How to calculate earnings from advances on your insurance business

About one third of insurance companies offer advances now.  It is very hard for a new insurance agent to make it without getting some start of advances to get going.  Unless you have a large loan most insurance agents wouldn't be able to support their families without an advance. 

The key to becoming profitable while getting advances is to save up enough money so that you have enough cash on hand to cover your debt to the insurance company.  Until you have saved up this much money you are not "making money" in this business because you are living off loans.  Most agencies that insurance agents work for don't really care about the bottom line of the agents or really understand how to maximize each agents earnings.  To fully understand how to increase profitability for your insurance business you need to have all of your accounts in a program like Quickbooks that can help you measure profitability. 

About 95% of insurance agents don't really treat their insurance business like a business.  They treat it like a hobby.  You can tell a true business owner that really has intentions on making money because they have records that show money made and money lost.  If you had to hire a 3rd party to view your books would they be able to see what's going on with your company and make recommendations?  You should have your entire book of business located in a central location so that you can have available documents to share with others that might be able to help you.

I would strongly encourage each insurance agent to start entering information into Quickbooks and consult with a financial advisor that is trained in financial analysis at least every quarter.  I am convinced that really anyone can make a living in this business if they have the tools to make informed decisions.  In the future we will have some tutorials on this blog that should only take you about 5 hours a week to to input it yourself.  Most bookkeepers will do it for less than $16 an hour so if you make more than that an hour you should probably hire someone to do it for you.  The point is that you want to get it started so that you can make more accurate decisions about your business.