Fair Commission?

[Trevor0316]

Hi all. What would be a fair commission for an IMO that provided leads (free of charge via telemarketing, direct mail, and the rest would be my duty of door knocking etc.) Their main focus is Med Sup but also specialize in Life and Annuities (life is what I desire to sell the most) The leads are primarily for Med sup with a training program with the goal of cross-sale for Life, annuities, etc.. Thanks in advance.

 

[axeman462]

well, captive companies typically get away with paying their agents around 50%
And thats one of their biggest arguments "we provide you with leads and training"

But if you want to retain agents, I'd suggest around 75% (but of course you would need to sit down and figure out the economics of it, and whether or not you can afford to do that)

 

[HoosierLife]

We would need to know the exact comp % to do the math to see if its good.

Assuming life leads at $20 a pop and say you get 20/wk. cost is $400. You sell 20% with a 500 AP average at 100%. That's $2000 (x 100%)- $400 in lead costs = $1600 x .75 adv = $1200/wk

If you got the same 20 leads for free at 75% comp. that's $2000 x .75 comp = $1500 x .75 adv = $1125/wk

 

[Trevor0316]

Thanks for the input.

 

[WCMason]

well, captive companies typically get away with paying their agents around 50%...And thats one of their biggest arguments "we provide you with leads and training"...But if you want to retain agents, I'd suggest around 75%

When I first started I got 48%. I was so naive. "I get half the annual premium?" Seemed like a lot. Six months in we get a new carrier, RNA. Big meeting. Big announcement. 75% COMMISSION! I remember thinking "Wait a minute. I thought 48% was good." I didn't take the increase as a reason to celebrate as others in the meeting did. I saw it as a reason to question what the real potential comp is. Within 6 months I went indy with some help from TXRecruiter on this board, I get more than double those first days and after two years of struggling made six figures in 2012, my third year. Thanks, Chris.

 

[Trevor0316]

So I guess it is safe to say 60/40 on Med Sup with given leads is something that can definitely be beat! Thanks for the help.

 

[SDCLife88]

Aren't Med Supp commissions already low? Like 16-23%? That is what I thought.

so If they are paying for leads I think that is a good estimate, no?