It's Official, I've Reached 1000 Active Medsupps!
- Thread starter azmedsupagent
- Start date
Sadly, even if you have a reasonably strong residual past six years (my primary carrier pays 7%), the reality is that a six year old policy is usually part of a company's "death spiral" as far as rates go. The six-year mark is when the rate increases start hitting 15% to 20%, year after year, and any client healthy enough to switch is going to do just that. And some of those not healthy enough will take the Medicare Disadvantage route to save $200+/month in premium. If you, the agent, have switched to "sit on keyster" mode, some other agent will have those people on his books six years from now. Also, consider policy-owner death rates: I lose about 5% of my Medicare supplement block to death each year.
I reasonably predict that six years of "sitting on keyster" will cause a 1000-policy book to reduce to about 400. And presuming the renewal commission is at an industry average of 5% (after the first six years), and the initial base premium was $120; that $6/month x 400 policies, or $2,400/month, down from the $24,000/month he is probably bringing in today. And that $2,400 figure will erode to nearly zero by year 12 or so. Not bad for sitting on your keyster, but really hard to count on med supp business for long-term rocking chair money; once you quit working it, the money will fall quickly.
- Thread starter
- #55
- 484
Your right on the money... I can easily take a month off and not hurt my renewals but if im not constantly replacing those that reach yr 7 or drop off for other reasons those renewals will vanish. If want to keep my renewals at the same level i need to continue writing new business. The question is do I go Bevo's route and hire an assistant to focus on working referrals from my existing book, or do i double down and go for 2k, or do I implement both strategies? I've seen lots of good advice on this thread and I think the game plan going forward is going to be shoot for 2k and hire an assistant to work my existing book. At least untill I find another business venture that captures my interest. I'd like to buy a car wash or a chain of dry cleaning plants lol!
- 29,508
Couldn't you keep selling Med Supps, buy a car wash and hire somebody to run the car wash?
Diversification is a great idea at this point, however i'd say the numbers have to really make sense. And they're going up against the golden goose of all business where you can sell something once and get paid for 6 years.
Not saying avoid other businesses (buy and hold real estate is my new venture), but brick-and-mortars come with a lot of strings and headaches attached. With equal time and investment put into both (Your current Med Supp business or a Car Wash/Wash N Suds), how close will the actual ROI's be? I'd be willing to bet any money invested in a start up car wash applied to Med supps with even 1 or 2 sales assistants/agents would reap you a far larger profit in light speed time compared to the car wash. But who knows.
Ultimately it all comes down to what you truly desire out of your own life. (Freedom, happiness, travel, owning several businesses) If you woke up tomorrow and opened your eyes and you had total fulfillment in your life, what would it look like?
Define that first then only choose things that will help you towards that main goal.
Hiring an assistant could be a good idea, IF you get the right person. Pay a really solid salary, and I suggest finding someone who is sort of burnt out on having to hunt down new sales/customers. If you hire "young and hungry," you may experience the unpleasant outcome of the person quitting the job you gave him/her, and becoming your competitor and taking a lot of your customers with him/her. I can't imagine trying to take on the responsibility of a dry cleaning operation -- so many employees and so much equipment, and you have to have high-traffic retail locations . . . . sounds tough in that isn't a business that you really know well. But I sort of like the car wash idea.
financewizusa
New Member
- 12
If you sold them a UNITED American Policy you get commissions for life!
Otherwise I would start working on calling those customers back and offer them ANNUITIES !!!
Great Work
Otherwise I would start working on calling those customers back and offer them ANNUITIES !!!
Great WorkIf you sold them a UNITED American Policy you get commissions for life!
Otherwise I would start working on calling those customers back and offer them ANNUITIES !!!
Wow, what great insight-United American Med Supps are about 2X the cost of most of the major companies in AZ, is that how you allegedly make $500K a year, by ripping off unsuspecting prospects?
Similar threads
