Insurance Agent Forum

[mbscagent]

FMO's promise leads where you are on your own with companies direct right? I noticed Humana and UHC both are on TV now gearing up for open enrollmentfor MA who gets all these hot leads?

[ATM]

I've worked for FMO's, Brokerage houses, insurance companies and as a captive and independent agent so maybe I can add some insight.

If you are an independent agent I think you need both an FMO and a primary carrier and here's why. As has been noted the FMO will always try to pay you as little as possible on your business because they get paid on the spread. Typically this will be 30-40% override but independnet agents need to remember that the payout to the FMO is loosely based upon the FMOs total premium with that carrier that drives their contract so you aren't giving up 30-40%. You might not even be giving up anything if you don't do a great deal of business.

With your primary company, and there are a good number you can go directly to and who will work with you almost as though you are a captive agent but you're not. You can build a relationship with the key people who help drive your business, the underwriters and case managers etc and you can focus your business and service on that particular company or companies.

As most of these types of companies will pay you directly you will tend to make much more money over time while still retaining the FMO relationship for those cases thaty don't fit or need more competitive underwriting etc.

I have a main carrier that gets the majority of my business and I have an FMO relationship where I can shop those cases that need it. I make more, I'm more efficient so clients get better service and everyone is happier.

[padthaiforlunch]

I'm contracted directly with all the major health carriers (not so with life, annuity and med supp). My commission level is the standard street.

I looked into Health Choice One. Their contract states that they own the client. That is not worth any amount of support they offer.

[Yoda]

Heres another risky scenario that I have seen happen many times in my career. Lets say that you contract with say Gerber Life through FMO or MGA that you met on this site with. Now morph into the future 5 or 6 years and you have sold a hundred or two hundred policies through Gerber but they are no longer competitive. You end up contracting with another FMO or MGA to sell the newestt hot med supp company to come out and your not doing any business with Gerber anymore. Now Tony soprano er I mean your old FMO from Gerber realizes that you are not his boy anymore. So what does he do, he takes the list he has of all your Gerber clients and gives it to a Career agent who is a shark and that shark starts looking up your clients and rolling them and they split the commissions and you are left in the cold..This scenario happens every day folks believe it!

[Cenla Agent]

Originally Posted by mbscagent

FMO's promise leads where you are on your own with companies direct right? I noticed Humana and UHC both are on TV now gearing up for open enrollmentfor MA who gets all these hot leads?

It is primarily captive agents who get those leads. I don't know how UHC does it, but that's how it is with Humana. Humana has some FMO's that can provide leads, but only in areas in which their captive sales force is not concentrated--usually rural areas with higher premium plans.