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