt isn’t hungry? Isn’t it rational to want to pay off that debt as fast as possible?
With the college debt comes a sense of entitlement. “I went to College so I want more money to pay it off”. My nephew thought he was going to command $60,000 + upon graduation. He got a hard slap of reality. Found himself on ground floor of a start up making $10.00. After paying his dues on the bottom rung, he has climbed a few steps through his hard work and determination. Very proud of him sticking it out.
Some jobs do pay $60K right out of college, but they require the right skill set. One of my sons made that much his first year, but he had a degree in computer science and math, so he was able to get that much as a software engineer. A liberal arts major like me? Not so much. The demand for software engineers is higher than it is for liberal arts majors, so software engineers get bigger bucks. The old supply and demand story.
Glad to hear your nephew is working hard to improve his situation.
True on that point – the type of degree they get does help with the $$ they receive. My nephew got a Marketing Degree. He knew he had to pay his dues and now he is covering his expenses including the college debt looking, at getting married. His Girl Friend is fighting cancer and he has really stepped up, staying by her side through the whole ordeal. His future is pretty bright except for the cancer thing.
I am a smaller agency in southeast Texas. 5 employees and it is a constant hustle to keep up to staff. A CSR or Account Manager with experience in commercial lines has no problem looking you straight in the eye and ask for $50k – $60k per year plus benefits, days off, paid vacation and the opportunity to work remote from home. Then they don’t want to be bound by time restraints; reporting to work when they want and leaving when they want with the attitude of so what “as long as I get my work done”. Never mind that the CFO at one of your larger commercial accounts wants to talk to his account manager when he calls at 8:30 a.m. I agree that we as an industry need to pay these young people a living wage; it’s hard for them to make it. My daughter spent $100,000+ getting a degree and now teaches school for $44,000 per year. How do we expect them to carry that burden and live – we have to pay them. But, the new generation of employee has to understand that there are things they need to do as well; they can’t always have it the way they want it; they may have to show some drive and initiative and improve their situation by their own action; and there may be rules they have to follow. It’s a two way street. I want to employ you for a livable wage on which you can survive, but I want your dedication and hard work in return and for you to stop asking for the moon.
The employee’s work isn’t done if he or she isn’t able to take that CFO’s call at 8:30. That said, technology today allows that person to take the call from places other than the office. When my office phone is set on “out of office,” my calls go straight to my cell phone. I can talk with a customer from anywhere, though I do draw the line at the men’s room. There are certain activities that should not be multitasked.
my thoughts exactly. Current technology allows for employees to be able to work from most places at pretty much any time of the day. Employees should be afforded that opportunity if you want them to stick around. If the employee wants to work from home and have flexible hours, that’s fine but it also means they would be available to adequately serve the needs of the CFO at 8:30am, and if they’re not they’re not doing the job they were hired to do.
Let them work from home and you don’t know what they are doing during the work day. It won’t be insurance work for the most part.
Yeah, pretty telling when their first example is solved by technology that is like 170 years old. Of course for many in the insurance industry that still qualifies as new technology.
Very good post MrD. One of my “mistakes” was originally hired as a CSR. Hadn’t hired a male before to do CSR duties, but we gave him a try. He was good at the computer and learned how to quote the carriers quickly. He did ok, but came to me saying he wanted to be a producer because dealing with prospects/custormers over the phone was boring and he wanted to be where the action was. We thoroughly discussed what was to be expected of him and sales were how he could make it. Turned out that he didn’t want to work that hard and expected the market to come to him. We tried to help him, but he couldn’t adapt to sales so we had to cut him loose.
My nephew didnt want to do sales. He was the marketing department. Now, company has grown and he is the head of the marketing department with 2 employees under his supervision.
FFA, being head of a marketing department means you have to produce sales in order to stay head of a marketing department. Hope he has competitive markets to compete with.
Agent, he seems to have his head on straight accepting the fact he has to pay his dues. I am not sure exactly what he does but I do know its got something to do with Web Sites. He has tweaked mine out from time to time. I know its helped as I have had comments from prospect calling in. I know he gets a base, commissions and over rides on his crew. Company is only 4 years old and he has been there for three years. His paychecks dont bounce. Seems he is going to stick with this until someone else comes along and makes his eyes pop out with a much bigger number. But for now, he is looking at the long haul. .
One CEO of a major personal/comm lines insurance company told their board the average agent is good to them for about 7 years.
I believe that. I have worked direct sales on the carrier side before selling PL. The churn and turnover is unbelievable. The pace is frenetic and never ever stops. 90% of the people will eventually hit a “wall” where they simply cannot do it any more. Insanely high sales goals, no commission from renewals, commoditized insurance market, constantly shifting commission structures–no thanks! I transitioned over to commercial lines on the independent agency side and it is about 1000 times better.
Augustine, you are right. Commercial Lines is really where it is at with ability to put volume on the books, get the added commission from it. However, when I sell a Commercial Account, I always ask to quote the Personal Lines. That tends to lock things down better.
I do get a chuckle out of the PL agents I talk with. They think PL is so much easier then commercial. They spend as much time chasing down a $4000 account as I do a $10,000 account. My main carrier pays 20% on Commercial and 10% on PL. Simple math for me. Chase $400 or chase $2000. I dont need a college degree to do that (old school) math. .
It just evolves from there… Because it takes the same amount of work for a $10,000 account as it does $100,000
I keep looking for that $100,000 account. Have had a few over the years but none as of late. But, I keep stepping up to the plate and swinging. so…..
This is an interesting article. What the industry fails to recognize is that we should focus on hiring those stuck in dead-end careers. These employees 1) have work experience, 2) usually understand basic employment requirements like attendance and punctuality, 3) should have team skills.
We keep focus on college age not realizing, especially in smaller agencies, we’re going to have to teach many of those skills. This article I wrote outlines some of the deficits I see in today’s younger workers.
We’re missing the boat if we don’t raid other industries (like construction) with applicable skill sets.
https://www.linkedin.com/pulse/six-important-facts-know-todays-young-adults-entering-nancy/
I would add that the industry should consciously pursue military veterans. Disciplined, conscientious, hard-working, plus they’ve earned the opportunity. And let’s face it – after someone has tried to kill you on the job, an angry client just isn’t going to rattle you very much.
Agree veterans should be hired. They will show up on time, work hard to learn the profession and get the work done. Don’t hire any of the artsy fartsy kids who think they are entitled and are lazy.
It is the same thing, different day. I have been practicing insurance for over 30 years. Got all the designations, degree, and even a master’s to “make myself more valuable.” That is what every employer said for me to do. Where has it gotten me today: insurance companies and agencies stating that I am now overqualified. I remember the 2007 McKinney report stating from 2008-18, over half a million will retire from the industry and will drive those with experience to be in demand. Then the 2008 Stock Market crashed, and all those people had to work longer to make up their losses. Now they are finally retiring but no one wants to pay for the people they currently have, only for someone new. Yet these companies do not know that it is cheaper to keep someone than hire and train a new person. No matter how many research studies confirm it time and time again, all industries do not care. I see people not having any loyalty and having better opportunities if they jump around. I do not like doing that but decided to test the job market. Each one ask why I have been with the company for so long (over 10 years) like it is a bad thing. I like what I do but some days, not being appreciated for what I have to offer really makes it hard.