Nationwide Switching to Independent Agency Distribution Model by 2020

[WolfpackAgent]

Nationwide Switching to Independent Agency Distribution Model by 2020

Interesting to see this. Larger trend or one-off?

 

[xrac]

I wonder what the captive Nationwide Agents have to say about this.

 

[Heather]

They suck in my area, the offices look shabby and old, so I guess its a good thing for agents if they are not loosing out financially.

 

[WolfpackAgent]

I wonder what the captive Nationwide Agents have to say about this.

If I read it right captives will become independents? So I wonder if this will make them a big IA franchise? I know they have contracted with National General for non-standard auto, 20/20 hindsight tells us that may have been a sign of something.

 

[AZDave]

You know all Nationwide agents took a huge hit this year. Maybe this will help them gain higher paying markets. Imagine your comm's and renewals being cut by a 1/3 - Nationwide is not on their side!

 

[indienoise]

They've been semi independent for quite a while. Nationwide brokerage was handing out appointments with a handful of carriers for several years now, and also had a pretty expansive market access program. The downside is that outside appointments all came with reduced commission and couldn't exceed 25% of total book. Curious to see how they structure this new model. Wonder if they'll operate like the AIDCO +1 model if the agent doesn't purchase the book.

 

[rousemark]

Companies that switch from captive to independent agents seem to struggle with the idea. They want to tell you you're independent but they tend to try to continue to control everything you do.

 

[Championpatriot]

I wonder myself if this shift has also a lot to do with the recent court ruling regarding American family that said their exclusive 1099 agents are in fact considered employees. Of course it will go back and forth through appeals if not settled at some point. But that is potentially a few billion dollars of money shifting hands there....

 

[AZDave]

I think that has a lot to do with it. Heard AMFAM is also trying to merge with Main Street America Group, also wanting to get into the independent distribution model.

These captives want to keep producers on a 1099 one way or another while expanding their distribution channel.

 

[Championpatriot]

Yeah I say the writing in clearly on the wall, I imagine the other bigs are not to far behind. Number 1 how do you get away with considering a 1099 agent captive if they are required to write only your lone product unless they decline on the risk , which is in itself stopping you from actually being an independent contractor , I am surprised they got away with it for so long in the first place, for a while I guess most of the exclusive agents must have been doing ok so not enough fought against it.....Number 2 P&C is out of the bag, how many times as a producer can you tell your client sorry about the increase, it is just a "general rate change" before they quote somewhere else and you lose the policy.....It takes up a huge amount of resources to fight for new business as your are also trying to write new business with ONE carrier...

Does anyone know of an exclusive agency (P&C specifically) thriving in California...I did not say surviving, THRIVING or at least growing at a good percentage...I mean how many people do you have to quote nowadays to get one policy with these exclusive primary carriers..DAUNTING!

I am on my way of removing these shackles!