looking for feedback/advice please....

[lonestar]

bjwest, you have indeed done your homework. State Farm has had 3 agency contract revisions since 1997, and with each revision, it becomes less agent friendly. I talked to a State Farm claims supervisor employee recently who has been with State Farm over 10 years. He is looking to be an agent, but not with State Farm. He said that with today's agent contract, there is no way he would go with them. He is looking to go IA. I had heard that State Farm will cut down an agent's auto commissions to as low as 7% if they don't peddle enough life insurance and new bank accounts. Who wants to be an employee with no employee benefits? You have chosen wisely, grasshopper.

[bjwestner]

BJ

for what is worth -- of all the companies you mentioned --- State Farm is the best opportunity on a captive side -- SF also tends to make agency opportunities available to its employees -- so you might think about taking your current skills set to State Farm to begin with -- It has been many years since I checked it out but I think SF is looking for a $50 to $100K commitment/investment by the agent to open or assume an agency - I believe the employees tend to cash in their retirement to fund the agency start up costs.

Mr. Graham,

Why is it the best opportunity? From the wording of your post you were discussing "owning" a SF agency.

From all the hours of reading and talking to people that own SF agencies under the AA05 contract, this is not a good move.

I'm asking to try to find out if you know something that I do not? Obviously if this is the case then please advise why you think it's the best opportunity for me.....I want to make the best choice I can so I can be successful in the future. Thanks,

BJ

[Otto]

It would be good for you to list a contact phone number or email address so those of us that might be interested in communicating with you could do so.

[bjwestner]

Sorry, I did not think that people wanted to actually email or call me. I figured they would just post their advice/feedback to the forum. My email address is bjwestner1@yahoo.com. Please email me there and I can then provide other info (i.e. phone number). Thanks,


BJ

[William Graham]

Well I guess I found out something too--

it has been more than 15 years since I checked out State Farm -- After I had been with FIG (Farmers) a little over 5 years, I almost decided to jump ship to State Farm -everything that I looked at back then was a much better situation than what I had with Farmers. I did not make the leap because it would have involved a move & the change for the kids, their schools, and my wife's career was not worth it. I know things do change on these agency contracts-- so it sounds like today there is not a captive program out there that is not a black hole.

[bjwestner]

FYI - of all the captive programs around me anyway, Nationwide seems to be the best. There are two programs they have. For one you need $10k liquid capital, second one is $35k liquid capital. You don't pay them anything, you just need to have it to be considered for the program. From the support that they provide and marketing wise to the training/etc it seems to be the best out of all of the captives.....

[amckirahan]

Thank you for these questions. Please see my responses below.

1. What is the average turnaround time from an agent submitting the information and a commercial lines quote coming back? What is the average on personal lines? Our Service Level Agreements (SLAs) are any new submission that we receive prior to 1:00 Central, gets processed the same day. Processing may be issuing a quote or asking for additional information. In Personal Lines, let's assume a request to firm up an EZLynx indication comes in by 10:00 am. When SAIS processes the indication, the driver's license # produces a no hit. Our SLA is to ask for clarification on the DL # by the close of business that day. When the agent responds, we track that response the same way; in by 1:00 out the same day. Commercial lines SLAs are the same.

2. Will you be supporting an instant quote any time in the future? I think I read somewhere that insurance noodle is doing this now on some business. We do not have the means to provide an instant quote at this time. We are researching a phone quote capability for commercial lines, but that is still on the drawing board.

3. On personal lines, what are the parameters usually for a risk that will not be accepted? I understand that this is a case by case basis, but I've ready that many not quite perfect risks have been rejected while they were far from going to the residual market. This is a big question and as you can imagine, varies by carrier. Depending on where you are located, there are restrictions on coastal, brush, quake and prior losses. Carriers are now demanding 1:1 auto to HO submissions in various states. Our preferred carriers are looking for the cream. Our non-standard carriers will accept some loss activity, and some lapse in coverage. Then we have the normal admitted carriers who accept no lapse, but maybe 1 or 2 not-at-fault losses. It's all over the board. If you gave us specific examples we could give you specific answers.

4. What is the average turnaround time for your customer service folks to return an agents calls? Are all calls returned? We average 400 phone calls a day and answer 90% of calls. We measure this everyday. We have a customer service group on the phone at all times. In the event they cannot answer a specific question (market availability or follow up on a specific account)the call is routed to underwriting, who in turn answer 90% of all calls. If a specific underwriter is not available, we have a roll over queue where someone else in the department answers the phone. In all cases, we average about 5 voicemails a day and those are returned by the next business day.

As all good companies do, we assess our performance and try very hard to improve our service offerings. I read in the blog where we were slow to turn around business. I would offer two perspectives on that statement. 1 year ago, before we instituted SLA's we could take as many as 5 days to turn a quote around. This was prior management who didn't realize the importance of consistent service. Since November 4 of 2011, we have consistently achieved our SLAs. What gets measured, gets done. The other perspective is that of a direct writer who is accustomed to instantaneous quotes. That is fairly easy when one is only getting a single carrier response. With multiple carriers, it takes time to fulfill the price indication on an account.

I appreciate your research and questions. I don't know if Superior Access is right for you. We are a good solution for thousands of agents who need multiple carriers in order to compete with any agent offering products. But, in order to cost justify the fee, you have to write business with us. I take offense to any notion that all we are interested in is your monthly fee. Agents who don't use us cannot justify the fee and they leave us. We're not perfect, but we manage this business like a large corporation with controls and actions plans to improve our service, markets and productivity.

[AgencyEquity]

Hi All - To all of those that know the industry well and have been around for a while, I would really appreciate your help/feedback on something.

Here's the deal: I've been in the insurance industry for 11 plus years. Most of that time has been with P&C carriers on the claims side. I've been a claims rep and a claims supervisor for 9+ of those 11 years. The rest of the time is from when I first got into the industry and worked in the underwriting department of a large life insurer. My primary experience while working for the P&C carriers is in personal and commerical auto claims.

I'm looking to get into the sales side of things as years on the claims side have been fun but it's time to get on the front end of things. I just obtained my producer license in Maryland for P&C, Life, Accident, and Health. I'm a CPCU, CLU, RHU, and FLMI and have been to college. I would think that this would make a decent resume for someone trying to get into the sales side.

I'm not dumb enough to just jump into something that pays commission only as I am well aware of how hard the first few years are on that road. The only offer I've received is from Farmers and this is what I need input on. I've read all the forums and such but the only place that I can get an offer is with them. I do not like the offer as obviously I'd be captive and there is no base salary just a "stipend" which ultimately is going to go back to Farmers anyway. Ideally I'd like to get with an experienced agency that provides some base salary. Don't get me wrong, I plan on working my ass off, I just would like to have someone to learn from and help out as well. If I expect an agency to hire me then I fully expect to give back, after all it's not all about me and I fully understand this. The problem is just that there is nothing out there in the DC area as I've applied many places and the only offer I've gotten in a month of job searching is from Farmers.


Is this something I should consider at all or completely forget it and just wait around until something comes up. I am still employed by an insurance company and I like working here it's just that there is no growth at all (it's a long story). Any feedback would be appreciated and if anyone knows of an agency in the DC area please let me know as I am happy to share my resume and discuss. I have a lot of experience including 4 years of management experience with one of the largest auto carriers in the country. Thanks.

The reason why Insurance Agents and Agencies make what they make is because of risk they take, including funding their survivial and growth for the first few years. You want the guarantees and then you go on to talk about how hard you will work, well you will do well enough to not need the guarantees you demand if you truly work hard. You want it both ways, you want your salary you are getting now and your long term growth, the bottom line is, what you want is not available as very few people want to take a the risk and fund you, a risk you don't even want to take on your own. Finally, you are not established in sales, you have this working against you.

[bjwestner]

Very true AgencyEquity....Why would I take such a huge risk of just starting to sell on my own when I have only between $15-20k in capital, no sales experience, no appointments, etc., when I can potentially find someone/somewhere that can provide me some much needed security of a base salary and training to start out? Who would not take that in my situation? I am not naive enough to think that starting on my own gives me the best chance for success. These forums are filled with people that have done this with even much less than I have as far as capital and background goes and the failure rate is very high.

The reason I posted this thread was to get valuable advice and feedback from people that are successful. The impression that I got from reading your reply was that you are trying to get me to go on my own and start. If that's wrong then I apologize but that was the impression that I got.

Yes I am confident that I will succeed on the sales end of the business, however, I also listen to many people who tell me that if I can find a indy agency that will take me on and train me while in turn I produce for them that this would be the best bet since I might be able to find some added security of a base plus commission versus only commission. I've been told the same thing with a captive as well, that if I can find the right situation that the chances of my success long term will be better versus starting my own agency. Do you agree or disagree that my chances of longterm success are better by finding an IA/captive and get on with them for a while are better than starting on my own?

In theory the only thing stopping me from selling my first policy is getting my E&O (I've gotten some quotes already) and then finding an MGA (whether that be somone in the area I'll be selling or using Superior Acess, Noodle/etc). Oh and the other thing stopping me is all the information I've learned from many sources that tells me the better option is to see if I can find an IA/captive to work for first....

[NYagent301]

My suggestion is to work with an independent agent as a producer. The KEY is to negotiate a good commission split and that YOU OWN YOUR BOOK OF BUSINESS. I have 2 partners and let me tell you there is a lot more to running an agency then sales. You mention E&O coverage, how about GL, taxes, marketing, claims, advertising, office equipment, agency management system, customer service, policy checking, and yes sales. However sales is the life blood of any company. Once you know you can produce and generate your own book of business, then look at your options of going it alone.