Lately I have bee thinking about getting a business partner for my health insurance agency. I really have no idea why. I am doing fine working by myself out of my home. Maybe I want more of a 'business feel' about my agency--whatever the heck that means. I do not even have a partner in mind--but I want to explore it anyway.
So, do you have a business partner? Either way, why?
*Never sign anything where the profits are split. One of you is going to be better than the other and I guarantee if you put in $10,000 for the week and he puts in $2,000 you'll be getting into bitter situations.
*Do not take on anyone who's not an established producer - and you'll want to see their NAP statements.
The best partnerships and the ones that actually work are when partners compliment each other. Maybe you love to train and hate interviewing and your partner love to interview - hates to train.
Maybe one partner just does hiring, training and meetings you and the other takes care of leads, sales and underwriting.
What I'd actually like to do is just "office share." I'd like to find independents to simply split office costs. Then we could share a secretary, admin and telemarketers.
Net annualized premium - how much you wrote for the year. If you're doing $600,000 NAP you don't want to partner with someone doing $100,000 NAP.
Thanks for the input. They could always write under me as a writing agent though with those numbers.
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[COLOR=#000066]"Tell me and I will forget. Show me and I will remember. Involve me and I will understand." Confucius
The problem is they are like marriages, but even tougher, because money is at stake.
And inevitably once you get past the cutesies and niceties, someone always feel like they are getting hosed -- relative to their individual efforts, that is.
Heck, I'll bet this forum is loaded with people who (felt they) got hosed by a former partner.
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They do not work. One always thinks they're doing more work than the other. One's always producing more. The reps you hire always like one partner over the other and they all just call that one partner for support. You give up all control with a partnership. You're all excited to implement that new great idea you have until your partner doesn't like it. He has an idea that you know will fail yet he's gonna do it anway.
Do not partner. If you want to do something with an office setting then hire a manager.
If you ever do decide to partner here's some "worst case scenarios" you'll want to address in your partnership agreement.
1) After two years of building the business each is earning $5,000 a week. One partner decides he's now gonna devote 20 hours a week into real estate investing yet continue to get his $5,000 a week. Now you need to work twice as hard to pick up the slack.
2) One partner flat out quits yet still wants half of the business.
3) One partner dies and now the wife wants half the business.
4) One partner becomes disabled - long-term - and still wants half the business.
5) The business is making $6,000 a week - $3,000 a piece. One partner wants to take $1,000 of his $3,000 and put it back into the business so it'll grow more. The other partner is done - $3,000 a week is plenty so he's not putting in a nickle or an extra hour of work.
6) One partner, upon making good money, simply becomes lazy. He stops coming into the office, he's not showing up to meetings, it's his day to interview and he calls saying "I can't come in today." In the mean time he's making $2,500 a week from the business and no longer wants to work hard.
All of these need to be working out in a legal agreement.
I agree that partnering with someone is not always the best idea. If you want more of an office feel I would suggest partnering with someone that has a different specialty. I had a great partnership with a property and casualty agent. He specialized in business insurance and I specialize in employee benefits. We would go cold calling together, and split the cost of the leads. Typically one of us got a policy out of it. The great part was retention. If your partnered agency has both the P and C and the health you are more likely to keep the client. And your going after the same business.
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Steph
My job is so secret I don't even know what I'm doing!
You'd better know who you're getting in bed with. I'd suggest pulling credit reports and background checks. Money is the biggest issue and the level of trust is insane. Obviously all the money is going into a joint business account. The problem is any partner could wipe the entire account out. Is it theft? Nope. His name is on that account so if there's $20,000 he can legally take all of it. Can he be arrested? Nope - again, his name is on the account. Can you sue him in civil court? Yes. Good luck and see you in about three years.
You'd better know who you're getting in bed with.Go to Top
Check out your partner's spouse. The spouse can make or break a partnership. If that person is constantly in the back ground planting seeds of discontent, impatience etc... the partnership is doomed.
Outline expectations in writting and be sure spouses agree.
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“Ethics is a code of values which guide our choices and actions and determine the purpose and course of our lives.”
— Ayn Rand, Russian-American novelist and philosopher (1905-1982)
Just don't partner. If you want to build a mid-sized agency just hire managers. If you like the concept of having an office and one agent sells life, another sells health and another sells P&C then just think about sharing office space and expenses.
Don't partner. Someone is going to be "better." If you're better you'll eventually resent your partner. If your partner is better he'll resent you. Someone will always be bringing in more business, someone will be the better closer, and someone will work with the agents better.
I don't think any agent can be an expert in all areas of insurance. I take my son to a pediatrician, not a sports medicine doctor. If I get a DWI I don't see a divorce lawyer.
You can write "X" amount of business without any staff. What what almost everyone on this board does. However, if you really want to bat it out of the park you'd need help.
Partners - no way. Write to me and I'll tell you why My mentor in the business will also share with you why they dont' work and he has over 1000 agents. Control your own destiny. Why do you think you want a partner?
Jen
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Jennifer
Life/Health/Annuites/Senior Products
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