TLTR: This article compares two insurance entities: Estrella Insurance franchise and Covered by SAGE. It looks at business models, costs, obligations, earning opportunities, and more.
Insurance is a dynamic industry, and it is recently being injected with technological advancements. There are several insurance business models that agents can use to grow professionally. However, with an industry that changes as rapidly as insurance, choosing the right fit for you is crucial.
Estrella Insurance Franchise and Covered by SAGE offer vastly different offerings with some overlaps. While Estrella Insurance franchise is an established name with over 35 years of experience in the industry, Covered by SAGE is a relative newcomer that is looking to change the status quo using plug-and-play technology in insurance.
So, which is the better fit for you? Read on to find out!
Estrella Insurance franchise is an insurance franchise that has over 35 years of industry presence. They follow a tried-and-tested franchise model, but there are several clauses that they put in their contracts (such as not allowing another franchise outlet to open within a one-mile driving radius around another) that allow its agencies to compete with other insurance agencies rather than themselves.
Estrella Insurance franchise also provides its agents with marketing & servicing support, and mandate training. Some of the training modules are held at their headquarters, so agents are required to attend.
On the other hand, Covered by SAGE is a relative newcomer to the industry. They believe technology will empower insurance and are backed by industry trendsetters who believe in the same vision. They do not operate on a franchise model but as a brokerage.
Estrella Insurance agents make money through commissions from each policy they sell. Estrella offers a wide range of P&C insurance policies. They get to keep 86% of their earnings, while Estrella charges the remaining 14% as royalty.
Covered by SAGE agents make money on commissions too. The splits offered go up to 95%, depending on volume and type of policy. Covered by SAGE currently offers the best economics for agents in the market.
Estrella Insurance runs on a franchise model. As such, it charges a franchise fee of $25,000 from its agents. There are also several other charges that it takes, including up to $2,500 for training, 7% of agency revenue for advertising, and more. According to Franchise Grade, it takes anywhere from $49,950 to $84,000 initial investment for an Estrella Insurance franchise. There is also a franchise outlet requirement, which means spending in rent and maintenance.
Compared to this, Covered by SAGE charges a minimal $100 per month service fee from its agents. There are no other costs apart from the commission splits, and no retail requirements to ensure agents can start their agencies from the comfort of their homes at virtually no cost. Covered by SAGE also gives its agents full servicing and marketing support, negating the need for staff. This means that you have the potential to earn more.
Estrella Insurance offers its agents access to 160 carriers. They primarily operate out of Florida, California, Texas, and Arizona. They also offer marketing assistance and some servicing support to their agents. However, there are several charges that they take from the agents to compensate for this.
Estrella Insurance also has the power to exercise the right of first refusal while selling your book, so there might be issues later if you decide to start another insurance venture.
Covered by SAGE provides their agents access to over 80 carriers, which is quite substantial. Their market access is wide enough to address a vast appetite, from personal & commercial insurance to even life and health policies.
Additionally, Covered by SAGE also offers a guaranteed buyout of a multiple of your book value. This means that the barrier to exit is substantially low, and coupled with the minimal $100 monthly service charge, is an enticing option for agents.
Estrella Insurance franchise is an industry veteran and works on a tried-and-tested business model. However, the entry as well as exit barriers are quite high, and require a lot of commitment and thought before starting. Like Brightway Insurance, Estrella Insurance also charges a hefty sum and regular payments to maintain the franchise agreement. Estrella Insurance reviews online are also lukewarm, with an equal number of positive and negative statements.
However, Covered by SAGE makes it extremely easy for an agent to start their agency at virtually no cost. The monthly fee is nominal, and agents get to run an independent insurance agency from the comfort of their homes. Taking a bird’s eye view, Covered by SAGE seems like the ideal choice for any agent, from novices or industry experts.
|We Insure||Covered by SAGE|
|High Franchise Fee||Yes||No|
|Retail space required||Yes||No|
|Agents can sell life and health policies||No||Yes|
|Agents can sell personal policies||Yes||Yes|
|Agents can sell commercial policies||Yes||Yes|
|Monthly technology fees||Yes||No|
|Variable on-demand fees||Yes||No|
|Proprietary technology agents can use for free||No||Yes|
|Restrictions and fees on buyouts||Yes||No|
|Buyouts at multiple value of the book of business||No||Yes|
Did you find this insurance blog helpful? Let us know if you have any more thoughts on this matter in the comments below!
A Cheat Sheet
Helping Clients is The Best Way to Retain Customers and Gain Referrals