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Reply to I've Always Been Curious what a FE Imo Nets     
Old 12-19-2014, 07:19 AM   #1
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I've Always Been Curious what a FE Imo Nets I've Always Been Curious what a FE Imo Nets
Newby since you're so forth coming give us some real #'s of what an imo potentially makes..Lets use an imo that's does $5 mil of ap in a yr. we know they're on 20-30% minimium override.So right there that's at least $1 mil of overrides. So deduct about 20-25% in chargebacks so that still leaves around $750k in fyc. Lets say they have $150k of expense like hiring an office guy or maybe they even have an office. That leaves a whopping $600k in net let over. Now lets get into the back end. A lot of imo's are making 1-3% on the back end. So say an imo organization after a yr or 2 is doing $5 mil of ap. They do that for 7 straight yrs, In the 5th yr even if 40% of the yr one business is on the books. That's $3 million at an avg 2% or $60k. But what about the renewals from the block ofbusiness last yr and the previous 3 yrs.Were talking potentially $300k$500k just on the back end of yr 5. Newby are these #'s somewhat accurate and if not were am I off base?
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Old 12-19-2014, 07:36 AM   #2
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I've Always Been Curious what a FE Imo Nets Re: I've Always Been Curious what a FE Imo Nets
Originally Posted by peteybear View Post
Newby since you're so forth coming give us some real #'s of what an imo potentially makes..Lets use an imo that's does $5 mil of ap in a yr. we know they're on 20-30% minimium override.So right there that's at least $1 mil of overrides. So deduct about 20-25% in chargebacks so that still leaves around $750k in fyc. Lets say they have $150k of expense like hiring an office guy or maybe they even have an office. That leaves a whopping $600k in net let over. Now lets get into the back end. A lot of imo's are making 1-3% on the back end. So say an imo organization after a yr or 2 is doing $5 mil of ap. They do that for 7 straight yrs, In the 5th yr even if 40% of the yr one business is on the books. That's $3 million at an avg 2% or $60k. But what about the renewals from the block ofbusiness last yr and the previous 3 yrs.Were talking potentially $300k$500k just on the back end of yr 5. Newby are these #'s somewhat accurate and if not were am I off base?
Your figures look about right except that a lot of production comes from agencies under the IMO. The agencies are usually only 5-10 points under the IMO not 25.

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Old 12-19-2014, 07:45 AM   #3
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True I thought of that but on the upside it deflects a ton of work and head ache from the IMO . The one downside could be if a big agency under you left and had big charge backs it rolls up
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Old 12-19-2014, 10:41 AM   #4
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I've Always Been Curious what a FE Imo Nets Re: I've Always Been Curious what a FE Imo Nets
Originally Posted by peteybear View Post
Newby since you're so forth coming give us some real #'s of what an imo potentially makes..Lets use an imo that's does $5 mil of ap in a yr. we know they're on 20-30% minimium override.So right there that's at least $1 mil of overrides. So deduct about 20-25% in chargebacks so that still leaves around $750k in fyc. Lets say they have $150k of expense like hiring an office guy or maybe they even have an office. That leaves a whopping $600k in net let over. Now lets get into the back end. A lot of imo's are making 1-3% on the back end. So say an imo organization after a yr or 2 is doing $5 mil of ap. They do that for 7 straight yrs, In the 5th yr even if 40% of the yr one business is on the books. That's $3 million at an avg 2% or $60k. But what about the renewals from the block ofbusiness last yr and the previous 3 yrs.Were talking potentially $300k$500k just on the back end of yr 5. Newby are these #'s somewhat accurate and if not were am I off base?
One piece of the puzzle missing here. You did say 20-25% chargeback and that is true. The one thing you're not factoring in is the deadbeat agent that leaves the IMO having to pay back all of their advances that they didn't. That can be anywhere from a few hundred to quite a few thousand. It can rack up in a heartbeat!

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Old 12-19-2014, 07:24 PM   #5
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I've Always Been Curious what a FE Imo Nets Re: I've Always Been Curious what a FE Imo Nets
Originally Posted by Todd King View Post
One piece of the puzzle missing here. You did say 20-25% chargeback and that is true. The one thing you're not factoring in is the deadbeat agent that leaves the IMO having to pay back all of their advances that they didn't. That can be anywhere from a few hundred to quite a few thousand. It can rack up in a heartbeat!
Say it ain't so bro! Oh and everyone pays their lead bills like clockwork.
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Old 12-19-2014, 10:06 PM   #6
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I've Always Been Curious what a FE Imo Nets
Originally Posted by peteybear View Post
True I thought of that but on the upside it deflects a ton of work and head ache from the IMO . The one downside could be if a big agency under you left and had big charge backs it rolls up
If they leave nothing rolls up. The new IMO takes over any debts. It's called locking in your gains.

But if they go belly up without leaving, the up line loses.

If they start to go bad, we just slip them a few hundred to transfer to Todd or Brad.
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Old 12-19-2014, 10:37 PM   #7
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I've Always Been Curious what a FE Imo Nets Re: I've Always Been Curious what a FE Imo Nets
Originally Posted by Newby View Post
If they leave nothing rolls up. The new IMO takes over any debts. It's called locking in your gains.

But if they go belly up without leaving, the up line loses.

If they start to go bad, we just slip them a few hundred to transfer to Todd or Brad.
Newbie question. What do you mean by going bad or writing bad business? Does this just mean not paying your chargebacks?
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Old 12-19-2014, 11:31 PM   #8
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I've Always Been Curious what a FE Imo Nets
Originally Posted by Newby View Post

If they leave nothing rolls up. The new IMO takes over any debts. It's called locking in your gains.

But if they go belly up without leaving, the up line loses.

If they start to go bad, we just slip them a few hundred to transfer to Todd or Brad.
Oh the secret revealed.
This was a great post.
(seeing all this serious tension between the IMO's represented on the form. This post is right up my alley)
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Old 12-20-2014, 06:21 AM   #9
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I've Always Been Curious what a FE Imo Nets
Originally Posted by CJR View Post
Newbie question. What do you mean by going bad or writing bad business? Does this just mean not paying your chargebacks?

Going bad means having so much business fall off the books that your new business doesn't cover your chargebacks. If an agent's first year persistancy falls much under 80% he is going bad unless he doesn't take advances.

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Originally Posted by indiana260 View Post
Oh the secret revealed. This was a great post. (seeing all this serious tension between the IMO's represented on the form. This post is right up my alley)

Todd, Brad and us actually have no serious tension. We all have as much business as we can handle. Brad's downlines are in heavy recruiting mode. That's where the perception of any tension comes from. It's all just splitting hairs trying to be noticed. Friendly competition is the American way. Everyone trying to be just a little bit better than their competitors is what keeps us all improving. Good for us (all the IMOs) and good for the agents.
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Old 12-20-2014, 08:42 PM   #10
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I've Always Been Curious what a FE Imo Nets Re: I've Always Been Curious what a FE Imo Nets
Originally Posted by Newby View Post
Going bad means having so much business fall off the books that your new business doesn't cover your chargebacks. If an agent's first year persistancy falls much under 80% he is going bad unless he doesn't take advances.

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Todd, Brad and us actually have no serious tension. We all have as much business as we can handle. Brad's downlines are in heavy recruiting mode. That's where the perception of any tension comes from. It's all just splitting hairs trying to be noticed. Friendly competition is the American way. Everyone trying to be just a little bit better than their competitors is what keeps us all improving. Good for us (all the IMOs) and good for the agents.
Yes I am in heavy recruiting mode, last time I recruited an agent was....never, zzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzz
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