I Was Just Asked if I'd Like to Buy an Allstate Agency...

fjman

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There is a local GA that I've worked with for about 6 months. She gives me clients to sell LBL policies to her clients. She gets some commish and the production numbers she needs, I get a nice check. Its retirement time for her and she's asked me if I'd be interested in buying her agency (shes actually hinted at this a numbner of times..)

I have never sold P&C. Im not sure if I'd really like the lifestyle this type of sales demands (lots of calls for claims, dealing with Allstate, tons more time in the office). But, it does get me thinking.

My understanding is that Allstate would most likely finance the purchase and, if so, I would probably be profitable from day one as the renewals in the existing book of biz would pay the loan, staff and expenses.

does this sound about right? Eventhough it doesnt sound like something I'm terribly enthusiastic about, I am interested and always open to a good opportunity. Its a small agency and the only Allstate in a semi-small town.

And since I like the agency owner... if anyone is looking for a small agency to buy in VA about an hour from DC, let me know! You might save me from making a terrible mistake!

I told her we could set up a time to discuss it. What types of questions should I be asking her? I mainly just sell life and LTC now.
 
First you have to be an approved candidate. Of course, selling life, they are going to love you. As long as your credit, financial situation and background are good, I can't see why they'd deny you.

The real question is, do you want to be treated like an employee by management? You'll be a new agent, so you won't even get the free pass experienced agents get. Yes, I know you are experienced, but you are new to Allstate. One Allstate agent I know said that he was required to open by a certain time every day. He said management would actually drive by to check. Also, checks had to be deposited in a certain time frame. It was a real problem for him if the holiday fell just right, particularly since not many banks are open on Saturday here.

Of course, depending on how much of your business comes from the clients she sends you, you might have to buy it just to protect your revenue stream.
 
LBL..... limited-benefit life?

And to address your actual question, fjman, it sure sounds to me like your sub-conscious is hoping you don't take the Allstate gig.
 
LBL..... limited-benefit life?

And to address your actual question, fjman, it sure sounds to me like your sub-conscious is hoping you don't take the Allstate gig.

Lincoln Benefit Life, an Allstate subsidary. Allstate term is convertible to LBL.
 
Having managed a small Allstate agency for about a year I think it's not really a bad gig. I'd hang out in the office for a few days and see how things are run. It can be a tough gig, but if the book is large enough and well established it can be a fantastic deal. The real trick is making sure you don't pay too much for it.
 
Yeah, itrs not a huge book. Its considered a small agency by Allstate standards and its currently worth about a case a month to me, so its not a huge peice of business to me. It is true that you need to keep their hours or they will get ya. I've heard of them calling and asking agents why the anser machine was on at 4:50pm....

I guess my subconscience is not crazy about it but I'm also itching to do something new within the industry. Interestingly, I've been offered 3 different positions in the last week beyond that of "career agent producer"
 
Honestly, if you know what you're getting into it's not that bad. You need a book that is big enough to be able to higher at least one licensed support staff so that you don't need to be there all the time. I was looking at a book out west that was almost $3 million in premium and could support two sales staff. The biggest challenge with that is making sure you hit your production goals for the bonus, but that's a lot easier to do when your staff is taking care of the routine policy changes and quoting the easy sales.
 
We were looking to do the same in Georgia and are still pondering whether to do it. Did all the paperwork and had meetings with the local rep. We told her we weren't interested in a startup but were interested in the type of situation you are describing here. The issue I have is being captive, but that may be because I am so used to being independent (ind health, etc). Also, I heard they are really recruiting heavy in Virginia right now so I would check into that. But, I don't think they would jeopardize exisiting agents by overlapping territories. I just think their goal is to be on every corner in America, kind of like Starbucks. With that in mind, I really believe that you would want a couple of agencies to make the big $$. But they won't combine books for bonuses though. I am pretty sure none of the captives and/or exclusives do.

That being said, does she have good employees? You might not have a bad deal if you can retain the existing staff. If the block is solid, and they don't do anything crazy with their rates in your area, and you get a good price, this might be a good thing. But again, if something is nagging at you, you might really want to check into it carefully before doing it.

I grew up in NOVA and would be interested in that agency, except my husband and I are biz partners and I doubt if he would even consider moving up there (if that is what it took to buy the agency), says the traffic is too awful. And that is coming from someone who has lived in Atlanta for a long time!!
 
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