Looking for the Best Insurance Clusters to Join?

August 9, 2021

Ask These Eight Questions First...

Illustration of a business man with a telescope standing on a question mark to represent the many insurance clusters an independent agent can join.Independent insurance agents see the potential of a rewarding career with high earnings. However, unlocking that potential can be tough. The truth is that there’s a lot of competition out there, and it can be difficult to gain access to the best insurance carriers and product lines. Success is possible, but you might need some support to find it — and some agents find that support in insurance clusters.

Identifying Insurance Clusters

Identifying an insurance cluster can be tricky for one simple reason — insurance clusters might not use the term “insurance cluster” to identify themselves. This means that you have to look at how the organization is structured to determine whether it's a cluster, aggregator, or agency network. Generally, if agents are pooling their books of business with other agents' books to increase insurance buying power, you’re dealing with a cluster.

This might sound appealing to you. However, if you are interested in joining an insurance cluster, you need to assess your situation to find the best insurance cluster for your needs. Before you join, however, you should also ask whether any insurance cluster is truly the best option.

Asking the Right Questions

The best insurance cluster will depend on your needs. In other words, the best cluster for one agent might not be the best cluster for another agent. Before you join, you should ask some questions to decide if it’s really a good fit. Otherwise, you could end up making a decision you come to regret. 

1. What Are the Financial Requirements?

One of the first (but certainly not the last) questions you should ask is about the financial requirements to join. You need to know what fees you’re going to have to pay, either upfront or later on, to help pay for shared services. Also, find out what commissions you’ll be getting, how the accounting works, and whether you’re happy with these arrangements.

2. What Are the Production Requirements?

It's important to find out what the production requirements are. You want to grow your business, but you need to make sure the cluster’s requirements align with your capabilities.

3. What Else Is Needed to Join?

This is your career, so you have a lot on the line. If you’re going to combine your book of business with the books of other agents, find out exactly what that means.

  • What are you giving up?
  • What are you gaining?
  • Do you have to change the name of your agency or give up any other rights?
  • If you leave the cluster, can you take your business with you?

Make sure you understand how the group is structured and what your role and obligations will be.

4. Where Does the Cluster Operate?

Many clusters are regional. If there’s a great cluster that doesn’t operate in your area, it’s probably not the right cluster for you. Also, consider what happens if you move outside of the area of operation. You might not plan to move now, but that could change a few years down the road. Joining an organization with a wider reach may be in your best interest long term.

5. Which Products and Carriers Will You Be Able to Access?

Joining an organization can give you access to insurance carriers and products you couldn’t access on your own – but this isn’t a given. Find out which products and carriers you’ll gain access to.

  • Are they the insurance carriers and products you want — and the ones your clients want?
  • Do you already have access?
  • Can you write both personal and commercial lines?
  • Are there any niche-specialty carriers?

These are important considerations that will impact whether or not the arrangement actually helps you grow your business.

6. What Other Support Is Provided?

Independent insurance agents often need help with marketing, licensing, and compliance issues. They may also need help with difficult cases. Find out what support you’ll be getting when you join a cluster and make sure it’s the support you actually need.

7. What If You Want to Leave the Insurance Cluster?

You always need an exit plan. When you join a partnership, you hope it will last a long time — maybe even the rest of your career. The reality, though, is that relationships sometimes sour. You may become unhappy with the organization and need to sever ties, or you may simply find a better opportunity that you can’t afford to turn down. Regardless of your reason for leaving, you need to make sure it’s an option.

Find out what happens if you want to leave. Can you take your book of business with you? Are there other restrictions or time restraints? No matter how happy you think you’ll be in the organization, play it smart and make sure the termination terms for the relationship are reasonable.

8. Is an Insurance Cluster Really the Best Option?

What if there aren’t any clusters that exactly meet your needs? What if you’re unhappy with the support provided, the access to products, or the requirements for joining or leaving?

Don’t worry. You have other (possibly better) options. If you aren’t happy with the requirements of an insurance cluster, you should consider joining a network instead.

Why You Might Prefer an Insurance Network

Insurance networks provide independent agents with access to the support, carriers, and products they need while enabling them to remain truly independent. We’re guessing that if you’re an independent agent, you have a bit of entrepreneurial spirit in your blood and that word “independent” actually carries some weight with you.

Smart Choice offers agent services tailored to independent insurance agents. Whether you need access to specialty markets or marketing support, there's a program for you with no fees, low production requirements, and competitive commissions. Smart Choice is one of the largest and most empowering insurance networks in the country — and we're here to give you the freedom to succeed. 

Become an Agent