So, I mentioned insurance companies briefly yesterday's post...perfect time to unleash this story!
So, for 15 years I slaved away and toiled and gave my blood, sweat, tears and the prime time of my life (and child bearing years) to my career. It happened to be for a Fortune 100 Insurance Company. Let's call them BIC (Big Insurance Company).
The parting ways was very negative (another LONG story I am too tired to write about now). I was devastated. I will elaborate someday soon - maybe after my short term working gig is over this fall.
I moved on...I was married (bad marriage) to a guy who inherited a very successful agency business from his father. A huge "book" of business of loyal insurance clients. In insurance, when you sign up people and secure policies - you get a commission and kickbacks as long as they are signed up with you. So, I decided to learn they sales side of it in his office and then open a 2nd office.
So, I worked in his office, learned the systems they had in place, the basics about running an office and went about getting my formal training from insurance company #2. We will call them IC2. Another positive factor for me was the fact that I have legal background and claims background, so I already knew much about coverage and the features that enhance protecting one's assets, etc. I went a week in Denver - ALL my expenses I covered. I was in a class with about 40 other similar-prospective agents-in-training. Then a week in Chicago. Then another week in Denver. All along, IC2 is working with prospective agents hand in hand (setting up business plan, doing paperwork to set up legal entity with respective state, picking locations and signing leases, getting stationary/envelopes, arranging for signage, etc.).
Needless to say, this process costs THOUSANDS of dollars for everyone - the company PLUS the prospects. PLUS I am forgoing income for about a year getting this all set up. Part of the way IC2 gets new agents (besides being very hands-on for the first couple of years in setting everything up) is to offer financial incentives for certain sales goals, etc. They even offered me a free "book" of business, after the successful opening of my office, I would "own" this book.
If EH (ex-husband - sorry, spoiler alert) agency were strictly in numbers, figure his business did about $400,000 a year - not directly translated into income for him - that is much more complicated math. But, his book probably included about $400,000 revenue in premiums for a year for IC2. Mine was about $50,000 that IC2 "gave" me. But, hey, I will take it, you know?
So I spend thousands getting my company up and running, I hire 2 people and we are all trained and working hard. I even transferred my 401(k) to my own "book" and took a very nice commission on it to benefit my numbers. The problem was - that I was in my early 40's and stuck in a 10 year product that makes like nothing (and transversely - loses nothing). So, this investment vehicle has virtue for people who are older and risk intolerant - but a very BAD idea for younger person who needs their saved money to grow.
Anyway, I work at this business for about a year I get the nice bonus promised - low five-figures. But, keep in mind I have not worked for A YEAR - No INCOME! Then, IC2 comes to me and says, "yeah, we know you completed and turned in a business plan that we approved...but we are ending this partnership - we don't want you to run your business this way that you planned". My business plan included half insurance sales and half legal free-lance. THEY initially agreed to it, just to get me to commit!
I was stunned and incredulous. So, I went back to them and said if they would let me sell the book they gave me and give me a settlement, I would sell and get out. They agreed. I sold the business that I spent a year setting up for mid-five figures. OK, that was pretty good. And remember that bonus? Well, they paid me twice by accident. HAHA. But the icing on the cake - they paid me a settlement. So, I ended up about the same bottom line, as if I had worked for my prior insurance company for a year. I did feel bad about having to let my 2 employees go, but one woman was wanting to open her own company - which she did with A DIFFERENT insurance company, after seeing what IC2 did to me...and the other employee was having a lot of personal and health problems and wanted to get a less stressful (not sales-based) job - which she did right away.
I asked my tax guy about the taxes and he said IF IC2 sent a 1099 to the IRS, I would have to file income tax on that settlement money. Well, guess what? On the settlement I negotiated, they never 1099'd it so I did not have to pay taxes. How is that for sweet revenge against them changing the rules and pulling the rug out from under me?! Today I work in a job that is very low stress and OK revenue and I feel like I was VERY lucky in the long run. I did all this mentioned above with ZERO debt! All this money I invested and went out and immediately got a W2 job. Thank GOD!
IC2? Well, they are going strong.
Another agent I know of bought a book to the tune of mid-six-figures and is now working furiously to make it float. I know the agent he bought it from because she bought mine - and she was dirty. Trying to pull things, so I know she probably cheated him too. I am so grateful I did not borrow any money (Thank you Jesus).
The moral of this story? I was so angry at this company that I had my annuity moved away from them - TO ANOTHER ANNUITY. Can you say cut off my nose to spite my face? Oh well, when the 10 years came up and I could move my six-figure retirement account to another company - the agent on record was the same executive that I had battled with YEARS earlier. It was very satisfying to tell them that even if they were the last company on earth I could invest my money with - I would take my chances with putting it under my mattress!!!!!!!!!!
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