Becoming a State Farm Agent
- Thread starter shawn17ths
- Start date
Mickey Marrone
New Member
- 8
I am a State Farm agent who just completed my 11th year as an agent. I was one of the very first on the new contract. I have seen and experienced it all.
From what I have seen and hear, people's experiences vary widely on this contract...myself included. Some are doing great and some (like me) have struggled.
State Farm went to this contract for some very good strategic reasons. They have made several changes to the contract, based off of agent feedback and data, that have put the agent in a more sound financial position. The goal also being to put the company in a more competitive position. This is especially true when compared to what the contract looked like back in 2004.
If you would like more information about it just ask me. As you can see I use my real name. Feel free to look me up on the State Farm website if you need to verify anything. I am a straight shooter and this is my first post.
From what I have seen and hear, people's experiences vary widely on this contract...myself included. Some are doing great and some (like me) have struggled.
State Farm went to this contract for some very good strategic reasons. They have made several changes to the contract, based off of agent feedback and data, that have put the agent in a more sound financial position. The goal also being to put the company in a more competitive position. This is especially true when compared to what the contract looked like back in 2004.
If you would like more information about it just ask me. As you can see I use my real name. Feel free to look me up on the State Farm website if you need to verify anything. I am a straight shooter and this is my first post.
Hi Mickey,
I have been reading this forum for a few hours and I'm glad I found you!
I decided to make a transition to the Insurance and Financial Services industry and have two offers on the table. One from Prudential and another one from a State Farm Agent. I'm looking at the opportunity to work with the experienced agent to get my foot in the door and learn the business. Initially I was dreaming to become a SF Agent, but after reading this forum and I may go independent long-term.
The SF agent is offering me $24,000 base + commission as per agency bonus plan. I still don't know all the details of the commission structure, but during the interview he mentioned the following:
Auto: 3% of first six month premium
Fire: 3% of Annual premium
Life: 50% of Annual premium
Bank loan: $75 each
Is this a fair offer??? I'm in Miami, FL
Look forward to hearing from you soon as I have a time constraint to accept or decline.
Thanks!
I have been reading this forum for a few hours and I'm glad I found you!
I decided to make a transition to the Insurance and Financial Services industry and have two offers on the table. One from Prudential and another one from a State Farm Agent. I'm looking at the opportunity to work with the experienced agent to get my foot in the door and learn the business. Initially I was dreaming to become a SF Agent, but after reading this forum and I may go independent long-term.
The SF agent is offering me $24,000 base + commission as per agency bonus plan. I still don't know all the details of the commission structure, but during the interview he mentioned the following:
Auto: 3% of first six month premium
Fire: 3% of Annual premium
Life: 50% of Annual premium
Bank loan: $75 each
Is this a fair offer??? I'm in Miami, FL
Look forward to hearing from you soon as I have a time constraint to accept or decline.
Thanks!
- 273
I don't know that this is that much of a sweet deal. How much property can you actually write with State Farm in Miami. Difficult wind state. This means you are stuck writing auto and life. The life commission he is offering is more than they make on the policy but provides him the largest bonus. Auto: I'm just not confident with a State Farm agent on every corner there is enough business and rate competitiveness to make a living. 3% sucks. It is obvious he wants you to write life insurance.
Here is my recommendation: Take the SF job for 12 months and learn as much as you can without drinking the cool aid. And then find an independent agent in FL that will provide opportunity to continue your career path.
If you need a referral for a FL Indy agency. Let me know. I know a number of them. You will get better training at SF but you might have to bite your teeth for a depressing year of nonsense to learn what you need to know.
I personally think Nationwide might be a better opportunity.
Thanks so much! He wants me to focus on Life and Financial Services Products since I also have the Series 6. I'm looking forward to the learning experience and go Indy. I would appreciate if you send me the referrals to keep my eye on the long-term goal and start doing my research and connections while I learn with SF.
What type of products should I focus on to take advantage of the Series 6?
Thank you!
What type of products should I focus on to take advantage of the Series 6?
Thank you!
- 273
Just the normal financial products - 401k rollovers, annuities, Roth IRA's. I used to do a lot of Roths for young couples. Wasn't a lot of principle but the number of accounts opened was good.
Would you do it all over again? How much have the changes they have made helped the agents?
P.S. Welcome!
Mickey Marrone
New Member
- 8
Sorry for the delayed response. I don't visit the forum every day.
I would not start a position wit a State Farm agent thinking all the while that your are going to be leaving. I think it might be said that it show a lack of professional ethics. That employer, whether a State Farm agent or some other company, employs you in good faith. In the case of the State Farm agent, they put time and resources into you that are very valuable to them as small business people. I would assume that would be the case for any agency owner (All State, Indy, Farmers, etc.). Start where you want to be and you will find the training needed to be a success. Keep in mind that you are working for an agent, not the corporate State Farm. One day when you are an agency owner (it sounds like this is a goal of yours) you will better appreciate your square dealings with this agent.
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I am sorry, I did not address your question as to the fairness of the offer. This is a hard question to answer. I am not familiar with the Miami market. If, as you said in a different post, the agent wants you to focus on financial services, perhaps you can compare it to other financial service offers. Everything is relative.
When I worked as an investment advisor for Edward Jones before becoming a State Farm agent, I was given a two thousand a month base for the first two years. After that I was on 100% commission. The payout on financial service products at Jones was higher, but the base went away and I didn't have a ready made p&c customer base to prospect to.
I decided to leave for the more stable revenue stream of p&c at State Farm.
I hope that helped a little with your decision.
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Thank your for the Welcome...very kind of you.
The changes made to the contract have been numerous. I believe since 2004 there have been over 15 changes to the contract...each change has been an improvement for the agent. They literally just announced another change to the contract this past week. Again, it was a change for the better. The change doesn't really effect me at this time, but there are agents out there who benefited from it.
I believe they are committed to the direction and general idea that the new contract is intended to address. I also believe that the changes of the contract is just a part of an overall change that the company is going through meant to better serve the customers and put the company in a better competitive position.
With that said, this contract has been difficult. They have been responsive to the pleas of the agents, but it seems to be little nips and tucks rather than a complete addressing of the smvc issue. Myself, like most other AA05 agents feel that a base increase would address our basic concern and keep us in the game on a more substantial level. However, I have not worked for any other P&C company and I don't have anything to compare it to. I am just a middle of the road agent currently and my book size is 2.6 million. How does that compare to other agents with other companies? I am not sure.
To answer your question, yes I feel that changes they have made have been a big improvement for the agents on my contract. I would do it again in a heart beat. I know that I am an ok sales person, not great but not bad either. I don't think I would have the level of success I have enjoyed thus far if it were not for the State Farm brand. I realize I pay a premium for that brand name and I am ok with that. I believe it is a fair exchange.
I hope my response was helpful.
- 111
I have not heard that they were to benefit the Agent and an AFS who became an Agent would not agree either. She is no longer an Agent as she went independent. How is getting up to 33% of your hard earned money cut benefit the New Agent because he did not sell enough banking products?
Mickey Marrone
New Member
- 8
I am sorry, I don't think you read my post very closely.
The question was dealing with the changes that have been made on the contact since it came out. Every change that has been made on the contract since I came out (I was one of the first) has been in the agent's favor.
I am sure if you posed the question to your former AFS friend she would have to agree that each change has been better for the agent. A few come to mind:
moving base from 7% to 8% - yes it was 7%.
Three year rolling average on smvc or the better of current year - nice change and that isn't what happened for me. I dropped like a rock.
Second year bonus - I didn't get that either.
I could go on, but I think you get the point. There hasn't been one change that has been bad for the agent since rolling out the contract in 2004.
Now the second part of your comment is curious. The 33% your are referring to is comprised of three sections. One in auto, one in Fire, and one is financial services (bank, mutual funds, life, health). Your pay does not go up and down by 33% because of bank products?
SMVC (3%) is by far the biggest challenge in dealing with the AA05 contract, but it shouldn't be misrepresented.
The question was dealing with the changes that have been made on the contact since it came out. Every change that has been made on the contract since I came out (I was one of the first) has been in the agent's favor.
I am sure if you posed the question to your former AFS friend she would have to agree that each change has been better for the agent. A few come to mind:
moving base from 7% to 8% - yes it was 7%.
Three year rolling average on smvc or the better of current year - nice change and that isn't what happened for me. I dropped like a rock.
Second year bonus - I didn't get that either.
I could go on, but I think you get the point. There hasn't been one change that has been bad for the agent since rolling out the contract in 2004.
Now the second part of your comment is curious. The 33% your are referring to is comprised of three sections. One in auto, one in Fire, and one is financial services (bank, mutual funds, life, health). Your pay does not go up and down by 33% because of bank products?
SMVC (3%) is by far the biggest challenge in dealing with the AA05 contract, but it shouldn't be misrepresented.
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