Many agency owners form their opinions on insurance agency groups based on secondhand information.
Maybe you heard about a rival agency owner who lost their whole book of business when they joined an aggregator. Or perhaps a former colleague complained to you about the astronomical fees they were charged when they left their group. Maybe you watched a friend begrudgingly sign over ownership of their agency to join a group, and you decided right then and there that it wasn’t for you.
But, like the game of telephone you may have played as a child, the truth can sometimes get warped as it’s passed along. Aggregators are not all alike, and they have a wide variety of different benefits, structures, expectations and contract terms.
To make sure misconceptions don’t cause you to miss out on an opportunity to grow your agency, we wanted to debunk some of the most common myths about agency groups, ensuring you have the best information possible when deciding if an aggregator is a good fit for you.
Myth 1: All agency groups are the same
Agency groups are best known for their two core offerings: increased market access and profit sharing. While most agency groups provide these two core benefits, they vary in the other types of services and advantages they provide. This makes it very important to understand a group’s scope of services before joining.
Some groups position themselves as no more than “commission clubs,” offering only enhanced profit sharing and market access. But a select few provide group management and business services, technology offerings, and support that you can leverage as a member.
Renaissance Alliance, for example, is heavily focused on helping agencies achieve growth—not only by growing your premium and revenue, but also your agency value as a whole. Renaissance Alliance members grow at twice the national rate, on average, and our top-quartile members grow at 4-5x the national average.
Myth 2: You’ll lose ownership of your agency
Insurance agency mergers and acquisitions are at an all-time high. Chances are that you get regular phone calls from potential buyers interested in discussing the sale of your agency.
While that’s the right decision for some agency owners, it might not be the right decision for you. If you don’t want to sell, then an aggregator can be a fantastic alternative to help you be more competitive against larger agencies.
However, you need to be careful, as some aggregators do take ownership of some or all of your agency as part of their contracts. Be sure to carefully read the terms to ensure you can remain 100% independent and keep exclusive ownership, as you do with Renaissance Alliance. With Renaissance Alliance, you maintain complete agency independence, while having the added benefit of significant support to grow your premium, grow your revenue, and increase your operational efficiency.
Myth 3: You lose control of your book of business
When researching which aggregator is best to join, you will no doubt come across some that will want you to sell your book of business and give up your clients. Unfortunately, many independent agency owners believe that this is the only way to tap into an agency group’s benefits, and they end up signing over control as a result.
The good news? Not all aggregators are built the same. While some aggregators take control over your book of business or agency decisions, there are groups that allow you to retain complete ownership. With Renaissance Alliance, you remain 100% in control of your agency and business decisions. You will always be in control of where to place any piece of business, making the choices that are best for your clients without outside pressure.
Before seriously considering joining any insurance agency group, get clarity on their policies regarding ownership of your book of business and your agency as a whole, so you don’t end up surrendering any independence in the process.
Myth 4: It’s expensive to join and impossible to leave
One of the biggest things to pay attention to when signing a contract is the fine print around fees. It’s true that some agency groups require a high fee to join, and many of them draw up restrictive contracts that make it next to impossible or very expensive for you to get out. It’s very important to pay close attention to the length of the contract, as well as the fine print around buyout and exit fees.
You never want to be in that position. (You are an independent agency owner, after all, right?) And luckily, you don’t have to be in that position, because not all aggregators have hefty entrance or exit fees that make things more complicated.
We’re one of those insurance agency groups.
Renaissance Alliance has no entrance fees or exit fees. All you need to do to leave is to give 180 days notice. That’s it.
So, what have we learned?
Not all aggregators are the same, or the right choice for your agency.
But don’t let someone else’s bad experiences or a misunderstanding get in the way of your potential growth. When you can push the rumors aside and do your own deep research, you’re likely to find there’s an agency group that gives you all the things you want, and none of the things you don’t.
And if what you want is increased market access and increased carrier compensation, cutting-edge agency data technology, and services like account placement, back-office processing, employee training, marketing support, a help desk, and more, then Renaissance Alliance just might be the right aggregator for you.
Learn more about how you can experience the upside of being part of an agency group by joining Renaissance Alliance.