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How to choose a marketing organization

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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.

What is most important to you in your relationship with the FMO? Which companies does the FMO have contracts with? Do they offer a lead generation program or some sort of income planning software?

Don’t be laissez-faire in your selection process.

Treat this like a consultation for a job, and interview each group on your list. (After all, you will be paying this company to provide you with a service.) Develop an inventory of meaningful questions, and compare each organization’s responses.

If they want you, let them prove it.

Ask each of your final few what they will bring to the table in a shared relationship with you. If they cannot figure out why you need them, and what they can offer over their competitors, they can’t make it to the next round.

Test the chemistry.

Do you like the staff within the organization? Do you feel valued and appreciated? Do the principals know you and remember details from your previous conversations? Do they care? If they treat you like a number, move on.

Ultimately, the only thing that differentiates a marketing organization is their relationship-building abilities. Everything else can be duplicated by the FMO’s competitors: leads, mailer programs, seminar systems, products, companies, software and more.

In short, the one marketing organization you need is the one that meets your needs, helps your business grow, and treats you as a partner.

For more from Sheryl J. Moore, see:


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