A New Low

I am a middle aged man, selling business insurance full time and I’m somewhat new to the industry (18 months ago I joined an insurance broker that’s based on the opposite side of the country from where I live). 

My rationale for getting into business insurance in the first place is that there’s recurring revenue, and if I do a good job serving my clients, they’ll want to stick with me over the years. The compounding aspect of insurance is attractive because it should grow incrementally over time, as long as I do my job. That said, I think there is clear and present danger in some areas of the insurance industry. I had considered buying a Farmer’s Insurance franchise, but decided against it. I think the low end of the insurance market is going to be eaten by the Internet. 

A Farmer’s agent who owns their own agency is called a captive agent. It means that they’re only allowed to (for the most part) represent Farmers. 

The good thing about Farmers (and AllState, State Farm, etc.) is that they spend a sh*tload of money on advertising. Everyone has heard of these companies, so when you make cold calls, people have at least heard of you. 

Not so with most middle market business brokers. However, larger company business insurance is a more complex sale, and a more complex solution is needed. And these businesses will want a person to talk with, I think, because there will be claims of some sort and dealing with a machine when you have human problems is a terrible experience. I’m betting that having machines in customer service and support roles will be terrible for another 20 years, compared to a flesh and blood human with empathy.

But I digress from the “new low”. 

Yesterday I received a call from the CEO of my company. 

“We’re moving you to straight commission,” he said. In his defense, it wasn’t actually that blunt, and he had scheduled the call ahead of time, but that was the gist of the call. 

This move to straight commission marks a new low for me in terms of my income. For the past year, I’ve been on a sales draw of $60,000 with some of my sales expenses being reimbursed. I’m not sure what it will really mean in terms of cash flow. 

It certainly puts more pressure on me to be more disciplined, call more, meet with more people, etc. 

I will not waiver from my pursuit of the Midlife Croesus. I hope I am able to turn things around…