Starting Scratch Independent Agency

[indypendent]

I ventured out on my own after my non compete had expired and was fortunate to find a carrier who knew me agree to work with me. I didn't give up my "day job" while I was building my book. The problem is that one carrier didn't write everything and wasn't competitive every time. Other carriers refused me over and over again. It became obvious I had two choices: join a cluster or buy an existing agency. I was given a tip about an agent who was considering selling about 25 minutes from me. I worked that lead for about 9 months until he finally was ready and willing to talk to me...and we put a deal together. I now have an established book, two employees, and the companies I need to grow in my original location as well as the new one. And carriers will talk to me now that I have business to roll to them (even the ones that turned me down before). Now I'm positioned to grow and would consider another location in the next couple of years.

 

[Gulliver]

SIAA is pretty good. Their exit requirements turn me off a little. Premier Group in CO is pretty good as well. As noted above Shawn Walker is on this board some. David C in their home office is the coordinator I think. I would avoid Iroquois. If you are around St. Louis there are a lot of clusters around STL that have good track records. Look at Mid States Agencies and ask for Rick. He is one of the founders of Alternatives Insurance. He is the president and is a genius. There are tons of options in MO and you need to look at several of them. By the way Auto Owners is an excellent company but currently in MO they are going through a negative transition that has them near their all time low with the agency force. And no they probably would not give you a contract. Progressive is probably the easiest to get a contract with. Good luck. By the way AAA just announced they are cutting ties with all independent agents in MO.

 

[scooter33]

SIAA is pretty good. Their exit requirements turn me off a little. Premier Group in CO is pretty good as well. As noted above Shawn Walker is on this board some. David C in their home office is the coordinator I think. I would avoid Iroquois. If you are around St. Louis there are a lot of clusters around STL that have good track records. Look at Mid States Agencies and ask for Rick. He is one of the founders of Alternatives Insurance. He is the president and is a genius. There are tons of options in MO and you need to look at several of them. By the way Auto Owners is an excellent company but currently in MO they are going through a negative transition that has them near their all time low with the agency force. And no they probably would not give you a contract. Progressive is probably the easiest to get a contract with. Good luck. By the way AAA just announced they are cutting ties with all independent agents in MO.

SIAA exit turns you off a little?

They want your first born!

 

[Bob Klee]

SIAA exit turns you off a little?

They want your first born!

They do!

I don't see the negative with Iroquois Group. The only thing I didn't like is that if you want to quit working with them, any carrier they've helped you get appointed with, you have a 2 year period you can't be appointed directly with the carrier. But from what I see, they have an excellent contract, don't push anything on the agent. Really a pretty fair deal from what I've read in their contract. + as your BOB grows, you get even more of a cut...over 100% even from what I saw. They have excellent access to both commercial & personal lines it seems to me. FYI: I'm helping a friend look at different ways to go IA is why I know.

 

[Philly]

Iroquois group starts you at 80/20 split. When you hit $500,000 in premium then 85/15 and then 1 million premium 90/10 split. For the first they waive the monthly fee. After one year $150 per month, hit $500,000 $75 per mo and the when you hit a million no monthly fee.

 

[Gulliver]

"any carrier they've helped you get appointed with, you have a 2 year period you can't be appointed directly with the carrier." (Quote form Bob Klee)

That is about all that you need to know to avoid Iroquois....

 

[Pauldz]

I was with a local company in my state and I was captive. They got out of the insurance industry and thus I lost my agency, however they kept all the clients till they could sell off their business. Anyways, I loved what I did, but knew I needed to get out on my own. I contacted local independent agencies specifically looking for an agency/brokerage company that would allow me to write under their contracts they have with their carriers and I would own my book.

The company I joined with gave me an office space with them I pay them 30% of my commission and I get 70%, I am able to get 50% of my contingency checks as well, I own my book and I as able to start up and go right away. I deal 95% in personal lines and 5% in commercial and have been having great months since. It has only been a year and a half now and I am making what I was making after 3 years with my captive company I was at (including the salary that I had with my captive company).

There was no funds or salary with my cluster group I joined but I just trusted in my work ethic and made the leap. It turned out to be the best move I ever made and I was able to build my book up very quickly

How hard was it for you to negotiate your deal with this agency? Did you have to approach a number of agencies before one would agree to take you on? What type of agency did you find most receptive to this approach? I'm trying to see if I can do something similar, but I don't really know the right way to do it. Any insights would be appreciated.

 

[Schwetty]

I looked at many options when I opened my stratch IA, I found an option that has

• 
  Low buy-in
  ZERO buy-out
  100 of contingency bonus given to members (based upon % of biz with carrier)
  80/20 split until 100K
  90/10 split after 100K
  access to great list of companies (AAA,Allstate, MetLife, Travelers, Mercury, Hartford, Encompass and more)

They only operate in the midwest.

If you want more information, send me a PM.

 

[bliss171]

On a related note, does anyone know the process of contacting independent agents anonymously to inquire if they are willing to sell out? I want to contact some agencies but do not want to reveal my identity.

 

[AZDave]

On a related note, does anyone know the process of contacting independent agents anonymously to inquire if they are willing to sell out? I want to contact some agencies but do not want to reveal my identity.

Hmmm. Wear a disguise?

What would be wrong with approaching seasoned agent owner directly to inquire about buying. Unless the future buyer is standing next to you...