What is the Difference Between an IMO and an FMO?

Being an independent insurance agent is an extremely exciting endeavor. You get to run your own small business, without the constraints of having to sell for one large insurance carrier only, as captive agents do. 

At the same time, independent agents don’t have the same support, services, tools, access to carriers and stable income that captive agents do. Luckily, there are many organizations out there that provide this support to independent insurance agents as part of a mutually-beneficial relationship. 

If you’re an independent agent searching for this help, you might get a little confused about the options available. You’ll likely read about IMOs and FMOs and may not understand what they are. 

Below, we’ll discuss the difference between an IMO and an FMO to shed more light on the topic. 

What is an IMO and FMO? 

An Independent Marketing Organization, or IMO, is a professional entity that provides a lot of support to independent insurance agencies. This comes in the form of marketing and sales materials, back-end support and access to insurance carriers, among many other things. 

A Field Marketing Organization, or FMO, is very similar in this regard. The benefits they provide the agents with which they work are about the same 

Both of these types of organizations essentially act as a bridge between independent agents and large insurance carriers. They offer access to the carriers and the plans they have but in a non-captive way. In other words, independent agents can sell the plans that the carriers offer through the IMO or FMO, without being forced to only sell those plans. 

The organizations make their money based on the sales that the independent agents they work with make. Most will take part of the agent’s commission as the fee for their work, with a large portion of the commission going to the agents themselves. 

What is the Difference Between an IMO and FMO? 

As you can see, IMOs and FMOs are similar in many ways. They serve as valuable resources for independent insurance agents, providing them with the support, training and access to insurance carriers that they don’t get since they aren’t captive agents. 

Many independent agents find relationships with such organizations to be vital to their success, as it’s very hard for them to get this on their own, especially if they’re not fully established in their business. 

At the same time, there are some key differences between IMOs and FMOs that are important to understand before you choose which one you’d like to work with. Here are some of those main differences. 

Relationships with Insurance Carriers 

The access to large, well-known insurance carriers is a huge benefit of working with an IMO or FMO. Independent agents desire choice in carriers, and working with these organizations may be the only way they can actually gain that access. 

While both IMOs and FMOs provide access to carriers, the way they do so is often slightly different. 

IMOs are known for providing access to many different well-known carriers, without much limitation. 

FMOs, on the other hand, tend to have either preferred or exclusive relationships. This doesn’t mean that they force the agents they work with to be captive, but they may offer better incentives to work with one carrier over the other, or have limited access to carriers when compared to IMOs. 

Product Scope 

IMOs are known as being product agnostic. In other words, they offer the independent agents they work with a very wide choice of not just insurance carriers but also insurance products to sell. 

This means IMOs often appeal to a wider range of independent agents, and also might be more beneficial to agents who want to branch out and sell a wide range of products. 

FMOs usually specialize in one or two insurance product lines. They may focus just on life insurance, for instance, or home and auto.  

If you only sell one type of insurance product, you might think you would get better help and support from an FMO that also specializes in that type of product you sell. However, keep in mind that you will be limited if you decide to expand your business in the future. 

Support 

Along the same lines, FMOs typically provide support that is specialized and focused on limited markets. This is entirely based around the fact that they offer a more limited product line. 

They might be really good at offering all the specialized tools and resources independent agents need to sell Medicare products, for example, but may not have similar resources if you want to sell non-Medicare health insurance products. 

IMOs, meanwhile, offer support that’s much broader in scope. Their tools and marketing materials won’t be limited to just one product line or one way of doing things. 

Independent agents often prefer this type of support, since they can then customize it to their own style and needs, depending on which type of product they’re selling and who their target customer is. 

Live the Good Life by Partnering with GLIA 

IMOs and FMOs both provide invaluable resources to independent insurance agents as they look to build, grow and sustain their business. In many cases, though, IMOs are the much preferred type of organization to partner with, thanks to their wider range of services, support, tools and access to insurance carriers. 

When you partner with a well-respected IMO such as Good Life Insurance Associates, you’ll get all the support you need to thrive in your independent insurance venture. 

To learn more, or to get started, please contact us today.