What a first IMO contract usually doesn't explain about chargebacks

Advanced commissions are the reason new agents can eat in month two, and they're also the reason some agents owe $8,000 in month nine. Here's the part of the contract that gets skimmed.

How the advance works. The carrier pays a percentage of the first-year commission up front, often 75 percent of the annualized premium's commission, sometimes 50 or 100. It's a loan against commissions the policy hasn't earned yet. If the policy lapses inside the chargeback period, the unearned portion comes back out of your future commissions, and if there aren't any, from you.

The chargeback period. Typically 9 to 12 months, sometimes longer. Read it. A policy that lapses in month 10 on a 12-month chargeback returns two months' worth of unearned commission. A lapse in month 2 returns almost all of it.

Debt rolls up. If you leave an IMO owing chargebacks, the debt follows you, and carriers share vector reports. A vector hit makes the next IMO reluctant to contract you. Pay it or work it off, don't ghost it.

Advance versus as-earned. As-earned pays monthly as premiums come in. Slower, no chargeback shock, and it's what agents with an established book often switch to. Some carriers let you choose per contract.

The habit that protects you. Set aside a fixed percentage of every advance, 20 to 25 percent, in an account you don't touch. When persistency is good, that account becomes a bonus at month 13. When it's bad, it's the reason you're still in business.

Ask before you sign: chargeback period by carrier, whether advances are per-policy or capped, what happens to renewals if you leave, and whether the IMO will release you.

What's the biggest chargeback surprise you took in year one?