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Reply to Paying  my Agents     
Old 09-12-2017, 11:47 PM   #1
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Join Date: Jul 2009
Posts:12
State: sharon1900 is an Insurance Agent from Alabama
Paying  my Agents Paying my Agents
Hi,
I have a new agency that I started and I currently have 4 W2 employees who are now coming back asking for a raise.
I pay between $18-20/hour give a complete benefits package and 35% in commission.
Can you please share the common structure in P&C in Los Angeles area?
One of my employees do not get a commission. Instead he gets $700/week and $15 per policy and working only part time (8-2).
I think that I am over paying and would love to hear your input. TIA
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Old 09-13-2017, 01:09 AM   #2
Super Genius
BADTROUT on Paying  my Agents
 
Join Date: Jun 2010
Posts:53
State: BADTROUT is an Insurance Agent from Colorado
Paying  my Agents Re: Paying my Agents
I overpay, and yours makes me look cheap. Mine is simple...

YEAR 1: The higher of 75% New and renewal... OR Minimum Wage
YEAR 2: The higher of 70% New and renewal... OR Minimum Wage +$1.00
YEAR 3: The higher of 65% New and renewal... OR Minimum Wage +$2.00
YEAR 4: The higher of 60% New and renewal... OR Minimum Wage +$3.00
YEAR 5: The higher of 55% New and renewal... OR Minimum Wage +$4.00
YEAR 6: The higher of 50% New and renewal... OR Minimum Wage +$5.00
YEAR 7: The higher of 45% New and renewal... OR Minimum Wage +$6.00

The rest remains at 45% or Min +$6 (they never get paid hourly, its almost always the commission that pays.

With what you are giving them, I would at least do a higher of the two numbers similar to my structure... But seriously, Give one two weeks off, nice vacation... see how much business you are missing out on because they were not there.

If you notice... Bring em back...

If you do not notice a dip... make that vacation permanent.

I will say you HAVE to treat your producers well, they are building YOUR dream... But let me be very clear as I am with MY producers... They are paid well, yet I take about 99% of the risk in overhead, expenses, E&O etc etc as an agency owner.

Long story short... IMO you are paying too much.

*******UPDATE*******
For the record I am in Colorado, and I am unfamiliar with LA Wages and Expenses. (Please excuse what may be an ignorant answer geographically)

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Old 09-13-2017, 01:21 AM   #3
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Josh on Paying  my Agents
 
Join Date: Jan 2009
Posts:11,781
State: Josh is an Insurance Agent from Virginia
Josh is a member of 5000 posts Super VIP club
Paying  my Agents Re: Paying my Agents
Originally Posted by BADTROUT View Post
Give one two weeks off, nice vacation... see how much business you are missing out on because they were not there.

If you notice... Bring em back...

If you do not notice a dip... make that vacation permanent.
That's a brilliant strategy.
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Old 09-13-2017, 02:08 PM   #4
Super Genius
adjusterjack on Paying  my Agents
 
Join Date: Jun 2017
Posts:242
State: adjusterjack is an Insurance Agent from Arizona
Paying  my Agents Re: Paying my Agents
Originally Posted by sharon1900 View Post
Hi,
I have a new agency that I started and I currently have 4 W2 employees who are now coming back asking for a raise.
I pay between $18-20/hour give a complete benefits package and 35% in commission.
Can you please share the common structure in P&C in Los Angeles area?
One of my employees do not get a commission. Instead he gets $700/week and $15 per policy and working only part time (8-2).
I think that I am over paying and would love to hear your input. TIA
Offer to put them on straight commission and then they can make as much money as they want.
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Old 09-13-2017, 06:55 PM   #5
Expert
cruhm1971 on Paying  my Agents
 
Join Date: Dec 2015
Posts:28
State: cruhm1971 is an Insurance Agent from Undisclosed Location
Paying  my Agents Re: Paying my Agents
Definitely think you're over paying. My last gig in the P&C world, I got 40 new and 30 renewal in Scottsdale.

I now have partnered with an agency that pays me 50/50 Personal Lines and 30/30 for commercial. I simply refer and they quote, sell and service. They write in 42 states, so it works well for me.

They better have some hefty goals to get what you're paying, like $50,000 - $100,000 a month.
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Last edited by cruhm1971; 09-13-2017 at 06:58 PM. Reason: Adding opinion
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Old 09-13-2017, 07:33 PM   #6
Super Genius
BADTROUT on Paying  my Agents
 
Join Date: Jun 2010
Posts:53
State: BADTROUT is an Insurance Agent from Colorado
Paying  my Agents Re: Paying my Agents
At that commission I think 1 mil written in a nearly limitless city like LA would be minimum expectation.
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