Brightway Goes ‘All In’ on Independent Agents, Unveils No-Cost Path to Agency Ownership
On the heels of celebrating its 10-year anniversary, Jacksonville, Fla.-based Brightway Insurance, a national property/casualty insurance retailer selling through a network of franchised independent agencies, has unveiled a no-upfront cost program for independent insurance agents that offers a path to ownership of their own Brightway agency.
It also offers a way for existing independent agents to grow and open additional locations.
Describing it as “going all in” on the independent insurance agency channel at a time when some are questioning its future, Brightway Insurance Co-Founder & CEO Michael Miller said the new distribution model is designed for agents who have dreamed of being their own boss and owning their own agency but don’t have the financial resources to get there.
“We are 100 percent committed to the independent agent channel,” Miller said. “We’re betting everything that there are fantastic people who work in insurance today who would love to build their own business, be their own boss and have an organization like Brightway support them … and we’re excited to do it.”
The new commission-based agent program, called “Independent Agent,” gives experienced property/casualty insurance producers access to the Brightway system, which offers its agency owners resources and support to run their business, to start selling insurance while simultaneously qualifying for franchise ownership. The new model is different from Brightway’s current franchise system because it works as a 50/50 commission share model where agents have no upfront costs and can start profiting immediately, Miller said.
Under Brightway’s current business model, launched by Miller and his brother David back in 2008, people without insurance experience can be selected by the company to start a Brightway Agency and use the company’s technology and support services to run their business. Individuals pay a $60,000 initial fee to purchase their agency franchise, which requires them to operate a retail location with a minimum of three staff. Retail stores handle the day-to-day operations, including quoting, binding and customer interactions, and the central Brightway Insurance office handles the carrier relationships, customer service, marketing, accounting and technology.
How the New Program Works
The Independent Agent model offers a “first step” towards becoming a Brightway franchise for experienced personal lines sales people, Miller said. Agents can do business out of a home office or other location without having to employ a staff. After one year — or sooner if agents meet the Brightway sales goals — they qualify for a fully financed, lower-cost entry fee of $30,000 into Brightway’s new “office location” franchise model where agencies operate in a professional office space with teams of up to two people.
This new franchise model differs from Brightway’s existing model that requires agency owners be located in a retail space where they can build large sales teams, and reduces the current model up-front franchise fee of $60,000 as well as ongoing operating costs.
“I think about these options as opening doors to the Brightway system. Based on your background and goals, you can choose any door you like — Independent Agent or a franchise located either in an office space or a retail location — and grow in the direction you want,” Miller said.
The commission split on the Independent Agent program is 50 percent renewal/50 percent new business. Agents are required to have personal lines/property casualty sales experience — preferably two years — to be eligible for the program, unlike Brightway’s existing franchise model that doesn’t require agency owners to have any insurance experience but instead offers onboarding and training processes. Retail agents can bring over their current books of business and any carriers they work with that are not already affiliated with Brightway.
Agents are given a six-month contract for the Independent Agent program with one renewal option for a total of one year under the program. Miller said agents must meet the Brightway sales targets of selling a minimum of four new policies a week for at least an eight-week period to qualify for the next step — the new office location franchise model where Brightway finances the $30,000 franchise fee.
Agents can move on to the new franchise model before six months or a year if they meet the minimum requirements sooner, but the Independent Agent contract does not go beyond a year.
“The Independent Agent model is not a forever state — it’s an entry point,” Miller said. “It’s designed as a way to get started and help [agents] be profitable from the day they leave their day job as a producer or [current role] in the insurance industry to becoming a full franchisee. It helps them transition.”
If agents move into the office location franchise model, they will own an economic interest in their book of business like all Brightway franchisees do. However, if someone starts as an Independent Agent and decides not to become a franchise owner, their customers will stay with Brightway to ensure their coverage and service are not disrupted.
Miller said the new office location franchise model is designed to help people who want to build a business but don’t have a large amount of money to invest to open a full retail store with a large team. Agency owners under this model can still access the full array of Brightway resources and work with all of Brightway’s carriers, and the reduced franchise fee of $30,000 is fully financed by Brightway through a seven-year loan at a rate of prime plus 2 percent with a floor of 10 percent.
Agents can remain in this franchise model indefinitely if they choose, Miller said, but to grow to a larger business with multiple franchise locations they’d have to transition to a traditional Brightway retail store agency owner.
“What we’re really doing is moving to where we have created different options to allow people to not only engage with Brightway at the level that is right for them to begin with, but even move between these different models as they choose to grow their businesses,” Miller said.
Miller said Brightway is looking to partner with about 100 agents in the first year of the Independent Agent model in 21 states of the 22 states where it currently has franchise location stores (Ala., Ariz., Calif., Colo., Ga., Ind., Ks., La., Mich., Mo., N.Y., N.C., Okla., Pa., S.C., Texas, Wash., Tenn., N.J., Ill., and Wisc.). Because the company already has many retail stores in Florida, it is not looking to deploy the Independent Agent program in the state.