Becoming a State Farm Agent

[CaptiveAgent2009]

How do you compete?

compete = interview

 

[cv3]

I am going to watch this thread.. Actually - kind of funny to read after 11 yrs away from the "frickas and frackes" of State Farm. Born w/SF Tattooed on my butt - as i was a St Farm Son. Dad in the business for 30+ yrs - he started scratch - did well. 93/94 - something like that - he wanted to retire - and of course the curse of being a SF Son was not good at that time. 11 openings - 4 former SF Sons/Daughters in our area - NONE hired. What a joke - and - as we found out - all those "New Contracts" - even bigger joke. Our agency was in the top 100 for Life Sales Nationwide - for 30 + yrs. Crystall Excellence - etc etc etc... What a joke there for bonuses.

I started scratch as a Independent Agt - after the Agy Mgr (AFE?) and the Regional AVP came to our parents house and decided they were going to sue them for losing so much business.

Not ever day is roses - whose is.... but - my profit bonus for just personal lines is larger than most people make. 20% on Auto new - 15 % renewal... Take that as a meat and potatoes - and my bonus is the gravy.

Go independent - but do what you want - eat what you want - sell what you want. No one tells me what to do - when or how. Somedays i sell life - some months i sell life. I sell to who and with whoever helps the clients interest.

Again - not ever day is sunshine - but after 11 years - AND starting scratch - i make more than any SF, Farm Bureau (etc..) - agent.
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Hey - Dont mean to be snotty on the last post.

Do yourself a favor - if you are going to become a SF Agent - go 100 miles away - 2 counties away - a State away - and speak to old and new SF agents - ask around - see what is what - how and who. Money is the big driver here - and no one wants to work hard for nothing.

The current SF agent who took over my dad's agency was NOT informed of what was going on. No "Welcome Wagon" party w/the new agent saying hello to clients w/the retiring agt - no knowledge of the $/commission %'s - and what it takes to COMPETE - yes COMPETE. We did NOT take all the "Old" SF customers - didnt want them - and in some cases they NEEDED to stay at SF - but, its a TON of money out - when you are working 14-16 hr days to make ends meet.

I would leave a note here - i dont want to be negative - but i cant leave my email or contact info. SF Came after me (and several other former SF sons/daughters) - as they said i had "Trade Secrets" and was using them.

I sent the local phone book to the SF attorney on the letter - and said "here is my marketing plan" - go ahead and sue me! ha! And BTW - I am publishing your letter and my letter in the 3 largest papers in our state - so everyone knows whats going on.

I did - w/a letter from a client who said " I would soon chew glass - than keep state farm"! LOL

 

[Mygibby]

I bit and bit hard. The opportunity is as stated by WIN, if you have at least 3 years worth of your current financial needs set aside to use and can also wait at least 6-8 years before you see any real money, it's worth the effort.

Two very important issues to consider-1- Make sure you know the area you want to be an agent in. IF you are an outsider the other SF agents in the area will eat you for lunch as they are your largest competitors and 2- make sure you understand that there are no rule books and the underwriters control the business and change the rules for the benefit of the company. With todays internet and savy customers you only have relationshipping as an offering that no one else has.

 

[xrac]

Based upon what I am reading why in the world would anyone that is in their right mind want to start out with SF under the present contract unless they are given a substantial book of business? I don't mean that someone can't eventually become successful but why put so much at risk when there are other avenues open that will yield potentially as much or greater rewards on a shorter time horizon with less at risk.

 

[fastrack1]

Alas, Greenman, your rage has unbalanced you.

In looking back over your posts, you often make very astute observations, and describe the plight of the starving TICA/Newbie ICA in vivid detail (it has been very educational for me). But then you go sailing off on a sea of your own bile, lashing out at the world.

You sound very angry. You say you are happy with your chosen path? Who are you trying to convince? Yourself, perhaps--you don’t sound so happy. (Hey, I don’t blame you though.) But I would tell anyone to be careful about being happy with 80 or 100 grand a year. One new insurance law in your state legislature can drop that by 25% overnight, then what will you do? Get a part time job? (Now, a new law can also raise it overnight too . . .)

I am exactly what I say I am. I have been “exposed” only insofar as I would have to try very hard to get fired—not because I have 12 years in and bunch of plaques, and awards, and a picture shaking Ed Rust Jr’s hand. I can’t get fired because I now have friends in high places (MDRT does the for you). Most any review panel formed would have many people I knew personally. I said that “I could get fired for writing this” in my first post so as not to reveal myself as what most readers of this thread probably despise: the propped up rich agent with several staff who do all the work, a big retail storefront office, trip after trip, policy assignments that you will never get (even though you truly need them) and so on.

So you, and a couple others are right: I certainly can’t get fired for a few posts on a website, or for “talking out of school.” However, my guess is that you haven’t made too many friends in high places, so be careful if you think you enjoy the same luxury. You don’t. If you come off as a malcontent this early in your ICA years, your name is on a list somewhere . . . Think about it for a minute and you will feel that I am right. Don’t believe me? It really doesn’t matter--your name is still on the list.

Now for the irony. I didn’t look in on this thread to burst any bubbles or rub anyone’s nose in excrement. If I had to come through the TICA program now, scratch or with an assignment, I would certainly fail. So would several other bigshot agents in my Zone. We are used to being staged to be successful—we couldn’t deal with the adversity you are dealing with. (Tiger Woods could not shoot a 7 under par on some of the crappy municipal courses in my city, the greens are too bumpy and the fairways are lousy, but he can shoot 12 under par on the most pristine courses in the world.)

I looked in on this site because I constantly have wannabe agents, and agency interns paraded through my office. I never followed up on any of them to learn of their successes and failures (I’m not the mentoring type). But a couple TICAs failed recently in my AFO and I thought would try to find out what is really going on on the street with TICAs. I had lunch yesterday with a new ICA who spent some time in my office to get his insight as well. It sounds tough. The young man I had lunch with yesterday will never have close to the number of households I have—no matter how much money he spends on marketing. Hopefully, however, he can grow enough to provide a good life for his family.

So, I don’t know if I have any suggestions to help those in your situation (as I said, if I was in your shoes, I probably would not make it myself).

I did have some advice for the new ICA I had lunch with:
Focus solely, entirely, and singularly on growing quality new households based on relationships. Your AFC suggests you spend $500 a month on PAVe leads? (That’s just throwing confetti in the air with your name on it). I say spend the same $500 each month and take 10 clients out to lunch each month and tell them how truly important they are to you and your family. Be sincere. Be appreciative. Be grateful. Tell each one over lunch that you want to grow your business with more people JUST LIKE THEM. Then, if you have earned the right, ask them if they would feel comfortable giving one of your cards to a few friends. (Five).

You went to an AFO meeting and some TICA with money to burn is speaking on how he gets 250 internet leads a month and writes 50 raw new auto? Don’t get lured into it. Go around to each home around your office and bring something with your name on it and a business card. Just to say hello. Go to businesses. Be active in your kids schools. It’s not who you know, it’s who knows you. Get used to saying, “I am the kind of agent who ____________” to set yourself apart and to be memorable.

Here’s why you have to do this. Right now, State Farm probably insures about 1/3 of the people in your area. Of the other 2/3, half of them are unwriteable and undesireable to an insurance company. That leaves 1/3 of the people in your area as actual targets. Do not be stupid and think you can get to that 1/3 by mailing a bunch of crap to them every month, or putting your name on a bench, or having a clever internet site, or an ad in the paper. The best way to get to that magic third is THROUGH THE PEOPLE YOU ALREADY KNOW OR HAVE A CONNECTION TO YOU. Get to them through your book of business, kid’s school, church, etc. Also, get to know some of them by going around and shaking some hands.

Those internet leads? Most of them are from the 1/3 of the population that you really don’t want. Crap.

No PAVe. No internet leads. No telemarketers. No bench or bus stop ads (now, I do bus stop adds, but only to remind my existing clients that they are with a bigshot--the ads don't drive new business). Get to the magic 1/3 through your best clients and others you already know. Spend your marketing money on Starbuck’s cards, and gift baskets, and bottles of wine for the people who send you their friends and family. Sounds “old school” or too obvious? Bet you are not doing it. But I bet you bought some crap list of “qualified life leads” or “new homebuyers” that you thought would work.

Last thing. Don’t chase the scorecard—you don’t have enough money yet. I do. You don’t. Truthfully, I really just need to write as many autos as I lose each year. You probably need to grow some. Even though your E can convince a lot of people to spend money chasing bank or health or life because “you can make it up on the scorecard”, don’t you fall for it! You must have renewals first and foremost—more and more each year. What good is a $50,000 bonus that you spent $25,000 to get if you failed to add 120 quality households to your book? (The new households pay you each year, a bonus comes once.) So, it sounds easy to spend time chasing around some clients to get a loan out of them, but that time needs to be spent getting BRAND NEW quality households into your book first. Otherwise, how are you going to be better off 5 years from now?

Bottom line, grow 120 quality new households each year based on a genuine personal relationship or referral and you will be "set" in 5 years or less. Whore yourself out to every crap internet lead or "just shopping around" phone call off a "35% Off" postcard and you will be in the same rut you are in now.

Excellent post, despite Greenman's lack of response so far. If you are an imposter, you are a good one!

 

[fastrack1]

Fastrack - where's your shinebox? Legionaire has posted 4 times - his entire first post was predicated with a lie that he admitted was a lie when called on it. You go ahead and believe what you want - remember, on anonymous boards, everyone gets to be MDRT! hehehehe

I don't carry about his credentials or lack thereof.....his advice at the end of the post was very good. Ever heard of taking both the good and bad from someone? You have written off everything he says because you think he is a farse. I, on the other hand, don't care if he is a farse, because some of what he said is true and helpful and I am able to distinguish between the two. If you are so experienced, you should be able to also.

 

[DT1970]

After reading through this entire thread, it's apparent that starting a career as a State Farm agent has some serious challenges.

First off, you don't own your business. It's not REALLY your business...you do not get to sell it once you wish to retire. I don't think I like that very much especially when you are being asked to put your own money into the enterprise to grow it.

Not to mention the meddling into your affairs of a big brother. There are definite advantages...the name, the resources, the potential for appointments, etc.

But these seem to be offset by the politics and, the fact that at the end of the day, you are just renting your name on the shingle. Once you retire, your work will be given to someone else or split up among a number of other SF agents.

If SF is going to see a number of their agents retire in the near future, I would guess they would be interested in recruiting high quality career changers who have business acumen. I suppose young college grads are more willing koolaid drinkers, but, statistically, their failure rate would, I think, be higher than an experienced business person.

But how many business people would go into a SF opportunity knowing their going to chew through up to $50K-$100K in their own savings to establish their practice...all the time knowing they never really own it?

While I have alot of sympathy for people like SFTICA and the fact that he should be in a better place in life at this point in his career with SF, I can't help but wonder where he, and others like him, would be if he had gone captive with a quality company like NYLife/went independent etc? Most likely, given his work ethic and success at selling insurance, he would be at much more comfortable level in life.

The SF brand is pretty darn good and they have a high caliber network of agents. The thing holding me back, personally, for being interested in pursuing them is I have no wish to hand over my personal savings to grow & "rent" an office with my name on it. How many people accept a job with a company then start writing their employer checks? Does this make sense to anyone? If I had a vested interest in owning the office & it's book, then that would be an entirely different matter.

Alot of take by State Farm and not much give.

How can they expect to recruit quality people when they take have constructed a stingy financial model for new potential agents? If they want the best people, they need to make this thing lucrative for successful agents. And right now, for new agents, it doesn't appear to be.

 

[djs]

Hmmm, this is interesting. I do wonder how much of this is State Farm vs how much of this is getting started in the P&C world.

With health or life, new sales bring in decent checks. Residuals are lousy, but the new sales are good money (exception is group health, which is usually a flat rate new and renewal).

With P&C, new business and renewals pay almost the same. In comparison, new business is a miserable check compared to selling a health policy. Premiums are also much, much lower than health.

Over time though, if you manage expenses well, a P&C agency pretty much becomes a license to print money. The residuals start becoming the major revenue source.

Sounds like the premium dollars are there to be had with State Farm, just the required expenses are a bit overwhelming. I get that. Spending the required money to grow is sometimes hard to do. Of course, when you can control it, it's a bit easier then when you are told how to spend what.

Dan

 

[xrac]

Boards like this will play a role in causing change at SF for scratch agents. There is no doubt that many potential SF recruits who have read this forum are viewing the opportunity much, much differently and some have dropped interest all together. Imagine what a SF recruiter thinks reading this thread.

Based upon everything I have read there are only two kinds of people who will pursue the SF opportunity. First, those who have drank the SF koolaid, and take the opportunity based upon the old contracts and who do not understand the implications of the current contract. This is like buying past performance on a mutual fund when the manager and objective have changed. The other is someone who is just plain "nuts" or a glutton for punishment!

 

[Sailor]

Ditto on it's their sandbox.

I got into the game knowing full well it was not "fair". It is when it becomes unethical when it destroys families, credit histories and career paths that people get angry.

I sit in a home with an unpaid mortgage, with a fridge full of milk and cheese because my family is on the WIC program because my household income is $19,000 after 4 years of being a "new market" SF agent. All this while I constantly qualify for travel level 2 for trips yet because I am actually a talented insurance producer I am going to Hawaii very soon.

off topic:

I heard Allstate cancelled the top producer trip and gave its agents money in stead in light of the economy.

Too bad SF didn't think of that. That would have helped me tremendously, actually being awarded $10,000 and not just being taxed on a trip valued on that that I cannot afford to go on. I will be eating McDonalds in Waikaloa.

What a joke, SF "charges" you Wheel of Fortune prices for the "free" trip. You end up paying more in taxes for it than what it would cost you to travel by yourself with people you like.

Oh, and did you know all DAFO's travel level three with out even qualifying?