Why would you enter a multi-year contract with a company that you’ve never done business with?
Agents frequently ask how Firefly’s contract compares to other insurance clusters and networks.
- One major difference is that most of our competitors include a time-requirement in their contract.
⚠️That’s a big risk to you.
Heck, even when we changed phone systems, we wanted flexibility in case we didn’t like their service.
When searching for options, this ad got our attention – but not in a good way:
Kudos to them for being up-front. But having a one-year commitment raised red flags for us. Our biggest questions were:
- Why have a time commitment in your contract if your services are good enough win our business?
- Shouldn’t that keep us around?
What if we had a problem with their service and needed to change? Their requirement to have a one-year contract made us feel uneasy about their ability to deliver a reliable service.
Why Are Long-Term Contracts Scary?
Did you know that roughly 70% of business partnerships fail?
- 70%! Turns out business partnerships are even worse than the divorce rate.
This article is about marketing partnerships, and the statistic is even worse.
- 73% of partnerships ended in 3 years or less:
Ricky sums up the outlook of business partnerships nicely:
Here’s the good news. This doesn’t mean that your business will fail. But your partnerships, vendors, software, and even your insurance carriers may change over time.
Many insurance networks, aggregators, insurance clusters, and franchises have contracts that require you to stay with them for a period of time:
- Sometimes it’s called a vesting period.
- Other times it’s a detail that shows when you actually own your book outright.
- Most of these contracts are two to five years.
- Some are as long as 15 years! 😱
Most partnerships last 5 years or less, which means many of those contracts will be around longer than the business!
⬆️ Refer again to the image above to see what we think of that.
Continually Earning Your Business
The best companies to work with are the ones with clear terms, but no time-stipulations.
- Those companies have to earn your business year after year.
- They must constantly improve, or a competitor can come along and eat their lunch.
We like working with companies who act that way.
We also are a company who acts that way.
Firefly has a contract. It details commission splits, fees, your right to have outside carriers, and the ability to sell or give your business to someone else.
- But we have no long-term commitments. You can leave with 30 days’ notice.
We want to work with agents who want to be with us. And we work hard to offer so much value that agents never leave.
But It’s Important That You Can Leave
Firefly knows we have to stay on our A-game, or we could lose our agents. It also prevents us from doing crazy things like changing our commission structure in a way that hurts you, or adding new fees to line our pockets.
👍Having that walk away power protects you.
😡Contracts with time stipulations protect the aggregator.
You should choose to work with a company that respects you, and has enough confidence in its business model to not require you sign a time-oriented contract.
We’d love to hear your plans to start & grow your agency:
📆 Book a time on our calendar to chat with us.
📞 Or call us at (866) 903-1596.
We look forward to talking with you!