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I think some of you have found the problem with the business model. Executives SHOULD be bonused on helping agents achieve overall success, i.e., profit. ...
I think some of you have found the problem with the business model. Executives SHOULD be bonused on helping agents achieve overall success, i.e., profit. Profit from P&C, life, bank, health. A dollar of profit spends the same, no matter where it is derived! Management's primary goal should be advising agents on how to maximize profits from selling and retaining. Instead, it sounds as if it's all about selling, with or without profit. And that is just plain idiotic. If a goal is designed to benefit their bonus, while putting you in the red year after year, that's just greed and our country has seen too much of that lately.
Successful agents draw other high achievers into the fold, making life easier for all of us.
I would say it means try to keep us quiet. Some AA05's have been sending e-mails to a certain AVP. If you are not a TICA they really can't fire you for terminating an employee. If a TICA they will threaten you on not getting your AA05 if you do not do certain things. I know some agents that were hired in 2004 and 2005 that have ZERO staff, and many (the really smart ones) have cut to one staff just to survive. They have made it much better for the first two year agents than when we started but they will still end up with the current contract which is really bad.
Originally Posted by SFTICA
What does keep em "in check" mean? Patronize or just tell em "tought!". Or did namagement say its no big deal if they quit because they are burnt out and you can get new positive people in on good contract and assign their books?
Can they fire me if I lay off an employee? I am an AA05 now.
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My leadership doesn't care if I am profitable, doesn't care how far in debt I am or how difficult it is these days. Won't even discuss most of it. This person just wants to talk about how hard it was when they started as an agent. ALL they seem to care about is if I travel and that is how they get their bonus. I have traveled the first 3 years and could travel again this year, but I will turn it down. They charge a crazy amount as income for these trips. They charge 2-3 times what I could go it alone as income and I don't want to go on vacation with people who do NOT have my best interest at heart anyway.
Originally Posted by Numbers Man
I think some of you have found the problem with the business model. Executives SHOULD be bonused on helping agents achieve overall success, i.e., profit. Profit from P&C, life, bank, health. A dollar of profit spends the same, no matter where it is derived! Management's primary goal should be advising agents on how to maximize profits from selling and retaining. Instead, it sounds as if it's all about selling, with or without profit. And that is just plain idiotic. If a goal is designed to benefit their bonus, while putting you in the red year after year, that's just greed and our country has seen too much of that lately.
Successful agents draw other high achievers into the fold, making life easier for all of us.
Last edited by AgentZ : 09-23-2008 at 01:40 PM.
Reason: Automerged Doublepost
[COLOR=#8b0000]Another agent I met/knew who had started in 2004 just left the company this agent basically said that they are leaving due to lack of continuing financial resources that the AA05 contract affords them. Again here is where they raised our expenses and lowered our commissions and wonder why 2004 and 2005 agents are dropping like flies.[/COLOR]
[COLOR=#8b0000]Another agent I met/knew who had started in 2004 just left the company this agent basically said that they are leaving due to lack of continuing financial resources that the AA05 contract affords them. Again here is where they raised our expenses and lowered our commissions and wonder why 2004 and 2005 agents are dropping like flies.[/COLOR]
Sad, to see him go. His only option was to take employment elsewhere, to stop the bleeding debt.
Hello! I'm a new poster to this forum, but I have been reading it for a while. One of my friends from college just left his job to become a SF Agent. All he has talked about is how great of an opportunity it is and how they only take the best of the best and on and on. I was a little skeptical of the whole deal, because of others that I know who are agents and because my friend is definitely not "The best of the best"....anyway, he has already completed his training and taken all of the tests and has now been given an office of a retired agent. He definitely thinks he is on the way to riches, but after reading this forum, it sounds like he may have been suckered. I have tried to tell him to be careful, but I don't want to seam like I am pissing on his parade. He turned down a 75k a year job, because he deemed SF to be "way more lucrative" I guess my question is....is he really being suckered into this, or is it really as great as he thinks? I just can't imagine agents making that kind of money (He says 120k+) and it being as easy as it was for him. It seams to me that if it was that easy, every college graduate would be doing it. What am I missing here? Thanks in advance.
Hello! I'm a new poster to this forum, but I have been reading it for a while. One of my friends from college just left his job to become a SF Agent. All he has talked about is how great of an opportunity it is and how they only take the best of the best and on and on. I was a little skeptical of the whole deal, because of others that I know who are agents and because my friend is definitely not "The best of the best"....anyway, he has already completed his training and taken all of the tests and has now been given an office of a retired agent. He definitely thinks he is on the way to riches, but after reading this forum, it sounds like he may have been suckered. I have tried to tell him to be careful, but I don't want to seam like I am pissing on his parade. He turned down a 75k a year job, because he deemed SF to be "way more lucrative" I guess my question is....is he really being suckered into this, or is it really as great as he thinks? I just can't imagine agents making that kind of money (He says 120k+) and it being as easy as it was for him. It seams to me that if it was that easy, every college graduate would be doing it. What am I missing here? Thanks in advance.
He did not do his due diligence. He wasn't suckered he was just shown the positive and past performance. He didn't do his due diligence and does not understand the current downside.
Does anyone know a ball park range of what a team member working for an existing agent start out around, or how the commission works?
When I first started with SF,I started with a scratch agent. I had no experience, the agent got me licensed and started me at 1500/mo salary and my commission was $45 per home, auto. Renters $15. Life was one months premium. After I was there a year. After he got his contract, he decided to change the compensation schedule to 2,000 salary and 2% on al P/C lines. I was transferred to another scratch agent and helped train him and the other staff members he hired. When I left there I was making $2330/mo salary and 7% commission on all P/C, 2 months premium on life, and $100 on health policies, $100 per bank loan. You are required to sell alot of life. Aug, Sept, and Oct is Life Promotion Month. You better meat the quota on life on your first year or you might as well hang it up. That will decide whether you get your contract or not. Good Luck
Does everyone realize how hard these last 2 posters are working for the money they are talking about?
This should make anyone looking at becoming a new SF. Farmers, Allstate, ect. agent think twice. Both of these guys have built a nice book of business and done well, yet they are making very little for their efforts.
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Chuck
If you think your boss is stupid, remember: you wouldn't have a job if he was any smarter.”
It is a lifestyle choice. P&C has become a commodity. I actually prefer having an agent who will work for me and that I can go to their office to review my options. When I quit being a Farmers agent I was able to give my book of business, with the DM's blessing, to another agent I went to Career School with. It was a help to her and instead of once of the old timers who could have cared less, it went to someone who had to make numbers to survive.
I pay more for my home and auto by staying with my friend and agent. I could shop each renewal and find better prices online, but my agent is my 'go to gal' when I have a problem or a question. So I understand the sentiment.
The shear amount of customer service work provided by a store front agent is enormous, and with it comes very little compensation. Some of us appreciate it, but more often it is taken for granted and abused by the problem customers. The good customers generally don't have problems. Hats off to those of you who choose this route, I just wish the companies really appreciated the services you provide, and compensated accordingly.
I'm an AA97 contract in the GW Zone. Your experiences are very similar to a dozen or more scratch Tica friends of mine. Year 3 is the most difficult year, when the monthly PBP bonus really drops. I'm very thankful for the AA97 contract, started scratch, travel every year, nice scorecard, growing by 700 P&C year, and make more than I ever thought I would. That being said, I probably wouldn't take a scratch Tica position if I had to do it all over again. I know of 10 scratch Tica agents around me that are paying over $3k month rent and a staff person or two. Easy way to go broke if you're not hitting the PBP carrot.
Greenman, enjoyed reading your posts. Proud to have you as a fellow SF'er, we're in different markets but you're doing the right thing by running your Agency as a business and not giving in to the desires of AFE's/C's.
Best of luck
Last edited by pncplanner : 08-20-2009 at 02:08 PM.
So thanks to everyone through out this whole thread for all of the info. I am an approved canidate in the midwest and SF has just posted the location I want. So I have a couple of questions:
Will the recent compensation changes make it easier or are they still not offering enough?
Increase in the Premium Builder Payment (PBP) amounts in Yrs 3-4.
5th year of PBP for New Market TICAs.
Increase the Semi-Monthly Variable Compensation (SMVC) default rate from 1.5% to 2%
Add a Year 2 Signing Bonus of $12,0000
All TICAs with an assignment over $100,000 in P&C Premium will be eligible for the first two years of PBP.
Will I be able to pay myself a little to live on during my first few years?
I know that I will be going in debt to make this work but is the risk ever going to be worth the reward? Because I'm starting to feel like staying in my current position and giving up on this whole thing.
Do your diligence before starting scratch. have access to capital. they want you to be in a visible location (retail, shpping center, etc). most of the time you have to finance a buildout ($10 - $60k depenging on your sf, extent of upfit,, signage, etc). if you are in or near a major metro area, rent runs around $2000/mth for 1200 sf. obviously the part of the country matters. they would probably expect 5000 postcards a month. they would expect 2 team as well ("you have to be staffed for growth"). the DAFO will spend your money for you!
You have to make sure it is in an area that is growing, or where are agents who are not engaged in their marketing. the economy has definitely hurt home and auto sales around here (midwest)
You need to write P&C to survive, but it is all about life, bank, etc. scratch is definitely much tougher on the life sales. starting with 2000 autos from an existing agency is a potential goldmine for life. however, when starting scratch you have to write a lot of P&C to get the potential financial services customers. despite what they have you believe, you cannot write 2 cars, a home, 2 life, a hospital income, car loan, and Roth IRA with each new household. i would love to tell the DAFC that, but anything you say can and will be used against you (ie, competencies).
Hey smavo,
I am also going through the SF process to become a candidate. I am having problems putting together the business plan based on a phantom office i.e. production numbers on all the different product lines. What are realistic numbers of production for Auto, Fire, Life, Health, Bank, and so on? Can I get a copy of your Biz Plan?
Does everyone realize how hard these last 2 posters are working for the money they are talking about?
This should make anyone looking at becoming a new SF. Farmers, Allstate, ect. agent think twice. Both of these guys have built a nice book of business and done well, yet they are making very little for their efforts.
Those were my thoughts exactly, shuddering at what this gentleman has been through. I remember riding in an elevator with an old-time manager with All-State, who had been canned previous to pension, and him saying he should have gone with State Farm... Now we all know the way to go is indy.
He did not do his due diligence. He wasn't suckered he was just shown the positive and past performance. He didn't do his due diligence and does not understand the current downside.
You have the right idea: get your contract and then really run your agency like a business. If you can make a reasonable return on additional investment, spend the money. If not, be patient and grow yourself to prosperity. I did just that, getting by with one staff until I could afford two and now three. And, of course it is easier to sell more life and bank with more customers. You'll get there and you'll be glad you hung in there. I, too, enjoy running the show and taking care of customers! It is a good life. I just hope they treat TICA's better in the future.
You have the right idea: get your contract and then really run your agency like a business. If you can make a reasonable return on additional investment, spend the money. If not, be patient and grow yourself to prosperity. I did just that, getting by with one staff until I could afford two and now three. And, of course it is easier to sell more life and bank with more customers. You'll get there and you'll be glad you hung in there. I, too, enjoy running the show and taking care of customers! It is a good life. I just hope they treat TICA's better in the future.
I'm curious how long you have been an agent? Are you under the new contract?
Thanks for the encouragement. I just want New Market Tica's to be realistic about the fiscal and mental stamina it takes to get one of these things off the ground. It is NOT like getting a book - at all. In some limited ways it actually has it's advantages, but with regard to cash flow and investment required, there is no comparison between assignment and book. And you cannot expect advice on how to run a business from the company - the reality is that if you fail, they've actually invested very little and they'll throw someone else in and give them what you've built. Financial services is ALL they care about. Period. End of discussion.
Now, for you people considering scratch - the cold hard truth:
PBP max year 1:$132,000
Signing bonus: $ 18,000
That's $150,000 plus whatever renewals and financial services you can write. For fun, let's add another $25,00
$175,000 Gross - looks pretty good, huh?
2 team members
Seriously, you pay your team members $80k per year? I've never paid a salary greater than $25k and then they have to make the rest in production. If they don't produce, you don't have to pay. Just starting out, I'm confident I could make it work on $175,000, including two team members.
Man oh man, what a world of crap to be a SF agent. Thank God for the Erie Insurance Exchange! who gave me a chance 22 years ago...and being able to represent other fine carriers with no strings attached. I just took 1/2 hour of my day to read this and I'm appalled. I noticed that recruiter guy hasn't put up a post in the last four or so pages..... maybe he got promoted ?
I was joking with my staff just this morning about taking a school bus fleet away from the local SF girl. Now that I know she is only in her first full year, I don't feel nearly as happy.
All profit is profit
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