Allied/Nationwide
- Thread starter dean8287
- Start date
- 783
How are they selling these to agencies? Just "Hey we're lowering commissions but you're going to write enough new business b/c of it to break even?"
From State Auto: "Our commission structure is not meant to pay you less. It's meant to pay you more in total. Our objective is simple: Grow and earn together. Agents who write more and profitably grow their books will earn more — not less — overall"
In State Auto's move, they are introducing basically a brand new auto/home policy, and a whole new way to do business with them. They are betting this new Platform will open the flow of new premium, and let's the agency do the dirty work of rewriting the existing book to the new policy, or not.
Also by introducing a new policy, it gives them the opportunity to not only pay less in commissions, but to change policy language/add remove coverage forms/add new underwriting matrix/utilize new technology to eliminate labor intensive service such as underwriting and billing/ and introduce a new product with rates that will be smoking hot. It's a roller coaster ride.
The squeeze is on. Why do they lower commissions? Because they can!
From State Auto: "Our commission structure is not meant to pay you less. It's meant to pay you more in total. Our objective is simple: Grow and earn together. Agents who write more and profitably grow their books will earn more — not less — overall"
In State Auto's move, they are introducing basically a brand new auto/home policy, and a whole new way to do business with them. They are betting this new Platform will open the flow of new premium, and let's the agency do the dirty work of rewriting the existing book to the new policy, or not.
Also by introducing a new policy, it gives them the opportunity to not only pay less in commissions, but to change policy language/add remove coverage forms/add new underwriting matrix/utilize new technology to eliminate labor intensive service such as underwriting and billing/ and introduce a new product with rates that will be smoking hot. It's a roller coaster ride.
The squeeze is on. Why do they lower commissions? Because they can!
Just for fun... I'll come back here in 4 months and let you know what happened with a large deal in the works. Kisses.
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Nope I'm too cheap.
In your opinion and aside from the commission structure, do you think this is going to be a good thing with State Auto? Reason I ask is because I just got an appointment with them a few months ago. Their auto rates are okay but I've been writing a decent amount of homeowners with them. They seem pretty lenient on their underwriting. But now I'm not sure what's going to happen. What's your overall take on them?
- 1,481
State Auto is being led by a Giant in the Insurance industry! Former Safeco President- Mike LaRocco. He has the ability to turn it around and will.
New Product, new Tech Platform. All brighter days for State Auto!
In addition to this they need to:
1)Empower their staff to make decisions in the field and hold them accountable for those decisions faster.
2) Streamline UWing so the pass though rate increases dramatically! - Dropping expense ratio.
Watch State Auto in 2017 become a new Carrier. The Foundation is set. Now time to execute!
New Product, new Tech Platform. All brighter days for State Auto!
In addition to this they need to:
1)Empower their staff to make decisions in the field and hold them accountable for those decisions faster.
2) Streamline UWing so the pass though rate increases dramatically! - Dropping expense ratio.
Watch State Auto in 2017 become a new Carrier. The Foundation is set. Now time to execute!
- 2,192
Wow those are quite the earnings
- 783
In your opinion and aside from the commission structure, do you think this is going to be a good thing with State Auto? Reason I ask is because I just got an appointment with them a few months ago. Their auto rates are okay but I've been writing a decent amount of homeowners with them. They seem pretty lenient on their underwriting. But now I'm not sure what's going to happen. What's your overall take on them?
My take:
They needed to change the way they do business with agents. They did and that is a great thing. They had the most difficult system of any insurance company. Now it should be easier. (better be for 10% !)
I expect their rates will be smoking hot, let's hope they can hold future increases to normal inflationary adjustments. That has not been the case in the past.
You are in a better position being new with them. I have been remarketing my existing book due to large increases, and now another has been approved for the end of September. I have to roll that book. More work for less pay.
Their commercial lines is a whole other story. Hoping for some positive moves there - that area too needs serious transformation.
Watch State Auto in 2017 become a new Carrier. The Foundation is set. Now time to execute!
From the man with a salary! Or are you seeing a 30% pay cut in your future?
Dave
My take:
They needed to change the way they do business with agents. They did and that is a great thing. They had the most difficult system of any insurance company. Now it should be easier. (better be for 10% !)
I expect their rates will be smoking hot, let's hope they can hold future increases to normal inflationary adjustments. That has not been the case in the past.
You are in a better position being new with them. I have been remarketing my existing book due to large increases, and now another has been approved for the end of September. I have to roll that book. More work for less pay.
Their commercial lines is a whole other story. Hoping for some positive moves there - that area too needs serious transformation.
Watch State Auto in 2017 become a new Carrier. The Foundation is set. Now time to execute!
From the man with a salary! Or are you seeing a 30% pay cut in your future?
Dave
- 1,481
AZ Dave,
Again, Just because a carrier says we are going to drop commissions on a new Product, does not mean it plays out the same for every agent in the entire distribution channel.
I believe State Auto, will turn a corner- that is the opinion of a Salaried employee.
Good points on the Commercial (I'll add-Farm and Ranch products). Also AZ has been hard for State Auto and every other carrier. (Remember how competitive Kemper was 5 yrs ago.) You got to consider your 30% Pay cut in AZ, while I consider the relationship as an industry whole. Not only the AZ fraction.
Again, Just because a carrier says we are going to drop commissions on a new Product, does not mean it plays out the same for every agent in the entire distribution channel.
I believe State Auto, will turn a corner- that is the opinion of a Salaried employee.
Good points on the Commercial (I'll add-Farm and Ranch products). Also AZ has been hard for State Auto and every other carrier. (Remember how competitive Kemper was 5 yrs ago.) You got to consider your 30% Pay cut in AZ, while I consider the relationship as an industry whole. Not only the AZ fraction.
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I got the State Auto news as well. Their attitude with me was basically tough sh!t. I was writing a steady $20-25K a month with them on the PL side. Probably small potatoes compared with other agents out there. With 10% commissions on renewals going forward, they will probably become just a cheaper alternative to Progressive for me, along with the monthly $2K in NB premium. Too many competitive carriers out there willing to pay 30-50% more on renewal business.
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- #60
