I used them until I got tired of hearing how I was the 8th agent to call them. One time it was a total of 11. Even when you are the first person to call them, you have 5-10 other agents calling right after you. They are great about refunds for the uninsurables though. Not one question asked ever.
Spend your marketing money generating exclusive leads - not enriching lead companies while you claw and scratch to get the deal. You'll also realize that the target market for health insurance is small business owners - not some broke 23 year old.
I tried and quickly ditched the Google Adwords program. This is the reason leads used to be great and now are horrible....cost. Not 2 or 3 years ago you could pay 50 cents a click and get on the 1st page. Now lead companies are paying about $4 per click to get on the first page.

$4 per click? Just think about that cost - $4 just for someone to click on your site. That doesn't mean they'll submit their info or they won't put 555-5555 as their number and [email protected] as their email.

When I did Adwords it was about 6 hits to get one lead. So right off the bat that's $24 for a lead. But that doesn't mean the contact info is real or they're insurable. When the dust settles you're at about $40 a lead. As you can see, lead companies that charge $8 for that lead have to give it to at least 5 agents just to break even.

What the lead companies have started doing is selling to more than 5 agents while blantantly lying to you or selling the leads to other "warehouse" places like http://leadsclearance.com
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The healthleadsdirect guys are even worse.
However, I have a new agent that wants to work internet leads. He has 5,000 to start marketing with and does not need an immediate income. In his case, internet leads may be the way to go.
Possibly. I said before that there's still profit in the leads as long as you're writing 20% contracts:

20 leads X $8 = $160
$3,500 AV X 20% = $700
Profit = $540

You want 5 deals a week or 100 leads X $8 = $800 a week on lead costs. He'll blow through that $5,000 quickly - better be a closer.

I can't imagine closing less than 1 out of 20. For me it wasn't about the money but the bs factor.

I had an agent with me over a year ago who had just sold a business and had money to burn. He was horrible on the phone and was going through about 40 leads to close one deal. He blew out after about 2 months.
I just cannot justify, in my mind, paying for leads. There are too many sources out there, whereby you can develop your own leads for free:

Go to the local library and use:

Business Wise

Both of these sites have listings broken down by area, SIC, street and zip.
With ReferenceUSA, you can even put in delimeters, such as company size, etc.

If that isn't an option, go to www.switchboard.com and call businesses in a certain area.

There is another web site that is here, in Atlanta. I don't know if it's in another city. It's www.acinet.org/acinet .

This is used primarily by job seekers, but can be used to find businesses, in all different industries, in all different specialties. If anybody is interested, I can put together a cheat sheet for it.

Paying for leads is like paying for sex. Why should I, when I know, if I apply myself, I can get it for free?
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Fundamentally, you are absolutely correct. However, the current culture has created peole who are so afraid of rejection, even anonymous rejection, that they won't even try to play.
I bought internet leads for a long time despite local agent friends of mine who told me I was crazy. Since I've been off shared leads the quality of this job is far better and I'm turing in the exactly same amount of business, if not more, for next to zero cost.

If internet leads where the cure all then average agents could jump into this business, buy leads and make great money. The exact opposite is true. Agents come into the biz, buy leads, get their ass handed to them and quit.

The majority of leads are simply garbage. You can't get 60% to 70% of them to even anwer the phone or reply to emails. Most of these nutbags enter in their info for a price quote then go to Priceline and price out a 14 day Bahama cruise just because they're bored.

The other factor is being busy. Say you buy 5 leads a day. Great....so what are you doing with the other 7 hours of your day?