Sometimes known as insurance cluster, insurance aggregator has come into the forefront in recent times. In the insurance industry, aggregators refer to a formal association of insurance agencies. They work to help their member agents to increase efficiency.
An Accenture’s survey claims, UK insurance clusters account for 60% to 70% premiums in the private auto insurance market. Similarly, agency equity states that approximately one-quarter of insurance agents are working for an agency that belongs to a network.
Most of the insurance agents looking to grow in the insurance business ask the question if they should join an insurance aggregator or not. Joining an insurance cluster seems to be beneficial for insurance agents. But here are some of the things you should consider as an agent while deciding to join an insurance aggregator.
Beware of the cost of joining an aggregator
As an insurance agent, you must be aware of the real cost of membership into a cluster. The price might differ according to the choice of insurance aggregator. Before joining, you must take a look at the start-up fees. Some of the groups might charge high amount in initial dues.
Next, you should also be aware of the monthly fees that you would be paying to the insurance aggregator. Find out whether the insurance aggregator charges any monthly payments and how these fees are charged. Some may charge you a fixed sum of money and others might charge you a certain rate of your commission.
Moreover, you must also understand if there are other maintenance fees for support and benefits like software, advertising, and legal services. Finally, some insurance cluster can also charge you for exiting from the group. This exit fee might be substantial if the insurance aggregator has a motive of discouraging member turnover.
Leadership and management in insurance cluster
The success of your decision of joining an insurance aggregator highly depends on the leadership and management skills within the cluster. Look into the leadership and management of the group before entering it. The cluster must be able to identify its leader who can support the members.
Relationship of the insurance cluster with the insurance carrier
The kind of relationship of insurance cluster with its insurance carriers is one of the most important things to consider. Look into whether the existing cluster members had established a relationship with the aggregators and how reliable are those relationship. Also consider which carriers are related to the insurance agents and if they are the ones operating in the areas that you are dealing with.
Your success starts with choosing the right partner to invest your future in. Take some time to investigate different insurance aggregators before joining one. You can sit in their meeting and have the answer of your question before you make the decision.