Hiring Insurance Producers: Lessons Learned
Three years ago, a WDC-based insurance broker client of mine engaged me to build them a team of insurance commercial lines and employee benefits producers for their Mid-Atlantic offices.
At that time, she asked me what the right profile of producer is that we should hire. Without hesitation, I said, “Hire experience and success and pay them whatever you have to.”
She pressed me for more specifics so I told her the more experienced and successful a producer is, the greater the likelihood that they will be successful.
Instead of hiring young wannabes and training them, I recommended we hire only those with a track record of earning over $200k with at least ten years of total insurance sales experience. And, whenever possible, buying their books of business too.
We ended up placing seven producers each at salary/draws over $200k per year + commissions.
I met with her last week.
The results?
Six of the seven of these producers are still with the firm after 30 months. We had one miss and that’s because the producer’s wife became terminally ill and he had to resign to take care of her.
I asked my client hiring authority specifically how her producers were doing and she said, “Great…everyone meeting or exceeding their production goals…it’s been a real home run.”
She wants me to expand the search south to Florida.
She also volunteered that they had hired five producers from other internal and external resources during the same period of time and only two in five have made it past three years.
I asked her what happened and she explained, “They all required a lot of training, supervision, and mentoring and were all hired at compensation levels less than $100k…it was a time suck on everyone.”
She told me I could share some of the related critical success factors related to our collective experience hiring the senior producers:
- Engage legal counsel (during the interview process) to review the employment agreement of the producer being considered. You will understand the right and left limits to moving some, or all, of the producer’s existing book of business (or prospects) to your firm. You have to know how to (legally) exploit the agreement.
- Try to purchase the book of business. Most firms know most of the clients are going to follow their departing producer and they may be interested to sell it to you at a discount. You’ll never know if you don’t ask.
- Give these senior producers a compelling reason to depart their firms. More than the usual draw + commissions, offer them a significant one-time bonus if they achieve a certain level of book of business after say three or five years. Give them a strong financial incentive. These are money-motivated people.
- Find senior sales professionals outside of insurance who have robust networks/COIs developed in service industries such as payroll services, banking, and financial services. They sell to the same CFOs that you are selling to. In most cases, this negates the non-compete and restrictive covenant clauses allowing your new producer to hit the ground running on Day One. One of the producers we placed was a top sales professional for a national payroll service firm and had a network of over 1,500 CFOs…not covered in his restrictive covenants. She’s absolutely killing it.
- Offer them a declining salary over time with full commissions on top of this until validation.
- Women are better producers than men. They have that deadly combination of grit and empathy. It’s a fact.
- Entice senior producers with first class account manager support so that they can spend 100% of their time networking, prospecting, and selling the large, complex self-funded accounts.
- Hire producers that want to sell across commercial, private client, and employee benefits. Go for the entire account. Why let someone else in?
- Facilitate them bringing over their account manager. It can be done. Very carefully.
These are just some of the factors that went into finding, recruiting, and retaining top producer talent. Invest in top producer talent. It works.
