It’s 2011 and the market is as soft as can be. Independent agents going it alone are finding it increasingly difficult to maintain steady business, let alone grow new business. Customer need has shrunk, as has sales revenue for agencies of all sizes. Customers are demanding more options, better rates and exceptional coverage for the premiums.

Yet agents are finding ways to meet the growing demands of customers. Some are joining forces in agency networks—also called associations, aggregators and marketing groups—to get the support they need, find better rates and find those options that customers are expecting.

Same idea, different approach

Some of the more prominent groups—including Assurex Global, The ISU Network, Iroquois Group, Keystone Insurers Group, and ARM International—offer benefits ranging from networking opportunities to education to political activism. But not all networks may be right for you. Each has its own focus, motives and benefits that may or may not suit your particular business model.

Michael Pampalone, Jr., an independent agency owner in Merrillville, Ind., noted that some of the memberships he’s paid for didn’t provide the value he’d hoped for. “I’ve been a member of a number of associations that don’t help at all,” he said.

Instead, agents like Pampalone find more value in the connections he’s made through independent agent networks that operate as an insurance agency network without a third-party profit motive.

“It’s more about the relationships with agents that share a lot of the same values and type of business, so we can help each other.”

Is your agency ready for membership in a network? If you’re looking for increased access to education, products, territories, or resources, the answer could be yes. The key is to define your goals and determine if a network can help you attain those goals.

When looking for an agency network that fits with your needs, consider the following:

Is the network a member-driven group, or does the group dictate terms to its constituents?
What is the network’s motivation: political, educational, networking, trade, or increasing its own product penetration? How does that align with your goals?
Does the network offer exclusive products/services to its members?
How often are the national meetings? Are there also local events?
Are decisions made by a board or is the membership involved in everything from choosing products to voting on new members?
Do members have access to a strong referral resource?
What partnerships has the network made and how is that benefitting members?
Is the group actively seeking new business opportunities?
Do they offer regional products and programs?

Ideally, the network you choose should align with your existing business practices and not require much change, if any, to how you operate. Also, look for a network that is owned and directed by its members, and one in which members set the agenda, and one that is flexible, innovative, and works toward the evolution of the network.

If you’re looking to increase your business potential, tap in to exclusive products and partnerships, or take advantage of pooled resources and knowledge, consider carefully if an agency network can help you meet those goals. If so, choose a network that brings plenty of bang for your membership buck, and allows you to operate your business the way that best suits your needs.

Independent v. Aggregator: Which Works Best?

The toughest choice you must make when considering association membership is whether to maintain independence or join an association or aggregator relationship that requires agents to drop their independent status in exchange for access to products and sales opportunities. Most associations, including aggregator organizations, hold regular meetings and events designed to educate agents and help them improve their business processes. Others will include products or educational programs. Also, a good association will offer both national and local support.

The largest difference between the two groups is how their policies affect you and your agency. There are advantages to each group.

Choose an aggregator if:

You prefer specializing in one product line
Independence is not a primary concern
You don’t mind having the aggregator brand as your agency’s new name
Control over the association’s direction isn’t important to you

Choose an independent association if:

You prefer selling products from a number of insurers
You want to maintain independence and your agency name
You need access to a large contingent of knowledge and resources
You want a strong voice in the focus of the association

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9 questions to ask if you&rsquo;re considering an agent network

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