ef summer 10 - napaausa.org 2summer ef.pdf · agent terminations ... my customer relationship...

A Magazine for Allstate Agency Owners and Allstate Personal Financial Representatives

ExclusivefocusSummer 2010


An Official Publication of the National Association of Professional Allstate Agents, Inc.


Is Allstate Really the Best? page 18

From Good Hands to Boxing Gloves – Two Agent Reviews of the Controversial Book page 41

Allstate’s Hidden Agenda page 44

The Comprehensive Recreational Activity Policy – Allstate’s Secret Weapon to Becoming #1? page 22

State Farm Exploits Allstate

Agent Terminations page 14

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4 — Exclusivefocus Summer 2010

Exclusivefocus

An Official Publication of the National Association of Professional Allstate Agents, Inc.


Summer 2010

BUSINESS14 Atta Boy, Tommy, but not so fast…

28 How Download Delivers Value BY DOUG JOHNSTON

32 How Hurricane-proof are Your Business Records? BY STEVE MOHR

51 One Improvement in Your Agency can Keep you Ahead of the Rest BY TODD MCINDOO

55 Objection Handling for the Rookies and Especially for Veterans BY SEAN HOWELL

HUMOR22 Ed Liddy Saves the Day

50 I Promise Results with My Customer Relationship

Management (CRM) Database… Money Back

Guaranteed! BY HESH REINFELD

DEPARTMENTS6 President’s Letter10 Letters to NAPAA58 Membership Application59 NAPAA Market Place62 Index to Advertisers

FEATURES18 Are We Really the Best? BY THE “ANDY ROONEY” OF NAPAA

24 Can “ALI” be an Agent’s Best Friend? BY ROB LOOMIS

27 An Open Letter to Joe Richardson from a California Agent

31 Selling your Agency? Consider Advisors Who Understand the Allstate Process

34 An Extraordinary Event

41 BOOK REVIEW: “From Good Hands to Boxing Gloves: The Dark Side of Insurance”

44 Allstate’s Hidden Agenda

53 The End of Another Promising Career

MARKETING16 Getting Your Agency on Facebook BY ROBYN SHARP

20 Our Real Business is... Marketing! BY ALLSTATE AGENCY OWNER BILL GOUGH

40 3 Tips Guaranteed to Increase your Quote Volume BY DAVID NEUENSCHWANDER

group

a m e m b e r o f

SCIROCCO


president’s letter

have personally met me, or feel com-fortable calling me. As a result, I have been receiving calls from agents around the country who are in varying stages of the company’s pre-planned termination strategy.

Following are some of the unprincipled management tactics that agents around the country have indicated they are ex-periencing when attempting to sell their agencies. In my view, theses tactics are unethical and subvert the long-standing tradition of good faith and fair dealing and could be construed by the courts as “tortious/wrongful interference.”

• Agents’ Termination Payment re-ports (TPP) are being divulged to pro-spective buyers, enabling them to use this inside information as a baseline to

start negotiations. This approach works to the company’s benefit as lower sale prices produce more marketing dollars for agency buyers, which increases the amount of new business sold, which, in turn, results in larger stock options and bonuses for managers throughout the company - all at the expense of the ter-minated or selling agent.

• Company managers have been rec-ommending to prospective buyers that they not enter into any Letters of Intent (LOI) with sellers, leaving sellers in a very unfavorable position.

• These unsavory techniques leave selling agents in a desperate and irresolv-able position that causes them to hold

Before I get into the meat of my mes-sage, I want to sincerely thank each and every attendee and vendor who joined us for our record-breaking National EA Conference and Job Fair held at the luxurious Gaylord National Resort and Convention Center in Washing-ton, D.C. The setting, speakers, exhibi-tors and functions were truly amazing and are directly attributable to Jim and Nancy Fish, our Executive Director and Association Manager respectively. Thank you so much Jim and Nancy for all that you do for us each and every day, and especially for producing this spectacular event. We hope to see all of our growing membership at next year’s conference.

Because of my 20-year involvement with NAPAA, many of you know me,

ExclusivefocusNational Association of

Professional Allstate Agents, Inc.

P.O. Box 7666Gulfport, MS 39506-7666

Phone Toll Free (877) 627-2248Toll Free Fax (866) 627-2232

Web Site www.napaausa.orgEmail [email protected]

Jim FishExecutive Editor

P.O. Box 7666Gulfport, MS 39506

Phone (877) 269-3474 • Fax (866) [email protected]

Exclusivefocus and DirectExpress are official pub-lications of NAPAA - The National Association of Professional Allstate Agents, Inc. No part of this pub-lication may be reproduced without prior written per-mission of the publisher. It is the policy of this publica-

tion to reflect the professional thoughts and attitudes of our members and to advance the professionalism of the insurance industry to the ultimate benefit of the insuring public.

The views expressed by NAPAA, or any of its posi-tions relative to its activities and those of its members’ actions on behalf of this organization, are expressly those of NAPAA, and do not reflect the views or the opinions of Allstate Insurance Company, or any of its affiliates.

Letters to the Editor: All letters must include an address and a daytime and evening phone number. We reserve the right to edit letters for clarity and space.

This issue of Exclusivefocus magazine may contain articles of interest submitted to NAPAA by outside au-thors. NAPAA is not responsible for the opinions, advice or accuracy of any information provided therein.

NAPAA’s Mission StatementNAPAA is dedicated to the success of Allstate

Exclusive Agency Owners and to advance the independence and entrepreneurial spirit of our members.

NAPAA’s Goals Our goals are subject to alteration, influenced

by a constantly changing environment and the

needs and wishes of our members.NAPAA encourages its members to actively

participate in the process of defining and refining our Mission, Goals and Positions.

Our General Goals:• To provide an organization specifically tai-

lored to benefit Allstate Exclusive Agents• Monitor legislative and legal issues pertinent

to Agents and their clients• Maintain an Action Fund to support issues

beneficial to agents and clients• Provide reliable communications on all issues

that affect Agents and the ability to call upon our members to act

• Provide Agents with a distinct voice on issues that affect them, continually exploring options and solutions

• Make tools and resources available for members in an effort to increase agency value and success.

For more information, please visit

www.napaausa.org

President continued on page 8

It’s unlawful to commit tortious/wrongful interference in a business relationship.

“That’s NAPAA’s Stand”

Summer 2010 Exclusivefocus — 7

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ADMINISTRATIVE OFFICES

Jim Fish, Executive DirectorP. O. Box 7666

Gulfport, MS 39506Ph # 877-269-3474

[email protected]

Nancy Fish, Association ManagerP.O. Box 7666

Gulfport, MS 39506Ph #877-627-2248Fax #[email protected]

Please email [email protected] to

contact our officers and directors. Include the name of the person in

the subject line

OFFICERS

Bob IsacsenPresident

Hoboken, NJ

Dale RevelsImmediate Past President

Kissimmee, FL

Debe Campos-FleenorExecutive Vice President

Tucson, AZ

Ismael Melendez, Jr.Treasurer

Federal Way, WA

Judy OstSecretary

Battleground, WA

DIRECTORS

Al Bullard, Floral Park, NY

Ron Jay, Yukon, OK

Greg Thompson, Burleson, TX

Liz Solis, Miramar, FL

NAPAA Board of Directors 2009-2010

mortgages at favorable terms for the buyer, but offers them limited recourse in the event of a default.

• Mega agents, who at one time were the showpieces of the company, have now lost their luster and are now considered albatrosses around the company’s neck. As the “Megas” dramatically grew their businesses by purchasing other books, many of which were financed through Allstate Bank, they were required to cross-collateralize the (TPP) of each purchase. Now, when the “Megas” try to sell, they are having difficulty unwinding the (TPP) cross-collateralization.

I truly believe we can stop this and many of the other abuses we continue to face. It all comes back to having the members and resources necessary to take on such a major force. Our goal of 10,000 members is still a realistic number and very achievable. Protect your assets and join NAPAA today.

Warm personal regards,Bob IsacsenNAPAA President

Always a cell phone call away at: 347-572-4698

Support Those Who Bring You This Magazine

If you have a customer moving out of state, call the Agent-to-Agent Hotline to find an experienced NAPAA member in the area. Give something back to those dues-paying member agents who make this publication

possible. Your support is greatly appreciated.

When you have a Transfer-Out… Call 877.627.2248

Send email requests to

[email protected]


. . . . . . . . . . . . .I was given a 90-day letter last month

informing me that my termination would be effective on August 1. Then last week I got a call from my FSL, who told me that the date had been extended to September 1. I asked what would happen to my book and was told it would be transferred to the CIC. I’m not happy about that because they typically screw up 50% of the policies they touch. I get a lot of payments in my office – where will they go? They will leave us; that’s what will happen. What is this company thinking? Don’t they understand that the name of this long-term game is PERSONAL SERVICE? I feel like I’m being psychologically raped and have nothing to say about it.

Thanks for writing and sorry to hear about your pending termination. We have recently seen the company extend termination dates by a month in several cases. We’re not sure why they’re doing it, but it could be because there are more voluntary terminations than expected. We also agree with you that the company is making a big mistake by transferring books of business to the CIC. As you said, many of those customers will leave and never come back. This ill-conceived process can only hurt the company in the long term.

. . . . . . . . . . . . .I just received the spring issue of

Exclusivefocus magazine. Excellent content and very professional. Great Job!

Best, Rod LaRocque

Sudbury, Ontario

. . . . . . . . . . . . .I’ve been with Allstate for 6 ½ years,

but have been in the insurance business 27 years. When I was being courted by Allstate to come to work here, they sold me on the fact that I could sell my agency to an outside buyer or to another Allstate agent. I was told that hardly anyone takes

twice and earned the Premier Service Agency designation last year. Until now, I never really saw the need for NAPAA membership. But the future is most unsettling, especially considering that my auto growth requirement just went up 117%!

I hope to have a long and happy career representing the “Good Hands,” but it is time to be realistic in my future business planning. If Allstate decides in the future they no longer require or appreciate my services, then I need to be in a position to move on.

God bless you for your hard work and advocacy for Allstate agents/owners everywhere.

Thank you for your membership and kind words. The auto growth requirement has become a major issue for many agents this year, especially in markets where Allstate is no longer competitive. A 117% increase is substantial, even in a good market. Doesn’t it make you wonder how they come up with a percentage increase like that? You are wise to have the foresight to plan for the best, but prepare for the worst. As you stated in your letter, “it is time to be realistic in future business planning.”

. . . . . . . . . . . . .As a recently terminated New York

agent, I would like to be more involved with NAPAA.

My last day was November 30, 2009. I was fortunate enough to find a buyer. The company combined three books to make it enticing for the buyer. This allowed him to have a $4 million agency right off the bat. I was with Allstate for 23 years and I met many of my goals over the years, but without a homeowners product it was difficult to exist. But they wouldn’t let me buy other books to become an Ideal Agency. How fair is it that they let an unknown entity buy a $4 million book?

P.S. I applied for unemployment benefits. They are reviewing my submission.

After 36 years, I left Allstate on June 1. I decided to do this now before my entire book of business disappeared. I had the foresight seven years ago to have my sons open up an independent agency. I have now joined them. Allstate has just announced another auto rate increase after taking back-to-back increases prior to this latest one. The company’s script on how to handle customers complaining about the rates is nothing more than a joke and insults one’s intellect. I’m proud to have been an original member of NAPAA and certainly appreciate all of their fine efforts over the years. I plan on staying in touch.

P.S. No gold watch or pen on the way out after more than 30 years of loyal service.

. . . . . . . . . . . . .Enclosed is my NAPAA membership

application. I have been an Allstate agent since 2002. The past eight years have been both wonderful and frustrating. In my state, however, the AFCIC rates killed any competitive edge we had in auto insurance.

In spite of it all, I’ve made Honor Ring six times, National Conference twice and Chairman’s three times, Leader’s Forum three times, Quality Agent

letters to NAPAA


the TPP because there is always someone wanting to buy agencies at a much better price. I was also told that Allstate agencies are a hot commodity and, therefore, in demand. Of course that was then and this is now. Then there were no RFG points for inside buyers. And there was no such thing as a PSA designation, at least not to my knowledge. In short, since I arrived here, much has changed, and it is not for the better, at least from the agent’s point of view. The company has made it next to impossible for existing agents to buy a book.

I wanted to retire from Allstate, but now I feel I need to get out while I still have the shirt on my back. It’s like a bad dream. I feel if I stay, the company will destroy what’s left of my good health and spirit and I’ll be forced to take TPP, leaving me poorer than I was when I started.

Needless to say, I feel I’ve been misled. I’ve had several really good agents wanting to buy my book, but they have all fallen short of Allstate’s RFG requirements. These agents are evidently good enough to sell Allstate products, but not good enough to buy someone’s agency. How much sense does that make?

. . . . . . . . . . . . .I recently received a threatening call

from my FSL demanding that I bring my production up to speed or lose my Allstate contracts. Yes, I mean “contracts” because a year and half ago I bought a second agency, which is financed to the hilt.

These agencies are my retirement income. Selling them before my loan is paid off could be financially devastating for me. After 15 years of working my butt off for Allstate, this is the thanks I get. I haven’t received the letter yet, but my FSL tells me that I will, unless my production improves. I didn’t get in the position to buy an agency because I’m a bad agent or a slacker. I won Leaders Forum two years in a row.

On the subject of production, they blame everybody but themselves. They take double digit increases back-to-back on both auto and homeowners and then

expect to increase sales. They wonder why sales are down when all day long we are busy fixing the computers and trying to placate customers who are angry about the rate increases. And then there is the ALI… I won’t even get into that.

Why is everything the agent’s fault? Why doesn’t management admit they’ve mucked things up?

Thanks for writing. Regrettably, we’re seeing more and more of this happening to good agents who, through no fault of their own, have missed their numbers or aren’t on pace. Since you haven’t received a letter yet, you may not be in imminent danger of termination. Your FSL is likely under intense pressure to get his/her numbers up and believes intimidating you is the best way to increase production. The threat may or may not be real. All you can do is try your best to achieve your goals, but be thinking about a “Plan B” in case you don’t succeed.

. . . . . . . . . . . . .I started out with Allstate as a scratch

agency two years ago. I remember receiving your quarterly magazine in the

past, but today was the first time that I ever took the time to read it. I was absolutely shocked by how “spot on” your evaluations and observations are about Allstate. Even though I’ve only been in this environment for two years, I began to notice huge inconsistencies, deficiencies and a real lack of knowledge throughout company departments right from the beginning. I also sensed that the agents were very disloyal, disconnected and not very supportive of the company.

Before coming to Allstate, I worked for a major U.S. bank that fell victim to the problems that precipitated the 2008 recession. As a result, I had a lot experience and knowledge, business-wise, about how a company the size of Allstate should conduct itself in order to obtain optimal results. My fear is that Allstate is headed down a similar path as the bank I worked for… I see so many similarities.

I remember how the bank pitted good employees against each other with their many contests and campaigns, only to reward us with $10 or $25 for bringing in 20 times more business. When they implemented the dreaded monthly

letters to NAPAA

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letters to NAPAA

quotas that none of us could meet, the loss of good and loyal employees was tremendous. But guess what? They didn’t seem to care one bit! Sound familiar?

Now that I have gotten that off my chest and told everyone I know “I told you so” about Allstate’s future, I hope to move on and aspire to build my business. I would like for you to give me any advice on how I can best grow my super-small agency. My PIF is approximately 400. I’m trying to stay under Allstate’s radar so they won’t target my agency for takeover.

Thank you for your recent fax. With a 400 PIF book of business, you have a very long, uphill climb in order to reach the size agency that Allstate wants you to have. Its stated goal is for agencies to reach $4 million in premium and 4,000 accounts within 6 to 8 years. NAPAA believes this goal is unreasonable and unobtainable for the vast majority of Allstate agents. The company is not allowing rank and file agents an opportunity to buy additional books of business, which is the only way to grow quickly. Growing organically to $4 million in 6 to 8 years will not be possible for most agents considering the current competitive environment. Of course, there will be exceptions to the rule, but those who do attain the Ideal Agency size will have paid a very heavy financial price to get there. Internet leads, advertising and other prospecting tools takes capital – lots of capital. And, unless you’re willing to spend the kind of money it will take to grow by leaps and bounds, you will always be pressured by the company to do more.

. . . . . . . . . . . . .I just heard from a very reliable source

that agents will be required to have their offices open Saturday mornings. This should be rolling out in the 3rd quarter. For all you new agents, they tried this disaster about 11 years ago. It also sounds as if the company will require that we keep our offices open until 7 or 8 p.m. This, however, will be down the road a bit.

. . . . . . . . . . . . .Just thought I’d send over some

scuttlebutt I heard today. It seems to be reliable. A former MSM, who is now an agent, is still connected to those in management and a high level claims manager. The rumor is that they want only 750 agents in California. They know they will eventually be sued, because they are treating the agents as employees when they’re not. There are rumors of required Saturday hours and extended evening hours. They’re continuing to turn the screws because they know that eventually, they will be told to cease and desist, but for now they’re going to squeeze everything they can out of us. Have you all heard anything similar?

We’ve heard for several months that the company wants to trim the CA agency force by 400 agents, which would leave about 750 agents. We have also started to hear that the company will soon require extended evening hours and Saturday hours. So far, however, we have not seen or heard anything official.

If the IRS steps in and finds that the company is misclassifying its agents, you can bet there will be litigation. We can only hope.

. . . . . . . . . . . . .I think it would be interesting if you

asked for feedback from agents who have noticed how Allstate is gradually taking over their LSPs, or Licensed Sales Professionals. Allstate’s increasing control and management of LSPs, who work for the agent, NOT Allstate, gives added credence to the argument that we are not “independent contractors.” If we were, Allstate would never butt into the management of an agent’s employee as they are doing now.

The company not only requires that we hire staff, but that we also send them to mandatory Allstate training. And not just the basic training that is reasonable if they are to have Allstate binding authority, but a whole series of programming, so they will perform just as Allstate wants,

including selling the “Allstate way.”I have found over time that Allstate

appears to regard these LSPs as theirs, rather than as employees of the agent. Then they expect us to pay the LSP for the time spent at these brainwashing sessions. This brazen control of our employees is more proof that we are employees, not independent contractors.

Last year, I hired a part-time staff person and sent her to the Allstate training, which seemed reasonable for binding authority purposes. Once she completed the training, was licensed, and had binding authority, Allstate continued to offer “free” extra training seminars. After attending some of these “free” sessions, my LSP reported that Allstate was involving her in the following:

• Q&A sessions wherein the LSPs were prodded to share their agent’s marketing processes with the instructor and other attendees. For obvious reasons, this information is not something agents want to broadcast. Yet the company reps made an enthusiastic game of it and the naïve LSPs fell for it, not knowing any better. I reminded my LSP who pays her and asked why she would divulge privileged agency information.

• Sales contests, not only for policies sold, but for life leads, which were fed directly into the PDP (Purpose Driven Partnering) system where they could be worked by Life Specialists, who received 100% compensation for sales made to my clients. What irks me is that the company never consulted me or asked for permission!

• After the initial training, company reps made follow-up calls and sent follow-up emails to my LSP without my knowledge, ostensibly to check on how she was doing with the new programs that Allstate set up for her.

• Emails sent directly to my LSP to inform her that Allstate management would be by to spend several hours to “work” with her to help implement Allstate’s programs. I was not copied on the emails to my employee and I was not consulted about the time of the proposed


letters to NAPAA

meeting. When I found out about this, I called the person responsible and asked if she would be “bringing her checkbook” to pay for my LSP’s time. It never occurred to her that she would need to check with the agent. I also took issue with the fact that she was trying to schedule this meeting directly with my staff, without considering what I had planned for her that day.

. . . . . . . . . . . . .Well I got the bad news today. Allstate’s

management has cut me off at the knees. They will not allow my buyer, who was scheduled to buy my agency effective June 1, to consolidate my agency with hers as previously agreed. According to my buyer, too many agents have left the company and they don’t want fewer agents.

They said that since my buyer had received preliminary approval four weeks ago, they would allow her to split my agency with an outside buyer, which would keep the agent count up. However, if she can’t do the deal in the next two weeks, she’s SOL!

Back to the proverbial drawing board…

Jim, I can’t begin to tell you how deflated, dejected, disheartened, discouraged and downright aggravated I am with the Allstate management team. Words really can’t begin to describe it….

Thanks for continuing to fight the fight for the thousands of agents and staff who are impacted by Allstate’s willy-nilly management decisions.

Sorry to hear that you won’t be able to sell out. This company is incredible. They all but push the agents out the door with threats, terminations and intimidation and then they wonder why they are leaving in droves. The fact is that, like you, many agents don’t feel wanted or appreciated anymore. Since taking TPP is not a feasible economic option for you, finding an outside buyer appears to be your only choice at this time. Keep in touch and let me know if there is anything NAPAA can do for you.

. . . . . . . . . . . . .While my LSP (licensed sales

professional) was out of the office, I went into her computer to check her emails, etc. Every email she ever got was still saved in the deleted email file. I printed every one that was significant. Of particular note are the number of emails from the company Sales Education Consultant encouraging, cajoling and attempting to get my LSP involved in additional training, which is above and beyond the “basic training” that’s required. This still makes my blood boil.

As Allstate gears up to build all those 4,000 account mega-agencies, they are laying the groundwork for staffing those offices at the agents’ expense. I can foresee a day when my manager walks in to terminate me and, on the way out the door, offers my LSP a position in one of those agencies.

They are a smug bunch, aren’t they? They must actually believe they have the right to control your employees…. unbelievable. Meanwhile, hang on to those emails – they may be useful someday..

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Continued on page 35.

For Opinions

on the Recent

NAPAA Conference

and Job Fair see

Letters to NAPAA

Continued on Page 35

in the Convention

Recap Article.


business tips

BY NOW, EVERY Allstate agent HAS heard Allstate Senior Vice President Joe Richardson proclaim that in 10 years, Allstate will be the “number one provider of consumer protection in the U.S.” To be sure, this is welcome news for agency owners who have struggled to write new business for years. Until now, the compa-ny’s strategy caused overall sales to lan-guish and drove renewal customers away in large numbers.

What we don’t know for sure is what finally prompted Tom Wilson’s “eu-reka” moment. What has been clear to NAPAA and most agency owners for some time is that continuing the status quo would be a slow and excruciatingly

painful decline in market share and sta-tus for Allstate.

Has Tom Wilson finally realized that auto insurance has become a commod-ity where price really matters? Or, did he, at long last, hear the voices coming from all sides, urging him to scuttle his long-standing policy of avoiding price cuts? Well, sort of. According to a story in Crain’s Chicago Business on May 29th, “Allstate says it’s not cutting rates across the board but lowering prices selectively by improving existing discounts, includ-ing for consumers with multiple policies and those who pay premiums all at once.” While this is not the all out rate cut that many agents would like to see, it is cer-tainly a step in the right direction and should help agencies begin to grow again.

Many observers, including NAPAA, have serious doubts that the company can achieve its new 10-year objective. Our skepticism is based purely on the enormi-ty of the Herculean task that lies ahead. However, we welcome the company’s new aggressive mind-set. And if the company only achieves half its target, it will still be a resounding success by any measurement.

Storm clouds on the horizonAllstate has thrown down the gauntlet,

causing a stir among its rivals, who won’t take the news lying down. So while Rich-ardson, Wilson and others in Northbrook are busy backslapping and high-fiving each other, senior executives at State Farm are sure to be seething over what they con-sider an audacious and preposterous ini-tiative by their cross-state rival. “Them’s fighten’ words,” might be the likely retort uttered by State Farm CEO Ed Rust, Jr. upon learning of the Allstate plan.

So what will State Farm do about the Allstate strategy to become number one? In an internal State Farm document sent out to the field and received by NAPAA,

the company announced plans to take ad-vantage of Allstate’s current Achilles’ heel – the agent termination problem. In a nutshell, the plan will purportedly target Allstate customers aggressively in areas where Allstate agents have been, or are about to be, terminated. The memo states, “These Allstate office closings provide State Farm agents a unique opportunity to reach out to Allstate customers and demonstrate State Farm’s value. These Allstate customers will be experiencing a disruptive event that could lead them to shop for insurance.”

This opening salvo in the soon-to-be game of tit for tat comes at a particularly bad time for Mr. Wilson and company. While the company orchestrates the firing of hundreds, if not thousands, of agents, many more are voluntarily calling it quits, thereby giving State Farm even more prospecting opportunities. In addi-tion, State Farm’s Corporate Marketing Department “is offering agents located near Allstate office closings 50% co-op on specifi-cally identified print, radio and billboard ads that will appeal to Allstate customers,” according to the memo. Further, State Farm agents are encouraged to do the following: “Using your own marketplace intelligence, identify the exact locations of upcoming Allstate agency closings in your market area. Also identify Allstate agencies that closed over the past six months.”

So, not only is this bad news for North-brook, it’s bad news for agents who buy the books of terminating agents. If the State Farm campaign is successful, it will be because Allstate customers are tired of being jacked around. They don’t want to deal with the CIC. They don’t want a different agent every year. They want a stable relationship with an agent they know and trust. Unfortunately, this kind of relationship is becoming more diffi-cult to find at Allstate, but it is abundant at State Farm. Ef

Atta Boy, Tommy, but not so fast…


Charles Parkhurst 866-341-3504 [email protected]

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Getting Your Agency on FacebookBY ROBYN SHARP

marketing

SO YOU CAN’T avoid the hype any longer and you’re ready to jump into the world of social media. Great! But if you, like many others, just aren’t sure where to begin, here are a few simple steps to get you going on the right path.

Facebook is the largest social network and the place where you are most likely going to see the biggest return on your time investment. With over 400 million registered users, many of your clients and prospects are already regular users. My #1 rule when it comes to social media is to go where your clients are. If your clients are on Facebook, then you should be, too.

Your Personal Facebook ProfileI’m going to assume that you already

have a basic Facebook profile. If you don’t, simply visit www.facebook.com to get started. Here are a few rules about your personal Facebook account:

• It is meant to represent a real person’s name. I recommend using your name and not including your company name. This way you will show up if someone searches

for you and you will still be searchable by your agency name once you set up your business profile.

• You are limited to 5,000 friends. • You have specialized privacy

settings. Use the List feature to segment your friends into lists. (To create a list – Go to the Home screen. In the left column, click on Friends. Then in the top middle, under the search bar, click “Create a List.” Name your list and select the friends that will go on it.) If you allow your clients to become a friend on Facebook but you don’t really know them and aren’t comfortable sharing all your profile information, put them on a list named “Clients.” When you upload photos or put in new status updates, you can click on the little lock icon to set the privacy. Select the “Custom” feature and type in the name of your list under “Hide this from…” From here you can block or allow access to your photos and other profile information depending on the name of the list. Use this feature! It will allow you to connect with people

you might not know as well, and still feel comfortable sharing pictures of your kids and your family vacation with the people you do know.

Your Business PageNow let’s talk about creating a “Like”

page for your agency (previously called a Fan page). The Like page is a little different from your personal profile. It allows an unlimited number of followers (unlike your personal page limit of 5,000) and can give you the opportunity to connect with your clients without sharing all of your personal information.

To create a Like page, scroll down to the very bottom of your Facebook home page. Keep going all the way to the footer menu and click on “Advertising.” Across the top there will be an option for “Pages.” Click there and create a new page. Facebook will walk you through the settings. When you get started, everything is unpublished so you can edit as needed and click on “Publish” when it is all ready to go. Remember to add a nice head shot photo or agency logo to your page.

Allstate has put out its own set of social media guidelines for agents. There are a few details to keep in mind when creating your agency Facebook page. Per Allstate’s instructions, make sure you do the following:

• Uncheck the “Fan” permissions allowing Fans to write or post content on your wall.

• Remove the “Discussion Board” feature from your page. (Click on “Edit Page” under your profile picture and “Remove Application.”)

• Remove the “Reviews” feature from your page. (Same as the Discussion Board.)

While these can be useful features, you will need to either follow company


guidelines or make a page that does not reference Allstate in any way to avoid being out of compliance.

Finding FollowersWhen you are ready to share your page

and have published it, you now have two objectives. First is to get followers! Here are a few ways to get started:

• Click the “Suggest to Friends” button under the profile picture to share your new page with all of your friends. You can also manually go through and select who you would like to share with.

• Create a link to your new page in your email newsletter and ask your clients to “Like” your page. Links are the best way to direct your clients exactly where you want them to go. Also consider sending a link to any prospects in a follow-up email after giving them a quote.

• Research creating Facebook ads to drive traffic to your page. You can target your city or state and choose your market very specifically. The ads are very inexpensive (around .30 cents a click) and you can test them out for only a couple of dollars a day. To start an ad, go back to the “Advertising” link in the footer menu and select “Ads.”

What should you share and how often?Your second objective is to start

posting content. Social media content that you might share with your followers is easy to find! Links to helpful Websites or information on events in your community tend to be very popular. Don’t talk too much about insurance and don’t directly promote your products over and over again.

You need to offer helpful content to keep them hanging around. As we all know, consumers are generally not too interested in insurance itself, so you want to avoid just discussing policy details and deductibles all day long.

The best advice for how often to post on your Facebook page is once per day and no more than twice. If you are the only thing someone sees on their newsfeed, they will most likely “hide” your posts in the future. This means that even though they like your page, they will never see your updates! So keep the posts useful, entertaining and interesting to keep your followers engaged.

Need advice on where to find good articles and links?

Allstate is actually one of the best insurance companies at providing helpful information for agents to share with their clients via social media. Use it! This will save you time in having to create new content and creates a professional image

for your Facebook page. Here are a few good resources:

• Allstate Updates Blog – http://allstateupdates.com/

• Good Hands Community – Daily Spending Blog – http://bit.ly/daily-spending

• Good Hands Community – Personal Finance Blog – http://bit.ly/personal-finance

• Good Hands Community – All Things Wheels Blog – http://bit.ly/all-things-wheels

• Good Hands Community – Making A Difference Blog – http://bit.ly/making-a-difference

• Vehicle Vibes – www.vehiclevibes.com

Social media is a great way to connect with prospects and clients and for keeping your agency brand on their minds. While it can take a little bit of time investment to get started, creating a quality page will be worth it. Remember, go where your customers are and don’t waste any time getting started! Ef

Robyn Sharp is a marketing consultant and owner of CaptiveAgents.com. Visit her Facebook page at www.facebook.com/CaptiveAgents for free demonstration vid-eos showing how to set up your own Face-book page!


I’VE BEEN AROUND as an agent for many years. Until now, I’ve mostly watched and listened as our once-great company has re-shaped its business model and the world we know as agents. There-fore, I have decided to put my thoughts and observations into writing and share them with my fellow Allstate agents.

The frustrations we’ve all experienced have been numerous. We’ve all asked, “What has happened to this company?” Or, “Where in the heck are we going?” The agency force has been trying to tell management what the problems are, but they simply don’t listen. Our com-petitive posture has taken us out of the marketplace. They are demanding more and more auto production in an era when growth appears to be impossible given our rate structure.

The kickoff meetings earlier this year gave us at least a partial indication of the

Are We Really the Best?BY THE “ANDY ROONEY” OF NAPAA

company’s thinking when it brought in a spokesperson who offered us an analogy of a box manufacturer that charges more for its boxes than other box makers, yet has no problem selling boxes. The reason, suggested the spokesperson, is because they are the best box maker around. This logic works fine when you’re the best, but what if you aren’t? After all, I think we all can recognize the difference in qual-ity between a Cadillac and a Yugo, right? But when we liken this comparison to the insurance business, we really need to ask ourselves, “Are we the best company in the business? Well, are we?”

Let’s look at that a moment. For many years when Consumer Reports was rank-ing insurance companies, we consistently came out at, or near the bottom of the standard insurance companies for our method of doing business. As agents, we couldn’t figure out why the company al-

ways got a bad rap, especially since we always thought of ourselves as the best trained insurance people around. We delivered extraordinary customer service and always tried to do the right things for our customers. But here was this in-dependent rating organization regularly giving us low marks compared to other companies.

Were we the best then? How about now? We’ve moved some of the custom-er service operations overseas. Have we gotten better because of this, or did we do this because it’s cheaper to do busi-ness? We consistently get emails telling us that a whole group of our customers had renewals issued incorrectly, but be-cause of privacy issues, we can’t be told who they are. Since we can’t find out who they are until after they’ve left, we are powerless to retain them. Does that sound like a top-rated company? And we’ve got computer problems galore. If you add up all the time we spend reboot-ing, reopening and re-inputting informa-tion, it’s a wonder we write any insurance at all. Upgrading computer technology is supposed to make the job of serving our customers easier, not harder. Does this sound like a world-class operation? I haven’t even broached the subject of the controversial McKinsey documents and their affect on our corporate image. As I understand it, this issue of Exclusive-focus contains two agent reviews of the book, From Good Hands to Boxing Gloves. After reading those reviews, I would sug-gest you ask yourselves again, “Are we the best company in the business?”

This past winter, I had a customer who needed an emergency tow in northern Michigan during a blizzard. She called the number on her Allstate Motor Club card and instantly knew she was talking to someone in India. Nothing wrong with that, but the person who was try-

feature


ing to help her contacted a service station over 100 miles from her location. People in another country don’t understand the geography in this country. So when the service provider finally arrived more than three hours later, he charged her an ad-ditional $120 because of the distance he had to come. It’s clear to me that Allstate sets up shop in other countries because it’s cheaper, not more efficient. Is this another example of how we’re the best? What I have found in recent years is that everything seems more difficult than it once was, yet we’re told that everything is being done to benefit ours customers and make than happy. I have to wonder if that pricey box company has its customer service operations located in India…

I was at a meeting recently when a discussion came up about forwarding our phones and being open the day after Thanksgiving. We were told that these moves were made because the customers demanded it. I can’t imagine why a cus-tomer would need to change a car at 3:00 a.m., but let’s assume the company’s rea-son is valid. Let’s also assume that the be-ing open the day after Thanksgiving was to satisfy the customer as well. But what about rate relief? Hasn’t the customer has made it abundantly clear that he needs rate relief as well. How does the compa-ny, which says that it does everything for the customer, react to rate relief requests? That subject can’t even be discussed… its taboo, verboten, prohibido. Manage-ment refuses to acknowledge that our rates play a role in the mass exodus of our books of business. Seriously, how many of our customers have left because they couldn’t reach us after normal business hours? How many have left because we were unavailable the day after Thanks-giving? And finally, how many customers have left because our rate structure was so abhorrent? My guess is probably very few left for the first two reasons, but you can bet that they left in droves because of third reason. Yet the company refuses to address this all-important issue; is man-agement that badly informed?

What puzzles me is that management doesn’t seem to get it. By maintaining this posture we are practicing adverse se-lection in a way we have never done be-fore in my very long Allstate career. The

customers with really good IFS scores and clean driving records are gone, or will be, because they can easily find better rates. As a company, we retain customers with double digit IFS scores and claim frequency problems because they can’t go anywhere else. Don’t they see this?

Any agent worth his salt can usually retain his customers even if he is $100 to $200 higher than the competition be-cause of the bond he’s developed and fos-tered with his clients. They know we are there for them and frankly, if our service has been superb, we are worth it. How-ever, when we are $400, $500 or $600

Do you think a move like that would embrace our customer base? I sure do. It would show our customers that Allstate, like everyone else in this economy, is not immune to belt-tightening and sacrifice in hard times. But no, we won’t do that. Wall Street’s insatiable appetite must be satisfied. Management bonuses and shareholder dividends must be paid. And another great PR opportunity is wasted.

It seems to me when you’re in an in-dustry whose sole purpose is to provide service to customers and make them happy, and you accomplish that year af-ter year, you will be rewarded with pas-sionate and devoted clients who will sing your praises on the Internet, Twitter, Facebook, and to anyone who will lis-ten. You cannot manufacture this kind of customer loyalty; it must be earned through consistent and deliberate efforts that shout “the customer is king.” This is how you build a great reputation that keeps customers coming back asking for more, not by donning a pair of boxing gloves when a claim is made. If manage-ment could ever grasp this basic concept and actually figure out how to implement it without putting the fear of God in the agency force, the stock price would take care of itself.

In this economic climate, price is the most important thing. If you don’t believe that, then don’t be surprised when you hear the sound GEICO’s footsteps get-ting closer and closer. Do you hear them? I do. As for overtaking State Farm in ten years, that’s a pipedream. And we’ve been playing that game as long as I’ve been an agent, which would be since Tom Wil-son was in his teens. State Farm plays the game better than we do and it will rise to the challenge. One big difference between them and us is that they respect their ex-perienced agents – they’re not out there firing them for little or no reason.

I’ll be back again in the next issue with more observations and opinions. We’ll try to discuss questions like “What ever hap-pened to that mountain of money that was required to be set aside in reserve when we were writing earthquake insurance? Where did it go?” Or, maybe we’ll talk about why the company is issuing checkbooks instead of settlement checks when a life insurance claim is paid. Stay tuned… Ef

more than the rest, we lose them and they don’t come back, unless, of course, we can save them hundreds of dollars. And who can blame them? Heck, my rates are out of control too, and if they go up again, I’ll do the same thing my customers are doing.

It’s beyond me why, in this devastat-ing economic climate, company manage-ment doesn’t say “we know we may have to take rates, but due to the economic hardship it would cause our customers and the in-crease in customer defections we would suf-fer, we will delay any increase at this time.”

In this economic climate, price is the most important thing. If you don’t believe that, then don’t be

surprised when you hear the sound of GEICO’s footsteps

getting closer and closer.


PICTURE THIS SCENARIO…you are at a cocktail party mingling with oth-er attendees and someone asks what you do for a living. It’s the big question of the evening, so how do you respond? No doubt, most agents would probably reply by saying, “I run an insurance agency.” Guess what? Wrong answer!

I know, I know, you think I’m crazy because you do run an insurance agency. But, the right answer is that you are in marketing. Running an insurance agency just happens to be the business you’re in. Think about it, without marketing we would have no businesses!

Marketing is the time that you spend creating new experiences for prospective clients. Big, successful companies have the luxury of recognizable branding and millions of advertising dollars at their dis-posal to support their ad campaigns. But what advantages do small business own-ers have? We have something even more powerful, if we decide to make use of it. It is the “relationships” we have with our current customers, prospects and centers of influence. If utilized properly, these re-lationships will generate referral business to you on a regular and ongoing basis.

Do you know what one of the most important parts of marketing is? Direct response marketing and leveraging your relationships with your current custom-

This is what is unique to us!Personality Marketing when done cor-

rectly, puts a fence around your customers that guards them from the competition. First of all, we must all understand that our customers do not want to leave us. They will not jump to an unknown com-petitor for lower rates when they know that you always treat them right, treat them with respect and take care of their needs efficiently and correctly every time.

Following are some ways that you can market to your current clients:

• Email Marketing • Monthly Newsletters• Referral Programs• Annual Policy Reviews - Emphasiz-

ing discounts & other offerings• Customer Appreciation EventsI have been using these tactics in my

business for many years and they work! I don’t waste my time on unprofitable or ineffective marketing techniques. When I find something that works, I stick with it.

I continually seek new ideas to im-prove on my current marketing. The key to growing your business is to continu-ally market every day! You don’t have to spend a ton of money, but once you find the tactics that work in your agency, stick with them and then look for others. And most importantly, don’t lose sight of the needs and wants of your customers. Pay attention to them and nurture them be-cause they are like gold and will always be your best source for referrals and ad-ditional sales. Ef

Bill Gough is President of BGI Marketing Systems. BGI will host a three-day “Mar-keting Mastery Workshop,” September 16-18 in Chicago. This workshop will reveal the marketing secrets Bill has learned over the last 15 years from top Allstate agents. For complete details, go to www.BGIWork-shops.com or call (877) 208-9649.

Our Real Business is... Marketing!BY ALLSTATE AGENCY OWNER BILL GOUGH

ers and prospects through what I call Personality Marketing.

One of the best things you can do is to use personality marketing with your current customers, prospects and centers of influence. After all, these are the folks who know, like and trust you already. They are the people who will be most re-ceptive and who want to know what you have to offer. They want to continue their relationship with you or they wouldn’t be your customer in the first place. And they want your recommendation on products that they don’t already have. You see, your customers don’t want to shop the competition – they want a professional they can rely on for the rest of their lives. And guess what? They chose you!

So, the greatest strength we have as local agency owners is our relationship with our customers. Since day one, we have been told that our biggest strength is the brand we represent. This is not necessarily true, even though the giants we represent have gazillions of dollars to invest in promoting their brands. As small business owners, we don’t have this luxury, but what we can do is provide a personal level of service that no compa-ny can ever match. Combined with the strength of the brand we represent, it be-comes a powerful combination that can’t be found anywhere else in the industry.

marketing tips

Allstate�Insurance�Agency�Owner�Bill�Gough�Announces�A��Revolutionary,�BGI�Marketing�Mastery�Workshop,�Intended��

ONLY�For�Allstate�Insurance�Agency�Owners�Who�Seriously�Want��To�Take�Advantage�Of,�And�Profit�From�These�Economic�Times!!��

For�complete�details,�go�to�www.BGIWorkshops.com��or�call�1�877�208�9649�Toll�Free�NOW!!��

You probably got into the insurance business to make a great living and to have independence, to be in control, to feel confident and powerful, perhaps to be seen and respected as a business leader and known in your community, to have a more interesting and exciting live, and to create security and wealth.

Isn’t�This�What�Your�Insurance�Agency�Is�SUPPOSED�To�Be�Providing�You?��If your agency isn’t providing you all of these things, or if it has slipped away, then you owe it to yourself and your family to make the commitment RIGHT NOW to attend the BGI Marketing Mastery Workshop in Chicago, Illinois in September 16th-18th, 2010.

Most insurance agencies try to build businesses completely backwards. They attempt to build their agency by working hard, but without a compass, proper business sys-tems, or structured roadmap. You may not have stopped to think about it lately, but ask yourself… �Why�did�you�get�into�the�insurance�business�in�the�first�place?�� Did�You�Get�In�The�Insurance�Business�To�Work�Harder,�To�Work�Longer�Hours�

Every�Single�Day,�To�Fear�Taking�Time�Off?�� Did�You�Get�In�The�Insurance�Business�To�Worry�Endlessly�About�Where�Next�

Weeks’�Customers�and�Revenues�Are�Coming�From?�� Did�You�Get�In�The�Insurance�Business�To�Have�Relationship�Stress�On�A�Regular�

Basis?�� Did�You�Get�In�The�Insurance�Business�To�Just�Provide�Jobs�For�Those�In�Your�

Community�And�Pay�Lots�of�Taxes?�� Did�You�Get�In�The�Insurance�Business�To�Just�Pay�Your�Bills…�And�To�Earn�A�

Living?�� Did�You�Get�In�The�Insurance�Business�To�Be�A�‘Coal�Miner’…�“Hi�Ho,�Hi�Ho,�

It’s�Off�To�Work�I�Go”��

Bill Gough, Allstate Agent The behind the scenes “secret weapon” used by hundreds of suc-cessful Allstate Insurance Agency Owners. Agents hire Bill to help them grow their Book of Business, improve retention, and increase agency profits.

Bill’s Agency has qualified for Inner Circle 5 times, Chairman’s 12 times, Honor Ring 20 years, Na-tional Conference 5 years, and Leader’s Forum 18 years.

See�What�Other�Allstate�Insurance�Agency�Owners�Are�Saying�About�Bill�Gough:��

“I’ve had the blessing of knowing Bill Gough for many years. I’ve referred many people to him because he is absolutely, with-out a doubt, a Marketing Guru inside of Allstate, and besides he’s just a neat guy.”

Laura Harris, Corpus Christi, TX “Attending Bill’s 3 day event was PHENOMENAL! This is a great opportunity for ANYBODY, new and experienced agents alike!!”

Eugene Ungermann, Los Angeles, CA “I’ve been around for 40 years and we’re one of the top agencies in the country. Bill’s 3 day event was one of the most valuable things we’ve ever done. If we can use it, anybody can and I mean that!”

Jack Hallberg, Chicago, IL “Bill’s systems made an immediate difference in retention and new business. We added an additional $19,125.00 of annual income that will continue to roll in year after year. The ROI is staggering!”

Devery Prince, Anchorage, AK

BGI Marketing Systems / Phone: 877-208-9649 / Web: www.BGIWorkshops.com


A SUDDEN SCREECHING noise penetrates the massive hand-carved, sol-id mahogany doors. CEO Tom Wilson raises his right hand from the silk-lined massage table. His personal masseur, Pierre from Paris, pauses at the signal and watches as Wilson, wrapped only in a towel, leaves the table and tiptoes over to his office doors. With one hand holding the towel and the other gently cupping his ear, Wilson cocks his head, straining to hear the out of place sounds emanating from beyond the doors.

“Security!” someone shouts. “Will someone call security?” After a few muf-fled grunts, followed by cackles of laugh-ter, the screeching becomes loud enough that Wilson instinctively leaps back from the doors just as they burst open. “What the...” Wilson croaks, as the blur of a caped man atop an indistinguishable conveyance whips into his office.

“Whoo hooo,” shouts the figure as his cape spins wildly about, slapping Pierre in the face as he whizzes past. Wilson stares on in disbelief as he suddenly recognizes that the caped crusader careening around the massage table on a red and yellow, flame-embossed, supercharged Segway scooter is none other than former All-state CEO Ed Liddy. With his third lap around the table completed and the sudden appearance of three rather large and unpleasant looking security guards, Liddy comes to a screeching halt in front of a slack-jawed Tom Wilson.

“Well what do you think Tommy Boy? Not a bad entrance for a guy who is here to save the day!” Liddy flings his cape over his shoulder and with the aplomb of a circus acrobat, leaps gently to the marble floor.

“Okay everybody,” Wilson says. “I’ve got this. Nothing to see here. Move along.” With small flicking movements of his hands, he shoos everyone but Lid-dy out of his office.

After closing the doors, Wilson com-poses himself and takes in a deep breath. Turning to face the caped Ed Liddy, he instead finds an empty space. Wilson quickly scans his enormous office to locate his longtime mentor and friend. Pushing the smoking Segway human transporter out of his way, Wilson stalks over to his desk where he finds Ed Liddy comfortably ensconced in his $12,000 handcrafted Corinthian leather execu-tive chair.

Before Wilson could speak, Liddy rais-es his gloved right hand like a traffic cop and then motions for Wilson to sit down. “Tommy Boy, I know you weren’t neces-sarily expecting me.” Liddy states flatly. “But I’ve got to say the way things have been going for you lately, I feel the need to, well let’s just say, ride to the rescue.”

Wilson turns his head slightly and

glances over at the still smoking Segway. Liddy presses on. “The way I see it,

your recent performance for Q1 is mostly below quota, and since you can ratchet up premiums only so high on our loyal customers, you’re going to need a fresh approach to increasing revenues.” Lid-dy pauses long enough to light one of Wilson’s $125 Cuban cigars. “And that Emerging Business thing you started, fo-cused on all the wrong things. Sure, you can sell a golf cart policy here and there, but what you need to do is sell insurance policies to the masses. We need a grass roots policy that we can rely on. One that addresses the real emerging markets of current and future generations.”

Much like a reticent school boy being lectured for poor grades, Wilson sinks back into his chair. With his lower lip sliding forward into “full pout” mode, he crosses his arms with a grunt and glowers at his mentor.

Liddy preens his silken cape into a new position and presses on. “Now Tommy Boy, trust me. I know what the company needs. And believe me; what I’ve got is way better than the Parts and Labor program I introduced in the 90’s. Why, I would even go so far to say that it will make our idea of selling mutual funds look like promoting a kid’s lemonade stand in a blizzard. And if you crack the whip on those slacker agents you’ve got working for you, we can not only blow the doors off your PIF growth, we can structure a whole new bonus arrange-ment for management.”

At those words Wilson sucks in his lower lip and bolts forward in his chair. He looks up intently, if not almost lovingly at Liddy and says, “Did you say bonus?”

Flinging his cape over his shoulder, Liddy stands up and begins to pace be-hind the desk. “Tommy Boy,” he croons, “there will be no end to the cash this

Ed Liddy Saves the DayANONYMOUSLY SUBMITTED

humor


little jewel can create. Are you ready? Do you want to hear what my brilliant mind has created? This is so genius, I’ll probably be asked to come back as CEO. Ahem, I mean ...that is...” Liddy begins to stammer. “Well, what I meant to say... is if I was ever asked to come back af-ter you retired. And not that you would even want to retire for a while yet.” Liddy turns away from Wilson’s gaze and jerks his fist in self-admonishment.

“Okay Tommy Boy, here’s the deal,” Liddy says turning back to face Wilson. “We market a policy to protect our in-sureds’ personal recreational activities. Let me give you an example. Let’s say a snowboarder hits a thin patch of snow and a rock puts a ding in the board; we cover that. Then let’s say the same snow-boarder loses control while bailing out of a double black diamond mogul run and creams an old lady making her first trip down the bunny hill; we cover that.” Liddy pauses for effect and also to make sure Wilson is still paying attention. “Another excellent example would be to insure these babies,” pointing to his su-percharged Segway scooter. “Pretty soon these things will be in every household.

Mark my words these things are great. Everyone will own one. You watch; they’ll be everywhere. What a market!”

Wilson frowns and interjects, “Haven’t they been out for a while and I didn’t think sales were too ...” His voice trails off and he stops mid-sentence as Liddy waives his hands dismissively. “No mat-ter Tommy Boy, remember back in the day when I predicted that the Internet would be the future of insurance? Was I right? Of course I was. And the Segway market is kinda like that. They’re great. You should get one before the price goes up. Anyway, the point is, we can expect to insure thousands, no, millions of them and all of the liability exposure that goes with them.”

Liddy stops pacing, places both hands on the hand-carved mahogany desk and grows serious as he looks Wilson square-ly in the eye and says, “Whatever kind of recreational activity exists, from skate-boarding to snowboarding to rollerblad-ing, if it moves, we can cover it. Heck, we should consider adding bungee jumping - think of the rate we could get for that! Anyway, I call this new emerging market plan the Comprehensive Recreational

Activity Policy. Brilliant, eh?”Wilson cocks his head to one side like

an inquisitive pigeon and repeats the new product’s name: “Comprehensive Recre-ational Activity Policy. Let’s see, the ac-ronym for that would be C. R. A. .......”

Just then a screeching noise interrupts Wilson’s train of thought. “Whoo hooo,” Liddy shouts as he zooms by on the Seg-way. “The Lidster saves the day.” Liddy reaches out with one hand and pulls the office door open as he zooms by. “I’ll be in touch with all the particulars. Don’t worry Tommy Boy; this will be bigger than the requirement for agents to keep Saturday office hours.” Liddy caroms be-tween the forgotten massage table and where Wilson is standing still clad only in a towel. “Mark my words,” he prac-tically shouts. “This will even generate more to our bottom line than firing all those agents and hiring them back as in-dependent contractors.”

Wilson barely hears Liddy’s last words as he scurries out of the office and down the hall. And then, drafted by the wake of the speeding Segway, the mahogany door slams shut leaving Wilson suddenly alone.

Wilson finishes his last sentence, “P.” Ef

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IN TODAY’S NEW normal economy where everyone is re-thinking how and where they spend their dollars, selling is all about being just different enough to prove you have an edge on the details and knowledge of your product.

In the end, everybody is in sales. Even the dentist who sends a checkup remind-er is selling you on the necessity to get your teeth examined every six months. Sell, sell, sell. This is, or should be, espe-cially true in the insurance business be-cause agents are always selling. They sell new policies on the front end and then

have to convince people to renew their policies on the back end. Yet, with all this selling, there are few new approaches to convey that you care more for your cus-tomers than other insurance agents.

What’s made me buy, and keep buy-ing, from those I’ve bought from in the past? I’ve asked my electrician to fix dor-mant door bells, only to be told, Rob you can do it yourself. He was right, I could, and he saved me about $100. That’s hon-esty. As my cars have grown older, my agent pointed out that I don’t need the coverage for replacement cost for keys

with microchips in them. While that simple suggestion saved me money, my agent lost some because of the lower re-newal premium. That’s paying attention to me, the customer, and I appreciate it. I buy from those I believe to be honest and who have more knowledge than me on a particular product or service. In-surance is a product that most people don’t fully understand, so an agent who demonstrates good customer service and product knowledge, and willingly sug-gests appropriate coverage modifications, whether it profits him or not, is the agent that will earn the most business, espe-cially at renewal time.

As we know in the insurance business, an “ounce of prevention is worth a pound of cure,” but preventing claims is not likely to be the first or foremost thought in the minds of homeowners until a claim has occurred. Try as agents and Dennis Haysbert may, it’s hard to get clients to be proactive. There just isn’t much im-mediate financial gain or emotional tug to motivate a homeowner to action.

Enter a dog named “ALI.” Roughly 40% of U.S. households have an ALI, and if there was ever an emotional mo-tivation, it’s the family dog. But dogs are not an underwriter’s best friend. As the Insurance Information Institute (iii.org) reports: one-third of all liability claims on homeowners’ policies are related to dog bites. Fifty percent of all dog bites occur on the dog owner’s property and the average claim in 2008 was $24,461. But while this scenario is a bad one for dog owners, it is one where an insurance agent can help out and endear himself to the homeowner at the same time.

Homeowners might listen more in-tently on how best to safeguard their home and property when their dog’s name comes up. Dog bite blame is usu-ally directed at the dog since dogs can’t

Can “ALI” be an Agent’s Best Friend?BY ROB LOOMIS

retention and loyalty


tell their side of the story. But dog bites are beyond just another item on the “un-pleasant to do list,” they are emotionally draining for the dog owner. Laws cover-ing dogs vary by city, county and state and each year there is more regulation. In Fulton County, Georgia, which includes parts of Atlanta, reported dog bites trig-ger the Animal Control Department to quarantine the dog for a week. The pur-pose, regardless of when the dog received its rabies vaccine, is to ensure that the dog has not recently been bitten by a ra-bid wild animal. Needless to say, a week without those soulful looking eyes and wagging tail makes for a traumatic week for the dog’s family and the dog. And like so many incidents and accidents, dog bites don’t fall into those open calendar dates, they seem to happen at the worst possible times.

As an insurance agent, you can help prevent such unpleasant dog-related epi-sodes for your customers. Loss preven-tion awareness is vital to maintaining a low loss ratio, so it is critical that agents suggest ideas that can help reduce the possibility of preventable losses. Educat-ing your customers on the consequences of dog bites is an eye-opener for most people. Many dog owners don’t realize how much a dog-bite can cost the in-surance company or that their insurance policy can be cancelled as a result of one or more dog-related incidents. In addi-tion, agents can offer their clients advice on how to best manage dog risks and provide or recommend sensible, low-cost safeguards that dog owners can use to thwart future claims from occurring.

Dog breeders all want to know how their dog is going to be treated and housed, so quality breeders ask prospec-tive puppy owners facts about their liv-ing situation, lifestyle and oftentimes inquire if there is, or will be, a fenced yard available. A fenced yard is a big key to their degree of comfort in selling someone a puppy. “Fenced” means a real fence, not the underground or invisible “fences” that require the dog to wear a special collar. The reason is simple; these types of fencing do not keep neighbor-hood children or wild animals separated from the dog. While the dog can’t leave the yard, humans and other animals can

find themselves inside the dog’s territory without knowing it. There’s a long list of people who enter a homeowner’s yard. The list includes meter readers, service techs, delivery people, contractors and utility workers, all of whom are strang-ers to even a gentle dog. In case a wild animal ventures into the electronically fenced area, the dog cannot escape to safety. Real fencing not only makes for good neighbors, it makes for a safer en-vironment for the dog.

Most dog owners will readily admit that in today’s litigious society their dog can easily become a liability. Creating eye-pleasing signage to post on one’s property has not exactly been a top pri-ority for the exterior home décor indus-try, so taking the actual steps to post a property isn’t easy for a dog owner. It is an area that pretty much stops after ad-dress plaques and decorative mailboxes. The only signage options readily avail-able are limited to the black and orange plastic variety. So, why not just walk into a local hardware store and find a great sign? The large signage manufacturers have shown little interest, leaving small manufacturers to this niche market. Yet these small manufacturers face an uphill battle for shelf space as the big retailers pare their offerings in a down economy,

leaving dog owners with few options. With dog owners comprising up to

40% of your book of business or more, they may represent the single biggest af-finity group among your customers. As such, endearing yourself to this customer segment may pay significant dividends in your policy retention and ALI score. This could be as simple as including tips for dog owners in your agency newsletter, keeping a record of the family dog’s name for use in future conversations, support-ing your local Humane Society, offering free pet identification tags or other dog-specific giveaways, such as yard signs that inform the public that there is a dog on the premises, possibly lowering the inci-dence of dog bite claims in your book of business.

Whether you use one of these sug-gestions, or come up with a unique dog-friendly idea of your own, looking out for the family dog makes good business sense. It will increase good will and im-prove retention. And finally, remember that “ALI” the dog could be your ticket to a better loyalty score. Ef

Rob Loomis is vice president of sales for The Original Property Postings, manufacturer of a line of residential signage available at www.doginyard.com.

Contract Terminated? If you have been termi-nated by the company for failure to meet expected results, NAPAA wants to help. We will post your agency for sale on our Website at no charge. Just fax or email a copy of your termi-nation letter to 866-627-2232, or [email protected]. After forwarding your termination letter to us, go to the Sell Agency Listing page at www.napaausa.org and fill out the information you want included in your ad.

Important: Be sure to click “NAPAA Member – No Charge” before sending. We will post your listing for free.


June 7, 2010

Dear Joe,I am very encouraged by the tone and ambition of your recent memo to us in the field. I venture to say that, almost to a

person, we agents bleed Allstate blue and wish nothing but success for Allstate in its quest to become number one and we want to do our part to achieve that goal.

I am pained to remind you, however, that from the agent’s limited point of view, major management mistakes have been made. Certainly there have been some over which the company has had little or no control. Still, a great many errors have occurred because of a business philosophy and attitude that disregards feedback from the field and common sense suggestions from both agents and NAPAA. This has resulted in serious problems, mostly which have been self-induced, that have proven to be destructive to Allstate and the agency force.

My observation has been that our insureds would like to be treated as “clients,” not just temporary customers to be managed by the company for the company’s benefit. What do I mean by this? Since it was you who announced the “State Farm Challenge” and asked for comments, there is something you should know about this worthy adversary. It’s a basic, but important difference. When State Farm implements a line stoppage, such as a homeowner’s moratorium, they have the good business sense to give their existing policyholders preferential treatment when buying a different home, even when a moratorium is in effect. Of course, there are some areas where they won’t write policies for anyone, but for the others they’ll write a new homeowner policy for their existing policyholders.

On the other hand, Allstate, in its aggressive attempt to reduce its home and auto losses, inundates clients with a slew of paperwork, inspections, mileage verification questionnaires, etc. Then after the customer complies, the company oftentimes denies the veracity of the received answers, even though the insured has supplied the requested information and signed the forms. This is hardly the way to win the loyalty of our customers.

I also don’t understand why Allstate management continues to blame the agents for the company’s loss of PIF. This blame is misplaced. As a corporation, we spend great sums of money to support and tout our Good Hands philosophy. But that philosophy also comes with a responsibility to live up to the promises we make – and these promises must be fulfilled in both word and deed. This includes our reputation. We can never beat State Farm if we don’t change our “boxing gloves” approach.

As for the agents, we can all do better, but ALI is not the golden goose you think it is. I, for one, deeply resent it when the company ties my hands and limits my options to better serve my clients —and then informs me that my ALI ratio needs to improve because I am not providing “excellent” customer service!

The ALI survey should also address and seek answers about customer perceptions of corporate initiatives, customer satisfaction with Allstate service processing, the home inspection process, the no-holds-barred five-day auto payment limit at renewal and other processes that are out of the agent’s control. I would suggest that non-NAB agents, or NAPAA, be allowed to participate in the development of these questions so that we can avert a “fox guarding the henhouse” scenario.

I believe the key to achieving better business results rests upon the realization that both the company and the agent need to value and respect our customers. Achieving the goal that Mr. Wilson has proposed cannot be accomplished by the agency force alone. It will take collective action by every Allstater, from Tom Wilson on down. We must stop, look and listen to what our customers tell us and then take action. This insight can’t be learned from sugar-coated surveys or focus groups; it has to be learned in the trenches, where the agents live every day.

Sure, the stock price is important in the overall picture. And while institutional investors do not care much about the “little guy,” we need to remind them that our success depends on the satisfaction of our policyholders, who are all “little guys.”

Wishing you much success in your endeavors and I am looking forward to your innovative program implementation. I am committed to do my part.

With best regards,A California agent

feature

An Open Letter to Joe Richardson from a California Agent:


MORE THAN 20,000 insurance agen-cies consider policy download a corner-stone for running an effective agency. They’re free of manual file updates and reliance on carrier Web sites for accu-rate policy data. They’re saving money and concentrating on quality customer service. Whether yours is an indepen-dent agency or an exclusive agency that brokers, your business, too, can reap the benefits that download offers.

What is download? Download happens when insurance

carriers process daily output—like policy, billing and claims records—and send it to you electronically so that the data automatically synchronizes with your agency management system.

Your agency and your carriers main-tain separate, unique data management systems. Essentially, your agency collects data for processing and performs critical

customer sales and service functions. In-surance companies primarily process data into policies, endorsements, invoices and claims. Since only a portion of the pro-cessing performed by insurance carriers is initiated by agencies, the daily synchro-nization of data from carrier to agency is critical for keeping accurate data in your agency management system.

It happens while you sleepDownload from carriers to agencies

has occurred night after night without interruption for more than 20 years.

The process is quite simple:• Every agency receives an indus-

try mailbox hosted and managed by IVANS®, an independent company that handles overnight, as well as real-time, interfacing between insurance carriers and agency management systems.

• Every night as insurance companies complete their processing, they trans-mit any changes to each agency’s policy, billing and claims data via the agency’s IVANS mailbox.

• Every morning, each agency’s man-agement system connects to its IVANS mailbox and pulls the updated data files from each carrier. [Note: Since multiple carriers can place updated data into an agency’s mailbox, the agency retrieves all data from all carriers at the same time.]

• Since all carriers agree to transmit their data within an industry standard file format (ACORD AL3), the agency’s management system can easily update its policy, billing and claims records based on the data sent from each carrier.

• When agency personnel arrive each morning, the agency’s data is synchro-nized with the carrier’s data.

For a graphical representation of this workflow, visit www.appliedsystems.com/download.

office solutions

How Download Delivers ValueBY DOUG JOHNSTON


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Where is the value?Start by eliminating paper handling. If

you have not been liberated from the bur-den and expense of manually handling and processing every piece of policy pa-per output by your carriers, you are in for a surprise. When the data synchronized into your agency management system every night is the exact same data print-ed on policies, invoices and claims, you soon realize that handling the paper and manually updating the files is redundant and unnecessary. Because paper handling is also very time-consuming, it takes you

away from customer sales and service and becomes extremely expensive.

Next, look at customer service and customer relationship management. You purchase and install an agency manage-ment system in part to assist in your role of advisor and counselor. From inbound customer inquiries to outbound customer marketing, having accurate data in your system not only provides your custom-ers with the best possible service, it also helps eliminate potential E&O claims arising from incorrect data.

Then there’s SEMCI, which stands

for single-entry, multi-company inter-face. This is one of the most misunder-stood and most valuable concepts in all of insurance. SEMCI is the concept that data entered once is never entered again. Whether it is driver lists, vehicle sched-ules or simply an insured’s name and ad-dress, rekeying data is expensive and also introduces costly data-entry errors.

Here is how SEMCI works in every-day life:

• Policy, billing and/or claims data is loaded into your system from carrier downloads.

• When you need to generate an auto ID card: Click and it’s done. Print, e-mail or fax it.

• When you need to generate a cer-tificate or evidence: Click and it’s done. Print, e-mail or fax it.

• When you need to generate a sum-mary of insurance: Click and it’s done. Print, e-mail or fax it.

• When you need to generate a renew-al application: Click and it’s done. Send the application to the carrier in real time directly from your management system.

• Want to initiate a marketing cam-paign for all customers that have home-owners and auto policies, but not personal umbrella policies? Simply run a marketing search against accurate data, mail-merge a letter or e-mail, and automatically sched-ule a follow-up phone call.

• When your customer calls in a claim: Click First Notice of Loss populated. Submit it to your carrier in real time.

Each action is performed efficiently and accurately because the data is syn-chronized with your system without hu-man intervention.

Now think about your current work-flows. Would they be more efficient and take less time if you implement down-load in your office? Ef

Doug Johnston is Vice President of Part-ner Relations & Product Innovations at Applied Systems, which develops, sells and supports insurance agency management sys-tems and provides services for all agent and broker functions. Allstate downloads policy data through Applied Systems’ TAMOnline agency management system. For more in-formation, contact [email protected] or 800.999.5368.


I WAS FORTUNATE enough to be able to sell my book of business recently. Since selling my book was critical to my retirement plans, it was important that I pick the right advisors to help me with the sale. Based on my experience, I want to recommend someone who aided me greatly in my sale.

I did everything an agent is supposed to do when selling my book. I negotiated the price and provided the relevant infor-mation, like the CSRP, the list 60, etc. I engaged a local lawyer to handle all the le-gal stuff and I was set to go. However, the further I got into the process, the more I

realized that the attorney I had engaged had all the necessary legal background, but had no knowledge of the intricacies and peculiarities involved in selling an Allstate book, nor did he fully understand the concerns of the Allstate agent. Be-cause of this, I wanted someone who un-derstood the uniqueness of my situation. Someone who was aware of the potential pitfalls along the way, and someone who would make every effort to ensure that my financial well-being would be protect-ed—as much as possible—throughout the course of the sale process.

It was then that I decided to ask Dirk

Beamer of Wright Penning & Beamer to act as my consultant. As most of you know, Dirk is the attorney for NAPAA. Who better to know what is needed to complete this sale properly? Dirk’s firm is located in Michigan. Had the sale taken place in Michigan, I would have engaged him to handle the whole transaction, but since it took place in another state, I au-thorized my attorney to engage Dirk as a consultant. This turned out to be a very prudent and fortunate move for me. His professional demeanor made me feel very much at ease and my local attorney found him easy to work with. Dirk was also em-braced by the buyer of my book. Their conversations were very fruitful for both me and my buyer. Dirk always returned my phone inquiries in a timely man-ner and kept me apprised of all matters through e-mail. I had access to all corre-spondence exchanged among the relevant parties and my mind was generally at ease throughout the whole process.

In my case, selling my agency was something I would do only once in my lifetime. Therefore, I needed someone that I felt would be there watching out for me and who knew and understood the individual needs of an Allstate agent who was entering retirement. I found that person in Dirk Beamer.

If you are entering that phase in your life when you will be selling your book of business and are concerned about finding an attorney who understands the legal complexities of the sale process and the uniqueness of being an Allstate agent, maybe you’ll consider doing what I did. It gave me a comfort level I didn’t expect, but certainly welcomed. Ef

legal matters

Selling your Agency? Consider Advisors Who Understand

the Allstate ProcessSUBMITTED ANONYMOUSLY


THE COLORADO STATE Univer-sity forecast team predicts an above-av-erage hurricane season in 2010. Their forecast calls for 15 named storms to form in the Atlantic basin between June 1 and November 30, eight of which are expected to become hurricanes, with four of those developing into major hurricanes. Long-term averages are 9.6 named storms, 5.9 hurricanes and 2.3 major hurricanes per year.

With all of this activity on the hori-zon, how much thought have you given to your paper files? If a storm hit, could you recover all of the information con-tained in your file cabinets? What about your electronic files (e-mails, e-faxes and databases) stored on various hard drives throughout your office? HR files? Sales contracts? Corporate tax records? Do you even know what records you could lose?

“Hurricane season can be an uneasy time, especially for businesses operating near the water. But if business owners convert their paper documents into scanned images and store them online, they can relax knowing that when a storm does blow in, their infor-mation won’t be affected,” explained Leslie Haywood, CEO of eBridge Solutions. “It might be the only thing that allows you to resume normal business operations after a disaster.”

In fact, Gartner Research recently re-leased a chilling statistic; two out of five enterprises that experience a disaster go out of business within five years. The ab-sence of adequate disaster recovery and back-up plans hamper recovery efforts, resulting in a longer time period before day-to-day operations resume.

Now’s the time to update your docu-ment storage plans so when a hurricane,

tornado or other disaster strikes, your in-formation will be protected.

Step One: Get Rid of the Paper

One way to protect your information is to go digital with a web-based docu-ment management system. Then, all files will be housed online in a secure envi-ronment. By doing this, even if all your file cabinets are destroyed, you’ll still be able to access your valuable information.

Document management involves scan-ning paper documents, organizing them using index values and then making them available to view across your business. In addition to paper documents, electron-ic documents and e-mails can also be stored online. A good document man-agement system consolidates all impor-tant documents within an organization regardless of the type of document. This consolidation creates a centralized elec-tronic repository that not only improves operational efficiency, but also makes it possible to create and implement a suc-cessful disaster recovery plan.

Once the documents are scanned, the original paperwork can be securely shred. That frees up space in the office and, more importantly, puts the documents out of harm’s way.

Some business owners are proactive and scan before the first sign of a storm. “I feel I’m better prepared for any disas-ter that might occur because I can ac-cess my files from any online computer, allowing me to operate and protect my agency from possible E&O scenarios,” explained John Chapetta of Chappetta Insurance in Metairie, Louisiana. Liv-ing on the Gulf Coast post-Hurricane Katrina gave him plenty of motivation to start scanning his documents.

office solutions

How Hurricane-proof are Your Business Records?

BY STEVE MOHR


Fed Up With Your Paper Files?

www.ebridge-solutions.com 877.676.6067

With eBridge Solutions’ online document management system and eAgent— our new agency management tool — you can eliminate file cabinets and paper forever. By storing your customer data and electronic documents in one program, you’ll:

• Reduce operating expenses• Increase staff productivity• Improve customer service and compliance• Implement back-up and recovery systems• Decrease physical storage space• Increase your ability to cross sell• Go green

All of eBridge Solutions’ low-cost start-up and monthly maintenance fees can be charged to your Executive Advantage card.

Call eBridge Solutions today to set up a demo and see for yourself why now is the perfect time to go paperless!

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The financial cost of lost business in-formation swells when important cus-tomer records, product information, or business files cannot be found. Re-creat-ing documents is only one aspect of the cost associated with lost information - the loss of proprietary knowledge can be an even greater cost.

Step Two: Back-Up Electronic Documents

Web-based document management systems also take the burden of backing up those electronic documents off the busi-ness owner. As files are added to the docu-ment management system, they should be backed-up in real time. In addition, some document management companies offer monthly back-up CDs of scanned docu-ments that business owners can keep for additional peace of mind.

Step Three: Test your Back-Up System

If your document management pro-vider gives you back-up CDs, make sure they have all of the information you need

on them. Don’t wait until there is a disas-ter to pop them in your computer. Then, make sure you store them off-site. The CDs won’t help if they are underwater in your office.

Step Four: Rest Easy

Once you’ve converted your paper documents and started storing them to-gether online with your electronic docu-ments, you’ll be better prepared for a hurricane, flood or fire. Hopefully, you’ll never need to refer to your disaster-re-covery plan or back-up CDs, but they’re there if you need them.

In the event of a disaster, the goal is to be able to quickly establish a temporary office and restore all critical documents. Using a web-based document manage-ment system should let you and your employees resume working as quickly as possible. Ef

Steve Mohr is a National Account Manager at eBridge Solutions, a Tampa-based docu-ment management provider.

34 – Exclusivefocus Summer 2010

• 2010 National EA Conference & Job Fair

AS A SECOND TIME attendee to NAPAA’s annual conference, I feel uniquely qualified to provide a review of this year’s event. It is not that my attend-ing the meeting twice is any great record, especially since I met several individuals who have been attending since the orga-nization was founded some 20 years ago. Instead, my qualifications relate to the fact that I specifically attended this year’s con-ference because of the positive experience I had at last year’s conference. So you might say my attendance in 2010 was predicated on some pretty big expectations.

Last year’s conference was held in Sa-vanna, GA at the Mansion on Forsyth Park. Located in a historical district, both the setting and the accommodations were conducive to an intimate meeting. This year, the conference was held at the Gaylord National Resort and Conven-tion Center in National Harbor, Mary-land. If the grand scale of the location site was a preview of what was to come, NAPAA had some big shoes to fill.

Unlike my feelings about attending

An Extraordinary Event…ONE ATTENDEE’S ASSESSMENT OF THE 2010 NAPAA CONFERENCE

last year’s conference, I had zero reser-vations about spending the time and money to attend this year’s meeting. I did, however, approach the meeting with some pretty big expectations. As is natu-ral with attempting to repeat a positive experience, the second time around can be somewhat disappointing. With this in mind, I prepared myself for a letdown. But I am happy to report that it never happened! I can state unequivocally that every part of this year’s conference was outstanding. Every agent in attendance benefited by the hard work of Jim and Nancy Fish, who not only delivered an environment conducive to success for those who plan to stay with Allstate, but also offered advice and opportunities for departing agents.

Billed as the 2010 National EA Con-ference and Job Fair, NAPAA designed and produced a program that included various speakers and vendors who were in sync with the swiftly changing employ-ment landscape that face Allstate agents today. There really was something for

everyone. Keynote speaker Bob Loonan, an American Family agent from Minne-sota, was both inspiring and entertain-ing. His message about “change” was important for everyone. Bob is a well-known speaker and CE instructor in his home state of Minnesota. I took pages of notes and I have already applied several of his suggestions in the daily operations of my agency. NAPAA’s commitment to a successful meeting could have ended with Bob’s presentation, because he was that good. But there was much more, the meeting was just getting started.

Stan Burns, an Allstate EFS, spoke about his techniques for selling AWD and Al Bullard, now an independent agent, spoke about “thinking ahead” and designing a successful action plan when negotiating the sale of your agency. All-

Left Keynote speaker Bob Loonan in action.

Right EFS Stan Burns explains his AWD approach

Summer 2010 Exclusivefocus – 35

2010 National EA Conference & Job Fair •

state agent and NAPAA board member Debe Campos-Fleenor gave an excel-lent presentation on low-cost market-ing techniques. Tom Sanders of Capital Resources presented some great ideas on agency valuation. Gary Leonardi spoke about developing a “winning mindset;” Bryan Shepherd talked about the paper-less office; attorney Betty Lugo covered the pitfalls agents face when selling their agencies and attorney Dirk Beamer con-ducted a legal Q&A session. But, if I had to choose the speaker with the most impact at the conference, I would choose “Mega” agent Ed Hogg.

With a multi-million dollar book com-prised of multiple locations, Ed became an Ideal Agency owner back before the concept ever existed. His frank comments had the crowd on the edge of their seats. I swear, you could have heard a pin drop in the meeting hall. What I got out of it was that it doesn’t matter how success-ful you become, or how big you are, the

letters to NAPAA

Conference Comments

Man, what a two days! Great people and great agenda. You did a fantastic job. I could have spent two days with Ed Hogg and the guy from Sun Mergers and Acquisitions!

. . . . . . . . . . . . .First of all, I was very impressed with

the organization, the professionalism, the appropriate vendors, the helpful speakers and the beautiful hotel at the conference. WOW!

I recommend that all Allstate agents attend at least one of these conferences. Of course, some would not understand the overall urgency or importance of the knowledge provided at a conference like this unless they read Exclusivefocus magazine - especially the latest edition. I intend to share the news from the conference and about NAPAA with trusted agents in my area.

Now the overall cost of the conference,

with travel and hotel was a bit exorbitant for my little bitty budget, but God always works it out. Maybe I will reap huge rewards from attending the conference that will offset the price I paid to attend.

Thank you again for all that you have done for me. I intend to take your advice and what I learned at the conference to make plans for my future. I will take my time and do my homework to make the best and safest choice possible.

. . . . . . . . . . . . .Thank you for having us at the 2010

National EA Conference. It was one of the most informative and motivating meetings/conferences I have been to in years. The speakers were positive and delivered the facts of our trade. It was nice meeting agents from other parts of the country. I can’t think of anything I would change. You did a great job getting quality speakers and vendors

Continued on page 36.Letters continued on page 37.

Left Mega agent Ed Hogg wows the audience.

Right NAPAA board member Al Bul-lard makes a point.



company still micromanages every aspect of your business with a “what are you go-ing to do for me today” attitude. Ed has earned many awards over the years, but has decided to leave the company and has sold most of his agencies. As part of his presentation, he answered questions and stayed past his allotted time to an-swer as many questions as he could.

The “Job Fair/Vendor Fair” portion of the meeting included 26 exhibitors. Like last year, agents were encouraged to visit each vendor using a clever “Treasure Hunt” format. I didn’t embrace the con-cept completely during my first confer-

ence last year, but this year I was eager to engage each vendor to learn about their various products and services. I can confidently state that this portion of the conference was a hit with the other at-tendees, too.

While other conferences have a “break-out-style” format involving simultaneous meetings on different topics, NAPAA has perfected the format of bringing up excellent speakers in quick succession in order to maximize time and attention. That being said, I would like to suggest post-session mini-meetings with each speaker, if space and time were available.

Most of the speakers stayed for the bal-ance of the meeting and talked with in-

Top Left Bob Isacsen (Left) and Jim Fish (Center) with special guests Cindy Turcotte, Monique LaRocque and Rod LaRocque of Canada.

Top Right Association Manager Nancy Fish enjoys a rare break.

Bottom Los Tres Amigos: Dale Rev-els (left), Tom Saunders of Capitol Resources (center), and Tom Jecker (right).

Summer 2010 Exclusivefocus – 37

2010 National EA Conference & Job Fair •

and the hotel was beautiful and the cost was affordable. Plus, as an added bonus, Washington D.C. was a new experience for me.

I will be joining NAPAA and will encourage my fellow Allstate agents to support our organization. Thanks again for all you do. I only regret the time went by so fast.

. . . . . . . . . . . . .I GOT MORE OUT OF

THIS THAN ANY ALLSTATE FUNCTION I HAVE ATTENDED! The topics were great; you couldn’t have done a better job. They were very helpful and interesting. I am going to strongly recommend that other agents join and attend the conference. The cost was very reasonable and it was a good location.

. . . . . . . . . . . . .Kudos for doing another outstanding

job! The venue, the meetings, the opportunities to meet with agents – everything made for a great convention.

I was delighted to be welcomed as if I were an old friend. So many people made me, and my team member, Mark DiVincenzo, feel right at home. We truly regret the plight so many Allstate agents are facing, and do hope we can offer a better “Plan B” when, and if, the time is right. Smart Choice will continue to support NAPAA and the great service and support your organization provides.

I know we’ll be in touch – please don’t hesitate to contact me if I can be of help in any way.

Warmest regards!Mary Beth Yates

Vice President, Strategic Communications

Smart Choice

. . . . . . . . . . . . .I thought it was the best conference

ever. Job Fair was GREAT! Question: Where were the attendees from? Were they mostly from the East? If so, maybe should you consider a western conference location to widen our influence. It is a thought. Keep up the good work.

. . . . . . . . . . . . .Thank you for hosting the meeting.I was overwhelmed by the number

of people there looking for information to get out. I wish it would have been balanced out by people who were having success and felt we had a viable company. There is a lot to be said for surrounding yourself with successful people. I left with a little more knowledge, but a sense of dread instead of being pumped and ready to go make money.

Having said that, I understand Allstate is now offering customers a $35 bonus when they buy an auto policy online. Why am I paying the rent and staffing my agency? This is really in competition with the agents. If there was no bonus, then at least we’d be on a level playing field. What’s the “bonus” for? Having customers deal with lack of talent? Surely, this will teach me to not help customers that didn’t want an agent to begin with.

I would like to learn more about the tools Allstate has that can help us manage our business. I would also like to know more about other tools that can track and manage any brokered business. With the recent management changes, there is a training void that needs to be filled. I think NAPAA could fill this void by offering sessions at the conference where we could learn how to use the marketing tools available to us. I would also be interested in hearing how successful agents maximize their RFG.

I sent the AWD tips received from Stan Burns to my EFS. They were simple and potentially profitable ideas. I don’t think a back up plan is selling health foods or additives for oil. There’s got to be something better for insurance professionals.

dividual agents one-on-one, which was a great benefit.

I am once again struck by the incredible amount of work Jim and Nancy Fish put into this conference. Granted, attendees paid a conference fee, and therefore de-served a quality, well-planned event. My observation is that everyone who attended left with a greater than expected outcome. In reality, it would be very difficult for agents to gain this kind of knowledge, ex-perience and information by themselves. And this is the benefit of NAPAA. Any agent who is not a member should con-sider joining immediately. I personally be-lieve in the saying; “The sum of the parts is greater than the whole.”

NAPAA is the only organization that is dedicated to providing support, infor-mation and communication to the entire Allstate agency sales force. Not even All-state can make that claim. As was the case last year, this year’s conference was about business; it was not an “Us against them” bitch session. I didn’t hear a harsh word spoken against Allstate. Yes, there was some constructive criticism both during and after the sessions, but my impres-sion of the attendees was that they just want to make things better at Allstate. If company managers had been present, which they weren’t, they would have seen a concerned coalition of agents meeting to design a successful future. They would have been sorely disappointed if they ex-pected a “gripe session.”

I will say that with this year’s increased attendance, the variety of age, gender, tenure and ethnic representation was im-pressive. To Allstate’s credit, they have hired a talented, diverse group of agents.

In summary, I would like to urge any nonmembers to join NAPAA. I also sug-gest every agent attend one of these con-ferences to see firsthand what NAPAA is all about, and I’ll bet you’ll be back for more. Believe me, NAPAA is noth-ing like the description you’ve probably heard from your manager.

It is imperative that we coalesce into a large representative organization in or-der to be able to affect our future careers at Allstate. There is not only strength in numbers, there is bargaining power. We need to be a partner in shaping our ca-reers at Allstate, not a victim. Ef

letters to NAPAALetters continued from page 35.

Letter continued on page 38.



letters to NAPAA

I don’t know if I would recommend the annual conference. I’d have to see the agenda and then determine if the topics would benefit me. If we were trying to overcome the fact that people think NAPAA provides too much negative information, then this meeting might have met those expectations. Of course, since one of this year’s main themes was the Job Fair and Plan B opportunities, there were a lot of agents attending who simply want to get out.

The location was great. We signed up for a Washington tour on Saturday and then headed futher down the East Coast for the weekend to see some relatives.

Editor’s Response:Thank you for your thoughtful comments.

I understand your concern about the direction of the conference. It was different than those we’ve had in the recent past. When the Chicago Tribune broke the story about the number of agencies that would be terminated in the next few years, we decided to host a job fair in conjunction with the vendor fair. Believe me; those attendees who were seeking alternatives to their Allstate careers were grateful that NAPAA provided them an opportunity to meet some of the best IA cluster groups in the country.

In addition, we did try to balance the conference with positive speakers such as Bob Loonan, Stan Burns, Tom Sanders and Debe Campos-Fleenor. And we added a dose of reality with mega agent Ed Hogg. All of these speakers offered ways to succeed at Allstate – from coping with change, to frugal marketing ideas, to how to sell more AWD.

I know we may not always deliver the message that individual agents want to hear, but it’s not for a lack of trying. Our primary goal is to help agents be successful. For some that means being successful at Allstate and for others, it’s to become successful after leaving Allstate.

It is my hope that Allstate will come to its senses and abandon its plan to eliminate agencies. Perhaps then, we can focus our full

attention on the growth and prosperity of each and every agency. I’m sorry, if you felt the conference was a negative experience. It wasn’t meant to be.

. . . . . . . . . . . . .I enjoyed the whole event. It was the

best one I’ve attended in three years. Excellent facility and great vendors. I would recommend it to others. I would like to see the speaker who did that nice painting last year again. Maybe we can get Bill Gough next year. I’d like to hear what he has to say. I would also like see some workshops/speakers focused on marketing/selling techniques.

Thanks again. I’m already looking forward to next year.

. . . . . . . . . . . . .I think you did a really good job with

the conference. The hotel/conference center was great and the location was very convenient. I have only been to two conferences. I thought last year was pretty upbeat. I thought this year there was a lot of concern about the future. Most of the speakers were pretty good, but I thought the lawyer from New York was a little

weak. She was vague and very general. I liked Stan Burns’ presentation and he gave me some ideas that I could take back with me and use in my agency. The others presentations were very good, but so much seemed to be focused on Plan B. However, I think you presented what most of the audience wanted to hear.

. . . . . . . . . . . . .Thank you for all your hard work

putting on an incredible conference. Although I personally was only able to attend one full day, I found it very informative and well worth the effort and expense of attending. I would highly recommend that other Allstate agents attend future conferences. The information sharing and camaraderie was astounding. Personally, I found the presentation by Tom Sanders of Capital Resources to be the most beneficial. Also, The Job/Vendor fair was exceptional. As a member of NAPAA since the beginning, and this being my first conference, I was very happy I attended. Again, many thanks for all the hard work by HQ staff and the NAPAA Board. Keeping the agent informed is a very important aspect of our business.

Letters continued from page 37.

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AS I HAVE often said, Allstate agents are by far the best in the industry. All-state agents, unlike those of other com-panies I occasionally consult with, are known for being able to close business. And now that discounts have (finally) gotten Allstate’s rates more competitive, it’s time to aggressively pursue agency growth and get your item count up.

For an Allstate agency to really boost the amount of business it’s writing, the focus needs to be on growing quote vol-ume, not simply trying to increase your closing ratio. Let’s face it, improving your closing ratio by 5 or 10% is a good thing, but it’s not going to change your numbers dramatically and, odds are, it’s not going to max out your bonus or win you any trips.

The Way to Really Get More Business Closed Is To Get More Business Quoted

As you know, this is Allstate’s big push right now anyway. So with corporate breathing down your neck to increase quote volume, it seems like a practical, how-to-do-it plan would be a welcome change.

3 “Sure-Fire” Tips to Increase your Quote Volume

1. Stop Relying only on “Good Hands” Allstate marketing. The mes-sage you communicate to your prospects must be more than “me too.” No one be-lieves you’re the cheapest, so don’t pre-tend. Don’t try to sell a Cadillac policy with a VW sales pitch. Brand building advertising is a thing of the past, so TaG letters and other marketing that pre-dominately pushes the Allstate brand will largely be wasted. While this kind of marketing might help to increase brand awareness for Big Blue, it does little to significantly grow your book of business.

2. Drop your Yellow Page ad. Or, if you qualify for co-op dollars, you might want to drop down to a smaller ad. In a consultation just yesterday, a client named John mentioned he spent $60,000 on his Yellow Page ad last year and couldn’t pro-duce evidence of one single sale that re-sulted from that massive spend. Now for most agents, even $5,000 is a significant investment in Yellow Pages advertising. The problem with Yellow Pages is that it’s a rapidly declining medium, which means you can probably get more bang for your buck elsewhere.

Still convinced that Yellow Pages are the way to go? If so, then I suggest that the next time you go out to dinner with friends or family, ask everyone around the table if they’ve used a traditional phone book in the last 60 days. You’ll be hard-pressed to find one. Because of that, take your marketing dollars and do something else with them. Almost anything, includ-ing newsletters to generate referrals, lead generation postcards to targeted niches, or online marketing would be a better use of

money than a traditional Yellow Page ad. These days, 37% of people use Google

primarily as an online phonebook. So there’s a huge opportunity in placing yourself in front of the tens of thousands of people in your area searching for insurance.

3. Have a good follow-up system when someone requests a quote or in-formation. Keep in mind that 87% of sales come from the second to the seventh contact, not the first. Whether you choose email, phone calls, or direct mail (ideally a combination of all 3), you want to ensure that you get contact information from each person, and communicate frequently. In these communications, don’t simply try to close the sale but offer useful, valuable information that will help in their insur-ance shopping experience. Then, instead of being an unwelcome pest, you become a trusted expert, a friend and a sought-af-ter source of vital information.

So there you have it—three strategies that will absolutely increase the quote vol-ume in your agency. And for the skeptic who scoffs at the simplicity of these strat-egies, I’ll quote the old saying, “Genius is simple ideas well applied.” Every agent I’ve worked with who has applied these strate-gies has increased quote volume, and much more importantly, increased item count, book size and dollars in the bank. Ef

David Neuenschwander is a marketing consultant whose breakthrough strategies and turnkey systems have created explo-sive growth in Allstate Agencies across the country. Visit www.MassiveRFG.com to request your FREE Special Report, “On-line Marketing for Allstate Agents – How to Get All the Agency Exposure and Quote Requests You Can Handle… Guaranteed”

3 Tips Guaranteed to Increase your Quote Volume

BY DAVID NEUENSCHWANDER

marketing

3


Review Number 1

Trial attorney David Berardinelli’s book, From Good Hands to Boxing Gloves, tells about a side of the Allstate business plan that company management would prefer to keep secret. Starting with a recap of an accident involving Jose and Olivia Pincheira, Berardinelli progresses to Allstate’s handling of their claim and

details how his experience as their trial lawyer leads to uncovering a business practice that, in his words, is “The dark side of insurance.”

After Berardinelli quickly relates the facts of the Pincheiras’ accident, he in-troduces us to McKinsey and Company, a high profile consulting firm hired by Allstate in 1992, ostensibly to help re-design the company’s core business plan with special emphasis on claims han-dling. Berardinelli spends the rest of the book describing McKinsey’s new claim process, designed specifically for Allstate. McKinsey calls it “Claims Core Process Redesign,” or CCPR. It has since become Allstate’s standard for claims processing. According to Berardinelli, the CCPR plan

book review

“From Good Hands to Boxing Gloves: The Dark Side of Insurance”

In this issue of Exclusivefocus magazine, we are presenting two reviews of this controversial book about Allstate. The following reviews were independently written by two active Allstate agents who do not know each other’s identities. Both of them wish to re-main anonymous.

would provide Allstate with record profits while, at the same time, deny financial benefits to its policyholders. Berardinelli further likens the McKinsey philosophy, which he says has become benchmark for the Allstate corporate philosophy, to Wall Street’s Gordon Gekko’s claim that “Greed is good.”

During the first few chapters, I initially found myself railing against Berardinelli’s supposition that Allstate was purposefully and maliciously denying the Pincheiras’ claim. After all, being a good “Allstater,” I was naturally going to come to the corpo-ration’s defense. Not knowing the explicit facts of the case, and instead relying on the summary Berardinelli presented, it seemed highly unlikely Allstate would en-gage in a process which not only involved an Allstate agent’s purported lies, but the use of a then-secret formula for defraud-ing Allstate’s own clients. As impatient as I was to quickly dismiss this book as a sour grapes retribution for running his client through the “mill,” Berardinelli pa-tiently tells a story that, in the end, makes a compelling case.

It was breathtaking to read about the depth and breadth the company went through in order to manipulate and, in essence, “invent” a new way to process claims. Previously implemented in oth-er industries, the McKinsey “Greed is Good” philosophy successfully merged Allstate’s pursuit for ever-increasing profits at any cost with the new CCPR claims process. Berardinelli goes on to say that when used as the new standard, CCPR relegates insurance customers to nuisance status and treats them as an impediment to profits rather than the fi-nancial focal point they deserve to be.

In Chapter nine, Berardinelli repro-duces a slide from McKinsey’s February 16, 1994 presentation to Allstate. The


Review Number 2 “I do not believe maximizing profits for

the investors is the only acceptable justifica-tion for all corporate actions. The investors are not the only people who matter. Cor-porations can exist for purposes other than simply maximizing profits.” John Mackey, Whole Foods Market CEO

“The time is always right to do what is right.” ~Martin Luther King, Jr.

Sears - “Satisfaction Guaranteed or your money back.” Allstate - “You’re in good hands.” Reputation. Integrity. Do-ing the right thing. These are, or were, the driving forces of business. Yet we as agents, and especially long-term agents, who have lived by these attributes for years have seen these same virtues disappear at Allstate. We sense it like we sense a storm coming by the wind shifting in the trees. Something’s amiss in our corporation. Just who is the corporation’s customer? As agents, we know who our customer is, but who is Allstate’s customer?

In the must-read book From Good Hands to Boxing Gloves: The Dark Side of Insurance, attorney and author David J. Berardinelli exposes what agents know all too well: the shareholder is Allstate’s customer and enhancing shareholder return is its underlying operating prin-ciple. Mr. Berardinelli is a trial lawyer who worked to become the first person to obtain the now infamous “McKinsey Documents.” The book talks about how the documents “teach insurers to profit by denying or delaying claims,” and how Allstate’s “Good Hands” treatment of its customers has been supplanted with a more aggressive and adversarial approach which, metaphorically speaking, requires the policyholder to don a pair of boxing gloves to spar with the company in order to reach a fair claim settlement.

As agents, we know the traditional rules of insurance. Our customers believe us when we tell them that their homes, autos, property and their lives are in Good Hands. We are the face and heartbeat of

slide depicts a “Current Game” graph showing gradually declining payouts of bodily injury claims over a 1250-day period. The intent is to show that early in a claim’s history; BI payouts tend to be higher, followed by a tapering off and a gradual step-down effect until most claims are settled by the end of the 1250-day period. The same slide also depicts a graph entitled “New Game” in which McKinsey recommends Allstate settle 90% of its claims in less than 180 days, or the “Good Hands” segment, fol-lowed by a deliberate delay of about four more years to settle the remaining 10%. McKinsey labels this segment “Boxing Gloves.” Berardinelli estimates that by giving customers the “Boxing Glove” treatment, Allstate can rack up billions in profits through this new delay tactic. According to Berardinelli, this strategy involves keeping clients away from at-torneys, promising forthcoming fair settlement offers, but not delivering, and exploiting policyholders’ financial vulnerability by making lowball initial settlement offers.

Berardinelli’s logical presentation in From Good Hands to Boxing Gloves aligns the Allstate philosophy with McKinsey and Company’s credo of “Greed is good.” It appears that encouraging Allstate’s pursuit of financial gains at the expense of the very customers it purports to serve is child’s play for McKinsey. Berardinelli reminds us that lest we forget one of the biggest financial scams of our time, one would do well to remember Enron. While the Enron name is synonymous with greed and corruption, it is McKin-sey that provided them with the neces-sary internal mechanics required to pull off their ascent to the top of Wall Street. And while Enron ultimately took the big fall, McKinsey quietly slipped out the back door to pursue its next high-paying client.

From Good Hands to Boxing Gloves con-cisely chronicles Allstate’s connection to and its use of McKinsey and Company’s “Greed is good” philosophy. It defines Allstate’s current direction, which may well serve to dissuade new clients from ever coming close to Allstate’s “Good Hands” for fear they may have to wear boxing gloves instead.

the insurance contract to our customers. They pay their premiums and when they have a covered loss, they believe those Good Hands will make them whole. Re-place the home damaged by a hurricane, tornado or fire; reimburse them for med-ical expenses or horrible injuries from an auto accident, especially if caused by an uninsured motorist. The customer natu-rally believes that Allstate will settle their claim fairly and promptly and will keep the policyholder’s best interests at the center of the process.

According to Berardinelli, “Casualty insurance is indemnity coverage. It doesn’t pay a set benefit. It pays as much as the policyholder needs, up to the policy limit to restore an insured to the same financial posi-tion after the loss that he or she was in prior to the loss.”

I don’t know about you, but these days I have a sense of dread and uncertainty every time a customer calls to report a claim. I never know what to expect any-more. After all, we know Allstate wants to settle the claim as quickly as possible for the least amount of money. My fear is that Allstate will lowball the customer with a “take it or leave it” settlement of-fer. And when this happens, the boxing gloves come out and I get caught in the middle, trying to do the right thing for my customer. Naturally, the company usually wins and I lose another customer.

Allstate Hires McKinsey: 1992First, a little background on McKinsey.

They do not solicit clients. Clients have to seek them out, just as Enron did. So why did Allstate seek and then adopt McKin-sey’s business model and what motives did senior executives at Allstate have?

As you may recall, in 1992 Sears, try-ing to prop up its suffering retail busi-ness, decided to spin off Allstate, Cold-well Banker and Dean Witter. Sears, of course, didn’t make the official an-nouncement of its plan until 1993, but some senior executives at Allstate seem to have been tipped off to the then-secret restructuring plan.

Enter Ed LiddyIn 1992, Sears’ CFO was Ed Liddy. Just

two years later he becomes president and CEO of Allstate. Coincidence? While at


Sears, Liddy’s executive compensation was mostly in the form of Sears stock and options, which were dependent on the entire performance of four separate busi-nesses. All that changed when Allstate was spun off and became the nation’s largest publicly traded personal lines in-surance company. Thereafter, executive stock options would depend solely on Allstate’s ability to increase net profits and build the value of Allstate stock.

McKinsey urged Allstate to align the in-terests of its employees and management with those of the shareholder. According to Berardinelli, “Proof of McKinsey’s plan to put shareholders ahead of policyholders isn’t hard to find. Allstate’s 2005 Proxy State-ment clearly spells out this plan: ‘Because we believe strongly in linking the interests of management with those of our shareholders, we first instituted stock ownership goals in 1996 for executives at the vice president level and above.’” Therefore, “Allstate CEOs are required to own company stock worth seven times their annual salary. Senior manage-ment executives are required to own stock worth four times their annual salary.”

You do the math. If you owned millions of Allstate shares whose interest would you protect? Who would your customer be, the policyholder or the shareholder?

“At the time of his retirement on De-cember 31, 2006 Liddy owned almost 4 million shares of Allstate worth approxi-mately $250,000,000 at the market price of $65.11” But wait, there’s more! “In all, Liddy’s move to Allstate in 1994 netted a PERSONAL FORTUNE of approximate-ly $350 million upon retirement on Decem-ber 31, 2006 - much of it due to McKinsey’s business model.”

For Liddy and other executives, in-cluding current president and CEO Tom Wilson, it was, and still is, a sweet, sweet deal indeed. For policyholders, it means excessive premiums combined with re-duced claim payments. And it continues to mean rate increase upon rate increase for our customers. No hard “talking path” can explain away the obvious: Executive endorsed, expertly entrenched, corpo-rate-sponsored greed.

Mr. Berardinelli’s book reads like a mur-der mystery in which he delves into the whodunit of Allstate and McKinsey like Sir Arthur Conan Doyle’s Sherlock Hol-

mes. Among chapter titles and sub-titles:• Good Hands or Boxing Gloves• An Alternative Explanation of

Earnings• McKinsey and the Greed is Good

Model• McKinsey’s Solution to the Allstate

Problem• Changing Employee Behavior• We get What we Measure• Litigation as a tool• Colossus• Redefining the GameEye-opening for agents will not be

what Allstate’s culture is, as we experi-ence this out of control beast on a daily basis. What will be eye-opening is the “smoking gun” itself; the subpoenaed McKinsey slides from the presentation in which the profitability to be had - by ba-sically turning the claims process into an adversarial, litigious profit center – was revealed. The “keep ‘em running, keep ‘em guessing” human resource policy that has affected agents and employees since 1994, when most agents were employees, continues to fester as RFG for today’s so-called ‘independent contractor’ Ex-clusive Agents. As the McKinsey report states: “We get what we measure. The new measurement approach will be based on the processes and activities required to achieve the desired outcomes (increasing profits).” Does this sound a bit like Expected Re-sults or RFG?

While the main subject of Mr. Berardi-nelli’s book deals with McKinsey and the claims paying process changes to increase profitability at Allstate using CCPR, it isn’t a stretch at all for us to surmise that McKinsey must have been asked for other ways to increase profitability in Allstate’s distribution sector – the agency system. At the time, the vast majority of agents were Allstate employees who began to feel the effects of the company’s cost-shifting plan. The costs of running an office, which the corporation previously assumed, were slowly shifted to agents through the Neighborhood Office Agent (NOA) program and then in 2000, All-state completely shifted its costs, includ-ing pensions, employment taxes, health insurance, etc. to its newly-converted “en-trepreneurial” agent work force. Thus, the greatest oxymoronic title in Allstate his-

tory: the Independent Contractor Exclu-sive Agency Owner!

Enter 2010. Agents are being termi-nated for lack of production, for AFS, agency standards and perhaps most ab-surdly - for ALI. Now the Ideal Agency Model, part of the Sales and Customer Service Roadmap, threatens to eliminate thousands of agents as they struggle to grow their agencies to meet this new $4 million per agency corporate stan-dard. Indeed, the future looks bleak for the agency force. Yes, some will make it, but most will fail for a number of rea-sons, including rates, MMGs and a lack of capital. McKinsian in its goals and objectives, the Ideal Agency Model was described as follows by Joe Richardson in an announcement released to the field:

• “Based on agency feedback and model-ing, Allstate has determined an ideal scale that puts an agency in an optimal financial position while still encouraging growth and sustainability.”

• “An agency’s progress toward this ‘ideal agency model’ will be measured, and tools are being built to support agencies in their efforts to maintain a positive ‘trajectory’ to-wards the model.”

• “For agencies who have already met or exceeded the ideal model, Allstate will contin-ue to provide extensive support to encourage growth and sustained success.”

The future for many small to medium size agencies is clear: grow or go. Zero tolerance.

While the Good Hands to Boxing Gloves business model is being applied to the detriment of policyholders, it is helping to achieve the “expected results” that company leaders need to enhance their compensation levels and, of course, increase shareholder value.

It is very clear to this writer that this same Good Hands to Boxing Gloves business model has, and will continue to be, applied to the agency force.

Make no mistake. At a minimum, All-state has a 10-year plan on just when and where they are going. It’s common knowl-edge that the company plans to reduce the number of existing agents by up to 3,300 existing agents over the next few years. If you don’t plan accordingly, you may just be knocked out of the ring whether it’s your first or your fiftieth fight.


WHAT WOULD YOU do if someone stole something from you? What would your reaction be if someone lied to you? What if, in the course of a business re-lationship, both of these things hap-pened to you? Doubtless you would seek to quickly end such a relationship. You might even consider legal action if the elements of both cost and outcome were decidedly in your favor. But if the offenses aren’t easily quantifiable, or if over time, they have grown from an annoyance to outright unethical, when does your level of awareness trigger a response?

Allstate has declared its agent sales force independent. Yet in clear contra-diction to an IRS Private Letter Ruling, IRS standards and Allstate’s own words of a promise of independence, Allstate

agents are anything but independent. On the IRS Website under the heading of Behavioral Control, the IRS stipulates an employee relationship exists when a certain amount of control exists. The very first point of control listed under the sub-heading “Types of Instruction Given” is “When and where to do the work.” Allstate agents know the compa-ny dictates the number of hours required (44 hours per week) as well as the work week schedule (Allstate defines the ac-ceptable holiday schedule) and where the company finds it suitable for an agent to locate their offices. Allstate’s corporate advertising for new agents declares one’s ability to “Be your own boss.” If agents have to conform to corporately-defined office hours, work week schedules, and

corporately approved locations, clearly agents are not their own boss. Issues such as these and more comprise the lie part of the equation.

In 1999 and 2000, Allstate promised its then-employee agents the ability to replace the growing equity of their em-ployee pensions with the value of their future book of business under the new “Independent Contractor Exclusive Agent” program. This promise, used as an inducement for employee agents to quickly convert to the new contract has seldomly been delivered on. Newly-hired agents are promised the future value of their book as a secure retirement income vehicle as well. As we now know, values of agent’s books are shrinking, but it is not the U.S. economy that is taking its toll on their values.

Values for books of business have been severely curtailed by Allstate management through various forms of interference. Chief among the types of interference is the 90 day termination notice. Resulting in the confiscation of an agent’s book of business at bargain basement prices, All-state frequently employs this method of contract termination and then parks the departing agent’s book at the CIC or at another agent location at a discounted commission schedule. Agents are often harassed with relentless emails or phone calls decrying their performance and are advised to sell even before any formal no-tices are delivered. Many times this ploy is used even when no warning or termi-nation notice is forthcoming. When All-state gains control over an agent’s book in this manner, it is the theft part of the equation. Every Allstate agent should realize by now that they are not “inde-pendent contractors.” This article is not about the agents’ “status” as employees; it is about Allstate’s motivation for mis-classifying agents as independent.

feature

Allstate’s Hidden AgendaONE AGENT’S OPINION


Greed and its PartnerA lie, in and of itself, is not necessar-

ily damaging. “White lies” are told with predictable frequency at dinner parties or during bragging sessions after a fishing trip. Anyone can stand up in a crowded movie theater and declare he is the best tennis player on the planet, in spite of the fact he is not Roger Federer. However, this example would result in an embarrassing moment for the individual as opposed to creating a beneficial outcome for the liar. It is when the result of telling a lie benefits the liar at the expense of the recipient that things begin to get more serious.

In the book, From Good Hands to Boxing Gloves (reviewed in this issue), we learned that Allstate customers Jose and Olivia Pincheira were involved in a disputed claim with Allstate beginning in 1999. The book’s author, David Berardinelli, explains that the Pincheira’s agent admit-ted she told Mr. Pincheira that medical payments coverage was the same as unin-sured motorist except that uninsured mo-torist coverage paid for lost wages. Clearly this is not the case. As the Pincheiras were retired, they were “sold” on eliminating this valuable coverage because the agent falsely explained the coverage. Likely, the agent’s intent was not to harm the client, and had Allstate admitted the error, the resulting lawsuit and public disclosure of Allstate’s connection with McKinsey and Company may have never seen the light of day. But according to Berardinelli, Allstate’s choice to defend the lie rather than resolve the dispute is totally founded in a level of greed that is so profound, it is breathtaking.

Nearly eight years earlier, Allstate had already entered into an agreement with McKinsey and Company, an international business consulting company. McKinsey was hired to perform a “top to bottom” redesign of Allstate’s business operations. McKinsey was to concentrate initially on the claims portion of Allstate’s operations. As related in the book, it was McKinsey’s Claims Core Process Redesign or CCPR that the company used to derail the Pin-cheira’s claim. It was also clearly Allstate’s choice to implement the CCPR mandates or not. For Allstate, it became the pur-suit of profit over contractual obligation. Greed over compassion.

Greed does not exist without a “plan.” You might say they are partners. Most of us understand it is not a bad thing to want more of something. After all, who wouldn’t want more dessert, or more love or more money? It becomes a differ-ent issue, however, when our desire for something is conjoined with a plan that, when implemented, harms someone else. If I’m greedy and I want more dessert, I

be greedy today!” Rather, we hope he de-clares a hopeful future for his company that is consistent with sound business ethics and mindful of his fiduciary re-sponsibilities toward company employ-ees, shareholders and the general public. But when the CEO has a plan that en-riches him at the expense of others, an ethical line has been crossed that ought to land him in jail. Any plan a CEO un-dertakes that breaches the ultimate fidu-ciary responsibility of putting employees and shareholders first is a defacto lie. And therefore, for greed to exist there must also be a lie at some level.

Most of us remember the Enron scan-dal. At the time it represented the premier example of corporate greed. To then-En-ron CEO Jeff Skilling, the potential for immense wealth was so overpowering that the lies he was willing to tell were practically boundless. In the end, greed blinded him so much that he was even willing to risk an “insider” stock trade for 500,000 Enron shares worth $15.5 million. It is doubtful Skilling set out to defraud Enron at the beginning of his tenure with the company. Rather, it was his Harvard MBA, combined with his training at McKinsey as one of their top executives that offered him the insight to recognize the opportunity. Said another way; knowledge, plus greed, plus the lie equaled the potential for untold wealth. In all, the Enron collapse represented the loss of more than $60 billion in market value, $2.1 billion in retirement savings and 5,600 jobs. Skilling wasn’t willing to think about the consequences of his ac-tions, he only saw the cash.

If the old adage of the apple not fall-ing far from the apple tree is true of people, it likely has a similar adage for corporations. In 1979, fresh from getting his MBA from Harvard, Skilling was recruited by McKinsey and Company. There he enjoyed a kinship-like bond and a plethora of business skills unri-valed in his industry. By 1987, he was a top executive for McKinsey and proved his considerable talents while working as a consultant to Enron. In 1990 he was recruited by Enron’s Ken Lay to be CEO of Enron Finance Company. In 2001, Skilling became CEO of Enron Corpo-ration. A scant few months later, Skill-

might plan a way to distract you so I can take the last piece of birthday cake. All in good fun, of course. But when greed in-volves money, the potential for schemes or “plans” would seem to be limitless. As we will see, some plans end with a differ-ent than expected outcome.

Why McKinsey?It would shock most of us if it was

reported that the CEO of a prominent corporation called a press conference and publically declared, “I think I‘m going to

Enron is not McKinsey’s

only controversial connection.

McKinsey has been associated with a lawsuit

related to Hurricane Katrina, Swissair’s

bankruptcy, the British railway

financial collapse, Allstate’s claims

practices, and more.


ing would resign, followed by the now famous investigation.

Enron is not McKinsey’s only contro-versial connection. McKinsey has been associated with a lawsuit related to Hur-ricane Katrina, Swissair’s bankruptcy, the British railway financial collapse, Allstate’s claims practices, and more. Several books have been written detail-ing Mckinsey’s controversial activities including From Good Hands to Boxing Gloves. So the question then becomes, are there just a few bad apples or is the apple tree producing the bad fruit?

When Allstate hired McKinsey and Company in 1992 to help redesign (“plan”) its business processes, it is likely they had a specific set of problems in need of addressing. After suffering more than $2.5 billion in losses from Hurri-cane Andrew, anticipating going public in the largest initial public offering ever in the United States, and dealing with IRS scrutiny over its captive agents fil-ing Schedule C, Allstate likely could use the expertise they felt McKinsey had to offer. But just as likely was the fact that Allstate viewed McKinsey’s expertise in dramatically increasing executive com-pensation as a most coveted benefit.

Unlike a marriage or even a dating situ-ation, opposites do not attract in the busi-ness world. A partnership of like-minded entities run by like-minded individuals is essential if success is to be attained. Like-ly, the millions of dollars Allstate paid to

McKinsey didn’t hurt either, but there also had to be more. McKinsey’s Har-vard business school mentality, combined with its considerable connections, repre-sents the core of its philosophy and was aptly summed up in a January 17, 2002 Wall Street Journal article that said, “For decades, McKinsey has been revered - even feared - for its influence in boardrooms and its extensive and powerful old-boy network among major corporations. Its alumni list reads like a who’s who of the Fortune 500, including the likes of IBM Corp. Chief Ex-ecutive Lou Gerstner. In recent years, that network has helped privately held McKinsey win lucrative consulting contracts from com-panies run by its former partners.”

Allstate knows a thing or two about old-boy networking as Former Sears CEO Ed Brennan, and Ed Liddy can attest. And lest we forget, Tom Wilson served as Sears’ Vice President of Strat-egy and Analysis. All of these men even-tually “found” their way to very powerful positions at Allstate.

Dear Shareholders: What is yours, is mine

If corporate profits are the primary fo-cus of a CEO, can greed be far behind? What differentiates a successful CEO from one that is going the way of Enron’s Jeff Skilling? Shareholders would argue that the former enriches the value of a company and takes care of his employ-ees. The latter enriches himself and takes

advantage of his employees. McKinsey and Company was hired

during Jerry Choate’s tenure with All-state. It is assumed Jerry Choate, then President of Allstate’s Personal Prop-erty unit, at least had a hand in hiring McKinsey and Company. Choate later became CEO. His successor, Ed Liddy, then retained McKinsey and continued implementing their plan with equal en-thusiasm. In From Good Hands to Boxing Gloves, Berardinelli writes, “We do know that Choate and Liddy immediately im-plemented McKinsey’s recommendation to create executive compensation plans at All-state based on a strong belief in ‘linking the interests of management with those of our shareholders.’ Together, Choate and Liddy used the Sears IPO and their adoption of McKinsey’s business plan, to create lottery-sized personal fortunes for themselves.”

Choate had accumulated stock and options worth an estimated $63 million and retired in 1998, receiving an esti-mated $10 million more. Liddy retired in 2006 with 3,823,255 shares of Allstate worth $250 million, plus an additional $71 million in retirement package bene-fits. Not bad parting gifts for two gradu-ates of the McKinsey business plan for Allstate CEOs.

Apparently, Tom Wilson is just getting ramped up with his wealth accumulation plan because his total compensation for 2008 was $9.51 million and $10.4 mil-lion in 2009. And even though the stock has tanked recently, his 2010 compensa-tion looks to be going up. All this is oc-curring as Wilson lays off or fires thou-sands of employees and agents, and while giving up market share to GEICO, State Farm and Progressive.

Dear Agents: What is yours, never really was yours. Therefore, it was always mine

But Allstate and Wilson couldn’t earn a dime if it weren’t for the blood, sweat and cash that Allstate agents have in-vested into their agencies. The way the company goes through agents, it would seem more correct to classify them as “useful idiots” instead of the key com-ponent they are. And much like the lazy child is maligned for sloppy schoolwork; the Allstate agent is derided for failing


to meet corporately-imposed quotas. In spite of this, Allstate agents are pit bulls when it comes to making their agencies successful. They are highly talented pro-fessionals who run agencies that provide Allstate and themselves a decent income stream. The agent’s overarching motiva-tion is to succeed as a business and pro-vide a decent income for their families.

But in addition to the annual profit they take from their agencies, every agent also expects a final return on their invest-ment (when they retire) in the form of the sale of their book of business. It is safe to assume that every EA has been told by management, at one time or another, that they “own” their book of business. Of course, what they’re referring to is that nebulous, albeit ingenious, creation the company has dubbed “economic inter-est.” This clever terminology was doubt-less meant to fool agents into thinking they actually own something. The com-pany took the independent agent model, where agents own their books lock stock and barrel, and morphed it into a look-alike with little substance. Of course, it is Allstate’s intent to imply that agents have control (ownership) over the disposition of the accumulated value of their books of business, but ultimately, it is Allstate that holds all the cards.

It’s also crystal clear that Allstate, along with some other captive carriers, rejects the notion that its ‘independent contractor’ agents own their client lists, customers or books of business. This, of course, is not true in the independent agent world, where agents are also inde-pendent contractors and, without ques-tion, own it all.

As if to emphasize the point, Allstate CEO, Tom Wilson, made an interesting declaration during the company’s 4th Quarter 2009 Earnings Call. Vinay Mis-quith from Credit Suisse asked Wilson the following: “So on store’s policy, does All-state own those policies for which the agents are leaving and therefore you run the risk in the short term you might have lower policy in force count?” Wilson responded, “Vinay, I would start with the concept that nobody owns the customer. The customer owns themselves and their own relationship.”

What Wilson really said in two short sentences is that Allstate agents do not

now, nor will they ever, own their books of business. He goes on to try to qualify his misstep, but if we are to take Wilson at his word, then everything Allstate has ever promised an agent in this regard is untrue

Now Wilson might argue that his met-aphor of the customer owning himself is

annual reviews, and more are the magi-cian’s “lovely assistants” that distract the agents, it is the carefully crafted, hidden elements of the “trick” that make every-thing possible.

Here are the elements Allstate doesn’t want the agent to see:

• Establish a complex set of ever-changing guidelines which are geared for only partial success, constantly forcing agent turnover.

• Manage agent turnover rate so that the constant outflow of agents provides the company with a specified premium base that has no commission expense against it.

• Require a constant infusion of newly-hired agents that are channeled to sell life and annuity products as a requirement to keep their jobs, thereby providing Allstate with ever-increasing sales contributions to its financial services goals.

• Deny approval of qualified buyers. • Deny or limit purchase of books by

Allstate agents.• Require sales management compen-

sation to be directly related to the agents’ RFG bonus structure. If agents achieve certain bonus levels, managers will be compensated accordingly. When agents fail to qualify for bonuses, a manager’s will be affected bonus as well.

• Urge agents to invest substantial amounts of money so that they cannot easily walk away from their agencies.

• Require senior management to be financially committed by making them purchase a percentage of their salary in Allstate stock. From Allstate’s 2005 Proxy statement:

“Stock ownership requirement

Because we believe strongly in linking the interests of management with those of our shareholders, we first instituted stock own-ership goals in 1996 for executives at the vice president level and above. These goals were increased in 2004 to require these ex-ecutives to own, within five years of the date the executive position is assumed, common stock worth a multiple of base salary:

Chief Executive Officer 7 times salary Senior Management Executives 4 times salaryOther Executives 2 times salary

really just a way describing how careful we must be in assuming a client will be loyal to our company. But the context in which the question was asked and answered left no doubt that in Allstate management’s eye, a departing agent does not own his client list. And this is a key moment, if ever there was one, in our ability to understand how Allstate views its relationship with the agent. Because if Allstate proceeds on the assumption that agents have minimal or no real rights to the economic interest in their books of business, then its right to confiscate the agents’ books is a forgone conclusion.

How do they do it?Like an audience member mesmer-

ized by a magician on a stage, agents are lulled into participating in a business plan developed and implemented by All-state. While RFG, quotas, office hours,

It is difficult to say when

Allstate’s plan will fail. This is because so much is riding on the outcome of what Allstate started with McKinsey. Millions,

if not billions, of dollars are at stake

for Allstate management.


Existing executives were given three years to reach the new levels of ownership.”

This requirement alone demonstrates that there will be no tolerance for poor performance from agents who might jeopardize management’s personal for-tunes. Further, Allstate never intended to give up any of the controls it exerted over its employee agents once they were forcibly converted to ‘independent con-tractor’ status in the year 2000. On the contrary, once the agents were converted, it was much easier to fire them for little or no reason, giving the company more incentive to tighten, rather than relax, its vice-like grip over the agents.

Today, any semblance of “indepen-dence” allowed with its current agent distribution program is merely window dressing. Berardinelli put it most suc-cinctly when he stated, “Whose interests do you think Mr. Wilson and other senior Allstate executives subject to such a stock ownership plan are more likely to be inter-ested in protecting?” The answer is clearly not the agents.

As entrepreneurs, agents deal with

the known factors of running their busi-nesses, such as competition, changing expenses, market conditions, etc. They are adept at adjusting for the unexpected, and make decisions based on sound busi-ness ethics. But these are overt elements of running a business that are easily dis-cernable. When a business relationship is tainted by one side’s hidden agenda, the relationship is doomed to fail. It is dif-ficult to say when Allstate’s plan will fail. This is because so much is riding on the outcome of what Allstate started with McKinsey.

Millions, if not billions, of dollars are at stake for Allstate management. CEO’s Liddy and Choate knew how to play the game and amassed staggering fortunes, some would say on the backs of Allstate customers. Tom Wilson looks to better his predecessors’ perfor-mances by combining their efforts with his vision of the new Allstate agency of the future. It is unfortunate that until now, not a single agent perceived the possibility that, not only is there a hid-den agenda, but that they are unwitting and unwilling participants.

This issue is not just about McKinsey and its vision for Allstate. The fact of the matter is that Allstate has a choice in the direction it chooses to move the company. It has purposefully cost-shift-ed multiple programs to the agency force and has implemented a carefully crafted “employee” agent program which is mul-tifaceted and complex.

Because a tenured agent sales force is not intended to be a permanent com-ponent of Allstate’s vision, the company refuses to open a dialogue with any rep-resentative voice, including NAPAA. But all of this is a conscious choice that Allstate has made. If ever there were a test of whose best interest the company is dedicated to protecting; all you have to do is follow the money.

And finally, here is the epiphany mo-ment this article is attempting to convey: Allstate can never allow its business model to include true independent contractors. Once the company becomes incapable of terminating agents at will, manage-ment loses its ability to control the fate of their own personal fortunes, and that, my friends, will never happen. Ef

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WHEN MY ALLSTATE agent clients call and say that their phone has stopped ringing, I tell them, “Open up your cus-tomized Hesh CRM database and start making calls.”

My customized CRM makes it very easy for them. It prioritizes calls based upon their probability of success. Now, it isn’t rocket science and they could really do the same thing with an Excel spread-sheet. But I don’t tell them that.

The software breaks prospects into the following categories:The “We love you” category:

The first calls are easy. My clients are calling current customers trying to sell them something new. With these people they can even be honest and say that their numbers are down and ask them to please take out a new policy.

Results: An entire day of fun conversa-tions, but no new business.

I Promise Results with My Customer Relationship Management (CRM) Database…

Money Back Guaranteed!BY HESH REINFELD

humor

The “We used to love you” category:On the second day, my clients typi-

cally attack the second group, which consists of their previous insureds. They haven’t bought anything in the past year but before that, they were pretty regular customers. Now the Hesh CRM brings up the excuse each client gave for not buying this past year: no budget, poor claims experience, lousy customer ser-vice from the CIC, cheaper rates, and then the one my clients really hate: “dis-likes the agent.”

Results: My clients may get one customer back on the roll. But it really doesn’t make a dent in their Expected Results. And now its 3 p.m. on day two and most of my clients are getting anxious.

The “We really like you but…” category:

The next category are customers who were serious prospects, but have never bought anything. The calls are all simi-lar. Here is a typical response: “Great to hear from you again. Thanks for calling; oh yes, we are interested. Can you send us a new quote? And, by the way, can you please include one of those fancy desk calendars?”

Results: My clients enter the requests into the CRM and promise to call back in a week. But I actually recommend they don’t follow up because it’s a waste of time!

The “Yellow Pages” category: These are leads agents purchase from

data-mining telemarketers. You can never assume the names are right, or that they’ve ever heard of your company.

Results: My clients realize that they haven’t eaten in two days. They break for

an early dinner and promise themselves to make the calls after dinner. They never do.

The “Mutual contempt” category: These are the prospects that drive my

agent clients crazy, and they often end up telling them to “take a hike.” Initially, they promised themselves to never, ever, call them again. They’re sure that their staff people, who are supposed to screen the calls, have them on a ‘tell them to drop dead’ list.

I suggest that my clients get a new phone that blocks the caller ID function for the person receiving the call. I’ve seen them used by drug dealers on “Law and Order.”

Results: Most of my clients skip this cat-egory and go directly to the last, and final, category on their CRM database. Only one name is on this list

The “humble/grovel” category: I give my clients a script for this call:

“Dad, hi, I’ve changed my mind, and yes, I would just love to come back and work in the family business…… and yes, you were right as always; people always need new tires.”

Result: Success, a regular paycheck, but no need for my customized by Hesh CRM.

The Final Result: I end up losing a client. Ef

Hesh Reinfeld is business writer, humor columnist and marketing strategist who helps small firms grow their client base. He sees his clients struggle over the decision whether they should or should not purchase CRM (customer relationship management) software. To learn more about Hesh Rein-feld, visit www.heshreinfeld.com.


GOING PAPERLESS SOUNDS great, but the concept is often viewed in the same category as “I want to Go Green” or “I want to make more money.” The fact of the matter is that these statements are too broad to have meaning. Conversely, when a business owner says “We want to improve how we deal with specific documents,” or “We want to improve customer service by making certain specific documents more accessible to everyone at the company,” the objectives of such statements become much easier to visualize. They are targeted concepts about instituting specific practical paperless office strategies.

Successful business owners think about

processes at their company and how to improve them. As an example, you may want to find ways to improve efficiencies in your agency. As an agency owner, you might say to your staff, “It would really improve our business if we could pull up and view all of our brokered business en-dorsements right here on our desktops, what do you think?”

Making one single business process (endorsements) more efficient is a very specifically targeted objective. The pro-ject to make them viewable right on the computer has a defined goal and is, the-refore, very understandable. The agency owner wants the agency’s brokered busi-

ness endorsement forms easily accessible so that his staff doesn’t have to contact the carrier or run to the file cabinet se-veral times a day. Instant access to these endorsements will make for happier sta-ff and will provide faster, more efficient customer service, which will lead to better overall customer satisfaction and improved ALI scores. Obviously, this is better than the current process, which is mostly still paper-based.

Let’s look quickly at what the paper-based process looks like. Let’s say a po-licyholder calls with a coverage question that can only be verified by pulling his policy file and accessing an old endorse-

office solutions

One Improvement in Your Agency can Keep you Ahead of the Rest

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ment. The staff, or worse, the owner pro-bably advises the client “Let me check on that for you, Mr. Jones.” Then giving himself plenty of wiggle room in case the endorsement can’t be easily located, he asks “Will it be okay if I call you later today or tomorrow?” At this point the staff is dispatched to find the file. This process could take a few minutes or a few days, depending on the availability of the file. If the file has been misfiled or otherwise misplaced, it could concei-vably take hours, days, or even weeks to locate it. In any event, the cost to locate a misplaced file will cost the agency owner dearly in wasted wages and staff time.

Once the search is over and the customer is taken care of, the agency owner directs a staff person to re-file the endorsement, praying that it will be properly filed away in the file cabinet.

So why does such a limited project, like the instant availability of brokered business endorsements, make so much sense for your agency? It is because an inefficient business process has been targeted with the intent to replace it with a more efficient, cost-effective pro-cess. Besides substantial cost savings, think of the time savings. When your staff is freed up, they can devote more time to other activities, such as selling

policies or doing policy reviews. In addition, tackling this one specific pa-perless goal allows your staff to learn a new skill, without overwhelming them. Plus, once they have mastered this new skill of converting paper documents to electronic documents, it will be easier for them when you want to go paperless in another area of your agency. The offi-ce staff, armed with these new skills can then continue to apply those same skills to other projects to further improve the business and continue to reduce costs. What’s more is that your bottom line will benefit, which, in turn, means your business will immediately be more com-petitive and a step ahead of the rest.

If you are intrigued by the paperless re-volution but are apprehensive about get-ting started, remember that it only takes one “success” to get everyone behind the concept. Once your staff sees how much it improves their jobs, it can easily be rol-led out into other areas of your organi-zation. And besides the benefits that you and your staff realize, the most impor-tant beneficiaries will be your customers, who will appreciate your fast, accurate and professional service. Ef

Todd McIndoo is a Vice President at Speedy Solutions, makers of the Speedy Organizer and other practical paperless office products. Todd is an expert in paperless office and author of “Paperless Office in Perspective a Document Management System for To-day.” For more information, send email to: [email protected] or call 800-655-2870.

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The original version of this letter was sent to Allstate by a terminating agent. We have changed or eliminated certain information including names, locations, dates and other references that could identify the author, who wishes to remain anonymous.

feature

The End of Another Promising Career

June 29, 2010

Allstate Insurance CompanyAttn: Field Vice President123 Elm StreetAnytown, U.S.A.

Dear Sir: Per our brief conversation on Wednesday, June 23, 2010, I would like to terminate my appointment with Allstate effective October

1, 2010. My last day with Allstate will be September 30, 2010. I would prefer to sell my book rather than take the TPP payments. I have an agent buyer in mind and he is willing to buy my agency. For obvious reasons, this arrangement would be mutually beneficial to both of us. If that is not possible, I would like to exercise my TPP option as defined in my contract. I assume, however, that Allstate will give me whatever the actual TPP is on my last day, September 30, 2010.

It is not easy to end my relationship with Allstate after only three and a half years. But I have carefully weighed my options and given this decision much thought and consideration. Unfortunately, I was assigned some accounts from a terminated agent. These accounts were assigned to my agency without my consent. My MDL advised me a few weeks earlier that the TDL wanted to give me some seed accounts. I had enough experience to know that assigned accounts could be a blessing or a curse. I also had the foresight to ask my MDL specific questions about these accounts before accepting them. For example, I wanted to know why the agent was terminated, why I was getting these accounts from an agent whose office was 25 miles or more away, whether or not I would be graded the same on these assigned accounts as I would be on my own accounts, what the retention and loss ratio were on the accounts, etc. All I was told was that I would be graded the same on the assigned accounts and would be paid 6% commission instead of 10%. I was never given any answers to the other important questions I had asked. I expressed my concerns and stated that I would most likely not be interested in taking the accounts. I didn’t hear from anyone after that. However, a couple weeks later, I began receiving phone calls from disgruntled customers that had been evidently assigned to my agency, even though I had not agreed to accept the accounts. I also began receiving calls from the Special Investigations Unit at Allstate. Apparently, this terminated agent had an extremely high loss ratio and certain claims were considered “suspicious.” I was truly shocked to learn what a mess I had inherited unwillingly. I assume that my TDL meant well by trying to give me seed accounts, but these accounts were nothing but toxic from day one.

A few weeks later, the territories were realigned and I had a completely different management team. I began to address my con-cerns with the new management team immediately. I was given quite a bit of incorrect information. Many empty promises were made. Management was clearly trying to convince me to keep the accounts despite knowing how badly they would ultimately af-fect my agency. Finally, after many emails, letters, phone calls and even conference calls with upper management and a controller (all carefully documented), Allstate finally agreed to remove these accounts at the end of 2007. They were reassigned to another agent who knew the circumstances and nevertheless agreed to accept them. However, at that point, the brunt of the damage from these accounts had already taken its toll on my agency. Also, the person in charge of removing the accounts missed the 2007 year-end deadline somehow and the accounts were not actually removed until January 15, 2008 - yet another blunder that was never corrected and which ultimately affected my RFG scores even longer. In addition, some accounts got missed entirely and were not removed from my book at all. There are still 17 assigned homeowner policies and 3 assigned auto policies in my book today.

Consequently, as a direct result of having these bad accounts in my book, my RFG numbers were negatively affected for each of the last three years. As a new agent, this situation basically took the wind out of my sails when I should have been concentrating on growing my agency. In fact, any small amount of money I earned on these accounts didn’t come close to the damage caused to me both financially and mentally. The situation has been frustrating and disheartening since day one. The negative impact overall has been fatal to my agency. I was told by one Allstate representative that my agency was used as an example in Home Office of what should never happen to an agent.

I was finally considered an “established” agent in 2009 and should have been eligible for a year-end bonus based on my efforts that year. My primary RFG numbers were actually pretty good. However, as a direct result of the assigned accounts, my combined RFG score was negatively impacted once again in 2009 for the third year in a row. Instead of receiving a year-end bonus, I was ineligible for any bonus at all due to the loss ratio on the assigned book. The loss ratio on my primary book for 2009 was 50.29%. However,


the loss ratio on the assigned book was 296.70%. Therefore, my 2009 year-end combined loss ratio was 76.04.I was hoping to have the high loss ratio on the assigned book (297%) backed out of my book somehow, so I could finish the year

strong and focus on maximizing my RFG score. After all, I had not been receiving compensation on these accounts since January 15, 2008. I approached my MDL who sympathized with me but didn’t give me much hope that this could be accomplished. I finally called the TDL and had a rather unpleasant conversation with him over this issue. Initially, He said there was nothing he could do. So I told him that my livelihood was at stake and that I had no choice but to elevate my concerns. He finally agreed to present my case to Home Office but he could make no promises. He asked me to document the history of events for him again, even though I had done this several times in the past. Any controller could take a look at my CSRP reports and easily make sense of what hap-pened. The numbers themselves paint a clear picture. I suppose in the end I didn’t get much sympathy from upper management and didn’t have much faith in the system to make this wrong a right. I honestly felt defeated by a very unfair and broken system and determined that I didn’t have yet another “fight” left in me. There clearly was no incentive to make the final push to hit $22,000 in AF either since it really wouldn’t make any difference, get me a bonus, or allow me to purchase a book. The Ideal Agency Model was probably the final straw for me. Unless I was able to buy a book in 2010, how could I possibly be on pace to reach the target goals defined in the “Ideal Agency” model? How does a scratch agent get to a $4 million book in five to seven years organically?

I must say that this is truly a sad day for me in my insurance career. I have been selling insurance since the age of 16. After manag-ing a highly successful State Farm agency for more than 20 years, I thought it would be an amazing opportunity to be an Allstate agent in the community that I had lived in for so many years. I was thrilled to finally be self-employed and in charge of my own destiny. I was excited to work with the centers of influence that I had developed in my area for so long. I was under the impression that I would be able to build a good quality book of business and eventually retire by selling my book at a ripe old age. Did I men-tion my ALI score was 91% in 2009? I always understood the importance of providing excellent customer service. Unfortunately, I feel that I was completely misled when I was hired and was not given pertinent information that would ultimately affect the rest of my life. Nor was I told that an agent could get terminated for failure to reach Expected Results after the original Star Bonus was met. I was also shocked to learn that long-term Allstate agents were getting terminated for “failing to reach Expected Results” at an alarming rate. State Farm can only terminate an established agent for just causes. With State Farm, you basically have to be doing something unethical to get fired.

I would also like to add that I specifically asked whether there would be any growth restrictions coming down the pipeline before I was hired by Allstate. Unfortunately, management either chose not to tell me that Allstate would stop writing homeowners in-surance in my state just a few months after I was hired or they just didn’t know. I never would have started an agency from scratch under such challenging circumstances. And the cash flow model provided by Allstate was completely inaccurate since it included elevated commissions on homeowners insurance that were taken away just a few months later. Most of my peers that I started with are no longer with Allstate. Some had to file bankruptcy.

As a new agent I was unable to get the jump-start I needed. I thought the challenges would be temporary and hoped I could ride out the difficult period. But I have found it impossible to survive the Allstate environment in so many other ways as well. I have seen things get progressively worse for the agents since I’ve been an agent. We are bogged down with endless processes and administration requirements; and yet we are still expected to grow somehow. Then we have to deal with the CIC, growth restrictions, and having to service accounts for free or at reduced commissions. We also have to compete with the company we represent for new business. The company has redirected web traffic towards the direct channels. The company has also passed on more and more business expenses to the agents since I’ve been hired. Agency Choice Technology is just one example. Oh, and then there’s the employee-like controls, mystery shoppers, RFG, PSA, and now the Ideal Agency Model. The company, in my opinion, is creating “the haves and the have-nots” with the latest PSA program. My phones ring less now as a result. So to make a long story even longer, I finally get it. The company is clearly attempting to reduce their agency force. After investing about $50,000 of my own money into my agency, I see that it is time to cut my losses and get out. I am disenchanted with Allstate, to say the least.

For what it’s worth, I am deeply concerned about the direction this company is going. It is disturbing to see the strained rela-tionship between Allstate and their agents. I have a lot of sympathy for the agents who have worked and continue to work so hard for Allstate. Yet their livelihoods are in jeopardy and the businesses they have built are basically being taken away from them. The morale among the agents is clearly at an all-time low. The customers are paying close attention to what’s going on. They do not appreciate being bounced around from agent to agent to agent. I have chosen to include these final comments in this letter of res-ignation in hopes that life will get better soon for the agents who remain. I feel compelled to speak up on their behalf. The agents truly are the backbone of this company, and they deserve so much better.

On a positive note, I have learned some invaluable life lessons. I thank you for allowing me to represent Allstate for the last three and a half years and to grow as a human being. At this point, I am asking that the company accept the agent who wants to buy my book. I know he hit his numbers in 2009 and finished the year strong with an RFG score of 7.2. He has his 6 & 63 and his agency is properly staffed. He should be on the PSA list any day now. Please let me know what I need to do in the interim to facilitate the smoothest transition possible. I look forward to hearing from you soon.

Sincerely,Name withheld by request


TIMES HAVE CHANGED. Modern life for most new families means that young parents now are in their late 30s, their kids are mostly young toddlers, mom and dad both work, older kids have cell phones, the parents volunteer on non-profit boards, community councils or neighborhood watch, and they all stay in touch on Facebook. Then, as if this isn’t enough to occupy their lives, their Allstate Exclusive Agent calls asking about life in-surance. What happens next?

Let’s recap; both are career parents. Here are some of the typical objections they might raise when their Allstate agent asks about life insurance:

• “I have it at work.” • “I have kids and I can’t afford it.” • “I already have some through an-

other agent.” • “We’re young and healthy so we

don’t need it.”In truth, while that is what your clients

likely will say, many may actually mean they are simply too busy, life has them swamped. The “no need, no money, no time,” are most likely just convenient ex-cuses for the real objection which is: “We don’t have time.”

Let’s take a look at the four objections listed above:

“I have it at work.” The downsides to this one are limitless. It isn’t portable. When a person changes jobs, becomes unemployed, or retires, it can be a real challenge finding an individual life insur-ance policy at an affordable rate, particu-larly for older workers or for those whose health may have deteriorated. For these reasons and more, group life just isn’t a viable long-term solution.

“I can’t afford it.” This is a pretty lame excuse when a 36 year old male can buy $1,000,000 ten year term insurance for $40 a month. Sure, the rewards of selling a permanent plan are great, but it is much

more important to get your customers covered. As agents, we have to remember that most of our clients are not flush with cash. They are struggling with mortgage payments, the slow economy and buying diapers. Yet if something happened and they had no coverage, where would that leave the spouse and children? Think of term insurance as a temporary solution, providing peace of mind for several years until the time is right for your customer to move up to a permanent plan. Doing the right thing for your customer every time will reinforce their trust and faith in you. In your annual policy reviews be sure you “sow the seed” for the eventual conversion to a permanent life insurance plan when the timing is right. This pre-conditioning will prepare your customer, making the conversion process much smoother and less stressful.

“I already have it through another agent.” This is great because it means they value life insurance. Chances are the other agent didn’t write the amount of coverage they needed, so they could use a review and a comparison. I’ll address the objection handling for this and every other objection later in this article.

“I don’t need it.” When a client says he or she doesn’t need life insurance, it is usually the most confusing objection for an agent, but it’s the one that gets to the heart of the problem the soonest. Most likely, your client really doesn’t mean to say she or he is invisible or doesn’t love their spouse. They’re saying, “I’ve got ba-bies in the back seat and I haven’t made dinner, so please Mr. Agent don’t point out another thing I haven’t done yet.”

No matter what the objection is in this day and age, it’s hard to know if that is really what the client means. They may

Objection Handling for the Rookies and Especially for Veterans

BY SEAN HOWELL

sales tips


be saying “not now,” or “I think I have that covered.” You might be able to over-come these objections and secure the ap-pointment, but it doesn’t always happen that way. More often than not, clients will put you off by finding ways to get off the phone by claiming they will “talk to you later.” This will become known as the “every time there is a no there is a yes” concept, which is I want to cover for the remainder of this article.

Regardless of the objection, you’re now further along in the sales process than you were before. You know some-thing more about the client than you did beforehand. In reality, this is your chance to shine. You know the four common ob-jections listed above, now here are some tips to help you overcome them.

You’re their agent, so the first thing you should do is let them know you care. As long as they haven’t confessed that they have a terminal illness, they are all warm prospects. So get out your pencil and pa-per because here’s the trick. Whatever the objection, write it down. “Talked to Susan Smith, she says she has it at work.” Briefly explain to her why group life has some major downsides. Ask to show her what an individual policy would mean for her family and then briefly explain the benefits. She’ll agree to set up a

meeting, object because she is too busy, or move on to another objection, such as “no money.” Write this objection down too, “Spoke to Susan Smith, has at work, has no money and no time.”

There is a good chance that if she lets you go through all your objection han-dling, she’ll let you set up an appoint-ment with your life expert. If time doesn’t allow, you’ll have to have a “Let me tell you everything” conversion. Odds are that she’ll want to get off the phone, so remember to be mindful of getting per-mission for additional action. As I already mentioned, any objection aside from her being terminally ill is a buying situation, so be sure to seize the day.

So, Susan Smith has it at work, has no money and no time. Now you need to end the call and set the stage for a follow up, which might go something like this: “Susan, I know you’re busy, let me send you some information and I’ll check back with you later.” Since it is usually either you or your staff talking to her, make sure the same person calls her back. You can mail her anything - a life brochure, Kettly Backroom Technician, term vs. perm information, a thank you card - it doesn’t really matter; you’re just one step closer to a deeper more meaningful life appointment.

Now that you have this valuable in-formation on Susan Smith, you need to store it. You can use IMPACT, a client file, a spiral notebook with your hot list of clients, or your x-date files - it doesn’t matter, as long as you know where to find it. When you call her back, start with the objections she raised in your prior con-versation, “Susan it is so good to talk to you again. Last time we spoke you told me you had life insurance through work. You also mentioned you were too busy to talk at that time. I am your agent and I care about you. Many of my clients have life insurance at work. Even I have some, but it’s not the same as having your own policy. I know you are worried about price too, but if something happens to Steven, I don’t want you to be left hold-ing an empty bag. That is why I would like you to meet Frank, my life expert.” At this point you should stop talking and pause for as long as it takes for her to speak first. This is critical.

When Susan does talk, she’ll say she has no money or will offer another objec-tion, but at this point your reply should always be “That is why I want you to meet Frank.” Your response might go something like: “That’s why I want you to meet Frank; I know you’re busy, and since Frank is an expert, meeting with him is the best way to look at this. Life insurance is important. I’ve got his cal-endar here in front of me now. His meet-ings are short too, in fact he has some 30 minute meetings available this week, one on Tuesday at 2:00 p.m. and one on Fri-day morning at 10 a.m., which one will work best for you?

Regardless of the language you use to combat objections, the important thing is to do your objection fact-finding. Keep-ing track will let you know how to get the appointment scheduled.

Families need your help to see the need and figure out what kind of policies and coverage they need. Ef

Sean Howell, is an EFS in Seattle. He a Top of the Table MDRT member, 4th most Life insurance producer at LBL, and enjoys working on the” roll up your sleeves” every-day life cases of regular Allstate families as well as the advanced planning charitable life cases. His family lives in California.


Why join NAPAA?NAPAA Acts as the Voice of the Allstate Agent:• We say the things that must be said

on behalf of the agent.• We take stands on issues that affect

agents, such as ALI, RFG, indepen-dent contractor status, quotas and terminations (See examples in Exclu-sivefocus magazine).

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and Section125 Plan when payroll is processed with Advanco. For details contact: Gerry Flores at (563) 564-1800 or [email protected]

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the NAPAA market placeAgencies for Sale Agencies for Sale Agencies for Sale Agencies for Sale

ALABAMAClantonLinda Wilson [email protected] 256-249-4512Asking Price: $110,000 PIF: 463 Premium: $370,000Number of Licensed Staff: 1Nice office in busy strip mall. 1200 sf. Very low rent.

Forestdale Louis P Kelker [email protected] Price: NegotiablePIF: 1,160 Premium: $1,370,265Number of Staff: 1 (0 lic)

ARIZONATucsonConfidential [email protected] 520-444-8607Asking Price: $1,800,000PIF: 5,500 Premium: $4,875,000Number of Licensed Staff: 230 year BOB, LR 43%, Ret 90%, PPH 2.2. Approved Allstate buyers. Building owned by agency, available for great lease terms. Bonus in 2010 approx $75,000.

TucsonJohn J [email protected] 520-481-9488Asking Price: $425,000PIF: 1,700 Premium: $1,700,000Number of Licensed Staff: 2Ret-90%, LR 24mm -43% ALI-80 Serious offers only.

ARKANSASGreenwoodJimmy McCormick [email protected] Price: $225,000PIF: 1,100 Premium: $925,000Number of Licensed Staff: 2

CALIFORNIA Alta LomaHarvey Poole [email protected] Price: NegotiablePIF: 1,620 Premium: $1,293,947Number of Staff: 1.5 (lic 1)Same location 16 years. 850sf office on 2nd Floor w/an eleva-tor. Only office in Alta Loma. L/R: 43.95% Ret: 90.82%, Life Retention: 100%. Retiring after 29 years.

SelmaCraig [email protected] Price: NegotiablePIF: 1,181 Premium: $1,157,000Number of Licensed Staff: 1Very clean book of business, great potential for growth and AFS sales. RFG L/R 30.64%, ALI 74. Central valley of CA, town of 25,000, near Fresno. Agency has positive cash flow.

Rancho Mirage Rick Kelly [email protected] Price: Call for info PIF: 1438 Premium: $1,557,450Number of Licensed Staff: 1Located in the Palm Springs area. No seller financing.

Montrose Mclynn Insurance Services Inc [email protected] Price: Call PIF: 1,787 Premium: $2,000,000Number of Staff: 3 (lic 2)North of Glendale. CSRP avail-able only to qualified Allstate-approved buyers/agents. No carry back.

West HillKaren Fountain [email protected] Price: NegotiablePIF: 1088 Premium: $943,141Number of Licensed Staff: 1

COLORADOWestminsterIvan Gerrity [email protected] 303-443-9988Asking Price: $148,000 PIF: 709 Premium: $593,277

CONNECTICUTTorringtonThomas Krohner [email protected] 860-480-4920Asking Price: $685,000PIF: 2,200 Premium: $2,356,652Number of Licensed Staff: 2After 42 years with Allstate it’s time. 2 agent office with 2 licensed staff, LR 35.54%, Ret 91.52%.

FLORIDAMiamiKurt Wienants [email protected] 305-343-7060Asking Price: Negotiable PIF: 1,280 Premium: $1,818,000Number of Licensed Staff: 2Located in busy shopping center for over 20 years. Great growth opportunity. Large bro-kered property book with great cross sale opportunity.

DeltonaDenise White [email protected] 386-214-1991Asking Price: Negotiable PIF: 900 Premium: $900,000 Number of Licensed Staff: 24 yr agency. Book qualifies for new agent bonus. Under 500 Allstate policies, 400 brokered home. Includes F&E. Buy the Allstate book only, or the entire agency. Call for details.

KissimmeeLarry Newman [email protected] 407-529-4147Asking Price: $1,100,000 PIF: 2,600 Premium: $2,650,000Number of Licensed Staff: 3Great location, agent retiring after 21 years, staff will stay, turnkey operation

KissimmeeDale Revels [email protected] 407-924-5336Asking Price: $850,000 PIF: 1,100 Premium: $2,200,000Number of Licensed Staff: 1 22 years in the heart of Central Florida. Paperless office and close association with Allstate Hall of Fame Life Specialist. Low overhead, excellent op-portunity to grow.

GEORGIASavannahPhil West [email protected] 912-748-6639Asking Price: $399,000 PIF: 1,638 Premium: $1,809,898Number of Licensed Staff: 2City of Pooler, near Savannah airport. Agent owns office building.

GriffinEric Moye [email protected] 770-228-0031Asking Price: $300,000 PIF: 1,400 Premium: $1,400,000Number of Licensed Staff: 2

SOLD!



SmyrnaMel Clemmons [email protected] 678-895-7322Asking Price: Call for price PIF: 3,400 Premium: $3,600,000Number of Licensed Staff: 2Selling 3.6 mill in Smyrna. Ret 91%, LR 53%. – Also have 2.5 mill in Alpharetta, Ret 90%, LR 54%. – Also, small 700 PIF book that can be merged.

KennesawPrivate listing678-895-7322Asking Price: $1,500,000 PIF: 4,500 Premium: $4,500,000Number of Licensed Staff: 3I have several agencies I am selling in Cobb County. Range from $1 mil to $4.5 mill. Prices are negotiable.

TyroneBrad Gohsman [email protected] 770-487-1112Asking Price: $475,000 PIF: 1,850 Premium: $1,450,704Number of Staff: 2 (lic 0) 25 year established agency, reasonable rent, near Atlanta with small town sensibilities and attitudes, low loss ratio, high retention.

WinderTim Milsten [email protected] 770-867-1001Asking Price: $670,000 PIF: 2,519 Premium: $2,666,277Number of Licensed Staff: 2Low overhead, great cash flow. LR 43.72%, Ret 89.55%,only 83 auto indemn policies. Very competitive rates, county seat of Barrow County, between Athens and Atlanta. One FT staff, second staff on Mon and Fri. No owner financing. Moving out of state. Computers included.

BraseltonDan Torbett [email protected] 770-778-9586Asking Price: $325,000 PIF: 1,375 Premium: $1,250,000Number of Licensed Staff: 2Highly sought-after book of business. High growth area, unbelievable demographics, incredible potential. Strong book of business, open 5 years. Ret 93%.

IDAHONampaEdward D Ramirez [email protected] 208-467-5771Asking Price: $240,000 PIF: 1,495 Premium: $1,132,339Number of Licensed Staff: 1 24mm LR 24%, Ret 84.57%.Solid line 10 and HO BOB, few indemnity. Town of 90,000. Sell-ing due to other interest.

ILLINOISSkokieTeresa Nieto [email protected] 847-933-0600Asking Price: $175,000 PIF: 776 Premium: $713,192Number of Licensed Staff: 1 On busy street near highway. Great exposure and location. English and Spanish speaking staff.

ChicagoRon Skold [email protected] 773-585-3100Asking Price: $120,000 PIF: 455 Premium: $611,617Number of Staff: 0 Retiring after 25 years. Pre-ferred contact by phone. LR 12mm 44.45, LR 24mm 39.99. Ret 82%.

KENTUCKYPaducahMarvin Green [email protected] 270-210-7586Asking Price: Negotiable PIF: 1,600 Premium: $1,800,000Number of Licensed Staff: 121 year agency, ret 89%, LR 48%. Furniture included. Agent will aid in transition

LOUISIANA HammondTerry King [email protected] 985-974-7144Asking Price: $1,850,000 PIF: 3,500 Premium: $5,450,000Number of Licensed Staff: 3 Premier 33 year agency, great location, fast growing area. Serious approved buyers only. 2008 RFG 7.6, LR 47%, Ret, 88.5%.

MICHIGANAnn ArborBill Tarrier [email protected] 734-341-3765Asking Price: $1,600,000PIF: 4,771 Premium: $4,100,000Number of Licensed Staff: 2 Unique 3 agent location being sold as 1 book. Turnkey Opera-tion. LR <30, retention 90%. 23 years same location. Agent tenure 42 years, 38 years, and 33 years.

MINNESOTARosevilleMichael Fish [email protected] 651-592-3073Asking Price: $129,000 PIF: 625 Premium: $710,000Number of Licensed Staff: 1 Book size qualifies for enhanced commissions for starting new agency.

MISSOURISt LouisAaron Gaston [email protected] 314-895-3290Asking Price: $90,000 PIF: 312 Premium: $365,937Number of Staff: 1(lic 0)Low overhead, great location, Hazelwood. Ret 88.15, LR 28.49, ALI 73.

NEVADAReno Doug Penrod [email protected] 775-527-0825Asking Price: $230,000 PIF: 900 Premium: $900,000

NEW MEXICOSanta FeDavid Yount [email protected] 505-286-1798Asking Price: $425,000 PIF: 2,040 Premium: $1,819,124Number of Staff: 1 (lic 0)Contact number is for John McCauley, my agent in the sale of this business.

Santa Fe Joanne Shaw [email protected] 505-920-4323Asking Price: $435,000 nego-tiable PIF: 1,622 Premium: $1,739,979Number of Licensed Staff: 2

NEW YORKMt Kisco Theresa DiNuzzo [email protected] 914-241-2100Asking Price: $600,000 PIF: 1,548 Premium: $2,279,782Number of Licensed Staff: 1

SOLD!


Agencies for Sale Agencies for Sale Agencies for Sale Agencies for Sale

the NAPAA market placethe NAPAA market place

Goshen Joseph A Giglio [email protected] 845-291-3677Asking Price: Call PIF: 1,343 Premium: $1,700,000Number of Staff: 0 Great location, low claims, high retention, good will and great service. Call for price. Port Jefferson StationFred Morris [email protected] 631-474-2020 Asking Price: call for informa-tion PIF: 1,273 Premium: $1,530,766Number of Staff: 2 (lic 1) Agency located in Port Jeff Sta since 1991, high retention/low loss ratio

WestburyJamie Acarino [email protected] 516-457-1256Asking Price: Call for informa-tion PIF: 1,303 Premium: $1,740,000Number of Staff: 2 (lic 1) Beautiful office, located in Westbury since 1988. Will work with new owner to ease transition for the clients. Port WashingtonBrien Sullivan [email protected] 516-883-2100Asking Price: $1,288,000 PIF: 2,832 Premium: $4,600,000Number of Licensed Staff: 2Ideal Agency, Great staff, LR 49%, Ret 89.86, RFG Bonus 6 Digits in 09, over 6.0 points RFG. Turnkey . Premium includes Flood and Ivantage brokering (approx $250,000)

ArmonkBill Landmark [email protected] 914-273-0700Asking Price: Negotiable PIF: 740 Premium: $931,723Number of Licensed Staff: 1 Opened agency 1998, nice of-fice in a good area.

Rego Park Milton Espinoza Agency, Inc. [email protected] 718-459-2000Asking Price: Negotiable PIF: 1,821 Premium: $1,820,383Number of Licensed Staff: 121 Years in Rego Park. 5 Year Retention 90.49%, LR 37.74%.

ManhassetLeland D McAllister [email protected] 631-821-7806Asking Price: Call for info PIF: 937 Premium: $1,538,000Number of Licensed Staff: 1

GreenvaleMelvin Davis [email protected] 516-621-7400Asking Price: $425,000 PIF: 1,300 Premium: $1,638,000Number of Licensed Staff: 1

OHIOAshtabulaAmy Clark [email protected] 440-992-1438Asking Price: $400,000PIF: 2234 Premium: $1,750,000Number of Staff: 2.5 (lic 2) ALI 81, Retention 89%, LR 50%. Agent to stay minimum of 5 years. Buyer can use agency name, no one will even know it changed hands.

Cuyahoga FallsRoger Moore [email protected] 330-715-7780Asking Price: $750,000 PIF: 3,499 Premium: $2,787,000Number of Licensed Staff: 2Good clean book. Great LR & retention

OKLAHOMATulsa Karen Howard [email protected] 918-742-2785Asking Price: $450,000 PIF: 1,451 Premium: $1,809,355

OREGON BeavertonDon Evans [email protected] 503-781-6801Asking Price: Call PIF: 2,369 Premium: $2,116,000Number of Licensed Staff: 2RET: 92%. LR: 42%. PSA for 2010. 2.52 Pols per HH. Solid 20 year agency in Portland suburb, located in a long-es-tablished, well-kept business park; 1/2 block from City Hall. Started from scratch in 1990. Retention numbers show how faithful our clients are.

SOUTH CAROLINAIrmoJulie Stephens [email protected] 803-238-1032Asking Price: Call PIF: 2,057 Premium: $2,065,000Number of Licensed Staff: 1Great location! Growing area just 10 minutes from downtown Columbia. Serious offers only.

TENNESSEERogersvilleDale Wilson [email protected] 423-272-5357Asking Price: $132,000 PIF: 757 Premium: $675,000Number of Licensed Staff: 1Upper eastern part of Tennes-see (Hawkins County). Only Allstate agency in Rogersville. Great potential for aggressive agent. Low overhead, great location, high business traffic area. ChattanoogaMitchell Beene [email protected] 423-504-1078Asking Price: Call for info PIF: 1,350 PIF Premium: $1,400,000Number of Licensed Staff: 1 15 yr agency, prime location. Licensed office manager w/10 year tenure. 1st yr retention 89.94, 5yr 92.76. New beautiful branded office condo. Next door to bank, Target, Best Buy, retailers and restaurants. Turnkey.

TEXAS WaxahachieDavid Box [email protected] 972-938-7634Asking Price: $375,000.00 PIF: 936 Premium: $1,296,522Number of Licensed Staff: 1Two locations, Selling the Ennis location. Growing area. Only Allstate agency in Ennis. Downsizing to spend time trav-eling, etc. Great opportunity.

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Flower MoundRandy Bergfield [email protected] 972-539-7162Asking Price: $998,000 PIF: 2300 Premium: $3,500,000Number of Licensed Staff: 1 Established agency, just minutes from DFW Airport, densely populated, high value clientele. Serious offers only please.

Port LavacaHerman Novak [email protected] 361-552-1935Asking Price: $390,000 PIF: 1,601 Premium: $1,893,542Number of Staff: 2 (lic 1) 24 yrs in Port Lavaca, LR 37%, Ret 87.75%. Right on Gulf Coast, Seacoast Zone 1.

ArlingtonDanny Vela [email protected] Price: Negotiable PIF: 1,120 Premium: $1,686,000Number of Licensed Staff: 1 25 year agency. LR 53%, Ret 88.27. ALI 86. Will work with buyer to assure smooth transi-tion.

GarlandRick Burridge [email protected] 972-840-3695Asking Price: $350,000 PIF: 1,707 Premium: $1,500,000Number of Licensed Staff: 1

VIRGINIALortonEd Hogg [email protected] 703-862-8168Asking Price: Negotiable PIF: 1,125 Premium: $851,000Number of Licensed Staff: 1 26 year agent. 2 year satellite (under ESA agreement). Reten-tion 89.07, LR 51.96.

Falls ChurchEd Hogg [email protected] 703-862-8168Asking Price: Negotiable PIF: 1,658 Premium: $1,842,000Number of Licensed Staff: 1 26 year agent. Retention 88.71, LR 49.45. Bi-lingual book Span-ish.

Virginia BeachHank C. Boone [email protected] 757-641-9971Asking Price: Negotiable PIF: 1,200 Premium: $1,120,000Number of Licensed Staff: 1 Great opportunity for satellite in the resort city of Virginia Beach. Inexpensive rent in high income demographic area.

WASHINGTONSnohomishKevin ONeill [email protected] 425-483-2886Asking Price: $225,000 PIF: 1,051 Premium: $1,190,000Number of Licensed Staff: 1 22 year agency, 30+ years this location, Low overhead, easy access, nice visibility, close to Woodinville and Mill Creek. Ret 92.34, LR 44.44, pol/hh 2.34, ALI 75. Let’s talk!

LynnwoodJeff Conwell [email protected] 425-775-4511Asking Price: $259,000 PIF: 1,480 Premium: $1,367,112Number of Licensed Staff: 2 Great Book! PSA for 2010, ALI 74, Ret 93, LR 38.39, pol/hh 2.31. Agency is in the Fast Lane on The Road Ahead! Great location next to the busiest in-tersection in the state! Strong visibility, Allstate Branded Retail Environment!

Spokane Steve Wilson [email protected] 509-325-9388Asking Price: CallPIF: 3,125 Premium: $1,832,547

WISCONSINWausauMike Handrick [email protected] 888-895-6022Asking Price: Negotiable PIF: 1,150 Premium: $780,000Number of Licensed Staff: 1Growing area, North Central Wisconsin.

The NAPAA market place…where buyers meet sellers.Place your classified ad here for just $99 per issue of Exclu-sivefocus (Price reduced to $50 if ad is in conjunction with online ad.)

For more information, go to www.napaausa.org, or contact NAPAA at 877-627-2248, or [email protected].

index to advertisers

SOLD!

Applied System . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29

BGI Marketing Systems . . . . . . . . . . . . . . . . . . . . . . . . . . 21

Capital Resources . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3

E-chx, Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15

eBridge Solutions. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33

Get Insured. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 49

Global Green Ins. Agency . . . . . . . . . . . . . . . . . . . . . . . . 33

FMJ Agency Alliance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5

Oak Street Funding . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39

Paragon Ind. Ins. Agencies . . . . . . . . . . . . . . . . . . . . . . . 13

PPC Loan . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7

Rhinotek . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23

SIAA . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9

Smart Choice . . . . . . . . . . . . . . . . . . . . . Inside Front Cover

Speedy Solutions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 52

Sprint . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 52, Back Cover

The Original Property Postings . . . . . . . . . . . . . . . . . . . . 25

TWFG . . . . . . . . . . . . . . . . . . . . . . . . . . . Inside Back Cover

Wright Penning & Beamer . . . . . . . . . . . . . . . . . . . . . . . . 30