Negotiations can be a challenge for anyone because the outcomes can have a big impact on your work and personal life. For insurance producers, they can be especially hard because agencies often have strict guidelines for what they’re willing to offer for compensation, particularly when it comes to noncompetes. Unfortunately, a tight noncompete can be a serious challenge for producers who are considering a move from their current firm to another but want to maintain their livelihood.
Whether you’re negotiating with a new agency or discussing opportunities to advance within your current organization, consider the following negotiating tips:
- Ask for what you want or a little more. The reality is, you won’t get something unless you ask for it. Successful negotiators are assertive and set the tone of the conversation by starting higher than where they expect to end up in order to set a base for subsequent discussions. Assertive negotiators ask for what they want while remaining respectful to others, but they’re still willing to challenge the status quo because they know they cannot accept everything at face value.
- Show your passion for the business and the negotiation. During the negotiation process, make your feelings known about the current offer. In a study published in the European Journal of Social Psychology, researchers found that “the social signal value of anger enhances the credibility of the complainant and, hence, leads to better compensation, but only when the complaint itself presents room for doubt.”
- Explain how you can meet their needs. If a company is going to negotiate benefits with you, its leadership needs to know you are going to meet their needs. Consider their perspective and provide examples of past work experience to show you have the skills and drive to help the company succeed.
- Do your homework. Gita Johar, a professor at Columbia Business School, says that when you “provide a lot of information, some of it is bound to stick.” By providing relevant data regarding pay, benefits packages, etc., you are likely to persuade the other party without them realizing it. The more information you have about industry averages and the people you are negotiating with, the stronger your argument will be.
Before entering into negotiations for a new compensation package, consider what you want from the company, such as no noncompete, high commissions, the opportunity for equity interest in your book, freedom in your daily schedule, and the option for stock ownership. Schedule meetings with your top agencies and speak with their leadership. Producers who are proven professionals may be surprised by the willingness of some companies to negotiate terms in order to bring the most talented people on board.
If a traditional agency doesn’t offer the package you want or deserve, consider an entrepreneurial or lifestyle agency model. The best entrepreneurial models typically do not require a rigid noncompete, offer the freedom to manage your work and personal life as you see fit, provide equity interest in your book, and offer stock options, superior tools, and higher commissions. For more information, check out the powerful and comprehensive ebook “The Insurance Producer’s 4-Step Guide to Fast-Tracking the Next Move.”