Cost of E&O Insurance For Consultants: Independent Insurance Agents
If you are an agent aspiring to open an independent insurance agency in North Carolina, then you have come to the right place. There is always an area to grow and learn about the things you are interested in. Likewise, you as an agent should explore your limits to learning. While you learn, also know the cost of e&o insurance for consultants. Discover how to become an independent insurance agent successfully in this blog.
Cost of E&O Insurance For Consultants
Independent agents are the agents that represent different insurance agencies. Their job is to sell insurance on behalf of the carriers. Customers usually are overwhelmed by the insurance options and are unsure of what insurance they should purchase, and seek expert advice. Therefore, as independent agents offer more choices, granting them flexibility, they have a higher chance of getting the client’s right insurance.
According to the Bureau of Labor Statistics, in May 2019, the median annual wage for an independent insurance agent in the U.S. was $50,940. The highest ten percent of independent insurance agents earned over $125,000. This level of commission allows successful agents to achieve high earnings. Additionally, commissions earned from renewed policies create a source of passive income. However, before making money on renewals, it is essential to build up the agency.
How do you start an independent insurance agency?
To start an independent insurance agency, agents can go through these easy options and decide:
Buy a book of business to start an Independent Insurance Agency
Agents can buy a book of business from already existing insurance. However, it could cost you $250,000 to $500,000, or even more, depending on how profitable it is.
Become an independent agent through an agency model
Agency models help independent agencies with needed assistance and support. Independent agents will focus on selling insurance while the agency provides all the operational assistance that your agency needs. This also includes an agent directory. You can also become a part of an insurance cluster for more sales.
There are two options for these agency models that you can choose from:
Franchise Model for Independent Insurance Agency
A franchise will allow you to own an insurance business. The agencies provide the operational assistance agents need, along with access to insurance carriers. Your agency will be associated with an established brand that adds value to your agency. Furthermore, this model does not give the agents much room to grow due to the non-compete clause.
Insurance FMO Model for Independent Insurance Agency and cost of e&o insurance for consultants
The second option is the FMO model. The FMO model gives the agents much of the same services that the franchise model provides. However, they split the commission with their agents. On average, the commission split is 70/30. This model is certainly a better option for your agency as it will provide maximum opportunities to grow. Independent insurance agency North Carolina looks forward to associating with this model as this model is particularly rising in popularity. If you want to know how to become a vehicle insurance agent, then research more.