Insurance Consultant's Newsletter
Scott Simmonds, CPCU, ARM
February, 2006
Helping Insurance Experts Build Great Consulting Practices
www.icmentor.com
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Feel free to forward this newsletter to colleagues. Comments, questions, and suggestions are always welcome. Email: Scott@InsuranceFixer.com or call 207-284-0085.
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Two Approaches To Insurance Consulting
I've changed the way I look at insurance consulting.
I have recently been considering how insurance buyers get insurance service and information. I've talked with other insurance people, consultants, and insurance buyers. My position on insurance consultants has changed dramatically.
In the past, I have championed the idea of insurance consultants who never sell insurance and never accept fees from insurance agencies or insurance companies. I now realize that there is plenty of room in the market for more.
I now view the world of insurance consulting as two sides of the same coin:
-Independent Insurance Consultants
-Affiliated Insurance Consultants
The independent insurance consultant doesn't sell insurance and will not accept fees or commissions from agents or insurers. The independent consultant is not affiliated with any agency or insurer. They work with a variety of agents, brokers, and insurers managing the insurance program for a client as a risk manager would in a Fortune 1000 company -- claims problems, bid management, coverage review, and risk management activities. Compensation is on a fee basis.
The affiliated insurance consultant works on a fee basis from within the framework of an insurance agency placing coverage, servicing policies, and making recommendations on coverage and risk management issues. Insurance is placed through the agency on a net-of-commission basis. Coverage is bid internally within the agency. CSRs manage the account for the client just as is now done in most agencies.
The common element in both consulting forms? Neither accepts commissions or fees that are based on insurance premiums.
Some will try to call the affiliated consultant a broker. However, brokers are often paid on a commission basis. That's the difference - consultants are paid fees, not premium-based commissions.
I've been asked if I see the two consulting types as being equal. No, there is a distinction. Some clients will prefer an independent consultant because they are independent. I see the affiliated consultant as a middle ground for the client between a independent consultant and a commissioned agent.
A rather spirited discussion on this topic can be found in the Insurance Journal's forum at - http://www.insurancejournal.com/forums/viewtopic.php?t=810. Several agents had a strong reaction to my contention that commission sales causes some insurance buyers to be skeptical of the advice agents provide. Several contributors offered interesting comments.
If you're currently an "affiliated consultant" I'd like to talk with you about your experiences and work. Please call or email me - Scott@InsuranceFixer.com or 207-284-0085.
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Free Teleseminar - Marketing Your Consulting Practice To Double Your Income
Join me on February 23 at 4:00 Eastern for a 45 minute session dedicated to marketing your consulting practice. Ideas, tips, thoughts, and help on getting the word out that your consulting practice can solve insurance problems.
Email me at Scott@InsuranceFixer.com or call 207-284-0085 to register.
Topics Will Include:
I'm also glad to take suggestions for the discussion or submit specific questions. Email me at Scott@InsuranceFixer.com or call 207-284-0085.
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New Insurance Blog Address – I've moved my blog . Go to - http://www.InsuranceBuzzer.com/. The site contains more information and an easier interface. Subscribe so you receive emailed updates of my postings there.
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Independent Insurance Consultant's Handbook - The only consulting resource built just for insurance consultants - Go to http://www.icmentor.com/handbook.htm.
--Advice Not Available Anywhere Else - Startup help, marketing tools, how to build referral sources, proposals, working with agents, fee setting, checklists...
--It's Guaranteed - Buy the handbook. If you're not convinced of its value, email me within 5 days for a full refund.
--Apply The Price To My Mentor Program - The price you pay for the handbook can be applied to a future fee for my mentor program.
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New! -- Affiliated Insurance Consultant's Handbook - A guidebook designed for the insurance consultant working from within an insurance agency. Due for publication April 10. Special pre-publication price. Same guarantee and mentor program deal as above. Go to http://www.icmentor.com/a-handbook.htm.
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Insurance Consultant Mentor Program - Designed to help you build your business faster, with less hassle, and fewer false starts. Grow your current practice or gain the edge in your startup. The object is for you to make your business the best it can be - faster and more profitably. Go to http://www.icmentor.com/mentor.htm.
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Scott Simmonds,
CPCU, ARM
Insurance Consultants of Maine, Inc.
Phone 207-284-0085
Scott@InsuranceFixer.com
http://www.InsuranceFixer.com
Insurance Consultant Services Website: http://www.icmentor.com
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