Non-Profit Insurance Agency

I am new to the com­mu­nity but have an idea that I would like to get feed­back on. I am a li­censed in­surance agent and fi­nan­cial ad­viser (Series 7&66). I started an in­de­pen­dent in­surance agency a lit­tle less than a year ago mainly be­cause I feel that the in­dus­try was in need of a more eth­i­cal ap­proach. My goal is to also start a con­nected RIA (Registered In­vest­ment Ad­vi­sor) but I have not got­ten that to­gether yet. Both in­surance and money man­age­ment can be highly lu­cra­tive en­deav­ors and , as such, tend to at­tract in­di­vi­d­u­als that are mo­ti­vated by mak­ing a lot of money. I definitely do not mean to im­ply that ev­ery­one in these fields are un­eth­i­cal but it has been my ex­pe­rience that many are.

My ini­tial fo­cus has been on helping se­niors nav­i­gate the Med­i­care sys­tem and to help them en­roll in the the most com­pet­i­tive Med­i­care sup­ple­ment or Med­i­care Ad­van­tage plan available for their par­tic­u­lar need. Se­niors are of­ten bom­barded with a ton of in­for­ma­tion from car­ri­ers and bro­kers—much of which is mis­lead­ing and typ­i­cally en­dors­ing what­ever plan is in the car­rier/​agents fi­nan­cial best in­ter­est as op­posed to that of the client. While there is a fair amount of nu­ance in this field, I be­lieve that it is pos­si­ble to de­velop a well run on­line plat­form fo­cused on trans­parency that could con­soli­date a sig­nifi­cant por­tion of the in­dus­try.

As an in­de­pen­dent agency, I can con­tract with pretty much ev­ery car­rier that offers these plans and can thus show clients all of the choices available in their area. For my ser­vices, I get paid a com­mis­sion from the car­rier my clients end up choos­ing. I also re­ceive a com­mis­sion ev­ery year that the client re­news their plan (or for a set amount of years de­pend­ing on the product). This resi­d­ual struc­ture can lead to what many agents dream of -sig­nifi­cant pas­sive in­come for main­tain­ing your book of busi­ness over time. While I am cur­rently fo­cused on health in­surance, this ba­sic idea is also true for other forms of in­surance as well as money man­age­ment.

Now that I’ve bored you with the ba­sics of how sel­l­ing in­surance works, let me now get to the point of why I am post­ing this on the EA fo­rum. I am strongly con­sid­er­ing turn­ing my agency into a non-profit and fun­nel­ing the gains into char­i­ties. This ap­peals to me be­cause it would es­sen­tially mean si­phon­ing off the com­mis­sions from the in­surance and fi­nan­cial and putting them to use helping peo­ple. The prob­lem is I know noth­ing about set­ting up a non-profit.

While I am cur­rently in my first year of busi­ness and, truth­fully, strug­gling to cover my own over­head I be­lieve that I will be able to gen­er­ate a sig­nifi­cant amount of money over time. Frankly, many suc­cess­ful agen­cies and/​or money man­agers gen­er­ate in­comes far in ac­cess of what I feel I need to live a happy life. I have never been an es­pe­cially money hun­gry per­son and landed in this field due to a com­bi­na­tion of chance and ne­ces­sity. But, given that this is now what I do I figure I might as well figure out a way to de­rive mean­ing for my­self and other.

Another as­pect of this that I find com­pel­ling is most peo­ple are skep­ti­cal about bro­kers and money man­agers be­cause of their high com­mis­sions and fees and are of­ten left won­der­ing whose in­ter­ests they are ac­tu­ally fo­cused on. Be­cause of this, I think that a non profit agency would be a great ‘sel­l­ing point’.

Tak­ing the high com­mis­sions and fees in­her­ent in the struc­ture of the in­dus­try and us­ing them to en­hance the health and well be­ing of oth­ers I think is a cool idea. That be­ing said, I would love any feed­back, recom­men­da­tions or in­ter­ests that could help me turn this dream into a re­al­ity.