What is a fair agreement?

[J.P.]

I have a friend and prior coworker that started an agency with Erie Insurance and I am looking into doing the same as it seams Erie is a decent place to be in my area. So my issue is I don't have much capital to get started on my own so I wanted to try snd come up with a deal with my friend of somehow working under him while I build up capital and then keeping some portion of my book I build under him. What do you all think would be a fair proposal to take to him? Thanks for your advice!

 

[fed up]

You get commission only and you take your policies when you leave. You split 50-50 on renewals until you go.

 

[shawnmwalker]

Erie Chief Says No End in Sight for Elevated Auto Claims Severity.
P&C carriers are not likely to enjoy relief from auto claims severity, which surged 20% in 2022 and is up another 20% so far this year. “We don’t see an end in sight in the inflation right now,” said Erie Insurance president and CEO Tim NeCastro

 

[Allen Trent]

Does Erie allow an agent to sell a portion of the book? Because allowing you to leave & take the policies is essentially the agent selling or giving those policies to you

Also, what is in it for your friend if he brings you on & pays you & gives you most of the commission & you take policies with you. That seems like a lot to ask of him as I am sure he will have to train you & his staff spend time with you or service those policies

 

[J.P.]

So, I wouldn't be asking him to pay me a salary, just commission or even possibly a split commission. If we came up with an agreement similar to what "fed up" mentioned, then he would benefit by getting renewals and then the increase with his sales numbers for bonuses or any incentive Erie may offer based on production. I don't need any training as I have several years of experience. I just don't have the Capital to start an agency currently and it made more sense to find a scenario where I could build up a book at a company that I would want to open an agency with rather than be captive for another company while I built up capital and then have to leave and have nothing to show for it as far as the book goes. I agree that what "fed up" suggested seems like a pretty sweet deal for me and not so much benefit for him. But that is why I came on here to ask if there was an industry norm for situations like this...