Producer Pay

[kethri2]

I was wondering if you pay a producer 10 percent on new business and 10 percent on renewals is that to rich. I see on here where guys only pay a small portion of renewal to producer. I want a person who envisions being a successful agent and sees this as a great career. I think if you offer less than that it is hard for people to make a career out of this. Thoughts? Thanks
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Sorry should have specified this is P&c. Agency would offer health and life sells as well though

 

[oneinsurance4u]

Thats better than what I started out at. I started out at 50/50
Your offer sounds good to me. You should be able to get some good people.

 

[Josh]

If you want good talent, you're definitely going to have to make it worth their while. Many good ideas are ruined by greed.

 

[kethri2]

I agree. I started out as a producer and watched greed pretty much shut down the agency I was with. I think it is super important for agencies to understand that you are not going to get rich off of a producer. I write my own business for that. What producers do is keep carriers happy and help pay for an isr. That is just my 2 cents.

 

[FL P&C Broker]

Depends on what is provided and also depends what percentage the insurance company pays to the agency. If it is 12% then 1-% might be a little to much if it is 15% then that could be fair. I prefer to with a percentage of the gross commission.

 

[wow314]

We have been doing 80/20 split no base.

 

[nyc2phi]

What would you recommend in this situation...

If I was to go through a cluster, they would take 30% of my commission, so where the typical pay for p&c from the carriers is 15% I would get 10.5% after they take their cut.

How would I split this with a producer? If I was to offer 50% he would only be looking at 5.25% which seems low, but if I was to give out a higher cut I would be taking a loss or not making anything unless he produces a substantial amount.

What would be a good offer that would keep them happy ?

 

[Norwayguy]

What would you recommend in this situation...

If I was to go through a cluster, they would take 30% of my commission, so where the typical pay for p&c from the carriers is 15% I would get 10.5% after they take their cut.

How would I split this with a producer? If I was to offer 50% he would only be looking at 5.25% which seems low, but if I was to give out a higher cut I would be taking a loss or not making anything unless he produces a substantial amount.

What would be a good offer that would keep them happy ?

First I don't sell P&C but it seems like one of the main issues with getting direct appointments is building that book of business. So a producer that you pay just a commission split helps you in multiple ways. You might think of break even or a little less for first year and much less for renewals.

 

[rudy323]

stop thinking that you NEED to make money off of the producer right away, thats like thinking starting a scratch agency is going to be printing money in the first year!

Treat your producer like an investment, not an immediate cash flow generator
First year commission is probably near breakeven and then juice from there on out

OR

Milk them for all you can for the 3 policies and 4 weeks they sell for you, and then wonder why you can't keep producers and why you have so much service work

The only employees willing to work for a shabby unfair deal are going to be incompetent anyways

 

[iiinycboi]

you wont have any producers for the first year as an indy at least, you can handle everything yourself.

but i am in the situation where i have and i start everyone out at 50% of agency commission and i have tiers for them to move up. (this is for indy agents that want to work as they please)

Dont think of them taking a cut from your profits, without them you wouldnt have gain the business anyways. Think of them helping you grow your business book and get some competitive direct appointments.

I really feel you and i are on the same boat and you are walking the same path that i did last year lol.