Direct Appointments Vs. Aggregator
- Thread starter 5150
- Start date
- 232
Generally speaking, direct appointments require more 'history' than most new agencies can document. They can also have pretty high expectations.
If you are being offered directs, I'd investigate those thoroughly. It says a lot, to me, that you are getting offers and may be able to go it alone.
Most go to an aggregator because they cannot get directs, they don't have the knowledge or experience to effectively grow a book in the independent world, or they are lazy.
Aggregators are there to provide markets and to back you as their producer. They'll have the type of access and experience to do what you can't. You'll get training and bonuses as part of the collective group that takes years to earn on your own. It might be small $$ or it could be very big $$ depending on the group. You'll pay a premium to be a part of that, but it might be worth it in any one case.
If you are being offered directs, I'd investigate those thoroughly. It says a lot, to me, that you are getting offers and may be able to go it alone.
Most go to an aggregator because they cannot get directs, they don't have the knowledge or experience to effectively grow a book in the independent world, or they are lazy.
Aggregators are there to provide markets and to back you as their producer. They'll have the type of access and experience to do what you can't. You'll get training and bonuses as part of the collective group that takes years to earn on your own. It might be small $$ or it could be very big $$ depending on the group. You'll pay a premium to be a part of that, but it might be worth it in any one case.
- 792
If you are able to get direct appointments with "many" carriers, why are you looking at aggregators? Foolish.
RicFlairII
Expert
- 92
Just because a carrier talks directly to you and acts as if getting
a contract is a possibility, that does not mean it is a given.
When you turn in the paperwork, the story from the carrier often
changes.
a contract is a possibility, that does not mean it is a given.
When you turn in the paperwork, the story from the carrier often
changes.
ya, they talk to you, be all nice, then comes down to negatotions and they say they require a $250,000 a year GWP committment, and or at least a $300,000 book roll.....
if it was THAT easy to get appts, clusters wouldnt exist
- Thread starter
- #6
I said that I "may". Nothing foolish about that.
I know that some of the non-preferred carriers will be easier to get direct appointments.
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ya, they talk to you, be all nice, then comes down to negatotions and they say they require a $250,000 a year GWP committment, and or at least a $300,000 book roll.....
if it was THAT easy to get appts, clusters wouldnt exist
That's easy enough for one carrier, but if that's what each one wants, it's gonna be an issue. Guess I'm back to the aggregator, at least for preferred carriers.
Thx
- 1,016
It gets very confusing on this forum now when F150 and 5150 are on the same thread because of the closeness of their usernames.
There for a minute, I didn't know whether to wind my a$$ or scratch my watch. I had to go back and re-read the thread for it to make sense.
^^^ That is exactly why the turnover rate is so high with sales reps! A competent sales rep would have told you that up front during your first conversation.
When independent carriers try to hire qualified and knowledgeable sales reps, the demand is far much greater than the supply. And today's travel expenses prevent a very good sales rep from being paid what they're really worth.
There for a minute, I didn't know whether to wind my a$$ or scratch my watch. I had to go back and re-read the thread for it to make sense.
^^^ That is exactly why the turnover rate is so high with sales reps! A competent sales rep would have told you that up front during your first conversation.
When independent carriers try to hire qualified and knowledgeable sales reps, the demand is far much greater than the supply. And today's travel expenses prevent a very good sales rep from being paid what they're really worth.
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- 1,581
You know I struggle w/ this because as part of SIAA they still have commitments (50-80k so say the reps) but I've never heard of them enforcing anything in our group so what gives? I'm guessing they just want to keep some level of pressure on the agencies.
That being said one of my carriers (Kemper) said they'd appoint me direct & said 2 policies a month would be fine. Travelers (at one point) said we were their top producing agency with like 11 policies per month on average? Like really out of 60+ agencies? At that pace we're not scheduled to meet the commitment they wanted.
I know plenty of agents that left Allstate & picked up 3 preferred carriers on their own. Now they had a lengthy history of running an agency BUT they still pulled it off. Overall I'm netting the same compensation and getting bonus in all the years they aren't because their book isn't big enough. Plus I'm insulated by the group and I have way more companies.
I've ran scenario's over...and over...and OVER again to see if it made sense to leave my group & it doesn't unless I banded together with 1-2 other agents. If you can write $1,000,000+ in premium per year then I'd say it makes sense to go direct if you can continue being a production machine for your forseeable future. Otherwise (based off my studies) it doesn't. The access to so many markets, the weight the group pulls etc outweigh the cut you give to the master agency. And btw...as you grow w/ SIAA the % they take shrinks so you're not really paying 10% on your total compensation. The biggest guys in our group are paying 4-6% of their total compensation because it scales down.
That being said one of my carriers (Kemper) said they'd appoint me direct & said 2 policies a month would be fine. Travelers (at one point) said we were their top producing agency with like 11 policies per month on average? Like really out of 60+ agencies? At that pace we're not scheduled to meet the commitment they wanted.
I know plenty of agents that left Allstate & picked up 3 preferred carriers on their own. Now they had a lengthy history of running an agency BUT they still pulled it off. Overall I'm netting the same compensation and getting bonus in all the years they aren't because their book isn't big enough. Plus I'm insulated by the group and I have way more companies.
I've ran scenario's over...and over...and OVER again to see if it made sense to leave my group & it doesn't unless I banded together with 1-2 other agents. If you can write $1,000,000+ in premium per year then I'd say it makes sense to go direct if you can continue being a production machine for your forseeable future. Otherwise (based off my studies) it doesn't. The access to so many markets, the weight the group pulls etc outweigh the cut you give to the master agency. And btw...as you grow w/ SIAA the % they take shrinks so you're not really paying 10% on your total compensation. The biggest guys in our group are paying 4-6% of their total compensation because it scales down.
Some really good posts and info here relative to your inquiry. Aggregators can be very good, depending on your situation and needs. However, if you decide to go with one, make sure you fully understand the contract, particularly as it relates to ownership of policies and terms of separation.
Of course there are other questions to ask and other contract issues. Let me know if you want a copy of a check-list I developed for this purpose.
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