Something talked about very little on this board are renewals. Some of these co's have 7-10% renewals. So if an agent is doing $150-$200k premium a yr for 4 yrs lets say and even keeps 50% on the books after 4 yrs that could be $32k a yr after 4 yrs. One of 2 things for the reason why theres so little talk of renewals. The first reason is because very few people on this board have been independent for more than 2 yrs as most were with secures.LH or efes so they've seen few renewals so far. The second is because i'm far overstating persistency(50% after 4 yrs) due to deaths and much more importantly lapses.I got a feeling its early lapses. Most agents in the p@c and medicare arenas can cost after 10 yrs due to big renewal bases . For instance med sups and Ma pay the same renewals for 7 yrs but if you're a good agent you might be able to keep many of these by moving them around after big rate increases.So my pt is it seems if your a fe agent you're going to be dependent on working your tail off for the rest of your life writing first yr business as renewals just won't be there.
People in the Business 3-5 Yrs how Are Your Renewals?
- Thread starter sirherbie
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You bring up an interesting topic. I would also presume that the lack of renewals for agents could also be that most of the agents aren't in the business long enough, (4-5 years) to really start to see any impact from the renewals.
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Then it will be like selling FE...
- 16,881
One of my favorite topics.
I've beat the renewal drum pretty hard. I've been writing for 18 years but only products that have renewals for around eight. I have always favored higher renewal companies. Some like, Assurity have much higher renewals. Settlers, Lafayette, American Memorial, and many others all have decent 10-year or longer renewals. If you throw in some Med Sup cross sells, FE agents can build a substantial renewal base. It gives you a lot of breathing room.
I don't doubt the government is going to screw with Medicare insurance and all parts of the insurance industry at some point. But right now it's good. They could ruin FE with the stroke of a pen. But you just can't dwell on things that haven't happened yet.
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That sky is falling prediction has been around many years.
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Agents with securus and EFES are independent and get renewals. I don't know where you got the info that they don't.
Even agents with LH get renewals until they fall below a certain threshold. In my case it was $250/mo. Then they keep the renewals.
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My renewals from my time at EFES are mostly in the 5% range. Except for Americo where they did that 10% bump in first year commissions in exchange for zero renewals. That was a really dumb move that most agents loved.
My renewals now are in the 7% range.
The Insurance Carrier is loving it if they have a 50% persistency after 5 years with FE/SIWL... Very few carriers are at that mark.
I am at 93% on 5 years for UL and other Fully underwritten Product and most companies strive for 80-85%.
You can see a major reason why there are few companies that stay in the FE business for any long period of time.... It is short term thinking in a long term business.
I am at 93% on 5 years for UL and other Fully underwritten Product and most companies strive for 80-85%.
You can see a major reason why there are few companies that stay in the FE business for any long period of time.... It is short term thinking in a long term business.
