Notes:
Dan's system back end
considerations
- Share of profit from underwriting, based on book underwriting loss ratio
- mandatory date for purchase by parent company,
- Established purchase price, i.e., 3 to 5 times gross revenue, or 2 times booked premium, or something times net profit after loss ratio?
- parent company has right of first refusal if sale is prior to mandatory date
- underwriting model is agent produced model. Rating system must support the ability to have many multiple price points
- Small contract is part of the program
- Most feed into back end system for accounting and possibly for renewal
- Seed money to build? Should be a requirement, no one works for free. Set purchase price in windows: i.e., system complete, marketing complete, production started. 1 year. etc.
- Company controls product offering on first right of refusal, other partners allowed but can be supplanted at company request
- after live, company can buy at 2 times seed money investment in first 12 months.
- after 12 months, purchase is based on production or other factor, predicted growth?
- Build is a direct model in states with an a corporate reps and in states without coporate rep, it is a direct model and an subagency model. Corporate reps not needed, but can spin off sub agents when corporate reps established in a specific state.
Time line:
Sept: accept appointment
Sept: USA partner meeting
Oct: Underwriting meeting
Nov: IT meeting
Dec: Corporate level meeting
Jan. 2025: Seed money request $75K
Feb: System build
April: IT/Underwriting presentation
May: System refinement
June: Underwriting design, completion
July-December: Seed Money request $75K Bond loading
January 2026: Underwriting, IT, Corp live review
Feb: Production open
March-July: Marketing blitz, third round of seed money $75K
What is corp production, profit expectation?
What is agency production, profit expectation?
