Some Help Here, Potential Job Opportunity?

[JoaoP]

Hi all,

I've read these forums up and down and have had a hard time finding the information I am looking for. Maybe one of you kind souls can help?

Have a firm who is willing to offer $50K base with a 60/40 split on new accounts and 80/20 on renewals. This would be commercial P&C only.

The agency has a full training program, six months of mentoring and I have five+ years of B2B experience. No experience in insurance though.

How are those splits with a $50K salary?

What would be a realistic goal for first year sales? Is $70K too high?

What other questions should I be asking (That I may not be thinking of)?

Thanks everyone, appreciate the help.

 

[DHK]

I don't know much about P&C.

A $50,000 base salary is AWESOME. There are a lot of State Farm, Allstate, and Farmers team members that would KILL for that kind of offer.

Whether a 60/40 split is okay or not... is almost immaterial right now.

You did ask if $70k was too high for a realistic first year amount of sales (I'm assuming premium).

I wouldn't ask that question. Remember: "Where much is given, much is expected and required."

For a $50,000 base, you need to learn your minimum production hurdles and find ways to surpass those on a regular basis. If you don't, you won't have that base or that position any longer.

Remember, to be a profitable team member, you need to MORE than "pay for yourself". I'm willing to bet that $70k is quite low for the benefits you are receiving and you should be thinking much bigger.


In addition, I would invest a portion of your salary towards earning a CPCU or other similar designation. Heck, your firm may offer educational reimbursement for those courses.

 

[VolAgent]

Just to put things in perspective for you.

At a 20% commission, you need $250,000 in premium to cover your base. At 15% it is roughly $333,000 and at 10% it is $500,000. Also, this does not account for any taxes, benefits and other expenses just to have you on the payroll and writing insurance.

Fortunately, the principal is probably expecting to lose money on you in the first year. But that doesn't mean he wants to carry you. Also, this is commercial with a longer sales cycle and ramp up period than personal lines.

It sounds like a great offer, but I would sit down with your future boss and go over what the expectations are. Be upfront, you know you are going to have to produce to make everyone money, but you want to plan out with him what your goals are both near term and longer to make sure this is successful for everyone.

In particular, what kind of premium do you need to be writing in 6 months, 12 months, 24 months, etc.

 

[JoaoP]

Thanks for the feedback.

That $70K is in commissions, so it's more like $700K in first year commercial premium.

 

[Italianik]

This does sound like a great deal, but depending on what market you target $700K is a tall glass of water. IMHO Even $250K- you are going to need to write a few nice accounts to hit this. Forget basic BOPs. You have to ask more questions and find what their niche market is and avg premium on those accounts.

$50K sounds nice to me right now... I am still running lean and mean...

 

[JoaoP]

This does sound like a great deal, but depending on what market you target $700K is a tall glass of water. IMHO Even $250K- you are going to need to write a few nice accounts to hit this. Forget basic BOPs. You have to ask more questions and find what their niche market is and avg premium on those accounts.

$50K sounds nice to me right now... I am still running lean and mean...

Agreed. Seems like a talk order, but I know they have certain niches that they target specifically.

 

[Italianik]

I started out new too, and I can say commercial is a whole other animal. It's not just getting the leads, but learning the coverage and underwriting. Actually getting the leads is the easiest part IMHO. If you have B2B sales experience you shouldn't have trouble with generating leads.

Its getting handed a folder of files and trying to dig through it to find out what they have, where they're naked, and fixing it that's the fun part!

IMHO - Anything with decent premium is going to be grittier. And it takes more time. Make sure you are going to have a lot of support.... Or maybe they have CSRs who will do all that for you? Find out. Ask questions.

Good luck! It's a great business.

 

[VolAgent]

I repeat my earlier advice. Talk to the firm.

Tell them they are interested and want to map out your goals. There is no way they expect you to write that much your first year, unless your family just happens to own several large businesses and will let you have their insurance.

They have done this before and they know what it takes to succeed and keep your job. Sit down, tell them you know there are going to be numbers to hit and goals to be met. That you have some rough ideas of what commissions are like for commercial, but you don't know their numbers and want to make sure you are on track to succeed with them.