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| Non-Liability Contracts http://fugitiverecovery.com/forum/viewtopic.php?f=13&t=10583 |
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| Author: | Mdbtyhtr [ Tue 03 Nov 2009 19:10 ] |
| Post subject: | Non-Liability Contracts |
Out of curiosity, how many of your states have insurance companies or Managing General Agents offering non-liability contracts? What is your point structure? Please respond by PM if you don't wish to respond publicly... Thanks in advance, Scott |
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| Author: | speezack [ Tue 03 Nov 2009 21:33 ] |
| Post subject: | Re: Non-Liability Contracts |
Scott, some of my associates, on several occasions tried the no liability... "posting agent" approach... the going rate is whatever the agent will accept.... usually a small percentage of the premium.... with a minimum for small bonds.... but it usually does not work out because the liability rests on the agent that does the hiring and often times lacking information will result in a bad skip and money spent.... most "posting agent" positions are very temporary to allow a future "liable" agent to get on board and gain some field experience. The rate would depend on the rate the hiring agent was getting and the minimum would be worked out between the two... usually $25 to $100 per bond or 1 to 2% of bond amount (10 to 20% of premium) I never found it necessary to consider a posting agent because around here it is usually slow enough to work the bonds myself or with my daughter.... just not enough to put another on.... of course big city or large AO's could probably work. I think I would lean toward just giving the new agent a minimum full liability contract.... say 50% and 10% of that into the BUF so the net to the agent would be 40%... not too bad for a newbie I think.... that is what I started at. Of course the other consideration is what expense he is expected to take on.......... phones, ads... etc... you know the drill on that........... |
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| Author: | Kathy [ Tue 03 Nov 2009 22:16 ] |
| Post subject: | Re: Non-Liability Contracts |
Non-liability contracts are fairly common here, depending on the general agent, and how they operate. Many of the larger companies use them, but the company receives all the calls, and dolls the bonds out to whoever they have on call to write the bonds. The company will pay for the agent's license for the time the agent writes for them, but the agent is also under contract not to write for themselves or any other agent for a set time. The overhead expenses are all under the company, so the only expense of the agent is gas to and from the jail. The company covers everything else. I got completely screwed when I first started writing bonds, in that I had to pay for all of my expenses, was liable for my bonds, and only made a minimal amount for writing them. I was making less than a non-liability agent, while being treated as a full liability one. Looking back, I see that I compromised myself because I didn't have the necessary collateral to be a GA, but I also allowed myself and my knowledge to not take advantage of my skills. In hindsight, I have no problem with new agents writing bonds under another when they are new, and/or do not have the collateral to write on their own. These agents need to understand that they will only write what the company tells them to write, so will have no personal liability for what they write. Once an agent has the proper collateral and experience to write bonds on their own, it should be thier choice to do so. |
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| Author: | Mdbtyhtr [ Wed 04 Nov 2009 08:13 ] |
| Post subject: | Re: Non-Liability Contracts |
Thank you for the responses, but I may not have phrased the question properly. Those of you that know me well, will understand that there is a method to my madness. I am not referring to Posting Agents, who are by definition, employees. I am referring to Insurance companies that offer an agent a No Liability contract, so instead of paying 2 points premium and 1 point to your buf, the company is paid all three and the agent is not responsible for forfeitures. The agent is responsible to assist the companies recovery people with correct paperwork and any help they can provide, but they will not bear any out of pocket expenses. We have an issue in Maryland with these types of contracts that breed bondsman that have no owned property, no financial stake in the game, no professionalism and no knowledge of the system because they don't need to know it, get the money, post the bond, period. They don't try to vet a potential indemnitor or qualify them, they just write the bonds. Because Maryland has a 10 year rule for recovering paid bonds, odds are that the insurance company will eventually recover their money paid on bad bonds. Their methodology is to generate cash flow now, in large volumes. My issue is that this type of business practice is detrimental to the industry as a whole and that the judiciary is catching on, with the end result being killing the goose that laid the golden egg. This is one of the reasons that we are facing competition with the courts for bonds and the court system opts for 10% payable to the court bonds. So, if this is happening in your state, please provide me with the particulars, in public or private. MEOOWW! That was the cat leaving the bag! Scott |
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| Author: | speezack [ Wed 04 Nov 2009 08:32 ] |
| Post subject: | Re: Non-Liability Contracts |
Understood. I will toss the question to my GA.... attorney... and several others in VA that are much more in the loop than I. Will get back later.... BTW Scott, please read the new post.... "Urbanna Oyster Festival" |
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