Independent Agent vs Captive


If I understand correctly, a captive agent has a contract to sell insurance for only one company, correct? I assume the contract requires exclusivity and prohibits the agent from selling policies from other companies?

If one is an independent agent, you can sell for multiple companies, correct?

Finally, can an agent (indep or captive) sell him/herself life and/or health insurance? If I become a licensed agent, can I purchase a policy for myself through a company with which I am appointed?
1) A captive agent can only sell the products of that specific company or the products of a specific agency.

2) An independent agent can contract with as many companies as they like.

3) You can write yourself a policy and you even get the commission.
Thank you John!

Another question I forgot to ask:

Does an independent agent have to pay any fees (annual or monthly) for the right to sell for a given company?

Are there any particular benefits to being a captive vs an independent? It would seem to me that being able to sell MORE products would be better.
No fees:

And here's the theory:

*Captive agent: Training on the products and normally you have a manager who you can call at any time for support. They normally give you leads or heavily discount them. Lots of atmosphere which a lot of people need to get off the ground. Contests, bonuses and recogintion for your efforts. Typically from 20% to 50% reduction of commissions of what you could get as an independent.

*Independent Agent: No formal training and no manager. It's you in your office with brochures and underwriting guidelines. Top commissions but you're on your own for a marketing plan. No atmosphere and normally no one to call if you need assistance.

It's pretty much the opinion of most people on this board that as long as the products are solid newbies should start out with a captive company then move to being independent once you're knowledgeable.
Although there are many very legitimate captive agencies you want to watch out for "turn it and burn it" operations. Warning flares should be going off if:

1) It's a group interview
2) The interviewer doesn't grill you on your resume or seem interested in your skills, past job record or what you bring to the table.
3) The entire interview centers around how rich you'll become
4) The "manager" is a 26 year old wearing a JCPenny tie
*Captive agent: .......... Contests, bonuses and recogintion for your efforts. Typically from 20% to 50% reduction of commissions of what you could get as an independent.

For those of us just starting though, isn't it fair to say that between the salary for a new/financed agent, the training and the bonuses, that the loss of commission is more than made up for?
Yes. And in fact it's possible to get more commission and take home less if you have trouble motivating yourself. A lot of people need those meetings and contests. They are driven to out-perform others or at least not be embarrassed at the meetings.

When I was with UGA at the beginning of every meeting on Friday you had to walk up to the board and write down your weekly production. That was the walk of shame of you didn't write anything and it was hard to justify when everyone else was writing business. Some people need that.

I blew out of UGA along with about either other agents. All of us were writing various levels of production to safe to say all of us were writing business. Three months later two of us were left standing as independents. Now I'm the only one left standing. The other seven simply couldn't handle working out of their houses with no support/motivational system.

Who makes more:

Captive agent at 10% writing $15,000 per week
Independent agent at 25% writing nothing per week

I'd say when you're new in this game don't get too crazy over the percentage you're making. Instead focus on how much you're making and learn the business.

For every owner of a company who is deeply driven and wakes up everyday and simply does his job, 10,000 people working for him need an atmosphere where if they're late for work they're fired.

I also don't mean to promote myself as someone with some insane level of self-motivation. The truth of the matter is today I don't feel like doing crap. So after my wife finishes making her homemade pasta sauce we're out of here to Home Depot.

If I was captive and went into an office today I might have drudged in there, but then you get around everyone and get all pumped up. So in that environment I would have made sales today. In my environment I'm not - and I'll cost me about $800 to blow today off.
I think it also depends on what you are selling.

With the senior market, some companies only let certain products to be sold by captive agents (Humana in cities with HMO and PPO's).

If you are new, I agree that you should go captive first, as then you will have all the training, support and usually leads to get you off the ground and running. Then once you build a book of business and pipeline of people to talk to, you can explore your opportunities.

It is just like any business. If you wanted to open a bar and have never bartended or worked in a restaurant before, would you work for someone to learn the ropes, or just open your own place and "hope" that it works?