Are any of y'all buying this LOA stuff?

[HoosierLife]

I mean this is going to attract all the bad agents that will roll up debt AND they are giving up ownership of their business. I can see the appeal to the kind of guy I wouldn't want, but I know some good guys are getting suckered into this too.

What's the exact details?

 

[tribetime32]

More will be coming out but it is definitely LOA which equals giving up ownership of your book.

 

[HoosierLife]

More will be coming out but it is definitely LOA which equals giving up ownership of your book.

More risk, more profit. Less risk, less profit.

I get where you're coming from. The only reason IFG would do it is if they thought it would make them more money.

But there have to be agents that find value in that or they wouldn't do it.

I just didn't know if the plan was to put all the agents on LOA or just the downlines?

 

[tribetime32]

Oh, it will definitely make IFG more money. It will also screw over their agents. They are just becoming TAG and eliminating their name from being viable competition.

 

[NSRH]

I dont claim to know anything about this new model, but I do know this...

Whenever someone is thinking of doing things a different way, all the of the guys they leave in the dust claim they are scamming agents...

 

[tribetime32]

This isn't new. LOA has been around forever. You can call it whatever you want, but it's not innovative or new, its just vying to own your agents' book of business.

 

[myinsurebiz]

There is a very prominent IMO that is touting the ability to "prevent chargebacks and debt rollup" by going LOA. I've learned that there isn't anything new under the sun in this business, but man this one baffles me.

How can agents really not see what they are giving up?

Apparently they have an option to stay a broker, but if a group is putting this much energy into something like this how much support is the independent guy who isn't giving up his book going to get?

Any of you guys come from this space to help shed light on this?

This seems like a greedy train wreck waiting to happen. Perhaps we can innovate a solution!

LOA has it's place. No different than being an agent for NYL or State Farm.

TAG has a nice Direct Mail Lead program for their LOA agents.

TAG gives 60% to 75% of AP and advances 12 months.

TAG has nice spreads on Medicare Advantage too with volume.

TAG has Benefits for those wanting to build an Agency and be a W2 employee -or- peeps can stay 1099.

 

[myinsurebiz]

Many agency builders are petrified of chargeback rollups.

I don't know if they're using this just for agency builders or all agents so they don't have to worry about ANY chargebacks, but it is what it is.

Even though you can make more money with high comp and paying for your own leads, there's tons of agents that don't want to take that risk and take reduced comp and free/discounted leads.

Would potential agency builders be any different?

Several large Agencies left OLA / HFG to go to TAG for this program style. Even the Chief Sales Officer [ SG ] took his entire office to TAG.

TAG has never rolled up any debt in Shakleford's time in the business. Someone can build an Agency without the fear of debt wiping them out 3 years down the road.

The trade is, 3 years down the road, the Agency doesn't own the book nor the client.

100% vesting takes a decade to achieve.

 

[tribetime32]

LOA has it's place. No different than being an agent for NYL or State Farm.

TAG has a nice Direct Mail Lead program for their LOA agents.

TAG gives 60% to 75% of AP and advances 12 months.

TAG has nice spreads on Medicare Advantage too with volume.

TAG has Benefits for those wanting to build an Agency and be a W2 employee -or- peeps can stay 1099.

I'm sure LOA has its place for someone who wants to be an EMPLOYEE, but with all due respect you can't say you're a business owner and be LOA. I'm not saying you can't make money, but most insurance agents would not be okay with not owning their book of business.

The problem is that these guys are dressing it up like it's the next best thing and it's clearly not.

 

[TripleH]

For the newer people to the industry or to this thread, an LOA is a Licensed Only Agent, this means a couple different things. They do NOT own their book of business nor their renewals and sometimes have to wait a vesting period before they even get renewals. Also have to sign a lengthy contract with a non-compete clause.

Seldom do LOA IMOs release, but I have seen it done before as long as you uphold your end of the contract and do NOT contact your clients, that you spent money on leads to acquire (either through lower comp, which means you are still paying for the leads, you just don't see it) or by physically paying yourself. You can get a release if you do not pay all your debt, but it is subjective to the IMO and the upline above you.

You do NOT own your book of business and if you leave to find a better opportunity, all the years of hard work and sweat equity you put into your business, is gone and you lose it. They own your book, you do not own your book of business or the right to contact those clients if you leave. Due to the IMO taking more risk on chargebacks, lead financing and debt roll-ups from downline agents, they will inherently pay lower comp or hold you hostage. I did see a post above by Newby that I liked, if places like this didn't exist and agents didn't get burned they would appreciate where the grass is truly greener on our side of the road.