Build Your Insurance Agency On Your Schedule By: Michael Miller, Smart Choice® State Director
Building an insurance agency is challenging, whether you’re a new insurance agent just starting out on your own or a seasoned agent adding a new line to your agency’s offerings. Developing relationships with carriers takes time and effort. Joining a cluster group is an effective way to fast-track those relationships and gain access to markets that you could not on your own.
But becoming a member of a cluster group can present its own set of issues. Some charge fees for starting and maintaining your membership. Others require agents to share a large portion of their commission, bonuses, and other supplemental compensation.
Often, cluster groups require agents to make a minimum monthly commission with carriers. But savvy agents know that not all months are created equal in the insurance business. Sales can fluctuate month-to-month and quarter-to-quarter. Requiring agents to meet monthly commission requirements can be unfair and unrealistic.
Smart Choice® Agents understands that not all agents have the same sales goals. Some are go-getters trying to maximize monthly sales, while other choose to grow more slowly. That’s why we do not require our agents to meet or exceed monthly commission goals. Our agents have the opportunity to make 100-percent commissions and keep all the supplemental compensation, bonuses, and trips they earn.
Whether you’re hoping to build a million-dollar agency in less than a year or slowly build your commercial insurance offerings in 2016, choose your cluster group wisely.
Is Your Insurance Cluster Group a Great Partner or a Ball and Chain? By: Michael Miller, Smart Choice® State Director
Choosing an insurance cluster group is a lot like choosing a spouse. You hope you’re both in it for the long haul, and you’d like to think that if you put the work in to sign new clients for your cluster group, the cluster group will reciprocate with giving you access to the industry’s top appointments.
You also know that if the relationship doesn’t work out, breaking up with your cluster group can be painful and difficult. That’s why it’s important to take the time you need to learn all you can about a cluster group before becoming a member. Armed with information, you’ll be able to make a better judgment on whether the group will become a great business partner and help you grow—or a ball and chain that holds you back.
Is It All or Nothing?
Some cluster groups require you to use a certain number of their carriers, and many demand that you use only their carriers. This can often mean cutting ties with your current carriers, resulting in lost clients and policies in force.
An all-or-nothing philosophy is not a win-win situation. You should be able to keep all the carrier relationships you’d like and use your cluster group membership to get high-value appointments with top carriers. Reputable cluster groups know they win when their agents are allowed to maintain their current book of business and carrier relationships.
Is Your Cluster Group’s Slice Too Big?
When your cluster group does allow you to keep your existing carrier relationships, they might require you to split your commission with them. This costs you much and only benefits the cluster group. Don’t fall into this trap when researching your options. Reputable groups will never ask you to share your commissions from existing carrier appointments.