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Reply to Taking Over State Farm Agency     
Old 09-07-2017, 11:36 AM   #1
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Taking Over State Farm Agency Taking Over State Farm Agency
Hi Everyone,

I have the opportunity to take over an existing State Farm Agency. What questions or performance metrics should I make sure to cover during my evaluation?

Thanks All
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Old 09-07-2017, 11:45 AM   #2
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VolAgent on Taking Over State Farm Agency
 
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Taking Over State Farm Agency Re: Taking Over State Farm Agency
Start with how much of the book will you be allowed to keep.

State Farm agencies cannot be sold. They go back to the mothership, which usually breaks it into smaller books to seed new agencies.

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Old 09-07-2017, 12:29 PM   #3
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Taking Over State Farm Agency Re: Taking Over State Farm Agency Needadvice is the thread starter for: Taking Over State Farm Agency

The recruiter just said that I would get all residuals of Agency and that it is a large book.
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Old 09-07-2017, 12:36 PM   #4
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VolAgent on Taking Over State Farm Agency
 
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Taking Over State Farm Agency Re: Taking Over State Farm Agency
Get in writing how much you will get. Not that it really matters, but it will help you find out just how honest the recruiter is.

Whatever they give you, they will set your goals to be a stretch.

When buying a book you typically want to know the mix of business, PL vs CL, standard vs non, monoline vs package, etc. Also what the revenue is, expenses, and how long they have been a client.

With State Farm, it doesn't matter so much since they are concerned about growth and hitting their bonuses. You can't just take over an agency and milk it for income. You will have to grow and hit the production mix they want to get your bonuses, otherwise you will be bleeding money.

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Old 09-07-2017, 01:25 PM   #5
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Taking Over State Farm Agency Re: Taking Over State Farm Agency Needadvice is the thread starter for: Taking Over State Farm Agency

Thank you. Do you feel State Farm is not the best company to sell for? Should I look for an independent instead?
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Old 09-07-2017, 01:31 PM   #6
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VolAgent on Taking Over State Farm Agency
 
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Taking Over State Farm Agency Re: Taking Over State Farm Agency
My issue here would not be with the company as an insurance company, but the company and their recruitment methods.

Based upon what I have seen on here, State Farm sets people up to fail, despite what they say and what they intend.

State Farm has a great name, and they can be competitive in certain areas. But then there are times they aren't competitive too.

Also, you have to learn insurance somewhere, so unless you find an independent willing to train you, working for State Farm to cut your teeth is not a bad idea.

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Old 09-07-2017, 01:31 PM   #7
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Chazm on Taking Over State Farm Agency
 
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Taking Over State Farm Agency Re: Taking Over State Farm Agency
You can't just take over a State Farm. You will go through rigorous training with them and you will have produce tons of projections, demographics, etc.
All the numbers you are looking for you will have to research.

My good friend took one over last year because an agent passed. They split his biz in 2 and he opened a new location.
He works very hard and expected to break even the first two years. Year one he broke even and this year he is expecting to profit 100k. But he is number 2 or 3 new agent in the southeast. The other new agent is struggling.

I believe you can't just buy their BOB either because you never really own it. So if a recruiter is talking to you, someone must be retiring. But you still have to apply for a location that becomes available and SF picks who gets that location.

How long have you been in the biz?
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