First Year Premium Sales

[shawnmwalker]

VolAgent,

I didn't forget. I didn't forget the 90% retention on the 141K book getting 15% renewal commission that the owner is not paying him, the bonuses, the cash for app incentives, or the overrides, either.

It is a winning situation for the employer. It is thin investment the first year or two, but after that there is one clear winner.

 

[VolAgent]

VolAgent,

I didn't forget. I didn't forget the 90% retention on the 141K book getting 15% renewal commission that the owner is not paying him, the bonuses, the cash for app incentives, or the overrides, either.

It is a winning situation for the employer. It is thin investment the first year or two, but after that there is one clear winner.

So, the employer shouldn't make a profit from their employees? Do you guarantee the employer the producer and book will stick around for 2 or 3 years to become profitable?

Maybe the comp should be tweaked on the backend, but as verbgravy pointed out, he basically covered his salary for the year. To say nothing of all the other expenses.

 

[shawnmwalker]

Volagent,

I am not disagreeing with you. The First year there is a very minor loss for the agent. But once you factor in the renewals and the other compensation pieces, it works, and it works well for the Agent. There is risk, so it should be that way.

We all know this specific scenario was not a losing proposition for the agent.

 

[1manshow]

I'm with Shawn on this one

If the book doesn't stick around 2-3 years then the office is a joke.

I'll take 1st yr break even and then 100% of all renewals on a 100 producers any day. Unfortunately...I'm not a greedy pos owner so that won't work for me.

 

[rudy323]

Before I went indy, I remember the owner always talked about the costs of supplies, office space and insurance. Now that I am an owner I realize how minimal those costs are in the scheme of things

 

[todd02]

I profit bonus my producers. If they make me more in commissions for the agency than I paid them total, I bonus them so I break even. They don't get any renewals but I do have a retention bonus that they get monthly based on a sliding scale of 1-2.5% of my entire books renewals. This helps my top people know they are getting at least what I'm getting and they love it. It's an easy business to understand for the producer that, "hey my agent isn't making money off me the first year, plus I get renewal bonuses off the entire book." I also give team production bonus' that they share. Also quarterly bonus. Both of my producers average 60-75k a year.

 

[Kremnuts]

I wrote 265k the office wrote about 500k with three producers. We have no benefits. The office has about a 7 mill book. 3 Csr's 2 principals. 3 producers. I get 69 percent commission and 415 a week salary. I guess im just trying to see how that stacks up. We also have no benefits of any kind. It's an awesome place to work I might add just checking. This was my first year being. I just got licensed last September. So I knew nothing going in. I should make about 45 k this year. Which doesn't seem terrible. I just wish I had some renewals. We also have about 93% retention.

 

[TylerP]

I wrote 265k the office wrote about 500k with three producers. We have no benefits. The office has about a 7 mill book. 3 Csr's 2 principals. 3 producers. I get 69 percent commission and 415 a week salary. I guess im just trying to see how that stacks up. We also have no benefits of any kind. It's an awesome place to work I might add just checking. This was my first year being. I just got licensed last September. So I knew nothing going in. I should make about 45 k this year. Which doesn't seem terrible. I just wish I had some renewals. We also have about 93% retention.

Well that's a big statistic you left out. The book you currently have is 7mil. So, like someone said, you're numbers are ok but they could be better.

With an insurance agency of that size, I imagine referrals, added cars, and other "freebies" are common. If this was a scratch agency starting from the ground up and you were producing at the level, that would be impressive.

I just went Indy after working in a scratch agency at State Farm for 2 years. I wrote about exactly what you did but our book of business wasn't even over a 1 mil. It's a whole different ball game.

My first month I only wrote about 15k in premium as a solo agent and without buying leads. This includes a month of growing pains, such as figuring out how each of my companies work. My overhead is between 400-500, so I am utilizing this "laid back scenario" and really focusing on the low hanging fruit (Friends, family, passive marketing). With leads given and a 7mil book of business, I'd think around 350-500k would be a pretty good year. You should be cross-selling your business till your blue in face, especially with households that are missing life insurance.

You are on the right track though.