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7 Tips for Transitioning from Captive to Independent Agent

Posted by Paul Rose on 3/22/21 1:45 PM

transitioning from captive to independent agent

Insurance agents have two major career paths. They can work as captive agents tied to one specific insurance carrier. Or they can work as independent agents, selling plans from a variety of different carriers.

The independent model can offer agents many advantages, but the transition can be challenging if you don’t know what to expect. Here are some tips to help you.

1. Read your contract and watch out for blackout periods.

You’ve worked hard to develop relationships with your clients, so it’s understandable that you don’t want to give those relationships up. You’ll need to read your contract carefully, though. Watch out for blackout periods restricting your sales opportunities. Also, take into consideration that if you intend to contract independently with a Field Marketing Organization (FMO), be sure to ask questions about their release policy. You will want to look for a FREE release policy, to make sure that if you decide to leave, the FMO will not keep any business you produced while under their contract. Also, determine whether or not it’s possible to take your book of business with you.

2. Set up your own website.

You may already have a website. If so, that’s great, but you’ll need to do a serious overhaul to reflect your new status as an independent agent. Now is your chance to add a personal touch and show off your services. Keep it professional and easy to navigate and include your contact information as well as information about the products you offer.

3. Think like an entrepreneur.

Now that you’re an independent agent, you need to start thinking more like an entrepreneur. This includes leveling up your marketing game. You’ll need to focus on advertising and getting leads if you want to succeed.

You should also consider how you want to structure your business. For example, do you want to form an LLC or an S-Corp? Look into your options and weigh the pros and cons of each one before deciding.

4. Contract with as many carriers as possible.

As a captive agent, you only had one carrier to promote – even if its products weren’t actually the best match for your clients. One of the greatest advantages to being an independent agent is that you get to draw from a variety of carriers. To help ensure that you can always offer a plan that’s a good match for your client, contract with as many carriers as you can.

5. Remember to re-certify every year.

Medicare insurance agents need to pass the AHIP certification exam each year and re-certify with carriers. This process starts in the summer. Don’t put it off, or you might not be ready for AEP.

6. Build solid relationships.

When you’re an independent agent, your clients are working with YOU, not the carrier. This means you need to prioritize building solid relationships.

A good way to do this is to establish yourself as a valuable source of information. Provide important updates and tips, as well as other information that your clients will find useful. If people learn to turn to you for information, they may turn to you for enrollment help, too.

And don’t neglect a relationship once you’ve made a sale. Maintain the relationship throughout the year to increase the chance of retention.

7. Find the support you need.

When you worked for a carrier as a captive agent, that carrier likely gave you considerable support. When you transition to working as an independent agent, you lose that support. As a result, you might feel overwhelmed and overworked.

But the good news is that independent agents don’t have to go it alone. An FMO, like Western Asset Protection, can provide you with the support you need to succeed as an independent agent.

Contact us to learn more.

Topics: transitioning from captive to independent agent

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