Advice for my situation?

[Bwarules]

First let me say thank you to everyone contributing to other posts. I've been reading for a few days now trying to learn what I can and this site has been amazingly helpful.

I am not a licensed agent at this time but am interested in getting into insurance. I own a company that provides merchant services for businesses (in a nutshell, that means we give businesses the ability to accept credit cards). I am interested in getting into insurance to provide another way to help our customers and diversify my company. My question is what type of insurance would you recommend? Health, Life, P&C? I would think P&C and Health are the most likely candidates? I've read enough on here to know that it sounds like I need a broker (or GA?) with a lower share and more support due to my lack of experience. The last thing I want to do is lose a client because I messed up their insurance. I really don't care about up-front commissions, my current business is built on a residual model and that is what attracts me about insurance. I'm all about the long-term income potential. Any recommendations on what is easier to start in and what direction you would head if you were me? Any advice is appreciated.

A few things I'm considering:

I'm in Texas.
What product is easier to learn?
Which will require less time to manage?
Are there other obvious opportunities I'm ignoring or don't know about?
Which product has the better long-term value / turnover?

 

[HomeService]

I am also in TX and have owned a business where I got many telemarketing calls about merchant services and accepting credit cards. However, I never took them up on it. I owned a service co. where I was on the road and did not have a business where I could put in a credit card machine. But, most business owners I have spoken with think the merchant services guys are raking them over the coals with high charges. I am not saying you do this, but I'm just saying that's what I'm hearing from some of them, mostly restaurants.

OK, as far as offering insurance, I have actually thought of this same concept, sort of build a "store" where you offer business merchant services, insurance, courier service, all of that. You could call it "business depot" or something. Maybe somebody took business depot as a name already. oops... edit... yep I did a search and staples has that name, apparently. We do not have many staples stores around here...

But, anyhow, one guy cannot do all of this, so most people network and get with a good agent that they refer business to, then get with a good courier company, then the agent refers your merchant service.... get a good network together. That would be my suggestion. I think yours is a good idea but for one guy to offer everything to every business- that's a stretch. I should think a referral network would be easier.

Now, if you really want to offer insurance and merchant services, and you think those two things work hand in hand.... I may suggest you first train in the supplemental markets like maybe with Colonial. Then you can learn the life market and health market later. Begin with something rather simple and easy to learn.

 

[Bwarules]

But, most business owners I have spoken with think the merchant services guys are raking them over the coals with high charges.

They're right, lol. Unfortunately, in our industry, there are a LOT of unscrupulous people who say one thing and do another. That's where we've found our market. We're just honest with them. It's amazing how far that goes, lol.

Thank you for your thoughts, I appreciate the input. For clarification, I wasn't going to do it all myself. I have an existing team to handle the merchant services side. My idea is that I could work the insurance side using the contacts and only handle some customer relationship aspects of the ongoing business. So, it won't just be me. Sorry, I should have said that in my first post. Thanks again for your help. Again, all ideas and thoughts are appreciated.

 

[HomeService]

I sort of figured you had a team of folks selling that stuff. I am glad you have a solid business based on being honest. That is wonderful to hear. You may find that you eventually build a team of agents as well. Could be in the future: one division is for merchant services, and one division is for insurance. Business liability is another thing to look into selling. And, workers comp, although in tX it does not sell as well as other states, because we do not have a state law requiring it, so we agents sell 24 accident plans. Some of us sell those. They cover the client at home or at work. I think you may be on to something. Get with a mentor of some kind in your town.

 

[somarco]

Interesting thread.

The last thing I want to do is lose a client because I messed up their insurance.

Despite what some think, if you take your business seriously, this is not something for the casual agent. While merchant services, telephone services, auto leasing, bank loans and insurance are all things businesses need that does not mean they will have confidence in a guy (or gal) that has them all in one-stop-shopping.

workers comp, although in tX it does not sell as well as other states, because we do not have a state law requiring it,

While TX does not require an employer to have WC it does not absolve the employer in the event of a work related injury.

An accident plan is not a substitute for WC liability.

CGL policies protect the employer against claims made by clients, not employees.

An employer that does not carry WC is running a big risk. Employer liability for work related injuries includes medical bills, lost wages and loss of life and limb.

 

[HomeService]

somarco, you touch on a great point: in order to be heading into businesses around here in TX, I guess a person better brush up on the state and federal laws that talk about worker's rights and lawsuits and who is liable and such. I know for a fact, I have seen in the individual health insurance policies, where they exclude injuries at work. They presume you have workers comp at work, or the employer is liable, but who knows in TX what the employer does, so there is a gap in coverage there, while at work, SOMETIMES. I need to get with a lawyer sometime- and discuss this.

 

[myinsurebiz]

If businesses are going to be your target market - health and supplemental products would fit. But yuck . . .

Sell life over the phone and work in your pajamas.

Less hassle and in my opinion - better commissions.

Good Luck!

Tom

 

[moonlightandmargaritas]

While TX does not require an employer to have WC it does not absolve the employer in the event of a work related injury.

An accident plan is not a substitute for WC liability.

CGL policies protect the employer against claims made by clients, not employees.

An employer that does not carry WC is running a big risk. Employer liability for work related injuries includes medical bills, lost wages and loss of life and limb.

Worker's Compensation insurance also provides a finite amount of liability for the employer.

If self-insured...all bets are off. Sky's the limit.

 

[djs]

If you are already in there on merchant accounts, the business liability, commercial auto, workers comp, business bonds, and group health are nice touch points, building on the service you already provide.

None of this is as easy as it sounds, and done incorrectly, could cost you some existing clients. That said, it can help you stretch your advertising dollar a bit, which is always nice.

Dan

 

[Bwarules]

If you are already in there on merchant accounts, the business liability, commercial auto, workers comp, business bonds, and group health are nice touch points, building on the service you already provide.

None of this is as easy as it sounds, and done incorrectly, could cost you some existing clients. That said, it can help you stretch your advertising dollar a bit, which is always nice.

Dan

So, if it were you, which of these would you pick to work on first? Are there large differences in margins from one product to the next? Are there differences in time constraints for one to the next. Obviously, if successful, I would like to branch into multiple services with an insurance "division" similar to what was mentioned above, but I really want to start slow and focus on one area so that I can have a shot of knowing what I'm doing.

Thank you to everyone who is offering thoughts, this is all really helpful info. to have for the decision making process.