Should You Join an Independent Agency Alliance?

• September 1, 2025

By Tiffany Overlease

For independent insurance agencies looking to boost sales and scale their business, joining an agency alliance can be a game-changer, but they are not a one-size-fits-all solution. The promise of increased market access, higher commissions and stronger negotiating power is compelling, but the benefits must be weighed against costs, obligations and, most importantly for independent agents, potential trade-offs in autonomy.

Agency alliances for independent insurance agencies, also referred to as aggregators or clusters, are becoming more common. But what exactly are they? How does one join one? And is joining one right for your agency?

Here are the answers to some commonly asked questions that may guide you in deciding if an agency alliance is right for your independent insurance agency:

1) What is an agency alliance? An agency alliance is a formal network of insurance agents. By joining together, agencies can aggregate premium, negotiate compensation and benefits on behalf of its members, and access additional carrier markets. At its core, an alliance is a group of businesses that join forces to leverage more power and pull in the marketplace.

2) What benefits does an agency receive by joining an alliance? There are many alliance programs, so program details vary. Generally, an agency will enjoy higher income potential due to the enhanced volume of the alliance’s aggregated premium, which provides greater eligibility for profit sharing and expanded access to carriers and vendors. Overall, an alliance works closely with carriers to promote profitability among its members.

3) What is the cost of joining an alliance? Typically, alliances have an initial sign-up fee, a contract commitment and monthly costs. Also, alliances will often have an exit fee. An alliance may also require your agency to use an agency management system (AMS)—possibly even a specific AMS—that carries separate fees.

Other items to consider are the commission split and the profit-sharing split between the agency and the alliance. Before joining an alliance, you’ll also need to determine if your agency owns its expirations, as well as whether you own your carrier code should you decide to leave. Therefore, when considering an alliance partnership, calculate the benefits versus the costs, including the potential costs to exit the arrangement.

4) What size agency can qualify for alliance membership? Whether your agency is a brand-new start up or is well established, there’s an alliance out there for everyone.

5) What should I ask an alliance to determine if they are a good fit? Here are some questions to ask an alliance or aggregator you’re considering joining:

• What is the sign-up fee?
• Is there a monthly membership fee? Or does the agency commit a percentage of overall revenue?
• What is the agency termination or exit clause? Is there a termination fee?
• Who owns the codes?
• Will my agency be required to use a particular AMS?
• How many years is my agency bound to the contract?
• Will I maintain ownership of my agency?
• Is there a nonsolicitation or noncompete clause in place?
• How is the agency paid on business written—full commission, split commission or profit-sharing eligibility?

6) Are there any drawbacks to joining an alliance? If a rising tide lifts all ships, the reverse can also be true. In joining an alliance, your bottom line will be affected as other agencies come and go. Consider market trends and evaluate your local alliance competition carefully as you choose where to align your business.

Ultimately, the decision to join an agency alliance should align with your agency’s long-term goals, operational needs and growth strategy. Taking the time to ask the right questions and fully understand the structure of an alliance can help ensure it’s a smart, sustainable move for your business.

Tiffany Overlease is assistant vice president of Big “I” Alliance Gold.