MAJOR
AGENCY CONCERNS
UFAA recently polled the agency force in
an unscientific survey on
several issues and the results were very
disturbing. The first survey dealt
strictly with whether agents had a PIF
gain or loss in 2008 and 2009. Agents
with less than five years were excluded
from the survey because many of those
newer agents received policies from
their district managers and are
therefore not a true representation of
the
agency
force. The net result in this
unscientific survey is that agents
reported that not only did they lose PIF
equal to the new business they wrote,
but they lost an additional 10% of their
PIF base. This is difficult to quantify.
Some agents wrote policies and some
agents couldn't write new business
because of uncompetitive rates. But the
commonality is a net loss of 10% of an
agent’s book of business. This is
troublesome because if this trend
continues with zero growth and a 10%
average net loss of policies many agents
will eventually lose their agencies.
Once again this was an unscientific
survey, but if you fall in this
percentile you are the average.
Now what do we do about this situation?
First let's realize that moaning
and groaning will not accomplish a
thing. A partial remedy to this problem
may be that if an agent wants to survive
in this business he/she is going to have
to make a paradigm shift.
Yes, I said a
paradigm shift because the reality is
you and only you will determine your
future in this business. So what UFAA
is suggesting is that if you find
yourself uncompetitive in auto and home
insurance then you need to start selling
Life Insurance, Business Insurance,
Health Insurance, medical health
supplements, Boat Insurance, Annuities,
etc. In other words, sell whatever you
can to maintain your agency and grow.
We
are, after all, insurance sales people.
I know, I know, I am going to receive
thousands of emails and phone calls
chastising me for saying or suggesting
such things and if FGI would just lower
their rates everything would be great.
Well folks there are no guarantees that
is going to happen, so we need to be
realistic
and deal with our current situation.
And the only way we can do that is to
sell the insurance products that we can
sell.
Many agents have called recently to
inform UFAA that they are packing it in
and leaving before they lose more
contract value. This is from the 9,000
PIF agent as well as the agent who went
from 2,300 policies to 1,200 policies in
one year. The list goes on and on.
UFAA is certainly not advocating that
you leave Farmers or sell business
through other insurance carriers that
qualify for Farmers and UFAA never will
do that.
But we are here to help the
agency force ("Agents Helping Agents®")
and the way to do that is to create a
shift in the way we think and sell and
stick together as one unified voice.
So
if you're struggling, please consider a
paradigm shift in the way you currently
do business and please consider joining UFAA.
Tom Schrader
President
United Farmers Agents Association