NAPAA - National Association of Professional Allstate Agents, Inc.

As the national economy sputtered on
the eve of the latest recession, there was
greater pressure on profit margins due
to a declining rate of return on invested
premium dollars. This was the same year
Tom Wilson became CEO of Allstate.
He and the Allstate Board of Directors
began to brandish their wizardry from
behind the curtain with loudspeakers
blasting. It was around this time they
began to intensify their efforts to control
every aspect of the agent’s job. The
company wanted to keep those overpaid
agents busy with corporate directives and
programs such as RFG, Alliance, agent
–owned technology, IMPACT, Allstate
Bank, 6&63, AFS, etc., so that they
would not, or could not, pay attention.
Natural disasters caused panic in the
boardroom and the company vowed
never again to expose itself to such great
losses ever again. The company passes on
the costs of reinsurance to the customer
or drops the customer if no reinsurance
is available. The Expanded Markets
program is ever-increasing. The company’s
financial services product portfolio
changes rapidly. New products are
given little time to prove their potential
worth. “Here today and gone tomorrow”
is the company’s financial product design
moniker. But it is nearly impossible to
design products that pay customers a fair
rate of return while simultaneously not
exposing the company to loss. Reducing
the amount at risk allows Tom Wilson
to continue to spend dollars on dubious
programs like woople. These programs
add another layer of smoke in front of
that mysterious curtain. The best part of
this obscure road map is that kids always
want to find the wizard! Therefore, those
existing agents who are still traveling the
road to Oz may or may not believe in
the wizard’s hidden agenda, yet they still
find some satisfaction in their attempts
to comply with his distorted and obfuscated
directions in their quest to find the
elusive Oz. However, many have ended
their journey lost, disillusioned or more
likely, discarded. Yet, the journey endures
and begins anew when new kids who pay
the $50k toll gladly commence their earnest
search for the magic wizard.
The “smaller pie” theory is guaranteed
to succeed. Think about it; why is
it so difficult to write new business IFS
scoring and SRM underwriting guarantee
that only a select few will qualify
and purchase coverage. The company is
certain that this selection model will assure
lower loss ratios. When is the last
time the company revealed loss ratio data
on our closed books of business vs. the
new companies The company does not
want to increase its potential for loss, yet
it threatens and fires those who do not
produce, whose retention and ALI scores
lag, and whoever disagrees with the
forfeiting of commissions via the EFS
money giveaway referral program. Just
perfect, is it not Agents and staff spend
most of their time quoting business that
will never be written or find themselves
defending the company’s rates and procedures
to save existing customers. I have
observed that I made the same commission
on a quote I didn’t write as I did on
the quote that was never done.
Either way, I should be commended.
I did my very best to aid in the effort to
downsize the company. I have watched
longtime customers leave after they concluded
that neither the company nor I
was worth the difference in price. If only
I had watched more woople…
I still believe that the company and
Tom Wilson have time to come out from
behind that mystical curtain and recognize
the true wizards of Allstate; the experienced
and dedicated Allstate agents
and their staff. This admission, however,
would require a fundamental attitude adjustment
by Tom Wilson, who recently
stated, “The fans I want to have are our
shareholders and our management team
and our board.” He did not mention customers
or agents. Joe Lacher also weighed
in with the following comment, “…some
of our agencies have a sufficiently small
scale that they’re not able to readily able
deliver that customer value proposition
that we’re looking for.” Value proposition
is an interesting choice of words, but it
sounds a lot like “smaller pie” to me.
I have seen the Wizard and, sure
enough, he is not real.
Best of luck to all,
Free at last in Texas
Texas Agents – Join Our Team
Are you considering a career as a professional independent insurance agent
Would you like to be in control of your income
Do you want to be able to serve the full range of your client’s insurance needs
Do you want to have a trusted partner who will invest in your future and allow you to
reach your full potential
• No start-up or monthly fees to join
• Errors and omissions insurance
• Have a financial interest in your book of business
• Expansion opportunities
• Access to quality personal and commercial lines products
• Agency management system
• Group Health Insurance Coverage
We look forward to discussing branch location opportunities
in selected areas of Texas.
For further information contact
Carl Shockey @ 972-978-8881
cshockey@paragoninsagencies.com
www.paragoninsagencies.com
Summer 2011 Exclusivefocus — 31