Don't Work With Pinney Insurance

[TomZack]

Holy Schnikees.....

what a kettle of (stinking) fish.

As I am still in the early formative stage of the business, I have been doing some closer research on a number of IMOs to affiliate with. It sounds like I need a lawyer just to get an enforceable contract where I get to keep my commissions/renewals if we part ways somewhere down the road.

But...as to the advice to go direct with carriers....won't they require a certain amount of annual volume to maintain a direct relationship?

And...other than this board....aren't (some?) IMOs a good source of where to send certain types of business (liberal underwriting or specific health issue focused carriers)

Or is this more of an issue with overrides that doesn't affect the average agent?

In either event, sounds like lots of bad blood and dirty laundry being aired publicly. So sad.

 

[Golfnut2112]

GO DIRECT all the talk for company minimums is IMO BS. I have been doing this for 30 years and except for hard to place sick people I have never had any use for IMO's. You can contract direct with Ohio National, Columbus Life and Lafayette Life and have about every life product you need. Why anyone would go into business for themselves and then have to worry about some IMO releasing you or taking your money is beyond believe, all three companies have great bonus programs which you will never see going thru and IMO.

 

[TomZack]

Thank you Golfnut. See my DM.

 

[CALTCAgent]

I didn't read everything as there was a lot of details here. I did skim through it so I may be way off base but am trying to understand the basics here.

There is talk of going direct but does Pinney bring something unique to the table as far as "processing" applications and that is why they were being recommended ?

Has that changed and there are other IMO's that can do the same thing ?

What are the competing products and processes in question here ?

So Pinney had a "contract" with JRoot where he could recruit and receieve a part of their override ? ( in other words not direct )

 

[NSRH]

GO DIRECT all the talk for company minimums is IMO BS. I have been doing this for 30 years and except for hard to place sick people I have never had any use for IMO's. You can contract direct with Ohio National, Columbus Life and Lafayette Life and have about every life product you need. Why anyone would go into business for themselves and then have to worry about some IMO releasing you or taking your money is beyond believe, all three companies have great bonus programs which you will never see going thru and IMO.

Most of the larger carriers require you to go through an IMO. Foresters for example.

 

[NinjaNic]

A bit of overlap in the replies here...I will try to explain my position since I am mentioned.

I was the one terminated by Pinney in Feb ‘16 due to “creating a competing product.” It was not a competing product (they have a CRM, our system is a website quoter only) and they knew about and embraced it for 4 months until they terminated me. I am fine with being terminated, actually glad. I was a W2 employee, in California. I am fine with the termination, what I am not fine with is being terminated after being the top earning person there and having all commissions during the month of termination not paid, as well as conveniently not paying me for my 2015 commission true up due a few weeks later. The claim of “as earned” is false. The amount due is well beyond what is owed to Jroot. I will not get into more specifics, but the case is heavily on my side. My attorney is collecting in a California wage claim case set to be heard in June.

All of the above I can completely live with. What I cannot live with is the bullying, the calling carriers telling them not to work with us throwing around their weight as a BGA, calling prospective future employers “warning” them about me, telling people that I stole, telling my broker relationships that they should seriously question my ethics. As an employer, in California, you are not legally or ethically allowed to impede on a past employee’s future economic relations. Meanwhile, carriers remove themselves from my quoting company and it takes months to get them back onboard after having multiple character witnesses come forward and back me. I have a very valid punitive damages case here (insert DHK’s Waddell and Reed reference), but I am choosing to take the high road and repair those relationships and compete. The claim of my diverting business is 100% false.

Why am I glad I was terminated?

After looking around I have found BGAs to all be the same, and for the most part of no help beyond being the middleman between agent and carrier. They all do the same thing, but the carrier drop ticket systems do them better. If your value proposition is that you help agents process business by providing them application fulfillment, an underwriting resource and a case manager you will be out of business in 5 years. Period. You have to teach them HOW to generate business, not just process it for them. Now, there are some GREAT BGAs out there and I am not knocking those doing the right thing and providing that value...I am just saying that most do not provide this value. Pinney certainly had some home runs during their day, but they went down the wrong path by not listening to their agents.

Anyone that has ever been to XXXXXX, or an event specifically catered to BGAs will immediately notice the average age is over 65. We are an industry controlled by an older, not as tech savvy group of people. Nothing against the generation at all, in fact quite the opposite--they have forgotten more about insurance than most of us will ever know. Problem is, they are not sharing it or are very against change. They control the IMO level, the BGA level, the carrier level etc. When someone comes in with a difference of opinion and innovates and disrupts their business, they fire shots to protect their empire. Why do you think that VCs are throwing a fortune at Insurtech right now. Change is happening. Unfortunately, an aged/established BGA cannot see the forest for the trees and most will close or be acquired soon.

Did we start a BGA after I was terminated, yes. Did we do it during my relationship with them, no. Why did we start a BGA in a time where we are seeing BGAs going out of business? Why start a business in a time where distribution is changing? Simply put: we provided a value not found elsewhere for digital and online focused agents. We know how to generate leads, we know how to train agents to sell and market, we know how to help an agent create an online business. Agents in our niche need this knowledge and for too long the guys at the top have gotten rich off the guy at the bottom, providing them little to no value outside of application fulfillment and an occasional underwriting question.

The main point is to make sure your BGA helps you generate or build your business, not just process your applications. A BGA does not deserve an override on your business just because they exist.

Questions to ask your BGA:

• Outside of app fulfillment and underwriting, what other kind of value will you provide me for the override I am paying you on my production? If there is no immediate response...move on.
• What kind of new business ideas can you provide me for the revenue I am providing you?
• Explain to me your release policy. Please send to me in writing.
• Can you please break down your contact sequences for your touches with my clients.
• What portion of the commissions are paid by the carrier vs. you? Please send me the contract to review before I contract.

The terms “IMO, FMO, BGA” are thrown around a lot. Here is a bit of clarity on the hierarchy:

Carrier>>>IMO>>>BGA>>>SubBGA>>>Agent

There are 7-10 IMOs in traditional life distribution
There are hundreds of BGAs (an estimated 700)
There are thousands of Sub-BGAs (downlines + bonuses paid on their own production)
There are hundreds of thousands of agents.


When carriers go to market with a product, they rely on IMOs to distribute it. IMOs rely on vetted BGAs to get it directly to agents. Carriers want limited contact with agents, hence the hierarchy of things. The value chain has changed over the years to where carriers are providing more value than their downline distributors. We are about to see a huge shift in business processes over the next few years due to the lacking values and high percentage of retiring agents no longer writing business or padding the pockets of aging BGAs.

_________

And because I get calls daily: I, Nic West, am also no longer affiliated with Pinney Insurance effective 2/29/16.


Edit: removed previous reference because I have the utmost respect for them as an organization.

 

[GreenSky]

It sounds that from an agent's perspective that this is all about overrides and nothing really to do with any of us working with or not working with them.

I'm really not taking sides on this except to ask "How does this affect me?"

Rick

 

[jboussea]

A bit of overlap in the replies here...I will try to explain my position since I am mentioned.

I was the one terminated by Pinney in Feb ‘16 due to “creating a competing product.” It was not a competing product (they have a CRM, our system is a website quoter only) and they knew about and embraced it for 4 months until they terminated me. I am fine with being terminated, actually glad. I was a W2 employee, in California. I am fine with the termination, what I am not fine with is being terminated after being the top earning person there and having all commissions during the month of termination not paid, as well as conveniently not paying me for my 2015 commission true up due a few weeks later. The claim of “as earned” is false. The amount due is well beyond what is owed to Jroot. I will not get into more specifics, but the case is heavily on my side. My attorney is collecting in a California wage claim case set to be heard in June.

All of the above I can completely live with. What I cannot live with is the bullying, the calling carriers telling them not to work with us throwing around their weight as a BGA, calling prospective future employers “warning” them about me, telling people that I stole, telling my broker relationships that they should seriously question my ethics. As an employer, in California, you are not legally or ethically allowed to impede on a past employee’s future economic relations. Meanwhile, carriers remove themselves from my quoting company and it takes months to get them back onboard after having multiple character witnesses come forward and back me. I have a very valid punitive damages case here (insert DHK’s Waddell and Reed reference), but I am choosing to take the high road and repair those relationships and compete. The claim of my diverting business is 100% false.

Why am I glad I was terminated?

After looking around I have found BGAs to all be the same, and for the most part of no help beyond being the middleman between agent and carrier. They all do the same thing, but the carrier drop ticket systems do them better. If your value proposition is that you help agents process business by providing them application fulfillment, an underwriting resource and a case manager you will be out of business in 5 years. Period. You have to teach them HOW to generate business, not just process it for them. Now, there are some GREAT BGAs out there and I am not knocking those doing the right thing and providing that value...I am just saying that most do not provide this value. Pinney certainly had some home runs during their day, but they went down the wrong path by not listening to their agents.

Anyone that has ever been to NAILBA, or an event specifically catered to BGAs will immediately notice the average age is over 65. We are an industry controlled by an older, not as tech savvy group of people. Nothing against the generation at all, in fact quite the opposite--they have forgotten more about insurance than most of us will ever know. Problem is, they are not sharing it or are very against change. They control the IMO level, the BGA level, the carrier level etc. When someone comes in with a difference of opinion and innovates and disrupts their business, they fire shots to protect their empire. Why do you think that VCs are throwing a fortune at Insurtech right now. Change is happening. Unfortunately, an aged/established BGA cannot see the forest for the trees and most will close or be acquired soon.

Did we start a BGA after I was terminated, yes. Did we do it during my relationship with them, no. Why did we start a BGA in a time where we are seeing BGAs going out of business? Why start a business in a time where distribution is changing? Simply put: we provided a value not found elsewhere for digital and online focused agents. We know how to generate leads, we know how to train agents to sell and market, we know how to help an agent create an online business. Agents in our niche need this knowledge and for too long the guys at the top have gotten rich off the guy at the bottom, providing them little to no value outside of application fulfillment and an occasional underwriting question.

The main point is to make sure your BGA helps you generate or build your business, not just process your applications. A BGA does not deserve an override on your business just because they exist.

Questions to ask your BGA:

• Outside of app fulfillment and underwriting, what other kind of value will you provide me for the override I am paying you on my production? If there is no immediate response...move on.
• What kind of new business ideas can you provide me for the revenue I am providing you?
• Explain to me your release policy. Please send to me in writing.
• Can you please break down your contact sequences for your touches with my clients.
• What portion of the commissions are paid by the carrier vs. you? Please send me the contract to review before I contract.

The terms “IMO, FMO, BGA” are thrown around a lot. Here is a bit of clarity on the hierarchy:

Carrier>>>IMO>>>BGA>>>SubBGA>>>Agent

There are 7-10 IMOs in traditional life distribution
There are hundreds of BGAs (an estimated 700)
There are thousands of Sub-BGAs (downlines + bonuses paid on their own production)
There are hundreds of thousands of agents.


When carriers go to market with a product, they rely on IMOs to distribute it. IMOs rely on vetted BGAs to get it directly to agents. Carriers want limited contact with agents, hence the hierarchy of things. The value chain has changed over the years to where carriers are providing more value than their downline distributors. We are about to see a huge shift in business processes over the next few years due to the lacking values and high percentage of retiring agents no longer writing business or padding the pockets of aging BGAs.

_________

And because I get calls daily: I, Nic West, am also no longer affiliated with Pinney Insurance effective 2/29/16.

If you don't mind my asking .. who are the big 7-10 IMO's out there.. I'm assuming Ash, Crump and BA , Partners Advantage are 4 of them?

and what's your BGA?

 

[sman]

It sounds that from an agent's perspective that this is all about overrides and nothing really to do with any of us working with or not working with them.

I'm really not taking sides on this except to ask "How does this affect me?"

Rick

How does anyone's personal experience with a BGA affect others? It doesn't other to warn us of how a particular BGA conducts business. In this case, it appears that Pinney will take measures to withhold commissions which rightfully belong to the agent.

 

[GreenSky]

How does anyone's personal experience with a BGA affect others? It doesn't other to warn us of how a particular BGA conducts business. In this case, it appears that Pinney will take measures to withhold commissions which rightfully belong to the agent.

Since agent commissions are paid directly I can't see how this or any other BGA working with a middleman affects any of us.

Not defending Pinney but even Jeff admits that every nickle of commission was paid, just not overrides.

The title of this thread is "Don't Work With Pinney Insurance." I haven't seen a reason that affects any agent working with them. In fact, I'm not convinced this thread is even appropriate. Seems like a private matter.

Rick