Captive vs. Independant Agency

When it comes to insurance agencies, there are many different forms/sizes/types... but I’d love to rant about one distinction: captive and independent insurance agencies. When an insurance company has captive agents, they work strictly with that company and its products. An independent agent works with multiple companies and does not have any allegiances.

So, is one better than another? Nope. I say this confidently b/c there are many different situations that afford each type the advantage.

For instance, captive agencies naturally have more interest in their agents' individual success. This may be the best way to get into the insurance industry as fresh meat (over 90% of ppl fail in their 1st year… you better find somebody who’s willing to hold your hand through the beginning). I began as a captive agent and was given free training, coaching, office materials, and best of all… free leads! As a captive agent, however, you have a limited line of products to meet clients’ needs and may not beat out the competition.

Insurance companies working with independent agents have an interest in the success of their product b/c their producers are actively shopping around. Because of this, an independent agent won’t always be afforded a huge support system/free training/free resources/free leads. You must come up with these things yourself as a producer, but you gain a competitive edge when dealing with customers. You are an expert in the industry who can find the best deal for your clients… take that you competitors! (err, yeah, something like that)

So, if you can see the general trend of my logic, I started off as a captive agent, grew, and have now “graduated” to being independent. Let’s see if I’m up to the task.

Here’s a better article that expands on my little rant: http://www.agentssalesjournal.com/content/view/670/108/