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Reflections of One Agent of a Disturbed Agency Force 

The two founder of our company must be whirling in their graves at the present management of what once was a partnership between agents and a company, both dedicated to growth and fairness to its customers, employees and agents.  Sadly, the process of change began when BAT (British, (American Tobacco) got its nose under the tent.  When Zurich finally purchased Farmers the changes were finalized.  Zurich is a Swiss multi-national banking and financial giant.  Farmers is just one cog in their large wheel.  While every from profit business, small or large exists to produce a profit, in the process there are some values that are not expected to be trampled.  They have been and this agency force is disappointed and angry. 

Every one of us understands that the Electronic Revolution is here and that business is being conducted differently.  We applaud the changes and adopt them and have spent and are spending important money to maintain them.  It has been a very good tool.  It has not, however, replaced personal service: that which we have promised our client-friends.  What we do not understand is why we are expected to think that our Company, that buys an additional insurance company which markets on line, under-prices its own agency force to the point of ridicule and tells us that it is helping us.  You insult our intelligence.   

When a client calls 21st Century or one of the many other companies promising large savings and trolling for bait and frequently saves a substantial amount of money for the caller, it is not unnatural for her to, assumes that her company has been over charging him all these years and is wide open to move the individual or families remaining policies.  Guess what?  They do.  Strangely some agents have found that by calling direct to 21st Century Insurance and posing as customers that somehow Farmers seems to be aware of this. 

Agent around the Country are worried about contract cancellations: company employees are disgruntled and indicate it in their voices when called and underwriters have become clerks, because there is largely very little judgment being allowed.  And somehow “The Free Market System.” Which has served well, based on competitive pricing and good service, for both small and large enterprises, seems to be one sided.  Does management think this axiom has been repealed?  The run off of clients is large numbers is a fact 9by our Companies own figures).  The Free market System works both ways and pricing really motivates buyers.  Otherwise why did management purchase 21st Century? 

The expansion of our Company is understandable and, no doubt, a wise business decision: using independent agents and better commissions.  What agents would like to know is just what the real plans are for the agency force which exists. 

We frankly wonder about our sincere efforts of days and nights of blood sweat and tears, labor and considerable investment.  Are you really inviting us to be “independent” as many of us have already done?  Do you really think that you can organize an agency based on trust and professional service and keep our clients by servicing them online?  Many, many of us do not think so. 

We really do feel that we need and deserve an honest explanation not slogans and information of Dashboard or DMs that also feel threatened. 

We also are aware of the big changes that are scheduled to be released in the New Year.  This letter is being written in advance of that time. 

We hope not to be disappointed.
Signed
Hopeful Agent 

Are Farmers executives and is Zurich, acting as Attorney-in-Fact,  breaching their Fiduciary duties and responsibilities by putting their best interest above those of the members of the Exchanges? 

Correct me if I am wrong, but the Exchanges are the P & C insurance companies and FIG is the Zurich umbrella name for their Attorney-in Fact interests in the exchanges. 

Under FIG, according to Wikipedia  "the exchanges hold the insurance risk, while Farmers Group, Inc. earns management fees by running the exchanges' affairs. The only exception is Farmers New World Life Insurance Company, a life insurer owned directly by Farmers Group, Inc." 

Question, did Zurich just absorb the Exchanges to use for their own benefit and at the expense of the of the members of the Exchanges?  How can the board of the Exchanges say they are acting on behalf of the members of the Exchanges when their rubber stamping of Zurich wishes shows contrary? 

Their huge pay raises, the ever increasing rates, the 25% fee to the A-I-F, the purchase of 21st Century followed by the prevention of 21st clients to move over to a Farmers (at penalty to the agents), the use of HelpPoint to service Zurich customers almost makes one think the Exchanges are nothing more than lackeys and yes-men to Zurich (provided they receive their bonuses or is the better term "kick-backs"?). 

If members of the Exchanges really had a voice, they would fire Zurich!  Farmers is no longer a small company without resources, so why is it they hire out an A-I-F at all? The ongoing outsourcing at Farmers has surrendered all control of the members to the A-I-F. 

The stupid ballots they hand out upon client renewals serves only to "legitimize" board members of the Exchanges with no real way to change the hand-picked members up for election.  Plain and simple it is a sham. 

Agents, of which most are Exchange members, have a strong interest in seeing the Exchanges succeed.  Strong Exchanges sharing the interests of its members is the reason the Exchanges were established in the first place.  How is it the Exchanges have deteriorated to the point to where they now serve the A-I-F instead of the other way around? 

It appears the only real voice the members of the Exchanges have are their agents.  Is this why management and the A-I-F are working so hard to diminish the number of agencies, thus diminishing the voice of the Exchange members?  I truly believe if members of the Exchanges are given back their voice; the members will receive better rates, the Exchanges will be more focused on providing better products, the attacks on agents will diminish, and agents will once again be able to focus more on their clients needs thus providing better service.  

Maybe UFAA needs to re-think  how it addresses the unfortunate divide issues between Agents and management.  Maybe it is time to FIRE Zurich and return to a more in-house approach in taking care of the Exchanges and its members.  Let’s face it, Zurich has incentive to seeing rate increases as 25% of MORE means MORE money in their pockets.  There is no incentive to do otherwise.  

Your email of 5/23/11 was right, The agency growth model is being implemented the first of the year.  I was District ##-## until my DM was fired in 2011. District ## agents were merged to District ## (now mega-District) effective 1/1/12. My new DM is meeting agents to discuss each agent's 2012 goals and the agency growth model.  I've been an agent for 10 years now, with the old AAA contract.  

You said mentioned this  "The problem is that once you open that door (contractual law) and you do not challenge it, you lose future rights to legally challenge it and they can increase the quoting and production numbers to whatever level they deem necessary."  Any advice on how I can discuss this to my new DM when I meet with him?  

Looking forward to hear from you.... 

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