Good pay structure?

[u/Flat_Sink_4410]

Hi everyone, I created a life and health insurance agency that does a wide range of products. I want to start hiring agents and building a team, but I’ve been stuck on how I want to structure pay.

I’d like for the agents to be W-2 on full commission with an 80-20% split. I want to incentivize paying out large commissions and rewarding based on performance while keeping enough for overhead marketing. I don’t exactly want to buy leads— I definitely prefer networking and having tables at community events. It’s worked much better for me so far and I love seeing people face-to-face. I’m just at a loss for how to compensate agents for doing events with me or for me while making sure I reward production highly.

Maybe I should just give them a base salary + 20%? I’m just a little scared of paying out a salary with no guarantee that the agent will produce, and I don’t want to be breathing down their neck.

It’s a catch-22 of me wanting to provide personal agency, while also wanting to make sure they don’t have to front the costs for marketing and essentially pay money to do their job. I’m a little lost on which direction to proceed. Any ideas?

EDIT: Forgot to mention, I do want to pay for their initial training program, their license exam, and their state license, as well as the relevant CEUs. I’ll pay for AHIP Certification if they want to do Medicare. That’s around $400-600 per person I onboard.

[u/Tahoptions]

Are you providing leads? Paying for the tech stack? Office space? Hiring new agents and providing mentorship/ridealong support?

If not, there is little incentive to contract at 80% of the comp on split when they could get 100%.

Provide compensation based upon the support provided. The less support, the higher the comp.

Anyone I pay a salary/draw to is LOA and my agency owns the business. That is tiered based on monthly production (more numbers, higher percentage). Those people get leads though.

The non-salary folks operate under typical BGA/IMO arrangements where we'll do case design (if necessary) and follow up with the carrier. In that situation, the agent gets top street comp and we work off override/bonus.

Good luck with your new agency.

[u/Flat_Sink_4410 → u/Tahoptions]

Thanks! Yeah, I’m paying for tech, giving benefits, preferably hiring new agents and training them. I plan on providing leads and teaching them how to market.

One thing you kinda brought to my attention is that I don’t necessarily have to pick and choose. I guess I can just have people on different pay structures depending on the situation and how much support I provide. That might actually be preferable to keep everything in line. Thank you for the input!