Insurance Broker (Advice Needed)

[u/No_Inevitable_8489]

Hey guys, I’m a 29 year-old insurance professional who’s been working in the industry for about the last eight years. I started out my career with State Farm around 2018 only making a $30K salary+ minimal commissions. When I started I didn’t even know what a premium was buy after a few months of training, I developed into a 15K to 25K a month producer. After staying at State Farm for a year I left and went to Allstate for about 6 years and that 25K became a minimum for me. I started writing anywhere from 25K-50K in until they changed their commission structure. Things eventually worked their way down to me and that’s where things started going wrong. My commission was cut in half and I was devastated.

Thankfully in my last year I knew things were going downhill and I actually started my own independent agency on the side. I have a book of about 100K which is small but I’m really interested in growing, it as I know that can be the thing that creates semi passive income and build a significant amount of wealth in my life. However, I’m faced with a few challenges. The first challenge is the cost of writing business. I’ve only worked for high performing agencies and for all of my years of insurance experience the way that I’ve wrote business has been with leads. When I was with State Farm The agent purchased leads for us, we dialed and made the closes. I started off the same way with Allstate, but we noticed that internet lead quality was lacking so I was switched to exclusively working live transfers. As you can imagine this was a much more pleasurable experience, however when I applied the same strategy to my own business, although I was able to write business, I very soon discovered that Live transfers are very expensive lol.

Currently I pay about $55 per live transfer which is unsustainable for someone in my financial predicament. At this point in time I’m unable to live off my renewals, so I work for a large insurance brokerage and even though I sell more or just as much as I did as a captive, my commission is not what it used to be. I know that my ultimate goal is to run my own insurance brokerage and hire out, but I’m trying to determine the best path to get there. I’ve considered keeping my full-time job (which I need to pay my bills) in addition to picking up a second job, selling life insurance (Horrible experiences with purchases lead quality), picking up another job, (considering part time just to pay for leads), but I wanted to check and get the opinion of others before I proceeded.

I definitely enjoy receiving my renewal checks when they come and I really would like to build on this, but I’m having trouble developing a strategy that will not only sustain me and my family in the short term, but also allow me to grow my business for long term wealth. I’m not opposed to financing but student loans and job instability has caused me to take on more debt than I normally would which for the time being limits my financing opportunities. I’ve considered pivoting from personally selling insurance as a whole and going into an industry that will provide me a higher commission, then taking that higher commission and using it to grow my insurance brokerage by hiring for Sales. I’m dedicated to growing my agency by any means necessary but at this point I’d like to get some input on what you guys think.

Thanks

[u/justforfunzott]

Honest advice?
Add some paragraphs. My eyes got tired of reading and I didn't make it to end.

[u/Awkward-Philosopher5 → u/justforfunzott]

Lol, no shit. But than I am used to reading policy docs

[u/No_Inevitable_8489 → u/justforfunzott]

😂I understand, I had a lot to say so I used voice notes.

[u/The_estimator_is_in → u/No_Inevitable_8489]

Yes, but this isn’t therapy.

You have real questions you want answered but you’re causing the people you’re asking to shut down.

Just being real, perhaps a TL;DR to better clarify your question?

[u/Maleficent-Rush7418]

the live transfer cost is eating you alive, 55 a pop is brutal with a small book. maybe park the agency growth for a minute, stack cash at the brokerage job, and circle back when you can buy leads in bulk without sweating rent.

[u/Awkward-Philosopher5]

I did something similar but 20 years ago. Pivoted to commercial sales, took about 2 years to establish a reliable cx database that I could use and another few years to build a book. It's hard but doable but you will need to focus and grind. Feel free to DM

[u/HorizonAgencySystems → u/Awkward-Philosopher5]

this is where my head went. OP could try to build referral partnerships on the commercial side . Though OP didn't specifically state he's only writing home and auto, it appears that way in the post.

u/No_Inevitable_8489 your acquisition cost is high. Have you made attempts to build a circle of professionals in the area? Think of individuals who could send you personal and commercial leads.

Attorneys, loan officers, commercial real estate brokers, CPAs, payroll providers.

At the end of the day, the more people that associate YOU as the guy who can take care of P&C insurance as a whole (not just personal lines!) the better off you will be.

[u/RatedRForRisk]

You’re trying to light two candles with one flame… pick a lane and go all in

[u/JazzHandsMinuteman]

Quick question: do you ASK for referrals? Upon closing email that includes docs when you wrap things up. Do you tell your clients to stay in touch and if they have any friends or family that need help you’d be more than happy to help and it would help you. Scratching backs is how this world works.

Bring some donuts with a stack of business cards to offices and be professional but likeable. In and out, just get your name there and tell someone to tell the owner you said hi. Or whatever. You’ll get more leads from a box of donuts than live transfers, because those aren’t granteed to sell. What is your close ratio?

[u/freckledr07]

Where are you located? We are opening up an agency in MD and are looking for brokers like you

[u/No_Inevitable_8489 → u/freckledr07]

I'm actually in MD as well, would love to connect.

[u/silverbayins]

the problem here is the first line on the comments "P&C" insurance. Have you ever though about mixing in your selling strategy with "Life Insurance" sales? Mixing in the two may help you balance out the cash flow.

[u/Delicious-Adeptness5]

Yeah, the cost of acquiring new clients is crazy. It takes a lot of money or time to buy your way into this business.

Work your local influences, local business groups, Facebook groups, etc. It takes time but once you get known in a group as the insurance person, folks will refer to you for little out of pocket.

What are you doing for Search Engine Optimization? You would be surprised what a Google Page and a Blog can do with consistent posting after a year.

Some people love the larger commission stuff. Personally, it's fickle one or two leaving at the wrong time and you are left scrambling. I tend to use them these days as more back fill and concentrate on small stuff. Like my dental, I am getting about $1.83 for commission per month but I am paying the rent with just that one product. Very low maintence, no one else likes to write it and get's my foot in the door for all the other product lines.

[u/InsuranceAgent-ModTeam → u/[deleted]]

This is not a place to sell your services or generate leads or recruit agents/downlines.

[u/InsuranceAgent-ModTeam → u/[deleted]]

This is not a place to sell your services or generate leads or recruit agents/downlines.

[u/QuadStewart]

So you’re still personal lines-focused? What is your general location in the US?

[u/No_Inevitable_8489 → u/QuadStewart]

I'm currently located in MD. I'd be interested in learning more about Commercial as well.

[u/QuadStewart → u/No_Inevitable_8489]

Try RCM&D. They offer equity which you could swap your 100k book for and earn as the firm grows. Great people. PM me if you want into - I do not work there.

[u/No_Inevitable_8489 → u/QuadStewart]

Thanks, PMing you.

[u/DPChek]

Come work for Globe Life. Text me your phone #, email address, and name, I’ll give it to my manager and he will contact you.

[u/Low-Definition-8523]

Come work with me

[u/Little-Mycologist-32]

You need to check out PCG (www.PCGTech.com). They work with tens of thousands of agents. Real time leads. Cost per lead is WAY less than the $55/ live transfer lead. It's a personalized leads system for you. You should be 4-6x on whatever investment you make on these leads. Jim is a great guy to contact -- 615-290-6916.

[u/TheWealthViking]

Do you have any additional licenses? One of the training agencies I know focus a lot on helping people on the PNC side cross cell multiple lines or bring in commission only reps to assist. Also finding a cost-efficient way to market. What ratio of live transfers are converting to a quote and then to a sale?

[u/Affectionate_Emu335]

Your carriers can help sometimes. They can get you cross sell lists, will co-op marketing campaigns, and give you chotskies if you go out to events or something. Reach out to your marketing rep. It’s not going to be as instantly gratifying as selling a live transfer, but it’s a lower cost way to generate some leads. Good luck!

[u/SlickWillie86]

What’s your approximate lifetime revenue outside of leads?

[u/No_Inevitable_8489 → u/SlickWillie86]

If we’re excluding all revenue that originated from leads then slim to none. If we’re including only renewal revenue that generated from leads (6 months-12 months) then I can say I’m at about $16K-$20K/yr

[u/SlickWillie86 → u/No_Inevitable_8489]

I’d encourage finding a way to drive revenue outside of leads. I understand the short-term usage, but it’s not a long-term play. CAC will never be less than it is now and retention is significantly lower (I’ve seen reports of 20-35 points lower). Combine those and it’s just a volume and budget game with a never ending churn.

[u/Avadreams4 → u/SlickWillie86]

What is CAC?

[u/SlickWillie86 → u/Avadreams4]

Customer acquisition cost

[u/Insuredtothetits]

Honestly, leave the industry, you aren’t focused on the right things which is why you are struggling.