Your best direct writers

[InsAgentSF]

If you would choose between your direct writers, who would you choose

[d's insurance store]

For much of the market, the Direct Writing route is a limited opportunity for a scratch agency.

All of the 4 or 5 direct writers have no problem saturating the market with multiple locations, all designed to allow a Darwinian survival of the fittest. They all operate in a very controled environment that mimics a franchise, but without the protection of franchise laws. They all demand financial product sales in addition to quotas for P&C, and the agency owner is at the mercy of where the pricing department in home office decides to put the competitive markers.

And, they all pretty much demand some degree of financial input by the new agent to get things going.

If you're stuck in the 'old' days, where agents were employees, nurtured by experienced managers in offices with sales and product support and minimum salary guaranties that allowed for a gradual building of a profitable book of business, those days are long gone.

Any of us in the independent world, either from our own experience of starting out as captives, or knowing direct writing peers can tell stories of carriers that are in the market one day, ready for growth, and the next day a memo or meeting announces a change in market direction or product availability, leaving the direct writer with no place else to go to protect the clients. Think Allstate, State Farm and Farmer's, all of which have turned on their agents, clients and markets with hot and cold growth initiatives at the drop of a cat(astrophy).

My feeling is that the direct writing route for a newbie is a dead end, with far greater odds for failure than success, and that there are NO good Direct Writer environments any longer.

[kevinraz]

I can't see why anyone would go with a captive any longer. How many captive agents does one area need? In my Chicago suburb there are an excess of Farmers, Allstate & State Farm agents nearby. Any newbie is up against severe competition including competing against more established agents from your own company.

Add in the fact that you are stuck with whatever you are given - rates, pricing, acceptability, technology, etc. Also add the requirement to produce a significant volume of life or financial services business.

A better way to break in: find a run down independent agency in your area with just a few employees left. Buy out the lousy owner and assume his contracts with carriers & start from scratch. Plan on keeping very few of the customers you acquire and grow it from the ground up, expanding your host of carriers every year.

[gregcw]

26 years ago, I started out life with Farmers Insurance, went I/A after seven years and now work on both sides of them (Zurich and Foremost). They are one company I'd stay away from. They still haven't trained their sales managers to tell the truth. They're all on a promotion ladder and don't care WHO they use for steps. The contract value of the agency is based on last years RENEWALS only and not total premiums. They also throw agents against the wall to see how many stick. To keep 4 offices open in my area, they hired more than 30 agents over 15 years with only one agent actually retiring. That's not a good success ratio. On the plus side, you are not truly captive, only encumbered. If they don't want it you can place it with a G/A or anyone that will appoint you.

I also do not have much respect for Allstate, who is now just working just two sides of the fence (I/A & Captive) with no employee agents. State Farm treats their agents best but I still get regular referrals from their agents. In that same 15 year period they only hired 3 agents to maintain 2 offices and those two agents retired.

This leaves American Family, which has had difficulty getting agents to stick in this area, Countrywide - that has had the same problem and Nationwide. If your going to work with Nationwide why not work with Allied, their I/A division?

The suggestion from

A better way to break in: find a run down independent agency in your area with just a few employees left. Buy out the lousy owner and assume his contracts with carriers & start from scratch. Plan on keeping very few of the customers you acquire and grow it from the ground up, expanding your host of carriers every year.

makes sense if you have the capital to purchase.

[Porter]

I would not want to be a captive. However, to answer your question I would choose the Allied captive appointment. With their contract your only captive on the personal lines and they don't have life quotas. Their profit bonus is very good also.

[InsAgentSF]

I guess i asked a misleading question. I mean CA Admitted companies. Let's say you have to pick direct appoitment with 2 carriers out of the following, which would you pick:

AIG, Hartford, Safeco, CNA, Allied, Travelers, CSE, Zurich

[d's insurance store]

From your moniker, I presume you're in San Francisco...plug in all of those carriers for either personal or commercial into your rater and see what comes up for real or hypothetical quotes.

Then talk to the marketing reps and see the guidelines so that you can make a good guess as to acceptability for the company appitite to discover if you can sell into what appear to be good rates.

Once you've narrowed down the choices from your list, come back here and solicite opinions from appointed agency owners about the winning candidates.

[mdterpfan88]

Personally, I would stay away from Allstate for sure. They keep taking and taking and taking more from their agency force who are supposed to be independent contractors. That's a laugh. They require that your office be open a minimum of 44 hours a week, have financial quotas that are quite impossible to attain and their intimidation methods are nothing more than pure hatred of the agency force. This year the agents have to purchase or lease their own computers, telephones, printers, ink cartridges, envelopes, letterhead and business cards when all of this was supplied by the company previously for the last 30 or so years. What's next - having to purchase the company's brochures? It has been shown in writing (by accident of course) that the lowest 10% producing agents will be terminated from year to year. Why would anyone want to live that way under constant threats? Look at the lawsuits against the company from the agency force itself. Yeah, a great company to work for when you have to sue your own company for illegal demands and promises they made upon the agency force 8 years ago. Go independent - you'll be glad you did.