Here It Comes Again. Safeco Reducing Commissions

[indienoise]

Spoke with my Safeco rep today. Said personal auto as an average across the country is running 107% LR

My rep told me 108 last week. Close enough, no matter which is right. Its very telling. We have monoline auto carriers leaving in droves in sc, if not taking double digit increases year after year.. So much fraud/misrepresentation going on in this market. Everyone I quote who has prior insurance has undeclared drivers on their existing policy. Case in point, I was competing with Nationwide on a package with home and dwelling fire. Thought it would be a good account. She has 3 kids, 4 cars, and "I will be the only driver". No, I'm sorry, you won't. I turn these people away if they don't want to do it right. My LR doesn't need that. But agents are so desperate they are writing this crap. I don't understand how direct writers like geico, who are already undercutting on price as it is, are staying afloat.

 

[nyc2phi]

My rep told me 108 last week. Close enough, no matter which is right. Its very telling. We have monoline auto carriers leaving in droves in sc, if not taking double digit increases year after year.. So much fraud/misrepresentation going on in this market. Everyone I quote who has prior insurance has undeclared drivers on their existing policy. Case in point, I was competing with Nationwide on a package with home and dwelling fire. Thought it would be a good account. She has 3 kids, 4 cars, and "I will be the only driver". No, I'm sorry, you won't. I turn these people away if they don't want to do it right. My LR doesn't need that. But agents are so desperate they are writing this crap. I don't understand how direct writers like geico, who are already undercutting on price as it is, are staying afloat.

This has always been my point, you can't properly underwrite a risk without us. I can't count how many times I've avoided a risk based off gathering info over the phone or in person with someone via conversation. If that same person was to shop online, there is no way they would mention they have a brother who lives in the house who has two accidents and a DUI.

GEICO does business differently then the preferred carriers. They out write their losses which is why they are popular in highly populated cities. Preferred carriers don't operate this way, they rely on underwriting good risks.

 

[indienoise]

This has always been my point, you can't properly underwrite a risk without us. I can't count how many times I've avoided a risk based off gathering info over the phone or in person with someone via conversation. If that same person was to shop online, there is no way they would mention they have a brother who lives in the house who has two accidents and a DUI.

GEICO does business differently then the preferred carriers. They out write their losses which is why they are popular in highly populated cities. Preferred carriers don't operate this way, they rely on underwriting good risks.

I agree with the sentiment you can't outwrite a high loss ratio by writing more bad business. And defintely not with the kind of premiums geico is charging. At least around here. It's exactly what UAIC tried (and recently failed) to do here in sc.

 

[insurance1822]

I was JUST TALKING ABOUT THIS. I had an account today w/ 2 kids that the lady wasn't insuring on her GEICO. So...I walked. But then I scratch my head & say "how do these direct writers absorb these types of risks without the correct premium?"

That's the only thing I weight my hope on...is maybe their poor UW culture catches up? But I must concede that I don't have a knowledge of that "bigger picture" as I just sell tons of personal lines.

 

[Pannagpamp]

Aaa emailed us today they are changing profit sharing to be more in line with industry which means reduction in bonuses. T

I got this email and the new contract too. I'm not happy about this one with no change to the threshold of getting the bonus. However, AAA did have an amazing bonus structure if you hit it. I took a look at some other companies after meeting with AAA and, at 50% loss ratio, they are still far above others.

 

[insurancemansam]

Aaa recently got a new CEO who came from captive. This will only get worse. They always say nothing will change, but captive culture is not good for agents. Had plenty of companies thru the years where a captive CEO was hired or the company was bought buy a captive and its always the same result.