An Insurance Agency Network Partnership Supports Agency Growth

November 1, 2022

Many independent agents fear joining an insurance agency network, alliance, or cluster group for obvious reasons. Agents often leave the captive side of the insurance world or their role in another agency because they wish to be exactly that — independent.

But in the current market, it can be nearly impossible to do it alone. Joining a network ensures that you have someone negotiating on your behalf for things like commission rates, bonus and incentive opportunities, markets access, and more. In fact, with an insurance agency network, you’ll have opportunities to access hundreds of qualified and top-rated markets, and exclusive incentive opportunities, which can make all the difference to a struggling agency.

The Advantage of Insurance Agency Networks in a Hard Market

The current insurance market has changed dramatically in the past two years since Covid. Insurance carriers have dramatically tightened risk and underwriting guidelines, leaving many agents with limited options. For an independent agent — this isn’t necessarily all gloom and doom because they have numerous market options to choose from. But for the captive agent — this can mean dramatically lower close ratios, and an inability to serve customers altogether.

New agency appointments are down significantly. Without an insurance agency network on your side, who already has established carrier relationships and will fight for appointments on your behalf, where will you be left standing with carriers?

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Even if you already have established carrier relationships and appointments — your carrier partners will increasingly be performing agency book audits. If you aren’t profitable, you stand to lose your agency code altogether. The carriers are also simultaneously beginning to demand higher premium commitments.

An agency network can negotiate and fight for you in these circumstances. Still, not all agency networks and alliances are created equal, and it’s up to the agency owner to find a partnership that works for their business.

Captive Agent Options When Carrier Rates Change

As a captive agent with only one carrier’s products to offer, what can you do to help your clients when their rates increase significantly overnight? Not much. Many captives find their hands completely tied during a hard market period.

Currently, captive agents hold approximately 52% of the insurance market share, equating to $719 billion in premiums annually.1 But in the hard market, captives stand to lose a significant portion of this business to independents with more options to offer clients — such as access to E&S and specialty markets to fill the gaps.

Many captives fear switching to independence for various reasons, including starting a book from scratch, learning many different carriers’ product suites, and more. However, an agency network or alliance group can help ease these burdens.

How to Choose an Agency Network Partnership

Agency networks are partnered with a reported 22,000 agencies across the U.S. and control approximately $138 billion in premium volume in the industry. With nearly 150 insurance agency network groups in the country, how should you choose a partner, and what are the most important factors to consider when selecting a network option?


New agents and agents new to the independent side of things need help:

  • Marketing
  • Staffing
  • First steps
  • Obtaining carrier contracts
  • Learning niche and E&S markets
  • Finding expansion opportunities
  • And more

Any good agency network should be able to provide all of these things with dedicated guidance from network staff. But, the network must have regional and local experts in every state they operate so that you get the personal attention and support you will need.


One of the top concerns most agents have about partnering with a network is what types of fees the group will charge. A recent poll of networks from INA shows that 81% of networks, alliances, and cluster groups charge their members a monthly fee. In fact, 52% impose initiation fees, 7% charge renewal fees, and over 20% charge separation or exit fees.1

Find an agency network that works for you, charges fair and reasonable fees, and doesn’t nickel and dime you for basic access. Smart Choice charges no start-up or monthly fees and requires no exit fees either — only a fair commission split on business written through the program.

Access to Top Rated Carriers

All agency clusters, networks, and alliances will help you partner with carriers, but make sure to do your due diligence to determine which national and regional carriers they have partnerships with. Also, consider the depth of the network's relationship with carriers, including sales volume, as this translates into influence and leverage to get you access and appointments.

Agency-friendly Agreement

Find a network with an agreement that is fair to your agency and allows you to maintain 100% ownership of your book. You should also be able to maintain all rights to your client expirations and renewals and policies in force from day one. Do not partner with a group that holds you captive if you want to part ways. Most importantly, choose a network that will give you a non-exclusive agreement, so you can keep your existing carriers and add new ones separate from those you access through the network.

Find a True Agency Network Partner

Most importantly, if you decide to go independent, find an agency network that will be a true partner and believes in the survival and importance of the independent model. The “right” network is the one that will be working with you and for you to help you succeed and will give you access to around-the-clock advice and mentorship.

A statue of lady justice stands in front of a setting sun.

Not all Agency Networks and Alliances are Created Equal...

... but Smart Choice is a true partner providing independent agents with access to top-rated carriers and support like marketing resources, startup expertise, and local territory managers. An agent-friendly agreement offers 100% ownership of your book without charging fees. Ready to become a Smart Choice partner?

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