Please post if you are a State Farm Agent
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scottinaustin
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We're State Farm Agents in Austin, TX
A04/05 Agent, made travel all years didn't go last one due to not having the spending cash to go. The Agents that started in 2004-2007 are leaving in record numbers. Comp on P & C is variable first 2 years on default almost all take a pay cut year 3. Many have taken a full 1.5 % cut so that can equal $30,000. There goes a staff person, less staff = less production. Less production = less income I personally know of one DAFO where there was 12 agents that started in 2005 and only 3 of them are still agents for this company. Management is "suggesting" that you have to have or borrow $250,000 to make an agency work. Go to TICA Agents Forum
Now there are people who will say this is only stories from failed or disgruntled agents. Believe what you want if you are considering this as a career choice you better talk to 10-15 agents that you AFE/DAFE doesn't suggest. Agents on prior contracts did well. Commission rate were higher and the company paid a lot more of the expenses. Prior to 2004 lets say you started with 2000 cars they co would have paid for you to have 2 staff and paid your rent among other things and in most cases you would have stayed in the prior agent's office. After Jan 2004 when the AA04 started they would have suggested you have at last 3 staff and that you buy the Putnam furniture package and move to an upscale office. They would have given you a sign on bonus & some marketing money, but all expenses were yours. They paid 8.5% comp on P&C the first 2 years called default now I think they pay 10%, and a bonus at the end of the TICA phase (1 year) so it's a better deal now than it was in 2004-2007. I believe from what I read the new contract is called the AE05. You get 8% on P&C with the opportunity to earn 11% you can get 1% for auto growth, 1% for Fire growth and 1% for financial services. You have to hit certain numbers to get part of this. Most agents I have talked to take a pay cut after 2 years of default. The Co. won't tell you how many people take a cut but from what I can tell it's most of them.
Unfortunately this contract has caused a lot of people to get so far in debt that they will never get out and many have already filed Bankruptcy. The agents that appear to be doing best on sales are in fact the ones that are failing most. The only way to survive for most agents on this contract is to cut back as soon as they get out of the TICA phase. Why can't the co. see this. All we want is the same deal the prior agents had it's the AA97 contract. Talk to some 15+ year agents that switched from the prior contract to the 97 they all regret it, but were told it was good for the company. 97 agents make less money than the prior contract and have no retirement. Still compared to the newest contract it a world better.
These stories on the NASFA web site are real stories of people who left good careers and were promised so much and under delivered by the company. Are there some agents on the new contract doing well , sure but they are few. I don't like to be the one who says I told you so but if you don't go talk to 10-15 agents that started in 2004-2007 then you will regret it. The current agency model is a recipe for failure and bankruptcy. Try to ask the co these things
Why are so many people that have to be an AFC only had one or two years in agency. Why are so few that go in to mgt not going back to agency like they once did. Before the contract change many agents that went to be AFC's went back to agency within 2 years. Ask them why they didn't send you to work with agents that started in 2004-2007 ? Ask them if they mind if a lawyer looks at the contract. The co line here is (last guy that did that isn't with the co anymore) Ask them what the failure rate is on the new contract compared to the previous one. Ask them what % of agents take a pay cut on P&C after the 2 year default rate. If it takes 7% auto growth to get the full 1% on variable . Ask them how many agents grew by the full amount on P&C policies to maximize their semi monthly comp. One year my AFO grew 200 cars for about 40 agents so how many do you think would have got the full 1% on the new contract.
People keep asking how did agents get that far in debt ? The DAFO will "Suggest" a lot of things and it's basically understood that do these things or you won't be getting your contract after the TICA phase. Finally there are agents that will slam me for this post but few will be agents that are on the new contract and off of default.
Now there are people who will say this is only stories from failed or disgruntled agents. Believe what you want if you are considering this as a career choice you better talk to 10-15 agents that you AFE/DAFE doesn't suggest. Agents on prior contracts did well. Commission rate were higher and the company paid a lot more of the expenses. Prior to 2004 lets say you started with 2000 cars they co would have paid for you to have 2 staff and paid your rent among other things and in most cases you would have stayed in the prior agent's office. After Jan 2004 when the AA04 started they would have suggested you have at last 3 staff and that you buy the Putnam furniture package and move to an upscale office. They would have given you a sign on bonus & some marketing money, but all expenses were yours. They paid 8.5% comp on P&C the first 2 years called default now I think they pay 10%, and a bonus at the end of the TICA phase (1 year) so it's a better deal now than it was in 2004-2007. I believe from what I read the new contract is called the AE05. You get 8% on P&C with the opportunity to earn 11% you can get 1% for auto growth, 1% for Fire growth and 1% for financial services. You have to hit certain numbers to get part of this. Most agents I have talked to take a pay cut after 2 years of default. The Co. won't tell you how many people take a cut but from what I can tell it's most of them.
Unfortunately this contract has caused a lot of people to get so far in debt that they will never get out and many have already filed Bankruptcy. The agents that appear to be doing best on sales are in fact the ones that are failing most. The only way to survive for most agents on this contract is to cut back as soon as they get out of the TICA phase. Why can't the co. see this. All we want is the same deal the prior agents had it's the AA97 contract. Talk to some 15+ year agents that switched from the prior contract to the 97 they all regret it, but were told it was good for the company. 97 agents make less money than the prior contract and have no retirement. Still compared to the newest contract it a world better.
These stories on the NASFA web site are real stories of people who left good careers and were promised so much and under delivered by the company. Are there some agents on the new contract doing well , sure but they are few. I don't like to be the one who says I told you so but if you don't go talk to 10-15 agents that started in 2004-2007 then you will regret it. The current agency model is a recipe for failure and bankruptcy. Try to ask the co these things
Why are so many people that have to be an AFC only had one or two years in agency. Why are so few that go in to mgt not going back to agency like they once did. Before the contract change many agents that went to be AFC's went back to agency within 2 years. Ask them why they didn't send you to work with agents that started in 2004-2007 ? Ask them if they mind if a lawyer looks at the contract. The co line here is (last guy that did that isn't with the co anymore) Ask them what the failure rate is on the new contract compared to the previous one. Ask them what % of agents take a pay cut on P&C after the 2 year default rate. If it takes 7% auto growth to get the full 1% on variable . Ask them how many agents grew by the full amount on P&C policies to maximize their semi monthly comp. One year my AFO grew 200 cars for about 40 agents so how many do you think would have got the full 1% on the new contract.
People keep asking how did agents get that far in debt ? The DAFO will "Suggest" a lot of things and it's basically understood that do these things or you won't be getting your contract after the TICA phase. Finally there are agents that will slam me for this post but few will be agents that are on the new contract and off of default.
Give me a break. Sounds like another bunch of agents who are expecting a handout. I am an AA05 in a rural area and am making more money than I ever though possible...more than most AA97 agents in my area because I know how my contract works, hold my team accountable for results, and don't spend time complaining about my contract.
This is the best gig going. If you talk to an agent who thinks they have been wronged by State Farm, believe me, there is something else going on there. If you are over $160k in debt, you don't know how to run a business. You may want to think about working for the government, they don't know how to run a business either.
Stop your complaining and get back to work.
This is the best gig going. If you talk to an agent who thinks they have been wronged by State Farm, believe me, there is something else going on there. If you are over $160k in debt, you don't know how to run a business. You may want to think about working for the government, they don't know how to run a business either.
Stop your complaining and get back to work.
- 14,809
No dog in the fight but I'm just trying to understand something regarding the approval process on SF's end.
Typically when you purchase a franchise, even through that might be technically incorrect, you need to prove financial liquidity.
An opportunity might cost $50K but also require an additional 125K liquid (proof that it is not loaned) as operating capital.
I've been reading these SF threads and hear stories about agents going BK or greatly struggling within months.
I can't see going into any one of these opportunities unless I had, say 300K liquid. I don't think running a SF is the proper situation for bootstrapping.
Not in a million years would I ever sign my name on the dotted line without having total operating expenses for at least two years. You need to enter opportunities like this with a "what's the worst case scenario plan." What are the max expenses and what's the minimum commission projections?
How much is in the "rainy day fund" in case one of the more popular SF products becomes uncompetitive? Just from reading these threads it appears that some agents are not going into this with a proper business plan.
Typically when you purchase a franchise, even through that might be technically incorrect, you need to prove financial liquidity.
An opportunity might cost $50K but also require an additional 125K liquid (proof that it is not loaned) as operating capital.
I've been reading these SF threads and hear stories about agents going BK or greatly struggling within months.
I can't see going into any one of these opportunities unless I had, say 300K liquid. I don't think running a SF is the proper situation for bootstrapping.
Not in a million years would I ever sign my name on the dotted line without having total operating expenses for at least two years. You need to enter opportunities like this with a "what's the worst case scenario plan." What are the max expenses and what's the minimum commission projections?
How much is in the "rainy day fund" in case one of the more popular SF products becomes uncompetitive? Just from reading these threads it appears that some agents are not going into this with a proper business plan.
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This is not a franchise. You don't "own" the business accounts.
Dubya is a cocky know-it-all at best; at worst, an *** . No all "opportunities" are equal by any means. Some agents start out with zero accounts. Typically, agents are not given a book of business to work that would create the kind of income needed to sustain the business. You have to build whatever you might get up to the point it will bring income in after expenses, which typically takes years to do. In the meantime, you work for free while laying out large sums of cash for marketing and to appease management, who can fire you for no other reason than your attitude (call competencies) during the first year.
This once was a good deal because you received renewals at a percentage that would provide a good income after you walked through hell for about 5 years. The way it is now, they have a "scorecard" set up so that if you don't sell "financial products" that you make little to no money off of, in addition to growing P&C at a high rate, you commission is dropped so low you go bankrupt.
Not a franchise.
Dubya is a cocky know-it-all at best; at worst, an *** . No all "opportunities" are equal by any means. Some agents start out with zero accounts. Typically, agents are not given a book of business to work that would create the kind of income needed to sustain the business. You have to build whatever you might get up to the point it will bring income in after expenses, which typically takes years to do. In the meantime, you work for free while laying out large sums of cash for marketing and to appease management, who can fire you for no other reason than your attitude (call competencies) during the first year.
This once was a good deal because you received renewals at a percentage that would provide a good income after you walked through hell for about 5 years. The way it is now, they have a "scorecard" set up so that if you don't sell "financial products" that you make little to no money off of, in addition to growing P&C at a high rate, you commission is dropped so low you go bankrupt.
Not a franchise.
dubya is a dumb dumb. Rural agent's are generally in better shape due to the fact they don't have the worst competition possible: Another SF agent. Second, when noobies are placed in Rural markets, there's no other place for them to assign out the files. Third, rural agents generally have lower cost structers for labor, rent, etc.
I worked in the assingment part of ASR for years and know rural agents have a 50% bigger file assignement on average compared to urban agents. I know this because I processed them.
Out of 20 appointments, 2 generally have a decent file assingment. 90% of the time it's more rural agents. This is the fact. Go rural if you can, you'll certainly make more money.
Every cost structure is diferent. But the fact remains, SF is beggining to get the agent they didn't want because of the AA05 contract. In this market, AA05 agents are downsizing.
This year I dumped my fancy office, got rid of 2 staff people, dumped most of marketing, and I have made more money in the first 5 months this year than I did in the last 3. Funny thing is.. Gross is up and lapse can is down. My production is 1/2 of what it was in year's past....Go figure.
No matter what I produced on AA05, I am still limited to capacity in my market place. As Obama would say: "Let me be clear": Production drives costs farther than your ROI in terms of Scale in your operation on the AA05. In otherwords, the contract is designed to pay you less based on your margin (after expenses) in proportion to your production. I've been on this thing for 5 years now, and finally get it.
SF is earning less from me and I'm making more on my new cost structure. I'm no logner chasing the score card to pay myself and taxes once a year by killing myself.
MORE PRODUCTION DOES NOT MEAN MORE NET INCOME. NET NET NET NET NET NET IS THE GAME!
I worked in the assingment part of ASR for years and know rural agents have a 50% bigger file assignement on average compared to urban agents. I know this because I processed them.
Out of 20 appointments, 2 generally have a decent file assingment. 90% of the time it's more rural agents. This is the fact. Go rural if you can, you'll certainly make more money.
Every cost structure is diferent. But the fact remains, SF is beggining to get the agent they didn't want because of the AA05 contract. In this market, AA05 agents are downsizing.
This year I dumped my fancy office, got rid of 2 staff people, dumped most of marketing, and I have made more money in the first 5 months this year than I did in the last 3. Funny thing is.. Gross is up and lapse can is down. My production is 1/2 of what it was in year's past....Go figure.
No matter what I produced on AA05, I am still limited to capacity in my market place. As Obama would say: "Let me be clear": Production drives costs farther than your ROI in terms of Scale in your operation on the AA05. In otherwords, the contract is designed to pay you less based on your margin (after expenses) in proportion to your production. I've been on this thing for 5 years now, and finally get it.
SF is earning less from me and I'm making more on my new cost structure. I'm no logner chasing the score card to pay myself and taxes once a year by killing myself.
MORE PRODUCTION DOES NOT MEAN MORE NET INCOME. NET NET NET NET NET NET IS THE GAME!
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A perfect example of what I am talking about. Cry and moan about how bad SF is...but you'll be more than happy to take their paychecks.
Rural agents do certainly have some advantages. However, metro agents make about 30% more per policy than I do, so a larger file assignment is appropriate for a rural agent.
Congrats on FINALLY figuring out how to make money. Sounds like you are finally owning your business. ROI is not a tought thing to figure out. Find your balance and move forward.
So you came from ASR and had access to all of those contracts and you still chose the opportunity. Sorry, no sympathy from this guy. You obviously had an inside track and inside look at things and you still chose the opportunity. You are a hypocritical fool to deride this company and still take your paycheck from them. If it is so bad, get out. For the betterment of the company, get out.
Sincererly,
Dumb Dumb Dubya
aka making more money and having more fun than ever thought possible.
Rural agents do certainly have some advantages. However, metro agents make about 30% more per policy than I do, so a larger file assignment is appropriate for a rural agent.
Congrats on FINALLY figuring out how to make money. Sounds like you are finally owning your business. ROI is not a tought thing to figure out. Find your balance and move forward.
So you came from ASR and had access to all of those contracts and you still chose the opportunity. Sorry, no sympathy from this guy. You obviously had an inside track and inside look at things and you still chose the opportunity. You are a hypocritical fool to deride this company and still take your paycheck from them. If it is so bad, get out. For the betterment of the company, get out.
Sincererly,
Dumb Dumb Dubya
aka making more money and having more fun than ever thought possible.
On reflection, Dubya is not likely dumb, cocky or a know-it-all. He is just a new agent.... I remember how I was when I was a new agent.....he just hasn't been in the business long enough to know any better.
Dubya, having a career is not a "love it or leave it" proposition. You don't have to love everything about a job in order to continue working for a company. You can think critically and seek to understand what makes sense and what does not. That is what Defender has done. He has finally realized that he can not follow the outline of everything the company would have him do and still make money.
I am a slow learner, too. For many years I tried to sell the life and financial products because that is what the company wanted me to do, even though (on the old contract) I not only made no money, it actually cost me money to sell that stuff. Plus, it totally stressed my staff and me out, year after year, trying to hit the numbers to make the company happy. And why? They still stacked agents all around me and told me it was a "business decision." I finally realized that TC does not continue to sell products that are unprofitable (we can only hope they eventually dump the bank and MFs, too) and I should not be spinning my wheels to market products that do not make money for me either. So I made my own business decision and I stopped marketing the stuff that makes me no money and stresses me and my staff. Life is much better and P&C production is way up.
Apparently a lot of people have serious problems with the new contract, as demonstrated not only on this forum but in other forums and directly heard from new agents. Lets hope the company is listening. In my experience, it may take a while, but usually they start to understand when one of their great ideas to generate production has backfired. I hope this is still that same great company.... I hope we get back to a focus on what we do best--auto and fire insurance--we regain the market share we lost, and we are able to continue to attract entrepreneurs that want to truly have their own small business with the potential to make a really good income and control their daily activities, while representing a company we can all be proud to be associated with.
Dubya, having a career is not a "love it or leave it" proposition. You don't have to love everything about a job in order to continue working for a company. You can think critically and seek to understand what makes sense and what does not. That is what Defender has done. He has finally realized that he can not follow the outline of everything the company would have him do and still make money.
I am a slow learner, too. For many years I tried to sell the life and financial products because that is what the company wanted me to do, even though (on the old contract) I not only made no money, it actually cost me money to sell that stuff. Plus, it totally stressed my staff and me out, year after year, trying to hit the numbers to make the company happy. And why? They still stacked agents all around me and told me it was a "business decision." I finally realized that TC does not continue to sell products that are unprofitable (we can only hope they eventually dump the bank and MFs, too) and I should not be spinning my wheels to market products that do not make money for me either. So I made my own business decision and I stopped marketing the stuff that makes me no money and stresses me and my staff. Life is much better and P&C production is way up.
Apparently a lot of people have serious problems with the new contract, as demonstrated not only on this forum but in other forums and directly heard from new agents. Lets hope the company is listening. In my experience, it may take a while, but usually they start to understand when one of their great ideas to generate production has backfired. I hope this is still that same great company.... I hope we get back to a focus on what we do best--auto and fire insurance--we regain the market share we lost, and we are able to continue to attract entrepreneurs that want to truly have their own small business with the potential to make a really good income and control their daily activities, while representing a company we can all be proud to be associated with.
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A I'm A Paulie. Do use guys get any health benifits??? I got a pre condition tat prevents me from gettin private insurance. When use become an agent wha happens?????
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A dis Paulie again. Is Farmers beta??????
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Anybody out dere???????
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A dis Paulie again. Is Farmers beta??????
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Anybody out dere???????
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