FAQs
Please click on a link below to find the answer to the question.
How is my current book of business protected in the Coop structure?
Members will bring their current book of business to the Coop and they will maintain 100% ownership and control of that business while in the Coop. The confidentiality, non compete and cross selling provisions of the membership agreement will prevent other coop members or the Coop itself from ever taking over other member’s clients – even if the clients ask to make a change. If members ever want to leave the Coop they can leave with all the client accounts they came with and all the client accounts they added while at the Coop.
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How will I grow my book of business within the Coop?
Associates and Partners will have access to cross selling opportunities within the Coop. Members will be introduced within the Coop and then select those members within the Coop they would like to work with to offer additional services to their existing clients. Non compete agreements and set commission sharing agreements will facilitate the cross selling environment. The web portal technology will allow multiple services – for instance employee benefit, 401K and property casualty – to be integrated into one web portal for easy access by the client. Members will also be able to offer payroll and other web based services to their clients that will be provided by vendors selected by the Coop – thereby offering additional sources of income and increasing account presence. By being part of a larger organization and being able to offer a full suite of informational and advanced web portal services to clients - members will also be able to better protect their existing client relationships from poaching by other market providers who are offering more and more “services” in exchange for new brokerage accounts. By entering into service continuity agreements with other Coop members – smaller brokers will also have a great answer to the proverbial – “what if you get hit by a bus” question. The Coop allows members to retain all the advantages of being small while having access to all of the services they need to compete effectively against the bigger players in the market place. Partners will also benefit from new accounts that are attracted to the Coop through its regional advertising. New account leads will be handed out internally based on a formula designed to ensure an equitable distribution of new opportunities. There will be no house accounts – everything is distributed to and owned by the members.
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How will the Coop position itself in the marketplace?
The intent of the Coop is to build a brand in the marketplace as the “best of the best”. High caliber independent agents - working together to provide the best client centric service available in the marketplace. The Coop will offer a full suit of services for all clients – a “one stop shop” for employee benefits, 401K/retirement, property casualty, payroll and HR services. Coop members can offer some or all of those services to clients – based on their needs - in a highly integrated fashion using the client web portal. Coop members will work on a fee for service or commission basis – but will always be 100% transparent on fees and will make sure our clients know what they are paying for and get 110% of the value they should expect from their broker. Coop members will educate their clients, their management and their employees so they can make informed decisions and optimize their company’s return on their benefit, retirement, risk management and employee service investments. The Coop is not a big national or regional provider with high overheads and many layers of management. The Coop is lean and cost effective. When a client works with the Coop he or she deals directly with experienced principals – experts in their business with years of hands on experience. Coop members do not make plan recommendations based on what maximizes broker commissions but rather on what is right for the client. Most importantly Coop members work for the client - not the carriers. Experience – Value – Service - Results are the foundations of the Coop service delivery model.
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Who has the liability for the account execution – the broker or the Coop?
The broker maintains the full liability for their accounts – and exercises full control over the service delivery and support of the client within the Coop structure. The Coop can provide admin and other resources for the members to make their service delivery and support more cost effective – but members still need to make sure they are fulfilling their ethical and legal responsibilities to their clients. Coop members can elect to have other members work with them to do peer reviews of proposals and the Coop will have resources (legal and otherwise) that can review proposal or ideas prior to submission. These services would be available on a discounted fee for services basis.
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Are there any production requirements and/or goals that need to be met to stay in the Coop?
Yes. You have to have annual commission or fee for service income of at least $350,000 to join and maintain membership in the Coop. If you drop below that level you will have an eighteen month (18) grace period to recover – during which you will still have to pay the minimum monthly membership fees to the Coop for either the Associate or Partner membership. You will also have to meet the Coop’s customer service and business practices standards. Coop members who do not meet those standards can be asked to leave any time - after being given a formal notice and cure period. The intent of those standards is to protect the brand name and market reputation of the Coop for all of its members.
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Will the Coop have office locations where members can bring clients if they want to meet?
If enough Coop members want the Coop to rent meeting space in different market locations the Coop members – through the Management Committee - can request that. It would come out of the operating fund. If the utilization by members was high enough then this common resource would make sense for the Coop to provide. The same is true with almost any other type of service that members would like the coop to provide. If members want it and it can be covered by the operating budget – then the Coop can provide it and make it available to one or both membership types based on the service and costs.
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Who will handle disputes or issues that come up within the Coop?
The Coop will form a Management Committee that will be made up of Partner and Associate members. The voting structure will reflect the amount of fees being paid by both types of members. The Management Committee will approve the operating budget and review, revise and alter operating policies and procedures of the Coop as the member see fit. Disputes between members of the Coop or between members of the Coop and the Coop itself will be handled by the Management Committee as well. The Coop will function as a member run, non profit organization.
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What does "non profit" really mean?
The Coop will take in scheduled fees from Associate and Partner members and from carriers for commissions and incentives. Commissions will be paid monthly as received back to the Coop members based on account ownership. Incentives will paid out as received by the carriers based on each member’s pro-rata share of the Coops total book of business with that Carrier. The Coop will operate within an agreed to budget and return any extra fees collected to its Partner members. If we can operate under budget – which we should be able to do as we grow the membership base – then Partner members will receive a quarterly rebate in fees – reducing their effective participation costs. The initial fee schedule for Associate and Partner members was set based on a membership of 30 brokers in the Coop. As membership increases above 30 – the costs for the Partner and Associate members should come down significantly. Members will have full access to the operating costs of the Coop and will set the standards for the services provided by the Coop to the membership.
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