RGV Financial Group

Typical Insurance Agency Model

As someone who operates a typical insurance agency, often referred to as a General Agent (GA), you spend much of your time recruiting and developing sales professionals. You are vested in teaching and training your agents to be good sales people.
Your income depends not only on your sales but also on the sales made by your agents, and so you can continue to receive that income you have to either limit your agents’ ambitions or, instead, pay them a higher contract that cuts into your own commissions.
This means that your “Sales Super Stars” can only grow their careers by either renegotiating their contracts to a higher payout (resulting in less income to you) OR leaving to start their own agency - and become the competition
When an agent leaves, you can no longer earn residual income or overrides from the agent, and you can lose clients since most financial services sales are relationship-based many clients will follow their original agent(s).
In most cases, the only way an agency can succeed long-term is for the leader to develop and maintain a team by managing restrictive career growth. You are vested in their limited success.