State Farm Agents on the AA05 Contract

[xrac]

No 1 yr of revenue is what it would take. I want to use the revenue from my current situation to building another business so that I can let the agency rot away. fire all staff, open 2 hrs a day, downsize my office and just take everything from the agency and pay off my debt, house, cars etc. I will do the bare minimum to keep it and bleed it to death, loosing state farm customer along the way. If it got too bad, I would file for bankruptcy and stick sf bank with bad debt.

I saw a post from someone who wasn't an agent yet but was in the program. You cant really understand this contract til you have lived it. If you are looking at sf then I suggest your talk to new agents on your own, not the ones that recruiter sends you to.

There it is from the horses mouth. Ignore at your own risk.

 

[Foolmeonce]

First let me make clear I am not yet a SF Agent. I am an Agent Aspirant who works for a Top 100 TICA, but I can give you my best shot at answering your questions.

1)Regarding semi-monthly variable compensation, are you able to meet the auto and fire benchmarks set up on an annual basis and have you dropped below the 2 year default of 10%. If so, what has that done in subsequent years to reach the benchmark again?

During the 3rd year many agents experience what is know as "the dip." During your first 2 years you don't have to work to hit your premium builder. If you don't take the extra 2% for granted you will be fine. The problem occurs when agents get to thier third year and drop from 10% on P and C to 8% not only are they making less they have less to invest in staff and marketing. This can cause many agents to spiral downward.

2)Many agencies are being split on a 2 for 1 basis and/or starting the new person out in a position where they inherit a book of a maximum of 1.5 million in premium. The remainder of the policies get spread out in the territory. New Market agencies are starting to spring up again per leaderships desire to get more financial services. Do you have any concerns about your ability to continue to grow an agency with more competition (with 25-35% SF existing market penetration) and have 1-2% of renewal and new business commissions forever tied to your agency growth? It seems to be a bit of a hamster wheel.


There is some truth to this. In my area they are no longer looking for new market. Splitting the book does 2 things:

Makes sure that you are hungry and allows the sales leader to pass policies to other less established agencies. So even though you may not get the entire book when you open a year from then you could receive another 200 cars when someone else opens. Over saturation and cannibalism are real problems, make sure your sales leader is looking out for you.

3) Sales leaders compensation is now closely tied to not only recruiting but financial services sales. What are your thoughts about increasing agents in a territory without any protection from more SF agents? I'm talking about the 2 for 1 model being duplicated over and over.

I don't think this is a problem as much as you believe it to be, but I can only speak for my market. They are not taking every agent that retires and splitting it hydra style into 2 offices. When a office opens up here anything over the 1500 cars is getting split between the other offices.

4)How have file assignments (if any) helped your agency and what are the top two keys in your opinion to netting a livable income ($80,000) with this venture?

I can't speak to your area but netting 80,000 in your second year is not difficult. Your first year you will make very little depending on your fixed costs vs your average premium for your market. Even in our worst months here we still have done 60 Auto and 30 Fire. That is with 2 sales people. The agent sells only financial services. The Agnet should make 6 figures this year.

5) How is your debt load from building the agency? Did you have to raid your retirement? What is your forecast to pay it back?

Most agents I know go into debt between $25,000 and $50,000 and pay it back within the first 2/3 years.


6)How much money does a person need to realistically have set aside to make this contract work financially assuming they don't fall victim to lavish furniture programs and keep a sharp eye on controlling costs? Are you able to make the scorecard work and make much off of it?

My estimated startup costs are just over 25k, and monthly I have about 17K estimated in expenses.

7) Do the pros outweigh the cons of this and would you do it again?

Can't answer this ask again in 2 years.

8) Lastly, assuming you have debt...If a person were to give you a check to pay off your debt would you walk away from the agency today or do you foresee sustainable opportunities in the future?

Can't help with this either.

No offense but you are drinking the kook aid. The agent u work for is embarrassed to let u know the truth.

 

[Amywilliams]

I am a State Farm Agent on the AA05 contract since 2007 as a New Market Agent. It's been an honor to be an agent and a wonderful experience for my family and we've grown steadily. I was an independent agent before choosing State Farm. Happy to answer any questions you have.

 

[xrac]

I am a State Farm Agent on the AA05 contract since 2007 as a New Market Agent. It's been an honor to be an agent and a wonderful experience for my family and we've grown steadily. I was an independent agent before choosing State Farm. Happy to answer any questions you have.

Are you out of Dallas?

 

[Amywilliams]

Are you out of Dallas?

North Carolina is where my agency is located.

 

[AgentThomas]

I am a State Farm Agent on the AA05 contract since 2007 as a New Market Agent. It's been an honor to be an agent and a wonderful experience for my family and we've grown steadily. I was an independent agent before choosing State Farm. Happy to answer any questions you have.

Hello Amy,

A person reading this forum would think State Farm is some sort of wicked entity with evil intent. It's refreshing to have a positive review from someone. My thoughts are that you are a part of a silent majority. It would appear that there are very few SF agents who post here. Those that do seem to be the minority who are unhappy and looking elsewhere. I wish them all the best of luck and hope they find their positive mojo.

As for me, I am a former independent agency owner who left the insurance industry in 2012. I have a sad story... 2008...The End. I sold the remnants of what was a thriving commercial agency and made a career change. As a 30 year insurance professional, I am feeling the pull to return to what I know best. I am in the middle of the State Farm process and am doing my do diligence.

I was once a cocky, arrogant young guy myself, so I read most of what's written here with a grain of salt. I may have written those same words when I was 30. At 59 however, my perspective has changed considerably. Being an independent in today's world is not what it used to be. Back in the day (God I sound old), appointments were EXTREMELY difficult to come by. If you had two or three of the elite companies you could write your own ticket. My agency had the pen with Transamerica, unheard of in today's market.

Now, any agent has access to almost any company, even without a direct appointment. Once upon a time if you were the first in with a bid from a specific company it was yours to win or lose. It has become a rat race and there is no real identity that sets you apart anymore. It's just a scramble to be the cheapest, not the best. I built my agency on being the best.

State Farm has always been the pinnacle. I believed this as an independent and I continue to believe it today. It's a culture of excellence based on values that seem to have eroded somewhat. I sought them out, they did not recruit me. Having been in the dogfight for years, I am looking for a company that shares my paradigm. I am looking to set myself apart from the pack.

If you would be so kind as to allow me to ask a few questions I would greatly appreciate it.

 

[xrac]

Hello Amy,

A person reading this forum would think State Farm is some sort of wicked entity with evil intent. It's refreshing to have a positive review from someone. My thoughts are that you are a part of a silent majority. It would appear that there are very few SF agents who post here. Those that do seem to be the minority who are unhappy and looking elsewhere. I wish them all the best of luck and hope they find their positive mojo.

As for me, I am a former independent agency owner who left the insurance industry in 2012. I have a sad story... 2008...The End. I sold the remnants of what was a thriving commercial agency and made a career change. As a 30 year insurance professional, I am feeling the pull to return to what I know best. I am in the middle of the State Farm process and am doing my do diligence.

I was once a cocky, arrogant young guy myself, so I read most of what's written here with a grain of salt. I may have written those same words when I was 30. At 59 however, my perspective has changed considerably. Being an independent in today's world is not what it used to be. Back in the day (God I sound old), appointments were EXTREMELY difficult to come by. If you had two or three of the elite companies you could write your own ticket. My agency had the pen with Transamerica, unheard of in today's market.

Now, any agent has access to almost any company, even without a direct appointment. Once upon a time if you were the first in with a bid from a specific company it was yours to win or lose. It has become a rat race and there is no real identity that sets you apart anymore. It's just a scramble to be the cheapest, not the best. I built my agency on being the best.

State Farm has always been the pinnacle. I believed this as an independent and I continue to believe it today. It's a culture of excellence based on values that seem to have eroded somewhat. I sought them out, they did not recruit me. Having been in the dogfight for years, I am looking for a company that shares my paradigm. I am looking to set myself apart from the pack.

If you would be so kind as to allow me to ask a few questions I would greatly appreciate it.

Maybe this is part of the reason that not many from State Farm venture to post here. A few years ago we had some really sharp SF agents on here. Caliban was the best, a very well spoken/written slightly arrogant State Farm Agent who deleted all of his threads. Some of the threads were very good and all were worth reading. He in my opinion is a pretty sharp cookie. Evidently some SF power that be got wind of his posts, figured out who he was, and counseled him upon the wisdom of what he was doing. He disappeared completely and all of his posts overnight.

Originally Posted by Legion View Post
On a completely different note, what the hell happened to Greenman and Caliban? They both had posts within the last couple weeks and now they have vanished off the forum?

It appears that ALL of their posts are gone!

(Did someone throw a sack over them and dump them in the river?)

Now you see why I was paranoid on my first post . . . should I delete all MY posts before the Thought Police kick in my doors too?
DITTO! Can someone please explain this?
- - - - - - - - - - - - - - - - - -
Elsewhere I read on a post that Caliban has withdrawn from the fourm. Do you think he has gotten in trouble someway with SF. Sure seems suspicious that they both drop out on the same day. They both gave a lot of insight about being with SF.

Poor Legion who posted the above also disappeared. Isn't it amazing that all of the SF guys disappeared at about the same time and their posts were all deleted. Greenman, Legion, Caliban, and others. Sounds like the mother ship maybe landed on them. Frankly, I find it very interesting that those who come on here touting SF pop on here with no posts and never do more than talk SF. I would take those posts with a grain of salt. Maybe SF is a wicked entity in more ways than one.

 

[AgentThomas]

Maybe this is part of the reason that not many from State Farm venture to post here. A few years ago we had some really sharp SF agents on here. Caliban was the best, a very well spoken/written slightly arrogant State Farm Agent who deleted all of his threads. Some of the threads were very good and all were worth reading. He in my opinion is a pretty sharp cookie. Evidently some SF power that be got wind of his posts, figured out who he was, and counseled him upon the wisdom of what he was doing. He disappeared completely and all of his posts overnight.



Poor Legion who posted the above also disappeared. Isn't it amazing that all of the SF guys disappeared at about the same time and their posts were all deleted. Greenman, Legion, Caliban, and others. Sounds like the mother ship maybe landed on them. Frankly, I find it very interesting that those who come on here touting SF pop on here with no posts and never do more than talk SF. I would take those posts with a grain of salt. Maybe SF is a wicked entity in more ways than one.

I have no knowledge of what you are referring to. I joined this forum in August of this year and have not been active since.

I am as I present, and am sincere in my intentions. Conspiracy theories aside my friend, as time goes by perhaps you and I can achieve a measure of trust. I do appreciate your input and I respect your point of view as legitimate, from your perspective of course. I have a very active online presence and hopefully I can share my identity with everyone soon. I am employed elsewhere in a different industry and I would like for the transition to be made with respect to those with whom I now work for.

I intend to be an active presence on this forum going forward. I am one who values respect. I will always be respectful, please respond in kind.

 

[insurance1822]

Hello Amy,

A person reading this forum would think State Farm is some sort of wicked entity with evil intent. It's refreshing to have a positive review from someone. My thoughts are that you are a part of a silent majority. It would appear that there are very few SF agents who post here. Those that do seem to be the minority who are unhappy and looking elsewhere. I wish them all the best of luck and hope they find their positive mojo.

As for me, I am a former independent agency owner who left the insurance industry in 2012. I have a sad story... 2008...The End. I sold the remnants of what was a thriving commercial agency and made a career change. As a 30 year insurance professional, I am feeling the pull to return to what I know best. I am in the middle of the State Farm process and am doing my do diligence.

I was once a cocky, arrogant young guy myself, so I read most of what's written here with a grain of salt. I may have written those same words when I was 30. At 59 however, my perspective has changed considerably. Being an independent in today's world is not what it used to be. Back in the day (God I sound old), appointments were EXTREMELY difficult to come by. If you had two or three of the elite companies you could write your own ticket. My agency had the pen with Transamerica, unheard of in today's market.

Now, any agent has access to almost any company, even without a direct appointment. Once upon a time if you were the first in with a bid from a specific company it was yours to win or lose. It has become a rat race and there is no real identity that sets you apart anymore. It's just a scramble to be the cheapest, not the best. I built my agency on being the best.

State Farm has always been the pinnacle. I believed this as an independent and I continue to believe it today. It's a culture of excellence based on values that seem to have eroded somewhat. I sought them out, they did not recruit me. Having been in the dogfight for years, I am looking for a company that shares my paradigm. I am looking to set myself apart from the pack.

If you would be so kind as to allow me to ask a few questions I would greatly appreciate it.

How will you feel selling your water back up endorsement that reads like a flood policy to a family that has a beautifully finished basement ??

How will you feel selling your home insurance policy that carries a deductible that the client may never be able to actually afford ?

in Lieu of these coverage gaps that are pretty much only specific to State Farm ... What do you recognize as making them the pinnacle ?

 

[AgentThomas]

How will you feel selling your water back up endorsement that reads like a flood policy to a family that has a beautifully finished basement ??

How will you feel selling your home insurance policy that carries a deductible that the client may never be able to actually afford ?

in Lieu of these coverage gaps that are pretty much only specific to State Farm ... What do you recognize as making them the pinnacle ?

Not having the forms and endorsements to validate your assertion I am unable to answer you sir.