Strategic Resources for Your Insurance Agency

What do Agency Aggregators Bring to the Table?



Overwhelmed with everything you need to do as an agency principal? Not able to secure markets or meet profit sharing minimums? You aren’t alone. Other agency owners before you have experienced all the same frustrations as you – and many of them have done something about it: They have become a part of an agency aggregator, which means a grouping of agencies under one master agency appointment agreement for each carrier that can be further sub-coded to each agency member.

Agency aggregators (also known as clusters, alliances, networks and franchises) is a formal association of insurance agencies formed for mutual support. They can provide economies of scale to assist in negotiating with carriers and pricing discounts from vendors. Some groups may include these services as part of their membership structure.

These groups almost always offer include the following:

  • Appointments or Access to many Carriers
  • Contingent Commissions (Including profit sharing and group volume bonuses)

Some groups also may include:  

  • Errors and omissions insurance coverage
  • Agency management software
  • Quoting or Market Placement Services
  • Special Group Training with Carriers
  • A number of other negotiated benefits

Because each group is free to enter into its own arrangements with carriers and vendors, each group can be very different from the others. The available options among these groups helps fill the different needs of each agency owner.



Individual agencies may have trouble getting appointments to the best, most desirable insurance carriers or products on their own. But an individual agency that wouldn’t be worth a second look to some carriers may gain access to these products as part of a group. As an individual agency, you may not even be on some carriers’ radar screen. However securing membership with an established agency aggregator or master agency network,  a carrier access or an appointment is often part of the package.


Just as groups are able to help small agencies gain access to the top insurance carriers, they can also negotiate more lucrative commission arrangements, as well. Naturally, the commission structure is different with each market, carrier and line. But affiliation with a group can help you get access to the best commission and renewal arrangements that the carriers normally reserve for their largest and most favored agencies.

This helps you maximize your agency override, while at the same time allowing you to pay your agents more, helping you retain your highest producers.

Profit sharing

Most groups have a profit sharing program that can be lucrative for the individual agency because the production is based upon the pooled volume of all agencies, rather than each agency individually. For many agencies, this more than offsets the fees or small commission percentages that these groups charge.  Also many groups negotiate higher new business commissions, such as a 5% above and beyond a standard 15% commission, often bringing the total new business commissions to 20% or more.  In addition to the number of carrier appointments, profit sharing is a huge reason on why many agencies join these groups.


Some groups can provide help with back office procedures. Some agents have successfully used these services to enable them to run solo practices out of their homes.


Before you get too deep in the process, review the qualifications guidelines for the group you are considering. Many groups will not work with brand new agencies, or agencies that do below a given level of volume.  However many will accept new agencies, you need to find the right group for your agency.

Also take a hard look at the “divorce” clauses. If you elect to leave the group for any reason, you may be subject to termination clauses. Some groups have termination fees when you leave, some may have non-compete clauses. Nevertheless, it’s best to read the contract and understand the terms. Even with these termination clauses, these groups provide significant advantages and should be taken into consideration when evaluating an agreement. If the advantages outweigh the disadvantages, membership may make sense for your agency.

Also, compare the upfront fees, if any, and the ongoing monthly or annual membership fees. Can you keep up the required payments, even when you have a couple of slow months?

The bottom line

There’s no single right or wrong answer to what group might work best for you. The answer depends on a variety of factors, including your location, existing book of business, volume, existing market, your agency needs and many other factors. Groups have their criteria of whom they accept as members and agencies should have their criteria of what they are looking for in a group. However there are more options than ever and because of this, more and more agencies are choosing to affiliate with a group because it significantly helps their bottom line.

Looking to start an Agency? Get detailed information by reading our Guide to Starting an Insurance Agency



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