I just read a great post on Get Rich Slowly where J.D. talks about a crappy job experience he had selling bad insurance to people who didn’t really need it. J and I met when we both worked for a large company, doing a job that we hated, basically just for the paycheck. A year after we met, J decided to quit and look for something else. What he found was health insurance sales. His first experience in the insurance industry was a lot like J.D.’s. He worked for a company that offered what was essentially a crappy policy, and he spent most of his time driving all over the state to sell it to people who didn’t understand just how bad the policy was. The managers told J that it was the best thing around, and so much better than all the other products out there. But in order to work for them, he had to agree to not sell any other company’s products. So the only way he got paid was if he convinced someone that the one policy he had was the best fit for them – even though it really wasn’t the best fit for anyone.
Within a few months, J started to get a feeling that he might not be working for the best health insurance company around. He researched other companies, and found out that there were much better options available. The kicker was that with the company he started with, whenever he sold a policy, he got 10 months of commission upfront. Of course he owed it back to the company if the person cancelled the policy within 10 months, but the upfront money was a good treat. With the reputable companies, commissions were paid as earned. That would mean that you could work your butt off and only make $300 your first month. Commissions would gradually build up over time, but getting started as a broker for good insurance companies would definitly not be a get-rich-quick scheme. Despite all this, he quit, and started building an honest agency that could actually provide a quality service to people.
I joined J in the insurance business about a year and a half after he started. By that time, he was working for several companies, and together we slowly built up a decent commission base. We do not represent any shady companies, or anything that’s too good to be true. We offer our clients advice and help in matching their needs to what’s available. We don’t cold call – our clients come to us. And we don’t ‘sell’ anything, which is helpful, since neither one of us is a good salesperson. We show every client multiple options that most closely match what they’ve told us they want, and let them pick the plan they like best. Then we help them apply and deal with the insurance company if they have questions or problems. The clients don’t pay any extra for our services – they would pay the same price if they found the insurance on their own.
Getting started in a commission-only industry is tough. We were poorer than poor. There were months when we paid our mortgage and put everything else on a credit card. But we were always able to sleep at night, knowing that we had helped a few people, and had not done anyone any harm that day. And although we’re far from rich, we have a comfortable income now – which we stretch quite a bit with our frugal ways. And we had the experience of being extremely poor, which makes us all the more grateful for what we have.