Consulting

billw123 · Post by **billw123** » Thu Sep 22, 2005 10:14 am

I have been in insurance for about ten years now. Selling mostly to businesses.

Anyone know where I can get information about being a consultant instead of selling?

I think there is a market for an advisor who does not sell insurance / take a commission.

sanddog · Post by **sanddog** » Thu Sep 22, 2005 10:44 am

Yes in our industry the position is known has a RISK MANAGER. Most large companies with employee exposure, and other hazard problems. Need help with WC issues and yes other insurance related problems. Any company that has an HR dept will have a paid Risk manager. You will need lots of experience from a large account business exposure. If you want to consult with small business under $ 10,000,000 you be dealing with brokers like me. We are their RISK managers.

sanddog · Post by **sanddog** » Thu Sep 22, 2005 10:46 am

Try the news paper ? or apply to HR, becareful you may get and HR butt too boot.

billw123 · Post by **billw123** » Thu Sep 22, 2005 11:17 am

I was thinking more of smaller companies - 100 to 200 employee firms - companies spending a few hundred thousand dollars in premium.

All of our clients know we get paid a commission - higher premiums mean higher commissions. Is there a need for an insurance expert on the buyer's side of the transaction?

I also want to get away from being controlled by my insurance companies - I can establish a great relationship with the prospect, identify many uninsured exposures, and do an all-around great job only to have my quote come in 20% high.

I think a consulting relationship eliminates the problems of working for free.

sanddog · Post by **sanddog** » Thu Sep 22, 2005 3:56 pm

Billw123, lets look at it this way. You're a consultant, all the companies you want to help want quotes and want you to work on the renewals, O' by the way who's going to carrier your E & O ins, remember your on your own. If you can even find it your looking at 10,000 plus in CA, I think even more because of the large premium clients you will have and exposure too. This is an incredible risk for any E & O carrier. How much is this going to cost them for you to do what I already do.
And you don't have any strength in the market place to get, and receive quotes. Each risk your dealing with is different and require a separate market. How many market do you think your going to have to place these large accounts OOOOO. I have excess to just about every major market out there, you will not have that choice on your own. Plus I can get any UW to sharpen the pencil. And I already do business with guy like you. ( RISK manager).
Dude you still have to eat and pay the bill nothing is FREE. Commission or consulting fee I'm sorry I see no differents.

scott · Post by **scott** » Thu Sep 22, 2005 6:55 pm

Five years ago I started my consulting practice after 20 years as an agent.

I make a great income. I set my own hours. My clients seek me out and appreciate my work. I don't worry about markets, underwriters, premium increases, or commission cutbacks. I work from my home in a beautiful, comfortable office. I get to meet my son at the door when he comes home from school each day. My clients see me as an advisor - not a salesman. I provide my clients with valuable insight and information. I am truly the master of my destiny and the keeper of my fate.

E&O insurance has not been a problem. I have a great policy by an A+ rated carrier. The premium is less than $1900 (and I'm five years into claims made).

My clients pay me a fee to provide specific value. Most of the time I work with their existing agents - tuning coverage, negotiating claims and renewals.

I can't imagine a better lifestyle or a better job. My clients like the service I provide.

<<Full disclosure… I also mentor insurance pros who want to become consultants. I don't normally follow this forum - but a friend told me what was being discussed. I couldn't resist - http://www.icmentor.com/>>

sanddog · Post by **sanddog** » Fri Sep 23, 2005 11:07 am

Scott, your life is perfect, good job we always like reading about successful entrepreneurs.
I like the fact that your promoting a spin to the broker world of insurance. Consultant for fee, or Broker for commission. Let see one has access to UW relationship and their companies and quotes. The insured still need to deal with renewals and get quotes. Good luck

I see you come from a Farmers ins back round personal lines. Humm

California is a whole different animal, unfortunately most of these posting are newbees and they never specify what state. I am sure in Maine, personal lines insurance for the most part is dirt cheap.
My statements were concerning CA land of the highest premium. The average premiums for E & O for and operating commercial insurance agency (Larger one) not personal lines is 15,000 plus.

scott · Post by **scott** » Fri Sep 23, 2005 11:34 am

Not sure where you get Farmers insurance - I spent 20 years in independent agencies - 17 as a commercial producer. I'm not sure what you are looking at to get PL - my bio is out there for all to see on my website.

I have clients with operations in every state and have mentored consultants in CA as well as eight other states.

Perhaps this will help you understand my position in the insurance transaction. Fortune 1000 companies have in the CFOs office employed risk managers - their job is to help the company manage risk including insurance. I take that role in smaller companies on a contract basis. Most of my clients spend 50,000 to 500,000 in premiums - I have some at 20k and others at 1.5 million.

The corporate risk manager doesn't replace the agent / broker and neither do I. I spend most of my day working with agents and brokers - negotiating coverage, premium and claims for my clients.

Anyway, consulting isn't for everyone and hiring consultants isn't for every insurance buyer. It works well for my clients and therefore works well for me.

sanddog · Post by **sanddog** » Fri Sep 23, 2005 12:46 pm

If your negotiating, premiums, coverages and claims and going back and forth: then you can call your self what ever you want, in my eye's you're a servicing broker, or consultant now I'm even becoming confused. The consultant is adding his two cent to the advise of a Insurance broker, on behalf of the client. Because client has no trust in the broker, but trust you. If your clients are as large as you have indicated and If they can't trust a large organization like AON or Gallagher or us. I guess a broker/ consultant is the way to go. They can pay your fee's and my commission sounds good to me. If you go to The State of Maine Insurance webb site. This site will show all your appointments over the years. Farmers and Travelers standout, and sham on you for being associated with farmers god help us. Travelers good people

billw123 · Post by **billw123** » Fri Sep 23, 2005 6:17 pm

Thanks Scott. I like your report. Gives me stuff to think about. I'll contact you off line.

scott · Post by **scott** » Sat Sep 24, 2005 6:39 pm

Sanddog, the key distinction in my approach is that I never accept fees or commissions from insurance companies or agencies. I don't let them buy me gifts or lunch. I never sell insurance. I don't own insurance company / agency stocks and sold the stock I did own in one bank when they bought an insurance agency.

I don't care if an insurance company makes or loses money on a policy they write. I only care that my client gets the best coverage for the best price and that the service provided (including claims performance) meets our expectations.

That's what my client pays me to care about.

riskyted · Post by **riskyted** » Sun Sep 25, 2005 8:15 am

Scott, I understand your set up. Your website outlines what you're doing for customers and it looks like it works for you.

I don't understand why someone would pay you when they have an agent that is effectively free.

scott · Post by **scott** » Mon Sep 26, 2005 3:59 am

Your clients don't think you're free. They all know that either the agent or the agency is working on a commission. All insurance buyers know that higher premiums mean higher commissions.

It's no different from any other commercial transaction. The seller of the product has a bias for their product because it's what makes them money.

One of the reasons my clients hire me is that they see that I have no reason to recommend a coverage besides their best interest.

When I recommend employment practices it's because they need it. When an agent recommends the coverage the buyer is aware that part of the transaction is money in the agent's / agency's pocket.

Some people compare me to a broker. Apples and oranges. I can work with any-and-all insurance markets for my clients - Nationwide, State Farm, Liberty, Universal Underwriters, captives, self insured groups, as well as traditional commercial insurers.

Let me also say that my service is not for everybody. If an insurance buyer is happy with the work of their agent / broker and has no doubts about the quality of coverage they don't call me.

About half my work starts out with a conversation like this, "I have been with my current agent for 10 years. I think he is doing a good job. I want to make sure and I don't want to get other quotes." How else is someone going to get an unbiased review of their $750,000 insurance program?

Consulting isn't for everyone either - works for me though. I'm glad to speak with those who are interested in more info.

sanddog · Post by **sanddog** » Mon Sep 26, 2005 10:23 am

Scott, what's this about your charging a consulting fee to the insured, just so they know their not getting hose by the broker ? O Please........... Scott, say about half of his work starts out with a conversation like this, "I have been with my current agent for 10 years. I think he is doing a good job. I want to make sure and I don't want to get other quotes." How else is someone going to get an unbiased review of their $750,000 insurance program. Simple call another Broker who has different markets..... ( any good broker shops the market, and provides what they found to the buyer so they together can make decision not just based on price, but protection.)
Any good qualified broker of any sales business knows that your going to loose the business or renewals, if you don't always put your best foot or price forward.

Scott, your collecting revenue one way or another. The revenue may not derive from a commission, but your charging a fee to the insured.
I don't agree at all with you comment concerning higher premiums means higher commissions. You seem to insinuate, we broker try to sell the highest possible price to receive a lucrative commission.
I must say it very hard to believe at one time you were a broker.

jtabosida · Post by **jtabosida** » Mon Sep 26, 2005 10:33 am

I agree with Sand Dog here on this one. I dont post a whole lot but California might as well be its own country as far as premiums are concerned for E&O Insurance and any other insurance for the most part. I have my own brokerage and access to every market that writes profesional liability, we specialize in Professional LIability. My suggestion would be dont worry so much about the consulting but more of finding a niche. As Sanddog said, your going up against brokerage houses, we already act as risk managers etc. Its all about having the complete package for the right approach. I wish you the best of luck!

PS - a typical E&O policy is 3 to 10 times higher in California than anyother state in the nation. Home of the litigation, Land of the Lawyers.