Why Are There So Many Allstate Agencies for Sale Now?

[nashrambler7]

The neighborhood/storefront P&C shop model is crumbling. The direct writers like GEICO and Progressive are crushing them.

Why do I need to come down to someone's office to buy a commodity like auto insurance when I can do it from my computer with esurance twenty-four hours a day?

In addition, the costs for office, support staff, etc. really effect the ability to make a profit. The business model is doomed.

Are you in Good Hands?

Thats all fine and good if you as the average person off the street have any clue what your current coverages mean and if they are even right for you. I find so many people that have bought insurance on their own and didnt do a very good job at it. Do you really think the order taker at Geico is going to explain to an insured what the differences in limits are and how it could affect them?

 

[agentinsure]

I was with Allstate for a few years when the internet insurance sales were evolving. I believe the company resisted the temptation to jump on full board with the internet at the risk of completely alienating an already alamred agency force. However they could not simply turn away from the oppty that does come with the net. Hence the CEO's public comments their position towards the net were always elusive at best, thousands of agents were always waiting to hear the other shoe drop.

Contrary to some of those on here who have you believe that EVERYONE will wind up buying on the net, I say bunk! At least for this generation or two who with a solid presentation and plenty of people to network with a truly competent agent will kick ass over any thing the directs can't even touch. There is still something to be said about a live sale. I think iHIAA and some others have been spending a little too much time behind the screen at times.

Geico has pursued opening a few offices in key markets for the sole purpose of attacking that segment of the market they admit they have trouble attracting online or over the phone. Progressive does an absolutely terrific job of direct selling, and a savvy agent can leverage this to capture these "orphan" policy holders and bring them into his own fold.

If you look at the tactic Allstate has finally settled on in terms of their approach to to internet sales for the benefit of their shareholders and to not forsake their agents in the process, I think they may have done alright. Are any of them perfect? Absolutely not, I admit their presence on the net is in fact added competion to those of us on the street, but to be in this biz for any length you must learn to adapt and improvise and capitalize on what ever oppty is out there.

Why a lot of Allstate agencies 4 sale, any captive system sucks generally unless your new! Can you spell Brooke? You have NO ECONOMIC interest in State Farm, Farmers may be transferred to a blood line otherwise it reverts to the district, and Allstate while they will let you sell it, after youve been with them for a few years and are tired of being kicked around by a rotation of new Area Managers, you begin to realize it really does not matter what sign is on your office that makes you successful, plus youll simply tire of being unable to write the really golden commercial stuff you will eventually stumble upon. Congratulations then, you have finally begun to grasp the truly independent nature of being self employed as an insurance pro.

As for opening a scratch agency, it can work. Select a good area with oppty, keep your over head low and begin to write a ton of biz. Then a few years down the road prepare to sell the interest to the company (preferable so your not screwing the next guy coming) or to a 3rd party, and then move your new office 2 miles down the road and continue with all your hard earned relationships, eventually you will have the majority of that preferred biz written with the likes of Safeco, Travelers and host of other brand companies and you will be smiling all the way to the bank!

 

[rdsoxfan58]

thanks for your post Akex

 

[Norwayguy]

thanks for your post Akex

Okay you've hit your 20 posts and can send PMs does this mean these so informative posts will cease or are you striving to hit some other goal of useless posts?

 

[xrac]

I was with Allstate for a few years when the internet insurance sales were evolving. I believe the company resisted the temptation to jump on full board with the internet at the risk of completely alienating an already alamred agency force. However they could not simply turn away from the oppty that does come with the net. Hence the CEO's public comments their position towards the net were always elusive at best, thousands of agents were always waiting to hear the other shoe drop.

Contrary to some of those on here who have you believe that EVERYONE will wind up buying on the net, I say bunk! At least for this generation or two who with a solid presentation and plenty of people to network with a truly competent agent will kick ass over any thing the directs can't even touch. There is still something to be said about a live sale. I think iHIAA and some others have been spending a little too much time behind the screen at times.

Geico has pursued opening a few offices in key markets for the sole purpose of attacking that segment of the market they admit they have trouble attracting online or over the phone. Progressive does an absolutely terrific job of direct selling, and a savvy agent can leverage this to capture these "orphan" policy holders and bring them into his own fold.

If you look at the tactic Allstate has finally settled on in terms of their approach to to internet sales for the benefit of their shareholders and to not forsake their agents in the process, I think they may have done alright. Are any of them perfect? Absolutely not, I admit their presence on the net is in fact added competion to those of us on the street, but to be in this biz for any length you must learn to adapt and improvise and capitalize on what ever oppty is out there.

Why a lot of Allstate agencies 4 sale, any captive system sucks generally unless your new! Can you spell Brooke? You have NO ECONOMIC interest in State Farm, Farmers may be transferred to a blood line otherwise it reverts to the district, and Allstate while they will let you sell it, after youve been with them for a few years and are tired of being kicked around by a rotation of new Area Managers, you begin to realize it really does not matter what sign is on your office that makes you successful, plus youll simply tire of being unable to write the really golden commercial stuff you will eventually stumble upon. Congratulations then, you have finally begun to grasp the truly independent nature of being self employed as an insurance pro.

As for opening a scratch agency, it can work. Select a good area with oppty, keep your over head low and begin to write a ton of biz. Then a few years down the road prepare to sell the interest to the company (preferable so your not screwing the next guy coming) or to a 3rd party, and then move your new office 2 miles down the road and continue with all your hard earned relationships, eventually you will have the majority of that preferred biz written with the likes of Safeco, Travelers and host of other brand companies and you will be smiling all the way to the bank!

Agentinsure, you sound like a sharp cookie. When you sell an Allstate agency what sort of non-compete is in the agreement as to distance and time.

 

[Lyn]

The neighborhood/storefront P&C shop model is crumbling. The direct writers like GEICO and Progressive are crushing them.

Why do I need to come down to someone's office to buy a commodity like auto insurance when I can do it from my computer with esurance twenty-four hours a day?

In addition, the costs for office, support staff, etc. really effect the ability to make a profit. The business model is doomed.

Are you in Good Hands?

Add to all that the medium cost of E&O for P&C is about $1800 per year.

 

[VolAgent]

Add to all that the medium cost of E&O for P&C is about $1800 per year.

That direct writer is great until it comes claim time. Witness Mark's thread about Progressive, and the consumer's post about GEICO. Claim time is an agent's chance to shine. I see Esurance is trying to give the same service with their dedicated claim specialists, but I bet it is still lacking. P&C agents ought to focus their advertising efforts on the presence and help of an agent at claim time.

 

[ABC]

I am currently being recruited by Allstate along with every other person.

I went to one of their seminars and listened to a couple of agents that had multi locations.

A couple of things popped out. The online leads have very low retention....(Shocker)

The owner of an Allstate agency is more of a manager of people than direct sales. Please correct me if I am wrong

Rural communities location have a higher success rate? Population under 100,000 people. Having 2.1 policies in place keep these area folks from leaving

Overall I thought the business model is simple but that does not mean easy. The main focus is auto and home so I would not expect them to be competitive in the commercial arena. Also I don't know if they are competitive in the personal lines?

My thought is for an Allstate location to be successful you need about 1000 house holds as clients.

To make real money after overhead you would need about 5000 house holds. To do that I think you would need 2-4 locations.

Please correct me if my thoughts are off track

 

[Bertolinoins]

I don't think the neighborhood storefront P&C shop is in danger... but the direct writer is going to have issues. People like to do business face to face for things like insurance, investments, etc. Most of the business and done over the phone or email but the final bind order and review is in person... either at my office or their house. The nameless, faceless companies with funny commercials but no relationship only thrive when they have the lowest price. I keep my clients and get a second or third look even when those companies undercut me because I take the time to make them real customers.

 

[ABC]

So am I wrong in my view of the allstate model?

I don't think the neighborhood storefront P&C shop is in danger... but the direct writer is going to have issues. People like to do business face to face for things like insurance, investments, etc. Most of the business and done over the phone or email but the final bind order and review is in person... either at my office or their house. The nameless, faceless companies with funny commercials but no relationship only thrive when they have the lowest price. I keep my clients and get a second or third look even when those companies undercut me because I take the time to make them real customers.