One of the biggest challenges that newly licensed independent insurance agents face today is identifying the marketing organization that they will appoint with. It seems logical that the typical independent agent is licensed with 26 different insurance companies. After all, the agent needs to have the most competitive products in their arsenal regardless of who offers them, in order to provide the best product solutions to their prospects.
By contrast, one must question why the typical agent is appointed with six different marketing organizations?!? The responses to this question range from "They offered a fantastic trip I wanted to attend" to "They have this lead generation program…"
In truth, there is no need for more than one marketing organization.
Before we can address why, we must first identify what the marketing organization brings to the table.
Marketing Organization (a.k.a. AFMO, FMO, IMO, NMO) – a third-party intermediary between independent licensed insurance agents and insurance company home offices, who provides economies of scale for product manufacturing and distribution. The intermediary is a distributor of insurance products that performs many of the functions traditionally provided by an insurance company in a career agency distribution arrangement. In exchange for a small portion of the commission paid on the products' sale, this third-party intermediary provides recruiting, contracting and agent licensing services for the insurance company home office while also offering continuing education, marketing, sales support, and other services to independently contracted insurance agents.
Note that it is possible to be an independent insurance agent and not use an FMO. However, there are only two insurance companies in the indexed annuity market that permit contracting directly with the home office (and thus bypassing a marketing group). Regardless of how knowledgeable, autonomous and experienced you are, the other 31 insurers that distribute their products through independent agents require a marketing organization intermediary.
And with 300-plus marketing organizations to choose from, how does an agent narrow it down to just one?
Create a list of FMOs that are strong where you are weak.
Are you a new agent and need a partner that can help you learn the basics? Or, are you seasoned and looking for a partner that can help with your ailing seminar program, etc.?
Narrow down your list based on shared significance.
