Going Independant! Please Help

[indi500]

Thanks all in advance for your help. Long time lurker, first time poster. I know this question has probably been asked a million times, but I really need help. I so appreciate any sincere advice you can give me. I apologize for my naivety on some of this.

My stats: Licensed P/C/Life agent. Work for an independent agency.. Strong work ethic. I have a high level of integrity in everything I do. (For example, I don't write junk business just to get a sale).

I have thought about having my own business for a long time now. when I got into insurance, I thought about going independent myself. Two major concerns include:

1) Coming up with start up capital (business expenses + 1-2 years living money)
2) Where and how to start so I don''t fail.

Some questions that come to mind.

-- What commission percentage does an independent agent make for NB and renewals?

--How do you get appointments with national carriers? What are the options and the pros and cons?

-- How much start-up capital does a single agent need to begin? It's obvious I'll need an income source while I'm building my client base and book.

-- The biggest concern is how to grow fast so that I can cover income and expenses. The agency owns my book so I can't take it with me. So what method did you use to generate new business?

-- What overhead costs such as office space? Do you really need an office to start out? Can you do virtual office to start? I can't imagine 100% of clients never wanting to meet me at my office.

-- What about E&O Insurance? How much does that cost?

-- What about a mutli-rater, and client management system?

I would enjoy hearing some of your success stories. How you started as independent agent and where you are now. Any current books, blogs, or websites to read regarding going independent?

Thanks again for the help

 

[Chevarian113]

Without typing a book about my experience, I made the switch right at a year ago. I've averaged writing 30k per month premium, which was right at my goal. My biggest piece of advice here is to really consider where you will get the business from and making sure you have the right portfolio of carriers to be competitive and offer quality.

Your question of where you bring your business in can only be answered by you. I've built my book so far solely on referral business, which has given me confidence in the quality of it. I, like you, won't write just anything just to get business. See what sort of natural market you have. Ramp up your referrals for yourself now to see what you have coming in. If you're going to build business cold calling, what are your sales advantages? Have you had experience in cold calling? It's a very tough thing to stay positive about at times, be sure you're not going to flop.

E&O, plan on around $350-400 per month.

Start up capital, well, make sure you don't have to take any money out of the business, so either live off another income or your savings. The commissions you make will cover your expenses if you keep them low.

No, you don't need an office. I would highly recommend having a virtual office setup though. You need to maintain a professional atmosphere, but that can be done by appointment in one. Prices for that depend on your area. Most give you a set amount of conference room time per month, some also give you an office to work in for an hour or so at a time. I considered doing this at first, but chose to get an office first.

You don't need a multi-rater. Management systems, I wouldn't live without one. I also use Salesforce for tracking sales since my AMS sucks. I just use it to house policy info in one central location so I can then refer to the carrier's site once I know who the policy is with.

As for appointments, you can start out 100% independent, but you won't get many options and you'll probably flop (sorry to sound pessimistic). Either join a cluster or start under another agency to get your contracts. Unless you have a decent size client base coming in (if you were a prior Loan Officer, etc), the big companies won't give you the time of day, not to mention you have annual goals with each of those to keep your contract. Clusters will give you a network, and many time, an Agency Management System, to work with. Get the right contracts to be competitive... you don't need every carrier known to man.

I hope that is helpful to you. Best of luck on getting the ball rolling!

 

[indi500]

Starting with a cluster sounds like an option. Any recommendations?

 

[todd02]

Without typing a book about my experience, I made the switch right at a year ago. I've averaged writing 30k per month premium, which was right at my goal. My biggest piece of advice here is to really consider where you will get the business from and making sure you have the right portfolio of carriers to be competitive and offer quality.

Your question of where you bring your business in can only be answered by you. I've built my book so far solely on referral business, which has given me confidence in the quality of it. I, like you, won't write just anything just to get business. See what sort of natural market you have. Ramp up your referrals for yourself now to see what you have coming in. If you're going to build business cold calling, what are your sales advantages? Have you had experience in cold calling? It's a very tough thing to stay positive about at times, be sure you're not going to flop.

E&O, plan on around $350-400 per month.

Start up capital, well, make sure you don't have to take any money out of the business, so either live off another income or your savings. The commissions you make will cover your expenses if you keep them low.

No, you don't need an office. I would highly recommend having a virtual office setup though. You need to maintain a professional atmosphere, but that can be done by appointment in one. Prices for that depend on your area. Most give you a set amount of conference room time per month, some also give you an office to work in for an hour or so at a time. I considered doing this at first, but chose to get an office first.

You don't need a multi-rater. Management systems, I wouldn't live without one. I also use Salesforce for tracking sales since my AMS sucks. I just use it to house policy info in one central location so I can then refer to the carrier's site once I know who the policy is with.

As for appointments, you can start out 100% independent, but you won't get many options and you'll probably flop (sorry to sound pessimistic). Either join a cluster or start under another agency to get your contracts. Unless you have a decent size client base coming in (if you were a prior Loan Officer, etc), the big companies won't give you the time of day, not to mention you have annual goals with each of those to keep your contract. Clusters will give you a network, and many time, an Agency Management System, to work with. Get the right contracts to be competitive... you don't need every carrier known to man.

I hope that is helpful to you. Best of luck on getting the ball rolling!

Can you describe your networking operation, how you went about it, what worked and what didn't work?

 

[ims01]

In what state are you located?

 

[Chevarian113]

I just realized I said I wouldn't write a book and ended up writing a book, my apologies.

For networking, I already had some good relationships with a couple loan officers and captive agents. I got a fair amount of relationships from those up front, and that has only grown significantly since starting up. I've gained a few more loan officers and captive agents since. You really just have to show your value and how you can make their lives easier. It seems to work well. All of my business has been from referrals and I've been able to average 30k a month. I am hoping to double that this year, and I think that is very realistic goal.

My advice, be passionate in what you do and show that to as many people as you can. Those that appreciate having a good partner will do business with you and send business to you. That's the value in having an agent.

 

[geekforthisstuff]

I am at the same career point. I am a former real estate guy that has been working for a captive for a few years now after a switching over from selling cars after the real estate bubble burst. I have maintained and continually grown a nice sized database of clients and referral streams from my real estate contacts as well as my time at the dealership. I am currently in an agency training program but am curious about the option of going independent. Someone above mentioned to join a cluster. Can someone help me understand a cluster and which I should be looking into? Thank you for any help

 

[celks72]

I wanted to give my 2 cents. I just went independent.

My starting capital is around 50k. But I could imagine you could start around 20k.
Really you only need 4 months of expenses for your office + all you license and corp fees.
As far as hiking a cluster for your p&c I would recommend that. Going independent you want to own your book of business. When you join a cluster they usually do an assignment of commissions, which means our writing business for them. So your in the same boat, either go direct with one carrier at a time or join a regional agency alliance. Yeah they take a bit of your business but you own your book.
As far as your life, I would join western marketing , they are an fmo. Yes they own your book but life commision is all up front so who cares,". But the good thing with them they will set you set up an over ride for the future if your hire life agents.
Also did you sign a non compete with your former company? FYI it's against the law for a company to stop ,slow, or interfer with a client switching out of a company.
When I left my company they sent out a letter that I was I longer with the company , that was the best thing they could of did for me. My phone didn't stop ringing, I switched all my clients over expect maybe 4.

Another piece advice make sure you place p&c and life in every house you get into and referrals referals,

I also have p/c/life/health/6/63
Anything else just pm me