Couple of general questions.....

[chp]

I have a couple of questions for you all, as I am still learning being an independent:

1. What are the standard commissions that most individual insurance companies pay? It seems to be 20%; is that the norm? When can you request a higher commission with a company, is it based on certain levels? I am appointed with just about everyone in my area (SC) but only writing two companies on most clients (Humana/G.Rule).

2. Is it worth it to get into selling group plans? I have no idea how, but my telemarketer is getting me a bunch of leads on companies looking for help. Do most of you individual guys also write groups, or just stay with individual policies.

3. What is the difference between a GA (general agent, agency??) and a MGA? I am appointed direct with most companies, except for G.Rule. I use a GA/MGA (not even sure!!) for G. Rule to get a 9 month advance. Is it worth it to go with on GA/MGA for all my companies? What benefits can they provide, other then "support" which I dont really need. Leads? Higher Commissions? I have several asking me to go with them..can I negotiate anything from them?

Thanks in advance, any help/insight will be appreciated!!

chp

 

[Post Quartermaster]

CHP,

What side of SC are you in? Hopefully I can provide some answers to most of your questions.

1. 20%new/10%renewal is the norm here in SC, although Humana is 5% on renewal, I believe. GR and Assurant are also below 10% on renewal, but they haven't been very competitive for us for awhile.

If you are mostly writing Humana/GR, you need to be showing BCBS and Carolina Care Plan as well. BCBS is fairly high right now above 30y/o but renewals are more predictable than Goldenrule and they are a good fit for certain cases. Wellpath is also very competitive in the SC market in some areas.

2. In the long run, group can be very profitable, depending on your market. Selling group requires alot more back end work IMO. I am lucky enough to work in an agency with a great support staff. I would not sell group without back end support, especially in the 15+ market.

Despite all of that, I enjoy the creativity involved in selling group - too many group agents around here are behind the curve on consumer driven concepts (HRAs, etc), which makes my life alot easier.

3. MGA is generally a higher level GA contract. I would wager that any company offering you a GA or MGA contract right now isn't competitive in the SC market right now. Most of the quality health carriers in SC have production requirements that make it tough for an individual agent to get a GA contract.

If you have any other questions, shoot me a pm. The agency I work out of is a GA for BlueCross, Carolina Care Plan, United/Goldenrule, Assurant, Cigna, etc...

 

[chp]

Hi, thanks for the response. I am in Myrtle Beach. I will shoot you an email when I get back from my last appointment for the day.

Thanks again, chp

 

[Labman]

How much work for a <10 group? I'm in the upstate of SC and will soon start working with Colonial on the supplemental side of things. I'm thinking about carrying group as well to help me get started off on the right foot. It seems to me that approaching the owners needs with two different products would improve my odds of making a sale. Thanks

 

[djs]

I can't speak for SC, but in California, groups of <10 are very easy. Pretty much low hanging fruit. Problem is, they don't pay very much.

Here, the problems you'll run into are:
- Lack of participation, making the group not viable. You usually need 75%, which means 8 out of 10 employees.
- Everyone wants different plans. This is manageable, but a pain when they ask followup questions.
- The employer will conveniently forget the premium payment every other month. He has other bills to pay.
- Not a tremendous amount, but a reasonable amount of service work on group plans as they hire / fire employees, people get married, divorced, have children, etc.

Small groups like this are great if you have complementary products to sell them as a package. I do a fair amount of small group, working on their liability coverage, health, retirements, and group life.

Dan