Exclusivefocus Summer 2012.pdf - National Association of ...

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ExclusivefocusSummer 2012An Official Publication of the National Association ofProfessional Allstate Agents, Inc.Features18 NAPAA Letter Requesting Forensic Accounting Auditof Agent Commissions23 Terminated? What’s the Big Deal?by Dave Thorpe36 Preparing for the Future: The Ins and Outs of Selling your Agencyby John McKenzie46 Adjuster Pay Stymied: A Field Adjuster’s Perspective48 SabotageBusiness12 Creating a Mega Agency without a Mega BudgetBy Robyn Sharp16 Grassroots Marketing: Back to the BasicsBy Lezlee Liljenberg20 How to Book More Life Insurance AppointmentsBy Bill GoughTechnology25 Has Allstate Ever Told You toContact Your Own IT Support?By Dan HeltonLegal14 Allstate Responds to NAPAA’sCall to Stop Interfering withFlood Policies38 One Year and One Mile:Understanding theNon-Compete Provisionsof the AllstateR3001 AgreementBy Attorney Dirk BeamerHumour47 Words with Allstateby Brian Spillman30 Don’t Allow Debt Aversion to Stunt Business GrowthBy Carissa Newton34 On Allstate’s DimeBy Lezlee Liljenberg41 PIIGS on the Wing (and Other Sightings)By Marcus Bruderer44 Overcome Objections and Close the Saleby John BoeA Magazine for Allstate Agency Owners and AllstatePersonal Financial RepresentativesDepartments6 President’s Letter8 Letters to NAPAA59 Membership Application60 NAPAA Market Place4 — Exclusivefocus Summer 2012

president’s letterThe State of NAPAAand NAPAA’S National EA Conference& Annual Board MeetingIn SolidarityBob IsacsenPresidentNAPAA/OPEIUGuild 17I just returned home today from New Orleansafter participating in our annual conference andboard meeting at Harrah’s Hotel & Casino, June20-22. The board meeting was held the day beforethe formal conference began and was attended bythe full board and several guests. With transparencyat the center of all we do, NAPAA membersare customarily invited and encouraged to attend.The board meeting lasted all day and into theevening. We reviewed our financial condition andagreed on the final budget for 2012 to 2013. I ampleased to report that NAPAA remains in strongfinancial condition and able to meet all of its financialobligations.In today’s economy, growing membership at allassociations is both difficult and challenging, butthanks to Allstate’s recent moves – such as cuttingagent compensation, extending TPP paymentsto 24 months and carrying out its unsavory andunwarranted agent termination plan – NAPAAsucceeded in growing its membership during thefiscal year that ended May 31st. Interestingly, thisdouble-digit growth in membership is taking placewhile the agency owner population is dramaticallyshrinking.It would appear that Allstate agents are muchbrighter than the company thinks, because in spiteof Allstate’s attempts to stymie the growth ofNAPAA, agents have not been fooled by the company’smore than obvious efforts to lull them into afalse sense of security. Even those agents who havebeen around for just a few years have seen theirdreams begin to shatter as the management teamhas waged war – albeit inconspicuously at times –on the agents of this great company. While mostagents understand that it is not possible to changea leopard’s spots, company leaders have recentlydonned a new face because they know they’ve gonetoo far and pushed too hard. If truth be told, theydon’t like you any more than they did last year; theyare simply trying to preserve their jobs. If leadershipwas really serious about making amends tothe agency force, Matt Winter would be the newCEO and Tom Wilson would be standing in theunemployment line. Thankfully, most of you seethrough the smoke and mirrors.Michael Goodwin, president, and Kevin Kistler,vice president of the Office and ProfessionalEmployees International Union (OPEIU), bothattended the conference. Michael Goodwin addressedthe board as well as the conference attendeesand has personally assisted us in our growthinitiatives and long-term strategies. OPEIU hasfurther enhanced our member benefit packagewhile giving us the resources and intellectual capitalthat is helping to level the playing field whendealing with a corporation the size of Allstate.When we affiliated with OPEIU, our membersbecame eligible to utilize their member benefits. Iam pleased to announce that one of our membersin the Capital Region won the $6,500 HowardCoughlin Memorial Scholarship award offeredthrough our affiliation with OPEIU. We have alsohad several agents take advantage of the E&Odeductible reimbursement benefit, which was designedespecially for NAPAA. This benefit pays20% of your E&O deductible up to $500. In thesedifficult and uncertain economic times, agentsneed all the help they can get.The following two additional member benefitshave been approved by your board and will be announcedshortly:• De-regulation of energy in Washington D.C,TX, MD, DE, PA, NJ, NY, CT, MA and IL hascreated an opportunity for NAPAA to sponsora discount Green Energy program provided byViridian and Ambit Energy, two of the leadingenergy providers in the U.S.• A new Prescription Drug purchasing paradigmis being sponsored by NAPAA and offeredby BidRx. Discounts over standard pricing are ashigh as 80% and are generally lower than the copaymentunder your prescription drug health plan.The guest speaker program at the annualContinued on page 8.6 — Exclusivefocus Summer 2012

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letters to NAPAAYou’ve done it again. You put togethera great convention and helped agentsmore than you know. And we know theactual convention is just the tip of theiceberg. You two are so dedicated, and weare lucky to have you at the helm.Thank you for inviting us to presentour ideas to the group and for includingus in every activity. You have been sogenerous to us. It was like a wonderfulvacation with the perk of learning waysto improve what we do. It was an extremelyPOSITIVE meeting.We love you both and look forward toour next get together!because it was an operations act, not anagency act. All the examples I sent incame back with the same answer.My question is: if this theory holds,should our commission stay the same ifoperations did endorsements to lower apolicy premium?This is such a scam. I am asking you topublish this scenario, and to encourageagents to submit WSRs to Agent Compto inquire at least about their homeownerpolicy commissions. I am so angry thatwe have to take our time to explain theserate increases to our irate customers andwe are not compensated for it.Editor’s response: Thanks for writing.NAPAA has heard from lots of agents overthe past several months who have echoedyour sentiments. In response, NAPAAmounted an email campaign on May 7th toadvise the agency force that it had created anonline petition to address the issue. The ideawas to garner enough support to present itto the Allstate Board of Directors, whichwe did in a letter to the Chair of the AuditCommittee on May 17th, just days beforethe shareholder meeting on May 22nd.NAPAA’s letter to the Audit Committee canbe found elsewhere in this issue of Exclusivefocusmagazine (see page 18).I am an Allstate agent who complainedto management about the bigdrop in commissions in December andJanuary. Naturally, I did not hear fromanyone, nor did anyone bother to lookinto my case.Another agent and I spent hours andhours in commission auditing and checking.We concluded that the auto commissionwas too complex to audit. However,the property commission was relativelyeasy, and we discovered that a wholebunch of policies were UNDERPAID!When we brought it up to management,they simply asked us to submit aWSR to contact Agent Comp. Since wecould only inquire about one policy at atime, we submitted a whole slew of them,asking why we were underpaid. The answerwe got was such a scam. I am surethat all agents, at least in my state, havebeen ripped off.Here’s a typical homeowner’s policyexample:2011 coverage was $100,000. Premiumwas $500. Commission $50. The 2012Renewal: coverage increased to $120,000.Premium went up to $700, but the commissionis still at $50, when it should havebeen $70. The explanation for the shortage?Commission on the increased coverageis not payable because the coverageincrease was due to a company endorsement,not an agent endorsement. Agentcomp stated that agent did not earn itpresident’s letterContinued from page 6.NAPAA Conference is one of our most valuable benefits of attendance. The ideas andinformation derived by attending the conference are just immeasurable. The cost benefitanalysis of the Conference Cost versus the Cost of Knowledge Gained from ourspeakers just can’t be measured. For a complete list of conference speakers and contactinformation, please contact NAPAA Headquarters via email at HQ@napaaUSA.orgor by phone at 877-627-2248.Our conference vendor line-up this year was just outstanding. The following companieswere in attendance. Take a moment to review their websites and if you’re in themarket for any of their products or services, please contact them and be sure to mentionthat NAPAA sent you!• Capital Resources – www.capitalresources.com• The Woodlands Financial Group – www.TWFG.com• Agency Support Network of America – www.asnoa.com• BGI Marketing Systems – www.BGImarketing.com• Smart Choice – www.smartchoiceagents.com• IHT – www.ihtagency.com• Hartford Flood – dale.ensminger@thehartford.com• Premier Group Insurance – www.ThinkPremierFirst.com• InsureZone.com – www.insurezone.com• Insurance Quote Exchange – www.iquotex.com• The Kindness Revolution – www.thekindnessrevolution.net• Legally Mine – www.legallymine.orgSoon we will be working on next year’s conference and I hope you’ll plan to join us.We will be seeking innovative speakers and vendors who can offer fresh ideas to helpyou grow your Allstate agency.If you’re a member, thank you from all of us in the NAPAA family. If you’re not amember, please join NAPAA/OPEIU Guild 17. Not only does it pay to belong, youowe it to yourself and your family to help build the only organization dedicated 100%to your well being and success. Remember, our goal is 10,000 members; let it startwith you. Thank you in advance for your support.8 — Exclusivefocus Summer 2012

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Then, at the Allstate Shareholders Meeting,I asked Tom Wilson the following question:“Approximately 1,200 active Allstateagents have signed a petition requesting aforensic audit of the company’s recent internalcontrols failures regarding agents’ commissions.These agents are frustrated aboutrecent mistakes disclosed earlier this year inwhich Allstate miscalculated agents’ commissionsand Form 1099 tax statements.We are concerned that these problems haveundermined agents’ faith in the company.It is the job of Allstate’s Board of Directorsto provide proper oversight of managementand to correct any weaknesses in the company’sinternal controls. What have you doneto fix Allstate’s agent commission trackingsystems? And will the Audit Committee hirean independent auditor to conduct a forensicaudit of these problems?”Mr. Wilson responded by saying that theboard had received the letter, but went on toassure investors that the financial results ofthe company were “accurate and complete.”He stated that report errors earlier this yeardid not affect agent pay and added, “Our goalis to pay all of our agencies the correct amountof money, and on time.” Referring to the requestby NAPAA for an independent forensicaudit, Wilson said that the audit committee“will determine the next steps.”We have yet to hear from Allstate, but wedon’t intend to let this matter die. We willsend a follow up letter to the audit committeeto inquire about their progress on this issue.In the meantime, it would be helpful ifyou could forward copies of the replies youreceived from Agent Comp, so we have theexact language they used to deny your requests.You can fax those to us at 866-627-2232. It would also be helpful if you couldgo back to the prior year to see if you werepaid on non-agent initiated policy increasesin the past.Heads up! RFG may be gone, but anew “disqualifier” lurks in the offing. Rumorhas it that those agents who are onlyable to get 9% commission for the nexttwo years will face a new round of threatletters and possible firings. My deductionis that there will be four or five disqualifiersand any one of them can kickan agency back down to 9%.It seems that senior managers I’ve spokento have no clue that by releasing somany of our senior baby boomer agents,the company will also lose many of itsPersonal Touch Loyalists. I guess theyhaven’t figured out that many PTLs haveloyalty to their agent – not the company –while others won’t tolerate being shiftedfrom agent to agent.I hope Matt Winter has a “secret successformula” up his sleeve to support hisclaim that Allstate will be the best smallbusiness opportunity in the U.S. of A. intwo years. Millions will be saved in agentreferral fees.Allstate has stepped up requirementsto remain T-doc and POSIS compliantand will hold that threat over agentsmore and more. I expect they will demand100% compliance – no excuses.I’m getting a bad feeling about my decisionto stay, maybe I’ll reconsider…Enclosed is a letter I received fromAllstate that basically says I now haveto have at least one “licensed” sales producerin my office in order to “qualify”for the base pay I received in the past. Ialso received a follow-up call Friday toconfirm I received the letter and that Iunderstood what it meant.At no point was I ever told that Iwould have to have a “licensed” salesproducer in order to receive my base pay.Since starting with Allstate, I’ve onlypaid myself $2,000 a month.Any excess has gone into marketing,rent, the loan on my agency and otherbasic office items.In 2009, I was at the point where I hadbuilt my agency up enough to possiblyhire a staff person, but Allstate startedits downward spiral in my state and beforeI found someone to hire, I was toospooked to commit any funds to hireanyone. Trust me, I’m worn-out from doingeverything myself and nobody wouldappreciate a second person in this officemore than me. However, I only bringin enough revenue to pay myself whatamounts to $6 or $7 an hour, so there isno way I could to pay someone else. I’veeven attempted to hire a producer on acommission-only basis, but we are so uncompetitive,they would starve.In short, I have two options here; Icould work for Allstate for free and pay alicensed staff person or could continue towork for Allstate at a reduced pay, whichI estimate would be between $5 and $6an hour.Editor’s comment: You must be putting in65 to 70 hours a week if you’re earning $7per hour and working even more if you areearning less than that. The Federal minimumwage is $7.25 per hour. With all theresponsibilities and stresses that come withrunning an agency, it hardly seems worthyour while to stay at Allstate.Many agents put in more hours than the44 hours that are required by Allstate, butif that’s all you worked and you were payingyourself $5.50 per hour, your annualincome – with no vacation time – wouldbe $12,584. At $6 per hour it would be$13,728. The scary part is that in 2010, theHHS poverty threshold for a single personwas $10,890.I would like to take a moment to commendyou and the organization for yourtremendous efforts in standing up for theagents, who have made considerable sacrificesin helping build a well-recognizedbrand. Unfortunately, it may be a littletoo late for me since I have been forcedto sell my agency.However, I would like to advise my fellowagents and business owners to pleaseview NAPAA membership and contributionsto the legal fund as an investmentto protect and grow your business.I was a union member in the past andI’ve witnessed the positives as well as thenegatives. However, I firmly believe thatsolidarity is of the utmost importance.I would like to thank you for all thesupport you have provided every time Ihave reached out to you. In life, I believewe meet good people and some not-sogoodpeople. We should always rememberthe good ones who have helped inmaking our lives better. I truly would likeContinued on page 54.10 — Exclusivefocus Summer 2012

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sales and marketingCreating a Mega AgencyWithout a Mega BudgetBy Robyn SharpMaking sales is a big priority inyour business. There is alwaysa lot of pressure to producemore, retain more, and grow your agency.Unfortunately, a lot of agents don’t thinkthey can do it because they don’t have abig budget to work with. Between lowercommission rates, payroll and high overhead,marketing can quickly fall behind.But all marketing doesn’t have to beexpensive. When you look beyond directmail and internet leads, you’ll find a lotof budget-friendly options that lead tomore prospects and more referrals. Beloware eight cost-effective ways to getstarted creating a mega agency withouthaving a mega budget.Create anAgency Facebook PageFacebook is a free option that only requiresa little time and creativity to keep itfresh and up to date. Sign up for a free accountat www.facebook.com and you canbe up and running in less than 10 minutes.The key to using Facebook to generatemore quotes is by reaching a lot of localpeople and increasing your name andbrand awareness while showing that you’rean insurance expert at the same time. You’llneed at least 100 “likes” and be posting atleast one update each day. This will helpyou get out to the most people and ensurethat you’re attracting new business.Speak At Local OrganizationsThink about all of those luncheonsand groups that you attend throughoutthe year. There are organizations allover town that are looking for someoneto speak at their next meeting and youcould be just what they need.You don’t have to be a professionalspeaker in order to make this a usefuland easy strategy for increasing quotes inyour agency. Half the battle in insuranceagency marketing is awareness. You wantpeople to choose your agency over thehundreds of other options available inyour community and on the Internet. Inorder for this to happen consistently, youneed to reach as many people as possible.Start contacting local groups like theKiwanis Club, Lions Club, or Rotary.See if they need a speaker and offer totalk about ways individuals can lower insurancecosts. This is an interesting topicand will give you a chance to help peopleand attract quotes at the same time! Tryto book at least one speaking opportunityevery quarter at a minimum, but aimfor a monthly event. Once you’ve spokena few times, you’ll notice that people willstart contacting you often.Promote Referral RewardsReferral rewards programs are popularright now. A lot of agents reward theirclients for sending a friend to them fora quote by giving away a small gift card,a lottery ticket, or entering them in amonthly drawing for a larger prize likedinner and a movie.Beyond what you use as a reward, thekey to getting more referrals is to ask forthem! You want to make this programsomething you and your staff talk aboutall the time. Make flyers, mention it toevery client that comes in the door, postit on your Facebook page, and do anythingelse you can think of to make surethat everyone knows about your rewardsprogram. The more you and your staffmention it, the more likely that peoplewill remember to send business your way.Run an Annual Life InsuranceCampaignRather than just waiting for life insurancesales to trickle in throughout the year,make it a point to go after them. Create amarketing campaign for life insurance tofamilies with young children. While youmight not have a way to narrow down thelist specifically, you could easily target allof your clients that are married and betweenthe ages of 25 and 40.Send postcards, make phone calls, poston social media, and send an email toeveryone on the list. Talk about how importantand affordable life insurance is foryoung families. Make it a point to quoteas many as possible each year. Prospectingfor life insurance should be an ongoingprocess every day. Don’t wait until the endof the year when you’re rushing to hit youryear-end Expected Results.12 — Exclusivefocus Summer 2012

Support a Charityto Get Facebook FansIf you’re struggling to grow your Facebookfans, here is an affordable option.Choose a local charity to support andannounce that you’ll be donating $1 forevery new “Like” on your page. Make ita short deadline (no more than a week orso) and start promoting.Agents have easily gained 200 fans inonly a few short days with this strategy.It’s a win-win solution that supports agreat cause while giving local residents agreat reason to “like” your business. Andwhen you have more “likes,” you’ll be ableto use Facebook to attract more quotes.Network Three Times a WeekNetworking is an easy way to bringin new quotes without spending a lotof money. You probably already belongto your local Chamber of Commerce orBoard of Realtors. Now it is time to reallyfocus on connecting with the individualsthat you meet.Make a goal to schedule three one-ononenetworking meetings each week. Itcould be a quick lunch or a meeting at acoffee shop. Sit down with someone andlearn more about their business and seehow you can help one another.This helps build your reputation inthe community, while getting connectedwith a lot of new potential clients!Celebrate Each VictoryThis might not generate sales directly,but it will help boost morale in your office.If you want more sales, you need tomake sure that your staff understandshow important it is. Make it a point tocelebrate every time someone sells a newpolicy. Ring a bell, cheer, blow a partyhorn, anything to get everyone smilingand excited.Show your team how much you appreciatetheir hard work. Recognition goesa long way in fueling their performance.Monoline ConversionsWhile it may be out of your budgetto send out direct mail each month tounknown prospects, it can be quite affordablewhen your list is a little smaller.Monoline policy holders already knowyou and your agency. They are morelikely to be receptive to your marketing,especially if they have an opportunity tosave on their current policy with a multilinediscount.Send a postcard and have your teamfollow up with a phone call for a quote.You could break the list up and onlysend a few each month to keep it manageable.This will help generate newsales while increasing your retention atthe same time.Implement these eight marketing strategiesand start generating new quotes andgrowing your agency without breakingthe bank. EfRobyn Sharp is a former agency owner andwriter of the Mega Agency Marketing blogat www.MegaAgencyMarketing.com. Visitthe website and get a free copy of her checklist“59 Ways to Attract All the InsuranceClients You Need.”Summer 2012 Exclusivefocus — 13

legal updatesAllstate Responds to NAPAA’s Call toStop Interfering with Flood PoliciesOver the course of several months,NAPAA received confirmationfrom multiple members in Floridaand elsewhere that Allstate’s Flood ServiceCenter was sending misleading letters tothe policyholders of recently terminatedagents. Under the National Flood InsuranceProgram (NFIP), when agents terminatewith Allstate, they can continueto service their flood books of businessthrough Allstate until renewal. And if theycontinue to work as licensed independentagents, they can roll their flood policiesinto their new books of business.NAPAA received copies of correspondencesent to flood policyholders withinweeks of their agents’ termination withAllstate. In those letters, Allstate told theinsureds:We have been advised that youragent … is no longer available toservice your flood insurance policy.An active property and casualtyinsurance agent must be assigned toevery flood insurance policy writtenwith the National Flood InsuranceProgram …. Please contact anotherAllstate Insurance Agent in yourarea, requesting that he/she take overthe servicing of your policy.NAPAA then asked its attorney towrite to Allstate to instruct it to ceaseand desist issuing false or misleadingletters to the policyholders of its memberswho had terminated with Allstate.NAPAA pointed out that, in most instances,Allstate’s letters were false to theextent they indicated the agent was nolonger available to service the policy andmisleading insofar as they implied theagent was not actively licensed to renewthe policy.Allstate referred the matter to aprominent Washington, D.C. law firmwith whom it has worked for manyyears, and NAPAA was pleased to receivecorrespondence responding to itsconcerns. Allstate’s attorney explainedthat those concerns were simply theproduct of a “misunderstanding” of theNFIP by NAPAA and that Allstate’ssole intent was to notify policyholdersof their renewal options in order toavoid a lapse in coverage. While he didnot acknowledge that Allstate had actedimproperly, he did confirm that Allstatehad discontinued its use of the offendingletters.NAPAA appreciates Allstate’s effortsin addressing these issues and for beingresponsive to the legitimate concernsof agents and consumers in this matter.NAPAA will continue to do its part tokeep you informed and vows to let Allstateknow when its conduct, whetherintentionally or otherwise, has crossedthe line.Comparetto v. AllstateAs previously reported, a group ofCalifornia agents filed a class action lawsuiton September 1, 2011, in the SuperiorCourt of California against AllstateInsurance Company. Earlier this year,Allstate filed a motion asking the courtto dismiss Plaintiffs’ Complaint, allegingthat the Plaintiffs’ claims were invalid.The court, in granting Allstate’s motion,permitted Plaintiffs to amend their complaintto correct certain deficiencies, andPlaintiffs filed their Second AmendedComplaint on May 8, 2012.The Second Amended Complaintfiled by the Plaintiffs includes claimsfor breach of covenant of good faith andfair dealing, breach of written contract,and violation of California’s Businessand Professions Code, which prohibitsunlawful, unfair, deceptive, and fraudulentbusiness acts and practices. TheComplaint claims that Allstate deliberatelybreached its contracts with agentsby failing to use good faith in exercisingits exclusive judgment regarding theapproval of potential buyers for agents’books of business. This resulted in significantlyreduced values of agency owners’books of business and deprived agentsof the ability to sell their book of businessfor fair market value. Plaintiffs alsoallege that they were forced to sell theirbook of business far earlier than they hadplanned because Allstate implementeda performance based termination program,although Allstate did not have thecontractual right to do so.Allstate has again filed a motion seekingto dismiss Plaintiffs’ Second AmendedComplaint. The motion is scheduled tobe heard in early August. If the Plaintiffs’Complaint survives Allstate’s motion, thecase will proceed. A jury trial is set to beginat the end of February, 2013. Ef14 — Exclusivefocus Summer 2012

Summer 2012 Exclusivefocus — 15

ing group and know immediately that itis not for you. Drop the group and saveyour time and money. If you are unsure,go a few times to see if you feel at homewith the group. If you join an organizationremember these pointers:You will not get business immediately,so don’t let this discourage you.If it seems like it is not working out,then trade it for another organization.Always remember you are not marriedto the group.InvolvementBecome a leader as soon as you can.This puts you front and center. I canhear the excuses now… “But I don’tlike speaking in front of others.” Or, “Iam not extroverted.” Or, “But, I am notcomfortable with this or that.” It is timeto get out of your comfort zone becausethese excuses will not get you morebusiness; they will only serve to inhibityour growth as a successful agency owner.If you have these fears there are remedies.Consider a Dale Carnegie courseor join Toastmasters International. Thisstep will take a little courage and sometime and effort, but the results could farexceed your expectations. If this is toobig a step, then consider becoming thetreasurer or secretary, which will exposeyou to the group, yet limit your speakingtime. I use the word “expose” here inthe most positive manner, so please donot go out and do something silly thatincludes drinks and a table.Being involved and interacting withthe group at this level is much moreproductive than just throwing moneyat an event or sponsorship. Being seen(and heard) at the group’s meetings andfunctions is crucial to getting referrals.The more you are seen, the more businessyou will cultivate.If you can’t attend, send a representativeof your agency. In my case, peoplewould come up and say, “Lezlee, youare everywhere!” It was true and afterI thought about it, I realized that Ineeded to do it again because it works.There were even other Allstate agentswho got frustrated with me because Iwas “everywhere.” Some of them wouldstay away from organizations that I wasa part of because they said I was “takingthe business.” That is ridiculous! Thereis plenty of business out there for everyoneand people gravitate to differentpersonalities. So if the group allows it,get three Allstate agents into the fold,and be a “force to be reckoned with.” Byteaming up, you may be able to force outthe major players from other insurancecompanies.Remove the Ball and Chainfrom your StaffFind an organization for staff to join.Obviously, there are different types ofstaff; some that can effectively marketand some who are best left in the office toperform administrative functions. This isnot to disparage those who remain at theoffice because they are the glue that keepseverything together. They complete thepaperwork properly and perform otherfunctions that keep the office hummingalong. Those staff that can handle themarketing end, however, will love thefreedom and trust being offered, whichbuilds morale. Go with them in the beginningto demonstrate how to networkand help them feel at ease. After a coupleof meetings, set them free.Set expectations for them, such as collectingat least three business cards ateach meeting and have them share theirconversations with you. Whenever youare all together at one event or party,your modus operandi should be to DI-VIDE and CONQUER. Too often, Ihave watched two or three employeeshuddle together rather than working theroom to gain referrals. This is a waste oftime and money. They can talk in the officeall day long, so huddling together innetworking situations should be bannedduring these events.Everyone – including and especiallythe agency owner – must be making newconnections. There is no greater trainingtool than “leading by example,” whichcan only be accomplished when theagency owner jumps into the trencheswith his staff, get his hands dirty, andworks the crowd.We must all remember that this iscalled NetWORKing, not NetSO-CIALizing. That is why it is called“work.” These are not meant to be la-didasocial affairs with no purpose; you arethere to accomplish something and thatis to build relationships, gather referralsand close business.Start back at the roots and grow fromthere. And always be sure to thank yourreferrals in some special way! EfLezlee Liljenberg is an active Allstate agentin Arlington, Texas and is a proud memberof NAPAA Board of Directors.Call us at 1-888-547-8877 or email TPPLoans@amgnational.comMember FDICEqual Housing LenderExpandYour AgencyorRefinanceat a Lower Rate• Lending up to 80% of TPP at competitive rates• Experience helping Allstate agents grow their businesses• Community bank service with national reach and resources• Strong and stable national institutionAMG National Trust Bankwww.amgnational.comSummer 2012 Exclusivefocus — 17

NAPAA Letter Requesting ForensicAccounting of Agent CommissionsMay 15, 2012Judith A. SprieserChair of Audit Committee, Board of Directorsc/o General CounselThe Allstate Corporation2775 Sanders Rd Suite F7Northbrook, IL 60062By e-mail: auditcommittee2@allstate.comEditor’s note: When this letter was written, more than 1,100active Allstate agents had signed our petition calling for a forensicaudit of agent commissions. By the time the window to sign thepetition had closed shortly after the annual shareholders meeting,more than 1,300 signatures had been collected.Dear Ms. Sprieser,I am writing on behalf of the National Association of Professional Allstate Agents (NAPAA) to urge the Audit Committee toreview and strengthen the Allstate Corporation’s internal controls over its commission systems for its exclusive agents.Allstate has recently suffered a series of problems in properly accounting for its exclusive agents’ commissions. At the beginning ofthe year, Allstate said that it had mistakenly underreported agents’ commissions for January. [1] Then in February, the company statedthat it had miscalculated Form 1099 tax statements for 4,700 agents. At that time, Allstate also announced that it was correcting errorsin the Customer Satisfaction Retention & Profitability reports that were used to calculate Allstate agents’ 2011 bonus payments. [2]Additionally, since May 4 th , over 1,100 active Allstate agents have signed a petition calling for a forensic audit of Allstate’s agentcommissions. Many of these agents are shareholders of Allstate and most, if not all prefer to remain anonymous. We will sharethe final, but anonymous, results of the petition with the committee upon request via an independent third party of our choice. Inlight of the recent problems with the company’s internal controls, we urge the Audit Committee to obtain an independent forensicaudit of the company’s recent internal controls failures, and to report its findings to shareholders.As you are aware, the Board of Directors has a fiduciary duty of care to ensure that Allstate has adequate internal controls in place overits accounting procedures. The recent mistakes in Allstate’s commissions for its agents raise concerns about the adequacy of the company’sfinancial reporting processes. Although these problems did not result in a restatement of Allstate’s financial results, they may indicateweaknesses in Allstate’s internal controls. We believe that a forensic audit supervised by the Audit Committee is therefore warranted.In addition to the potential risks to shareholders from these internal controls problems, the confidence of Allstate’s agents in the companyhas been shaken. Allstate’s agents are already on edge regarding Allstate’s planned reduction in base commissions by 10 percent in2013. We believe that concerns about Allstate’s commission reports have undermined the ability of Allstate’s agents to invest resourcesinto growing their agencies. As a result, Allstate’s acquisition of new customers may suffer until the concerns of its agents are addressed.For these reasons, we strongly urge the Audit Committee to investigate these recent miscalculations of Allstate’s agent commissions,as well as the overall reliability of Allstate’s internal controls over its accounting procedures. Conducting a forensic audit willgo a long way toward reassuring agents and shareholders that Allstate’s internal controls are adequate to prevent future problems. Welook forward to a productive engagement with you on these matters. Please contact me to discuss NAPAA’s concerns in more detail.Sincerely,Jim FishExecutive DirectorNational Association of Professional Allstate Agents, Inc.877-269-3474[1]Erik Holm, “Allstate Pay-Reporting Error Further Inflames Agents’ Ire,” Wall Street Journal, 1/12/2012.[2]Erik Holm, “Allstate Warns Agents of Tax Errors, Bonus Issues,” Wall Street Journal, 2/10/2012. [http://online.wsj.com/article/SB10001424052970203646004577215533578346866.html] (accessed 2/22/2012).18 — Exclusivefocus Summer 2012

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sales and marketingHow to Book MoreLife Insurance AppointmentsWarning: Ignore this process at your own peril!By Bill GoughIwas recently asked by an Allstate agentabout my Life Birthday Letter Process.He was curious about how we areable to achieve outstanding results whilehe has gotten very little response to thesame process. He wanted to improve hisresponse rate and book more life appointments.Of course, having a process for this iscritical because it is another way that wecan make the most of the biggest advantagethat we have as small business owners– the relationships we have with our customers,prospects, and our centers of influence.We need to do everything we can togrow and nurture these relationships – andwhat better way to do it than by wishingyour customer “Happy Birthday?”The Life Birthday Letter Processis a great campaign to use because youare reaching out to your customers on apersonal level. Plus when done the rightway, you’re almost guaranteed to booklife appointment after life appointment.This process can be extremely powerful,especially when you add a “scripted”outbound call. We will get to that in aminute, but first...For maximum results and best ROI,the Life Birthday Letter Process – likeother marketing processes – must be afull-blown marketing campaign usingmultiple steps and multiple media.This process will work if you followthese simple steps. Your EFS should costshare this with you, but if he doesn’t, Isay still do it. Your ROI on this marketingprocess will be awesome.Following are the steps I strongly recommendto achieve maximum results:Step 1 – Voice Broadcast. Schedule thisfor a day or two before expected letterarrival. The script should go somethinglike this:“Hello this is _________, your Allstateagent. I just wanted to call and saythank you for your business, and to letyou know to be on the lookout for a letterI’m sending you. You can’t miss it – itlooks like _______. It is very important,so call my office when you receive it. Oh,by the way, according to my records, I seeyou have a birthday just around the corner...so here’s an early Happy Birthdaywish from us! Thanks again for your supportand be sure call us at _______ whenyou receive the letter or whenever else wecan help you.”When you describe your mailer, be sureto mention what the envelope/postcardlooks like, including color, size, photo,20 — Exclusivefocus Summer 2012

etc. Also, when you wish your customer ahappy birthday, be sure to put a smile inyour voice. I promise they will be able todetect the warmth in your voice.This step alone will drastically increasethe response, but we’re just getting started.Step 2 – The Letter Arrives. You shouldknow the approximate delivery date theletter will reach your customers’ homes.This is critical because all the marketingsteps and media are aligned around thisstep for best results. If you’re using standardor bulk mail, you will not be able todetermine this exactly, but you can stillget a good idea. My suggestion – addyour name to every mailing so you knowwhen it arrives.Step 3 – Send a follow-up Video Email.It is crucial that you capture customeremail addresses every day. Require thatall of your employees capture new emailaddresses or update existing email addressesat every opportunity. Some customersdon’t have email or don’t like givingtheir email address out – I get that,but we still need to be asking for them.Video is another type of media that isvery effective and extremely powerful –much more than written words. Imaginesending your customers an email containinga video of you holding the letterand mentioning your recent phone call.Talk about making them feel special!Following is a script for your videoemail:“Hello, ______ here with a very importantmessage. So important that Irecently called you and sent you this letterregarding life Insurance and your upcomingbirthday... Happy Birthday! Asyou most likely know, life insurance pricingis all about age and health, so as wegrow older, rates for new policies go up.Now is best time to quickly review yourlife insurance to make sure there are nogaps and before rates get higher for you.”Then if you can, insert a quick oneminute (or less) story about a real lifeexperience. This can be critical and veryemotional because as we know, life insuranceis all about emotion. If you don’thave a real life story, borrow one.End the video with a very clear Callto Action. “Just hit the reply button andlet me know the best time to contact youor call me at ________.”Also, be sure to include some of thecopy in a summary in the body of youremail. Do not assume that each personreceiving the email will click on the videolink and watch the video. By addingsome of the video content in text beneaththe video link, we can help ensure thatour customers are receiving the message.I can hear some of the agents now;“But Bill, I don’t know how to shoot avideo.” Well, there’s a first time for everything.Remember, successful smallbusiness owners don’t become successfulby whining or making excuses. If youwant this process to work, stop makingexcuses and get busy! If you’re still notsure if you can do it, maybe you’re in thewrong business.Shooting the video will take you a littlepractice. You will be uncomfortable atfirst, but that’s okay – it’s natural to feelthis way. It doesn’t have to be perfect andactually, it is probably better if it’s not.After all, you’re not a TV anchorperson.Step 4 – Outbound Call. This is themoney step. This is you and your teamactually speaking with your customer.Your script is basically a repeat of thescript in the video. Make small talk andlet them know the reason for your call.Remind them about your recent communicationswith them – call, letter, andvideo email. The next thing you know,you’re off to the races booking anotherlife appointment.This Life Birthday Letter process isdone best just like all other highly successfulmarketing campaigns – when allthe steps are followed completely! Forthe best results, you must use all of thesteps mentioned above, in the right order,and completely. This will enable youto realize the best return possible andmake the most of the biggest advantagethat we have as small business owners– the relationships we build with ourcustomers, prospects, and our centers ofinfluence. EfBill Gough is President of BGI MarketingSystems. BGI is a company dedicated tohelping Allstate agents take their agencies tothe next level of growth while maximizingprofits. Bill can be reached at Bill@bgisystems.comor by calling 877- 208-9649.Attention New Agency Ownerswho either Bought an Agency orwere Assigned a Book of BusinessAre you frustrated with your FSL for not providing you with“Proven” methods to write more Life and Annuity Businessfrom your Book of Business?Let me show you a proven plan to increase your saleswhen you join NAPAA. With my plan, you’ll keep your FSLoff your back and make your EFS Happy – or you can do ityourself and put the $$$ in your pocket.For more information, please contact:Gerry FloresNapaa Benefits Representative563-564-180022 — Exclusivefocus Summer 2012

featureTerminated? What’s the Big Deal?By Dave ThorpeWe all remember FDR’s famousstatement that gave solaceto a frightened nation; “Theonly thing we have to fear, is fear itself.”Many of you in various regionsthroughout the country remember acertain high-profile RVP who madehis mark by terrifying agents, territorialleaders and local sales leaders. He alsospent a lot of time in court defendinghis and Allstate’s actions. His style wasmanagement by intimidation. And itworked. He scared the hell out of me. Hewas perhaps best known for the lawsuitshe was party to. I’m not going to use hisname in this article for fear of a redux ofprevious litigation. I thought about quittingback then, and to this day wonderwhat would have happened had I doneso. I decided to contact a few agents wholeft Allstate either voluntarily or otherwiseto see if they were better off.I was instrumental in the hiring ofWade Rohrs back in the late 1970s.Wade was an adopted child and after hisadoptive parents died, he changed hisname to his biological mother’s name,Hatton. We worked together sharing asales booth in a Sears’ store.Problems surfaced right away. He wasa handsome lad who was easily distractedby the Sears’ girls – and they loved hisattentions as well. He felt restricted inthe confines of Sears and thought theagency manager to be slow-witted. Sohe decided to walk out and try his handat catching bigger fish. On his plane rideout of town to Newport Beach, he happenedto sit next to a procurement officerwho worked for a small local airline. Theofficer complained about the pedanticattitude of his then commercial insuranceagent.Largely as a result of that meeting,Wade decided to go into commercialinsurance covering airlines. He kept incontact with the aforementioned procurementofficer and when licensed,wrote up the airline. That segued intoselling coverage for municipalities, titlecompanies, fast food restaurant chainsand global business entities. He becamea multimillionaire and 30 years later,bored by insurance, sold his agency. Hebought a high-end hotel at the foot ofthe San Francisco Peaks in Flagstaff, Arizonaand renamed it the Hatton House.You can say hello to Wade by emailinghim at mhatton2006@yahoo.com.Mike Conley is a bright lad with an artisticbent. He sold a 10-year-old agencyof medium size in 2000. He wanted thefreedom of a self-employed entrepreneur.He started Boundary Waters Pools andSpas. He designs pools, gazebos andSummer 2012 Exclusivefocus — 23

ock waterfalls and enjoys skills requiringa combination of artistic temperamentand construction expertise. Mikenever took a step back income-wise. Hebuilt my pool and waterfall, as well asmy son Jason’s. We couldn’t be happierwith his work. You can contact Michaelthrough his website at www.boundarywaterspools.com.Although the aforementioned RVPdisliked me personally, the then TerritorialManager was a personal friend whointervened and kept saving my job. Butthe RVP really hated Ed DeLorenzo,who did have a huge ego, almost as bigas his boss’s. Ed was a fine agent in theregion, highly productive and earnedArizona’s “Agent of the Year” recognitionseveral times. The RVP stayed onEd like a wolf on a treed bobcat. Ed had16 years with the company and simplygrew tired of the constant harassment.He quit Allstate and started AmbassadorInsurance in Scottsdale. He currently hasa $10 million book and 12 employees. Ifyou want to say hello to Ed, email him ateddelorenzo@yahoo.com.Tom Wittkopp was nothing if not agenuinely amiable agent, who was esteemedby fellow agents and clientsalike. He started his Allstate career in1975 and enjoyed almost two decades ofsteady growth. Then the same RVP whoharassed Ed stepped into the picture.What’s interesting in this case is that theRVP never came after Tom personally.But Tom couldn’t stand his overbearingattitude and felt the policies of the RVPwere a direct cause of his decreasing policycount. If nothing else, it was not anenjoyable atmosphere to work in. Manyagents felt management was just lookingfor an excuse to terminate another agentin an attempt to drive production by intimidation.Tom moved to Germany and beganselling Universal Life policies to ourtroops in Swetigen. He came back statesideand enrolled employees of riverboatcasinos in health and pension plans in BatonRouge, Louisiana. He’s now retired. Ifyou’re an old bud of Tom’s you can reachhim at wittkopp123@gmail.com.I’m saving my favorite guy for last. Notthat he was all that loveable. A little demented,a little rude and certainly surly,he was just my kind of guy. I’d knownDerrace Hoey before his Allstate dayswhen we worked in consumer finance.I was also instrumental in getting himhired because I knew he would be successful.And he was. Then he ran afoul“There is lifeafter Allstate.Termination isn’t theend of the world. Andfor those of you whoare anxious about yourown life after Allstate,you might find solaceand strength in thestories I’ve shared. Ifyou’re leaving, putyour head down andmove forward –it just might bethat you’ll end updoing somethingyou love andmaking more moneywhile you’reat it.“of the RVP. I have no idea why theRVP took such umbrage to these guys,but production and integrity didn’t playa part in it. Only subservience to histyranny mattered.* And if he personallydidn’t like you, that was it. He hada reputation for being very vindictive. SoDerrace quit and started his own agencyand it was an instant success. Years later,he sold out his interest to his partner. Heknew I liked to write and invited me toquit Allstate and join him in his motorhome, writing and going to ball games. Isometimes regret I didn’t.Unfortunately, Derrace didn’t get theopportunity to enjoy his newfound freedomand peace of mind too awfully long.He died of cancer. But he didn’t die at adesk despising the company he was affiliatedwith, and he left his widow Lanetta,very well off.So there you have it; there is life afterAllstate. Termination isn’t the end of theworld. And for those of you who are anxiousabout your own life after Allstate,you might find solace and strength in thestories I’ve shared. If you’re leaving, putyour head down and move forward – itjust might be that you’ll end up doingsomething you love and making moremoney while you’re at it.A nationally esteemed Allstater oncesaid, “Some people have a great job butmake lousy money while others makegreat money and hate their jobs. I’mlucky enough to have a great job and alsomake great money.” Unfortunately, todaysuch praise is hard to come by. This is notto say that some of our company officersare not enlightened. The Southwest Regionhas a great leader in Dennis Bailey.One last thought. What if those overbearingRVPs of yesteryear had beenfound out before they harassed and intimidatedthe many agents that have sinceleft us? How many more policyholderswould we have today? For a clue, checkwith State Farm. Their agents and policyholders are much more important to thecompany than are pompous, tyrannicalRVPs. If you want proof, just comparetheir policyholder count and yearly resultsto Allstate’s. I guarantee you; you’ll beembarrassed by what you see.*I wanted to find a special word todescribe this god-awful representativeof leadership. What I found is the wordDemogorgon, which is, according tothefreedictionary.com, “A terrifying ancientdeity or demon of the underworld.”And that description is as close as I couldget to who he really was. EfExclusivefocus readers have been very goodat posting me with anecdotes and stories.I want to hear more. You can contact methrough my website www.davethorpe.net.24 — Exclusivefocus Summer 2012

technologyHas Allstate Ever Told You to ContactYour Own IT Support?By Dan HeltonIn 2008, Allstate made all its agentsbuy their own computers and get theirown internet connection through a localISP (Internet Service Provider). Thistransition has created numerous additionalproblems for Allstate agents. Nownot only do they have to know how toquote and write insurance through theprograms that Allstate provides, theyalso have to be computer literate in theareas of PC networking, software installationand setup, PC Hardware troubleshooting,and all of the other little problemsthat come with maintaining theirown systems – or they need an expertthey can rely on to help them throughthese issues.Unfortunately, most PC vendors don’tknow what is required on the Allstate sideto be able to help resolve problems thatagents are having. During the conversion,many agents purchased computersthrough Dell and were offered remotesupport through Verizon.The support people at Verizon neverbothered to learn how agents used theircomputers to access Allstate programsthrough Gateway or what was requiredto actually get everything to functionproperly. If it was an Internet connectionproblem then Verizon could help. Ifit was a PC hardware problem, they toldagents to contact the vendor who soldthem the computers.Dell, for example, could help withhardware problems, but had no clue howto access the Allstate Gateway. Then ifit was a Gateway issue, such as gettinga printer to print from the Alliance appor Alstar, they would tell the agent to callAlstar Support. But when you called AlstarSupport, they were quick to declarethat if you were having a problem theywere not responsible for, you needed tocontact your own IT support. This leftthe agents frustrated about who was reallyresponsible for fixing their problem, andleft these three support entities playingthe inter-company finger pointing game.I am writing this article to give agentssome insight on how to fix some of theseproblems themselves and to shed somelight on some of the leftover problemsthat agents are suffering with becausethey were too frustrated to do anythingabout them.ISP ServiceFirst let’s talk about your ISP service.Generally you have two kinds of service;DSL provided by a national or local telephonecompany, such as AT&T, or cableservice, provided by your local cablecompany. With DSL (Digital SubscriberLine) you may have either a single DSLModem or a combination modem androuter. If you have a single DSL modem,it is only meant to handle one PCso chances are, you also have a separaterouter. Usually the router will also havewireless capabilities. If they set you upproperly, they will have either disabledthe wireless capability or secured it witha passcode or a passphrase to access yournetwork wirelessly.If you have DSL with a combinationmodem and router all in one unit, the unitwill also usually have wireless capability.This modem/router should also have thewireless either disabled or secured witha passcode or passphrase. Securing yourwireless prevents someone with a laptopfrom pulling up in your parking lotand getting into your network withoutyour knowledge. Most of the time it issomeone who just wants to get internetaccess temporarily, but you never know;someone with the right knowledge couldgain access to your entire office networkand any files on your computers. If youhave wireless capability in your office, Iwould recommend you check with yourISP to make sure that it is either securedor disabled.There are too many different modemsand routers on the market to getinto how to configure your particularsetup. However, the ISP or IT personwho set you up should be able to walkSummer 2012 Exclusivefocus — 25

1DSL Single Port Modem Provided by Local Phone Company or National Phone Company ISPIncoming Phone LinePhone Line ContinuesEthernet Cable to Internet Port onRouter ( Also sometimes calledCat5 Cable Or Patch Cable)These Lines Represent the Cabling in youroffice with Patch cables from the Wall toyour PC’s on the PC End and Patch Cablesfrom the Wall to your Router on theRouter EndRouter(Usually NotProvided By TelephoneCompany)2DSL Combo Modem/Router Provided by Local Phone Company or National Phone Company ISPIncoming Phone LinePhone Line ContinuesPhone Cable to DSL Port on RouterIn this Diagram all we have done is eliminate theseparate Modem and Router and Combined theminto one unit.Modem/Router(Provided By Telephone Company)These Lines Represent the Cabling in youroffice with Patch cables from the Wall toyour PC’s on the PC End and Patch Cablesfrom the Wall to your Router on theRouter End3 Cable Service Modem Provided by Local Cable Company or National Cable Company ISPyou through how to configure the wirelessmuch higher speeds, typically starterlybecause most routers and cable mo-settings in your equipment. Typical ing at 12MB/Sec. and going up from dems have four ports. If your office hasRG-6 Line to otherspeeds with DSL vary with the level of Cable Services there. such In as my experience, I’ve found thatIncoming Cable ServiceTV or Phone Modemservice you purchased Line from your ISP. you can get internet service, phone linesmore than four PCs, then the tech doingthe conversion should have connected allWith every internet service Cable you Splitter have and TV service for the same or less than of the PCs into the hub or switch. I haveRG-6 Cable to Cable Port onan upload speed and a download speed. you Modem would pay AT&T for phone lines included some diagrams in this article toThese Lines Represent the Cabling in yourWhen the ISP gives the speed, they referalone. Cable companies usually also of-office with illustrate Patch cables from how the Wall everything to should be con-to it in terms of the download speed. fer free long distance in the U.S. and from the Wall nected to your Router in your on the office to work correctly.In this Diagram you would have to add an additionalyour PC’s on the PC End and Patch CablesRouter in order to have Wireless service in your office.Router EndThe upload speed is usually much slower. Canada, whereas phone CableWireless Router not usually provided by your Cablecompanies makeNormally the highest speed you can get additional chargesModemCompany. This is shown in the next diagram.for their “MetropolitanDiagram 1: Shows DSL Service with awith DSL is 6MB/ Sec. This means theCalling Area Plan” as well as other single port modem provided by the tele-download speed is 6 million bits per secondand thecharges. With cable services, you usuallyneedphone company. In this case, you have to4uploadCablespeedServicewouldModemtypicallyProvided bytoCableaddCompanya router inISPorderwithtoWirelesshaveRouteradd a routerAddedif you have more than 1 PCbe around 1.5MB/Sec. AT&T’s RG-6 Line to U- other wireless in your Cable office. Modem Although recently in your office.Cable Services such asverse service works like DSL, but TV or can Phone Modem go I have seen cable (Provided modems By Cable Company) with wirelessIncoming Cable Serviceup to 24MB/Sec.LineHowever, it will costmore to get this speed. Most Cable ISP’s Splitter offerbuilt into them, most cable modems providedby the cable companies do not haveDiagram 2: Shows DSL Service with acombination modem /router provided byRG-6 Cable to Cable Port ona standard of 1.5MB/Sec. service for between$20.00 and $30.00/Month. When Another importantwireless.Patch Cable from anyModemthe telephone company. In this instance,Ethernet Port OnCable Modemcomponenttoin our These Lines Represent all we the have Cabling in done your is eliminate the separateInternet Port Onoffice with Patch cables from the Wall toAllstate was In doing this Diagram the conversions, shows an additional Verizonwas only offering DSL at the lowest When Allstate did the office conver-Router EndRouter office in order network to Wirelessis yourRouterswitch or hub. your PC’s on the modem PC End and Patch and Cables router and combined themhave Wireless service in your office. Wireless Routerfrom the Wall to your Router on thenot usually provided by your Cable Company.into one unit. Since the modem/routerspeed of 384KB/Sec. on both the upload sions, the techs doing Wireless the conversions has four ports on it, you can connect upside and the download side for $35.00/Month. So Allstate and Verizon didn’tdo anybody any favors by offering thisservice. If they had done a little morenegotiating, they probably could havegotten AT&T to provide the service for$20.00 a month or so.But that is all water under the bridgenow. Cable service generally offersshould have left the hub Router or switch in theon-site black box. Originally, the datacommunications equipment that Allstateand MCI provided included a 3Com 8Port Hub and at some point, Allstateupgraded most offices to a LinkSys 16Port Switch. If your office has four PCsor less, this hub or switch would not beneeded for your network to work prop-to four PCs on your network.Diagram 3: Shows cable modem service.As you can see, it is connected verysimilar to DSL service, but most cablemodems have four ports on them as theyare combination modem/routers. If youhave four or less PCs they can all beplugged into the cable modem. To have26 — Exclusivefocus Summer 2012

separate Modem and Router and Combined theminto one unit.(Provided By Telephone Company)3Cable Service Modem Provided by Local Cable Company or National Cable Company ISPIncoming Cable ServiceLineCable SplitterRG-6 Line to otherCable Services such asTV or Phone ModemRG-6 Cable to Cable Port onModemIn this Diagram you would have to add an additionalRouter in order to have Wireless service in your office.Wireless Router not usually provided by your CableCompany. This is shown in the next diagram.CableModemThese Lines Represent the Cabling in youroffice with Patch cables from the Wall toyour PC’s on the PC End and Patch Cablesfrom the Wall to your Router on theRouter End4Cable Service Modem Provided by Cable Company ISP with Wireless Router AddedIncoming Cable ServiceLineRG-6 Line to otherCable Services such asTV or Phone ModemCable SplitterRG-6 Cable to Cable Port onModemIn this Diagram shows an additional Router in order tohave Wireless service in your office. Wireless Routernot usually provided by your Cable Company.Cable Modem(Provided By Cable Company)Patch Cable from anyEthernet Port OnCable Modem toInternet Port OnWireless RouterWirelessRouterThese Lines Represent the Cabling in youroffice with Patch cables from the Wall toyour PC’s on the PC End and Patch Cablesfrom the Wall to your Router on theRouter Endwireless service, you usually have to adda wireless router yourself, as depicted inDiagram #4Diagram 4: Shows cable modem servicewith a wireless modem added. Inthis case, if you have four or less PCs inyour office you would connect all PCsinto the wireless router in order to havethem all on the same network.Diagram 5: Shows that if you havemore than four PCs, how you would usethe hub or switch to connect all of yourPCs together also with a wireless routeradded.Diagram 6: Shows how you could connectall of your PCs together if you havemore than four PCs, but this is NOT thecorrect way to connect because it putsthe PCs on two separate networks; onenetwork controlled by the router sectionof the cable modem, and one networkcontrolled by the wireless router.In this example, all PCs would haveinternet access, but if you use the “P”drive, or public drive, to share files orshare printers in your office, only the PCsconnected to the network that includesthe file sharing PC would have access tothose files, and only the PCs on the samenetwork as the PC sharing the printerwould have access to the shared printer.I’ll talk more about the correct networksetup in future articles to be published inthis magazine.Troubleshootingyour Internet ConnectionI get many calls from agents who callto tell me they suddenly lost access to theInternet. They usually tell me that theAgency Gateway has stopped working.There are many reasons that could causethis; rainy days with lightning, theirISP decided they needed to reset someequipment, and power outages are themost common culprits. When I get thesecalls, I usually have to determine if it’s aproblem with one computer or all of thecomputers in the office. The next step isto ascertain if it is the Gateway programsthat are experiencing the problem or ifit’s the Internet that is down. The agentor support staff can usually answer thesequestions right away. If all the computersin the office are affected, I ask if they areable to open Internet Explorer and go todifferent websites. If they say no, and allthey get is a message that Internet Explorercannot display the web page, thisusually can be resolved by power cyclingyour data communications equipment.The key is to know the proper order topower everything back up.If they can go to different websiteswith no problem, the problem is mostlikely that the Allstate servers are down.In this case, all they can do is wait forAllstate to get the servers back up andonline. This is very rare, but I have seenit happen once or twice. If they callAlstar Support, they usually receive amessage that the support center alreadyknows about the problem and are workingto resolve it.Now back to our troubleshooting. Ifwe determine that the problem is withonly one computer, rebooting the computerwill usually resolve the problem. Ifthe problem is that all computers in theoffice have no internet connection, weusually can power cycle the Data communicationsequipment and this willrestore service. After power cycling thedata communications equipment, I generallyhave them reboot all of the PCs inthe office, just to start out fresh. Whenpower cycling the data communicationsequipment, we have to determine if thereis only one unit we have to power cycle orSummer 2012 Exclusivefocus — 27

5Cable Service Modem with Wireless Router Added and Hub Or Switch / More Than 4 PC’sIncoming Cable ServiceLineRG-6 Line to otherCable Services such asTV or Phone ModemCable SplitterRG-6 Cable to Cable Port onModemIn this Diagram shows how, if you have more than 4computers, you can use the Hub or Switch to expandyour office network. It is the same for either DSL orCable ISP Service.Cable Modem(Provided By Cable Company)Patch Cable from anyEthernet Port OnCable Modem toInternet Port OnWireless RouterWirelessRouterPatch Cable from anyEthernet Port OnRouter to anyEthernet Port On Hubor SwitchThese Lines Represent the Cabling in youroffice with Patch cables from the Wall toyour PC’s on the PC End and Patch Cablesfrom the Wall to your Router on theRouter End6Cable Service Modem with Wireless Router Added More Than 4 PC’s—INCORRECT CONNECTIONSIncoming Cable ServiceLineRG-6 Line to otherCable Services such asTV or Phone ModemCable SplitterRG-6 Cable to Cable Port onModemIn this Diagram the 1st and 5th PC’s are connected to 2of the ports on the Modem while the other 3 are connectedto ports on the Router. This configuration isNOT recommended as this puts the computers on 2different networks.Cable Modem(Provided By Cable Company)Patch Cable from anyEthernet Port OnCable Modem toInternet Port OnWireless RouterWirelessRouterThese Lines Represent the Cabling in youroffice with Patch cables from the Wall toyour PC’s on the PC End and Patch Cablesfrom the Wall to your Router on theRouter Endis there more than one unit. If you havea setup like those found in diagrams 1,4, or 5, you have more than one unit topower cycle. If your setup is depicted asin diagrams 2 or 3, you only have 1 unitto power cycle. Most routers are configuredso that when they are power cycled,they automatically reconnect to the samenetwork. Put simply, when there is apower outage at your ISP’s office, or ifthey have to reset their equipment, yourdata communications equipment mustalso be reset in order for it to re-establishcommunications with the equipment atthe ISP.If you only have one device to powercycle as depicted in Diagrams 2 & 3,all you have to do is wait for it to synchronizewith the equipment at the ISP.When power cycling your DSL modem/router or cable modem/router, I recommendyou power it off and leave it offfor at least one minute before restoringpower to it. Waiting a couple of minutesis even better. If you have DSL service,power-up your DSL modem/router andwait for the DSL light to turn solid greenand then reboot or restart your computers.Note that the color of the DSL lightmay vary by model and from manufacturerto manufacturer.A cable modem/router works basicallythe same way, except the lights have differentnames. In the case where you have aseparate modem and router as depicted indiagram 1, or a cable modem/router witha separate wireless router as depicted indiagram 4, you’ll need to power off bothdevices, wait for a couple of minutes, andthen power-up the single DSL modemas found in diagram #1, or the cable modem/routeras depicted in diagram 4; waitfor the lights to come on, and then power-upthe additional router. This gives thefirst unit time to get synchronized withits counterpart at the ISP and allows theadditional router to correctly synchronizewith the DSL modem or cable modem/router in your office. Note that if youpower-up the second unit too fast, andthe first unit has not synchronized withthe equipment at the ISP, your whole net-work will remain down. If correctly powercycling your equipment does not get youback operational, you should then contactyour ISP or IT support to get more helpfrom them.That’s all for this article, I hope youhave found this information helpful. Iplan to submit more technology-relatedarticles for inclusion in future issues ofExclusivefocus. Some of the articles I amconsidering include the proper setup ofyour office network, Allstate’s softwarerequirements, printer sharing and troubleshootingand a special article on theNortel phone system. EfDan Helton has worked in the computerindustry for 32 years. Since 1995, he hasworked almost exclusively with Allstateagencies handling their technology needs.In 2001, Dan started WECUSS International,a computer support company. Hiscompany’s new remote support center wasdesigned to help Allstate agencies nationwide.For more information, call (877)993-2877.28 — Exclusivefocus Summer 2012

agency financesDon’t Allow Debt Aversionto Stunt Business GrowthBy Carissa Newtonagency is $52,629 and $33,834 for a supportstaff employee. And the combinedexpenses of technology, software andconsulting to manage advertising andmarketing campaigns can run anywherebetween $25,000 and $50,000 – andthat’s for a conservative plan.Successful companies have demonstratedthe necessity to make significantinvestments for growth. They see positiveresults of reinvested capital while stagnantbusinesses struggle to manage costsas revenues decline. Despite this reality,many owners scale back or completelyabandon their strategies because they lackthe necessary capital. In effect, this failureto invest decreases competition, allowingthose who choose to invest in their businessesto write more business.The credit crunch felt by businessowners of every industry in recent yearshas given way to more available and accessiblefunding. But some agents arereluctant to take on a business or commercialloan. Instead, they turn to creditcards and personal lines of credit whichcan negatively impact their individual financialhealth.With growing optimism and faithin a recovering economy, agentsare dusting off the plans they puton hold a few years ago and are now lookingto transition out of simply maintaining theiragencies to growing and thriving again.Many agency owners are ready to grow bypurchasing technology to implement newsales and marketing processes, acquiring anotheragency or book of business, or takingon additional licensed sales producers.As agency owners contemplate acquisitionsand organic growth, they face thechallenge of resources. Although thereare many low-cost initiatives agencyowners can use to grow, most plans requiremore capital than these agents haveon hand.Consider the cost of hiring just one extraemployee. According to the NationalAlliance Research Academy’s 2010-2011Insurance Agency Growth and PerformanceStandards, the average compensationfor a producer in a personal linesWhy are agency owners averseto commercial debt?Assets. Many believe that financial institutionsprovide loans based on balancesheet financials and are not likely to lendagainst the agency’s biggest asset — futurecash flow, which is embedded in theagency’s in-force book of business.Angst. Agency owners believe theseinstitutions prefer hard assets like real estateor inventory as collateral, and they’renot comfortable with that scenario.Skepticism. A common presumptionamong agency owners is that actually30 — Exclusivefocus Summer 2012

obtaining a loan is so unlikely; it’s noteven worth going through the applicationprocess.FICO. The economic recession andsoft insurance market hit many agencieshard over the last few years. As a result,finances have suffered and agencyowners believe a less-than-stellar creditscore will completely bar them fromgetting a loan.Dread. The application process for abusiness loan is an arduous task if agenciesaren’t disciplined about maintainingcurrent and accurate documents – formanagement and finance purposes. Theywould rather avoid it.Money. Owners believe a sizeable outlayof cash is initially required for a loan,and they simply don’t have it.Is their aversion justified?The fear or avoidance of loans by agencyowners may be somewhat unwarranted.For example, some lenders provideloans to borrowers who have a decentor respectable FICO score, even thoughthey may not fall within the top tier ofscores or they weren’t fortunate enoughto avoid some negative history. Lenderswill also use an agency owner’s futurecommission stream as collateral eventhough it’s an intangible asset. What’smore, lenders can work with borrowersto meet their needs, like providing aninterest-only loan with smaller first-yearpayments to an agency owner who maynot see the results of an additional producerfor several months or a year.It is true; the process for obtaininga business loan can be a long one, andsometimes complicated. But it doesn’thave to be. First, some lenders really understandthe insurance agency business,how to value commissions and what theunique needs of the agency owner are.This simplifies the process and makes itless painful for borrowers. Second, theprocess can be improved when ownerslearn the requirements ahead of time andtake steps to prepare the documentationin advance. In fact, some loans can fundwithin three to four weeks if proper documentationis provided in a timely way.There are no guarantees for securing abusiness loan from a financial institution,but trepidations can be overcome. Thepossibilities in the insurance agency marketare endless. While many successfulinsurance agencies are thriving despiteonly recent signs of economic and industryimprovement, some haven’t been ableto find resources to grow. Agency ownersshould know there are viable fundingoptions available that will allow them tomeet their goals. EfCarissa Newton is the Director of Marketingat Oak Street Funding and has over 17years experience working with insurance andfinancial services professionals nationwide.Loans and lines of credit subject to approval.Rate may vary at any time. CA residents:Loans made pursuant to a Department ofCorporations California Finance LendersLicense. Potential borrowers are responsiblefor their own due diligence on acquisitions.The materials in this article are for informationalpurposes only. They are not offeredas and do not constitute an offer for a loan,professional or legal advice or legal opinionand should not be used as a substitute for obtainingprofessional or legal advice. The useof this article, including sending an email,voice mail or any other communication toOak Street, does not create a relationship ofany kind between you and Oak Street.RHINOTEKProviding Premium Imaging Supplies for Over 28 Years!RHINOTEK is a preferred NAPAA supplier for ink and toner products.Great Savings - Group Buying DiscountsGuaranteed Quality - Higher Page YieldsFree Shipping - 30 Day Net TermsHelp the Environment - Save the RhinoWe provide our customers with value every step of the way!• A vast selection of 6500 compatible and OEM imaging supplies• Over 28 years as an industry leader of premium inkjet and toner supplies• High-quality output, vivid colors and exceptional yields• Compelling price to performance value• A knowledgeable sales team focused on your growth through savingsTRYING TO SAVE MONEY BY MAKING WISE PURCHASING DECISIONS?A RHINOTEK NEW LIFE PRINTER and PREMIUM TONER CARTRIDGE IS YOUR BEST SOLUTION.Part Number Product Description NAPAA PriceNA13MS-Q5927A RHINOTEK CERTIFIED PRE-OWNED HP LaserJet 1320 with 13 Month Warranty $255QH-1320 RHINOTEK Compatible HP Laserjet Black Toner Cartridge - 7000 yield $72Call your representative today at (800) 695-RHINO for special NAPAA pricing on all Rhinotek branded ink, toner and maintenance kits.Don’t forget to ask about our complete line of Certified Pre-Owned New Life Printers.Rhintotek Computer Products, Inc. 2301 E. Del Amo Blvd., Carson, CA 90220 (800) 695-RHINO www.rhinotek.com/napaa.htmSummer 2012 Exclusivefocus — 31

SUCCESSFUL INSURANCEAGENCY ACQUISITIONSWhy do so many acquisitions fail to liveup to their expected promises?There are alarming statistics that reveal the failure of acquisitions to achievethe desired increase in value, economies of scale, spike in revenue andgreater profitability, among other expectations.If you are selling an agency, what do you need to know to accept the rightoffer and how should you prepare for the sale? If you are buying an agency,how do you find one that will align with your needs, business goals, companyculture, management philosophy, and more?To help you ensure a successful acquisition outcome –whether you arepurchasing or selling, read Oak Street Funding’s complimentary white paperon why acquisitions fail.Get the whole story. Download our whitepaper on successful agency acquisitions.www.oakstreetfunding.com/Acquire* The materials in this paper are for informational purposes only. They are not offered as and do not constitutean offer for a loan, professional or legal advice or legal opinion and should not be used as a substitute forobtaining professional or legal advice. The use of this eBook, including sending an email, voice mail or any othercommunication to Oak Street, does not create a relationship of any kind between you and Oak Street.

It’s ok to dive inwith the right agency financingDownload awhitepaper onAcquiring anAgencyOak Street Funding knows that insurance agencies are readyto grow through acquisitions, technology upgrades, additionalproducers, marketing initiatives and more. From our inception,we’ve provided financing exclusively for insurance agents andbrokers. Our industry expertise and unique financing haveresulted in over $200 million in funds. We can help you financeinvestments with minimal out-of-pocket cost by leveragingagency commission streams. Learn more and download a whitepaper on acquisitions at oakstreetfunding.com/Acquire.• Loan amounts upto $10,000,000• Increase borrowingpower by leveragingagency commissionstreams• Competitive rates1-866-OAK FUND | oakstreetfunding.com/AcquireLoans and lines of credit subject to approval. California residents: Loans made pursuant toa Department of Corporations California Finance Lenders License. Potential borrowers areresponsible for their own due diligence on acquisitions.

sales and marketingOn Allstate’s DimeBy Lezlee LiljenbergHonestly, I really have no problemwith woople. Now don’t shootthe messenger, but this stuff isgood, and it’s FREE! None of us couldafford this opportunity to train staffwithout Allstate providing access towoople. Okay, be mad that you are forcedto take the classes, be aggravated that as aself-employed person you are being toldwhat to do. Suffice it to say that wooplebothers me too, but please understandthat depending on the day, I might usea whole different set of colorful, but unprintableadjectives to describe it. Thekey here is that we are currently stuckwith woople, so we may as well make thebest of it by taking that negative energyand embrace the chance to train yourpeople in less time and for less money.I have been in sales all of my life; myentire life. Even as a kid, I was selling.Because we moved around a lot, I wasdetermined to make new friends. Mygoal was to make as many new friendsas possible by the end of the week. Whatdid I do? I went out cold calling to meetnew people; up and down the street,knocking on doors, introducing myselfand asking people if there were any kidsin the house. The product I was sellingwas me. This was 1968-1978 and I wasonly 5 when I started this obnoxiousbehavior. Maybe this is why I have noproblem cold calling today, but that is foranother story.Now back to the future. There is nodoubt that repetition is always a goodthing. I have taken all kinds of trainingcourses and many, if not most of themtend to cover some of the same ground asthe course before and the one before that.From Xerox to IBM training, it seemsthat I have taken them all – even somefrom companies that are unknown today.But the fact remains that my ability tosell, handle different situations, objectionsand closings all came from repetition.I still continue to take sales coursesvoluntarily – yes, I said voluntarily! Itwill never hurt you and if you open yourmind, it can only help you, your staff andyour business.You might say, “Well I am not a salesperson.”I say, “Yes, you are!” We’re allsalespeople – every day of our lives. Othersmay say, “I am a customer serviceperson,” or, “I like helping people.” Myresponse would be, “What do you thinka salesperson does?”We help people every day to make theright decisions and yes, we “sell them apolicy.” In customer service situationsyou are always selling too. Advising onproper coverage, reminding customerswhy they need to make a payment, helpingthem understand why they shouldstay with you. If that is not “SELLING”then what is?“Selling” is not a vulgar four-letterword; it is what we all do in our agenciesevery day. To be sure, some people havea negative, preconceived notion of salespeople,particularly insurance salespeople;our job is to dispel that concept by beingpositive, upbeat and highly professional.The hardest part of hiring staff is findinggood salespeople. Yet if we allowourselves to attach negativity to the word– like the outside world does – we won’tget far in the sales world. We must riseabove the din and be proud of who weare and what we do for a living – onlythen can we achieve the confidence toexcel in this noble profession.Selling is a skill, no doubt about it. Itmust be learned, practiced and implementedjust like a football or ballet. Peoplewill argue Natural Sells vs. LearnedSells. My argument is that NO ONE – Irepeat, NO ONE – is born a true salesperson.While it’s true that some peopleare comfortable interacting with otherpeople, it doesn’t mean they are goodsalespeople. Is a good salesperson a personthat talks and talks until you breakdown and buy from them just to get ridof them? I hardly think so.The main reason there has beenpushback with woople is because it was“mandated,” and none of us are fond ofthat kind of treatment. In these difficulttimes when so much is being taken awayfrom us, now might be the time to acceptsomething ON ALLSTATE’S DIMEthat may be beneficial to our agencies. EfLezlee Liljenberg is an active Allstate agentin Arlington, Texas and is a proud memberof NAPAA Board of Directors.34 — Exclusivefocus Summer 2012

Summer 2012 Exclusivefocus — 35

featurePreparing for the Future:The ins and outs of selling your agencyBy John McKenzieWhen the time comes to sellyour agency, the best approachis to be prepared.After meeting with the first potentialbuyer of my agency, I saw that it was difficultfor him to visualize the concepts ofthe income/expense/opportunity cycle. Iquickly learned that while I was an experiencedand successful insurance agent,I had absolutely no experience in sellingmy Allstate agency. It was clear thatI needed to develop a presentation thatwas easy for prospective buyers to followand understand.Since I only had one agency to sell, Iconcluded that I needed to become anexpert in sale presentation. I could not affordto “practice” on potential buyers. Seriousbuyers don’t come along every day,so each presentation had to count. Eachand every prospect needed and deservedto see an expert presentation on the specificsof my agency and I needed to devisea track to keep my presentations oncourse. What I decided to do was to developa three-ring, tabbed binder to helpkeep me focused when speaking with potentialbuyers. This was a great help, as Iwas able to stay focused on the conversationand avoid small talk during the presentation.Later, the information in thebinder became helpful for the accountantand attorney working with the buyer.I also decided it was best to avoid “chatterconversation” about the sale. Whenfellow agents casually inquired how thesale was going or if I had any offers, Iwould ask if they were interested in buyingmy agency. If not, I would close thatconversation. In my opinion, the WW IIsaying, “loose lips sink ships” applies tothis process. Conversations should onlytake place with interested buyers and,until the contract is signed, no one elseshould be privy to the status of the sale,especially Allstate management.It took me two years to sell my agency.Over that period, I had nineteen solidprospects. One never knows where abuyer may come from. You should listthe agency for sale on all sites available,including www.napaausa.org and www.allstate.com. Some financial institutionswho lend money for agency purchasesmay have buyers who are interested.Other agents in your area may know ofinterested customers or family memberswho want to buy an agency. Yourown customers may be a referral sourceas well. In my case, my final buyer hadworked as a licensed sales producer foranother Allstate agency and wanted toown his own agency.The Tabbed Binder– What to Include• Three years of your IRS ScheduleC with your Social Security numberblacked out. The income and expensesfor your agency are detailed on this36 — Exclusivefocus Summer 2012

schedule. You can highlight those agencyexpenses such as entertainment, etc.which will not be a fixed agency expensefor the buyer. The buyer should subtractthese amounts from his/her cash flowanalysis. This information, includingyour Schedule C, will also be needed bythe buyer’s lender in order to underwritethe loan.• Current year-to-date CSRP Reportplus the year-end CSRP Reports fromthe two previous years.• Two years of your Agent ProgressReport.• List of all the companies that canbe written, including all the separate Allstatecompanies.• Detailed income and policy countsfrom NFIP, Northeast Agencies and anyother sources of policies that do not showup on CSRP• Zip code audit for number of policiesin each Zip code. A serious buyerwill want to know the areas where mostof your policies are written.• Copy of current lease.• A listing of lenders, including contactinformation, who are willing to financeAllstate agency purchases.• It may also helpful to contact theunderwriter and discuss the sale of youragency before you have a buyer. You maybe able to send them your CSRP and requesta sample cash flow for a buyer.• Any other information about youragency that will help identify the potentialwithin the agency, such as policy andprocedure manuals, staff job descriptions,staff history and production levels, etc.• A complete audit of the entire bookof business should be kept separately inthe event it is needed prior to closing.Suggested Departure ChecklistProfessional AdvisorsBe sure to involve your accountant andattorney in this process prior to closingthe sale. The contract should establishthe allocation of the proceeds that willdetermine the appropriate reporting procedureson your tax returns.Extended Coverage E&O InsuranceAutomatic Extended Reporting Period.Your coverage ceases on the datethat your EA Agreement terminates.You then are entitled to an automaticone year period from the date of terminationto report any claims. For an additionalpremium, you can purchase anextension of your E&O coverage. Thisis sometimes referred to as an “E&OTail,” but is more properly called an ExtendedReporting Period policy. You caneither buy the five-year plan or the lifetimeplan. While the extended policy isnot mandatory, NAPAA highly recommendsthat sellers buy it. The limits forthe Extended Reporting policy will bethe same as the limits purchased in thelast policy period, so plan ahead. If youopt to purchase the extension, you mustsend a completed “ERP Election Form”with payment to CalSurance within 60days of the termination of your Allstateagreement. To contact Calsurance bytelephone, call (800) 745-7189.E&O Insurance cancellationYou may also want to notify CalSuranceof your termination. This should be donein writing. Be sure to include the effectivedate of your termination and ask for arefund of the unearned premium of yourcurrent policy. We know of at least oneagent who successfully received a refundon his E&O policy, so it’s probably worthpursuing. To read his story, please see OneAgent’s E&O Experience in the fall 2008issue of Exclusivefocus magazine.Securities RegistrationYou should file form U5 to terminateyour registration. The AFS RegionalCoordinator should file this for you. Youwill then receive a letter from Allstateaccepting the termination and advisingthat you have two years to either movethe license to another firm or reinstate it.Dissolve your CorporationCheck with your state to determinethe requirements.Office SpaceIf you are leasing, contact the landlordto subcontract your lease. Obtain a letterfrom the landlord acknowledging transferof lease to the new agency owner. Ifyou own the space, be sure to secure alease from your buyer.Customer filesMost states require that you maintaincustomer records for a minimum of threeyears. If you release your customer filesto your buyer, you may want to have himsign a release assuming responsibility,and granting your access to the recordsin the event the department of insurancerequests information from you.Your Allstate ContractYour contract expressly incorporatesseveral documents – “as they may beamended from time to time.” Access tothese documents is limited to “active”agents via the Allstate Gateway. We recommendthat agents save each of the followingPDF files from the Gateway toyour hard drive, flash drive or compactdisk for future reference: R3001 Supplement,R3001 EA Independent ContractorManual, R3001 Reference Guide,and the Allstate Agency Standards. Thiswill be your last opportunity to accessand preserve this part of your contract.In addition, if you do not have a copy ofyour signed, executed R3001 Agreement,we recommend that you contact HumanResources prior to your termination dateand ask for a copy. It is doubtful that itwould be given to you at some point inthe future if you were to need it. EfSummer 2012 Exclusivefocus — 37

legal mattersOne Year and One MileUnderstanding the Non-Compete Provisionsof the Allstate R3001 AgreementBy Attorney Dirk BeamerAs every Allstate agent knows, theCompany can terminate theircontract for any reason (or noreason) with 90 days’ notice. And whilea growing number of agents seem tothink life without Allstate is not a badidea, departing agents must keep in mindtheir lingering contractual commitmentsfollowing termination of the Allstaterelationship. A spike in cease and desistletters from the Company over the pastyear suggests Allstate has a renewed interestin monitoring potential violationsof the non-competition provisions of theR3001 Agreement.What are Non-Competes?Covenants not to compete (noncompeteagreements) are contractualarrangements in which one party – typicallyeither an employee or a businessseller – agrees that he will not engage incertain competitive activity to the detrimentof the other party for some specifiedperiod of time. In some jurisdictions,like California, state law restrictsthis type of agreement in the employmentcontext. Other jurisdictions, includingmy home state of Michigan, expresslypermit non-compete agreementsby statute. Virtually every state allowsfor some type of non-compete in thecontext of a sale or transfer of businessassets. Even where they are permitted,these agreements are typically subject tocertain “reasonableness” standards. TheMichigan statute, for example, provides:“To the extent any such agreement orcovenant is found to be unreasonable inany respect, a court may limit the agreementto render it reasonable in light ofthe circumstances in which it was madeand specifically enforce the agreementas limited.”Allstate Agents across the countryoperate under the same non-competeprovisions. But because state laws vary(and because local practice among judgescan also vary), agents should consultwith their attorney if faced with specificquestions or concerns. My goal here is toprovide a general overview of the issuescreated by the Allstate non-compete.What does the Allstate R3001Agreement say aboutCompetition?Section 18 of the contract talks aboutagent “obligations” following termination.Sub-section D states:For a period of one year following termination,neither Agency, nor any of its… employees … will solicit the purchaseof products or services in competition38 — Exclusivefocus Summer 2012

with those sold by the Company:• With respect to [anyone] to whomAgency or anyone acting on its behalfsold insurance or other products or serviceson behalf of Company and who is acustomer of the Company at the time oftermination of the Agreement;• With respect to any person, company,or organization who is a customer ofthe Company at the time of terminationof this Agreement and whose identitywas discovered as a result of Agency’s …access to confidential information of theCompany; or• From any office or business site locatedwithin one mile of the agency saleslocation ….One Year LimitThe restrictions on competition in thecontract apply for one year from the terminationdate. After that one year, formerAllstate agents may solicit sales fromwhomever they want (including formerAllstate customers) and from whereverthey want (including their former Allstateoffice). Beware, however, of Allstate’sattempts to punish agents for usingan Allstate customer list at any time,even after the one year is up. More onthis later.Will not SolicitThe contract limits solicitation, notsales. If an agent opens an independentagency two miles from her Allstate office,and if a former Allstate customerchooses to seek her out and approachher for a policy, she is free to write thatpolicy. The risk, of course, is that Allstatewill assume the customer transferred dueto improper solicitation and will try tocause the agent grief. Departing agentsneed to decide if they are going to acceptbusiness from former Allstate customerswho approach them, or if they will take acomplete one-year ban on such customerssimply to avoid any headaches withAllstate. This decision is especially importantfor agents still receiving TPP.With Respect to Allstate CustomersThe restriction on solicitation extends,not only to the departing agent’s activeAllstate customers, but to any customersof Allstate at the time of termination ifthe departing agent learned of the prospectivecustomer through Allstate or itsbusiness information. In my experience,I have yet to encounter a terminatingAllstate Agent with information aboutAllstate customers who are not his own.I think it highly unlikely that Allstatewould be able to enforce this restrictionwithout clear proof that the former agentimproperly obtained and used Allstatecustomer data.Notice that the restriction on solicitingbusiness from Allstate customers is notlimited by the one mile radius rule. Forone year following termination, agentsshould avoid solicitations to their formercustomers and to others known by themto be Allstate customers, regardless ofwhere the agent relocates.Or from any BusinessSite within One MileThe one mile rule limits business activitygenerally – not just with respect toAllstate customers – during the one yearfollowing termination. In general, duringthat year, departing agents should notstart a new agency, whether independentor captive, in their former office or withina mile of it “as the crow flies.” Thiscan create a special hardship for agentswho own their Allstate location or have along-term lease.The one mile rule seeks to deter agentsfrom capitalizing on customer familiaritywith the location and the Allstate brand.I question whether Allstate would besuccessful enforcing the restriction if anagent used the existing location solely aswork space for a new agency but withoutsignage or customer access. If I’m makingcold calls, for example, from my cellphone, what difference does it make if Ido it from my former office location orfrom a hotel room on the other side ofthe country?Third party restrictionsIf you look again at sub-section Dabove, you will notice that the R3001Agreement purports to extend the noncompeteto third-party employees of theterminated agent. (In fact, I abridged thelanguage, which also reaches the agency’s“officers, directors, shareholders, members… Key Person or any other personsWRIGHT BEAMER, AttorneysSERVING NAPAA AND THE AGENTS OF ALLSTATE SINCE 2000DIRK A. BEAMER, ATTORNEYEXPERT CONSULTING FOR AGENTS AND THEIR ATTORNEYS ON:• ALLSTATE CORPORATE SECURITY INVESTIGATIONS• BUYING & SELLING BOOKS• ALLSTATE EA AGREEMENTSPH: 248.477.6300WRIGHTBEAMER.COMDBEAMER@WRIGHTBEAMER.COMSummer 2012 Exclusivefocus — 39

working in connection with” the Agreement.)Most producers will have signedtheir own Allstate non-compete already.But absent an independent agreement,agency employees should be free to do asthey choose, so long as they don’t do it onbehalf of the terminated agent.Confidential InformationIn addition to the non-compete provisionsin Section 18, the R3001 containsrestrictions on the use of “CompanyProperty” and “Confidential Information.”The restrictions and related definitionscan be found in Section 4 of thecontract.Confidential Information is definedto include “information regarding thenames, addresses, and ages of policyholdersof the Company.” The restrictionssurvive the termination of theagreement indefinitely, and, in Allstate’sview, they prevent agents from keepingcustomer lists or information.This is an especially thorny topic. Inmy experience, many judges dislike attemptsto stop sales professionals fromusing the customer contacts that theprofessionals themselves have developed.But others will say, “You agreed to it, soyou are stuck with it.” I repeat my earlieradvice: agents should consult with theirattorney if faced with specific questionsor concerns.Termination PaymentsTerminated agents receiving TPPneed to be wary of violations of the noncompeteand other contract provisionssince Allstate claims the right to discontinuethose payments if a breach occurs.If an agent finds herself cut-off due toan alleged breach, she needs to exploreher legal options. She certainly has anargument that, unless Allstate can provea violation and resulting damages, sheshould keep her TPP.Recent ActivityIt is difficult to track Allstate’s effortsto monitor agent activity and to enforcethe provisions of the contract followingtermination. Anecdotal evidence suggeststhe Company has assigned at leastone member of its corporate legal team topepper former agents with threat lettersand nasty phone calls if violations are suspected.Unfortunately, this lawyer seemsto be taking a “shoot first and ask questionslater” approach. An agent receiving achallenge should not ignore it. Instead, heshould consult with his lawyer, documenthis compliance, and respond.Agents Who Know the Rules and KnowTheir Rights will be FineThe key to a smooth transition liesin taking the time to learn and understandthe rules and the agent’s rightsunder them. With that information inhand, the terminated agent can map outa course of conduct that meets her personalobjectives and satisfies her commitmentsto the Company. If she hasleft Allstate, or if Allstate has terminatedher, odds are good she is “done” with theCompany and not interested in a harassingletter or phone call. EfDirk Beamer serves as General Counsel toNAPAA and helps NAPAA track legal issuesof interest to its members. NAPAA has providedthis update for informational purposesonly. The contents should not be construed aslegal advice or an endorsement from NAPAAor its attorneys, and NAPAA expressly disclaimsany such advice.Income for life!Sound good? We thought so too. Which is why we’re now offeringthis service to NAPAA members. Introducing, Income Solutions ® –a retirement annuity program created specifically to help youmaintain a reliable, lifelong revenue stream.Learn more about this program and other innovativesolutions at the RetirementSolutions website:www.EZRetirementSolutions.com/NAPAARetirementSolutions Innovative solutions for today’s retirement income challenges.© 2008, UNFCU Financial Advisors LLC, a United Nations Federal Credit Union owned company.EZRS_NAPAA_HalfPg2.indd 18/31/09 5:18 PM40 — Exclusivefocus Summer 2012

investingPIIGS on the Wing (and other sightings)By Marcus BrudererImay be dating myself a little bit herebut I remember Pink Floyd’s 1977 album“Animals” with songs titled “Pigs”and “Pigs on the Wing”. The four bandmembers must have known somethingwe are only now beginning to realize.Government Deficitsand Public Debts35 years later we look at a number ofcountries, namely Portugal, Ireland, Italy,Greece and Spain – now commonly referredto as PIIGS – dominating muchof the economic news because theirgovernments’ spending habits, whichhave caused their national debts to reachcritical levels. The European Union hasbeen struggling for the better part of twoyears with the crisis and there is no endin sight.The key factors being considered aretheir respective budget deficits as a percentageof the Gross Domestic Product(GDP) and the government debt as apercentage of the GDP.The obvious problem for Greece andItaly are the very high levels of governmentdebt at 120% (Italy) and more than160% (Greece). Adding to the pain isGreece’s budget deficit of nearly 8% ofGDP. Riots have become a regular occurrencethere and one retiree even sethimself on fire publicly because of hisdesperate situation. There are eerie similaritiesto the Argentinean default in2001, which led to widespread turmoil inthat country.The European Union is trying veryhard to avoid a spread to other countries,most notably Spain and Italy as they representmuch larger economies, to keepthe situation under control. But early lastmonth, countries in the Eurozone foundthemselves approving a bank rescue planthat could cost up to $125 billion to bailout the Spanish banking sector.What should very much concern usis that the PIIGS could take wing andland in our own front yard. As a matterof fact, the U.S. is not in a much betterposition than some of these countries(see chart below).Low Interest RatesWith budget deficits projected to continueat the current pace unless drasticmeasures are taken, the mid to long-termprospects for the U.S. economy becomerather clouded.Bill Gross, Warren Buffet and LarryFink have contrasting views of how toposition their investments. Bill Grossbought back U.S. Treasuries for the bondmutual funds and ETFs he is managingat PIMCO (after having sold themin the spring of 2011). He believes thatinvestors will favor U.S. Treasuries overother countries’ debt in light of the ongoingtroubles in Europe.While inflation is not perceived asa current threat, there may be externalfactors that could lead to higher bondyields. Except for Ireland, which is makingprogress towards stabilizing its fiscalposition, the other PIIGS countrieshave seen rising yields being demandedby investors in order to issue new bondsfor their governments. Meanwhile, thestronger countries such as Germany,Sweden and Switzerland are being rewardedwith lower borrowing costs (seechart on page 42).The day may not be too far away whenChina and Japan demand better returnsas a condition of their buying more U.S.Treasuries.Both Warren Buffet (the chairman ofBerkshire Hathaway) and Larry Fink(the head of BlackRock) believe thatyields have moved so low that bonds areunattractive and even represent a signifi-Summer 2012 Exclusivefocus — 41

(c) Bespoke Investment Groupcant risk when interest rates start rising.As a consequence, they are both favoringstocks.Investors in general have been pilinginto bond investments for their perceivedlower risk and greater stability over equities.The overall trends of the last 5+years is very striking with net cash flowsgoing into bond mutual funds reaching$800 billion while more than $400 billionwas pulled out of stock funds.Stocks and DividendsWith interest rates so low, dividendsare making a roaring comeback withinvestors showing renewed interest incompanies that have pricing power andare able to pay regular, and in some casesrising, dividends. There was a strongoverall relationship between dividendsand stock performance for the year 2011.There are a couple of potential equityyield traps for dividend stocks because alot of capital is flowing into the mutualfunds and ETFs focusing on this marketsegment. While a number of stocks areenjoying high current dividend yields,market conditions could cause these parametersto change:• Stock prices could rise substantiallythereby lowering the dividend yield or• Companies may no longer able tosustain their payouts and could be forcedto either reduce of suspend them.• It is also possible that a combinationof all three factors could negativelyimpact the segment.With investors searching for yield,along with the increasing publicity surroundingthese strategies and funds,these scenarios cannot be ruled out.Overall Investment StrategiesWe do not believe that investors shouldmake either a bonds only or stocks onlydecision but strongly believe in a diversifiedapproach. While traditionally cash,bonds and stocks have been the majorcomponents, additional market segmentsin the real assets categories have becomepart of the discussion.With the emergence of mutual fundsand ETFs covering commodities (energy,industrial and precious metals, agricultureand livestock), natural resources equities(energy, metals and mining and agribusiness)as well as real estate (REIT), investorshave a wide array of choices. Theseadditional segments not only provide forportfolio diversification, they have alsoshown to be good hedges during inflationaryperiods.Along with stocks they were ableto outperform TIPS (Treasury InflationProtected Securities), which we arealso viewing as a promising investmentchoice during periods of inflation andrising prices.Real assets also compare favorably undera risk-reward perspective. Between2002 and 2011, for example, a diversifiedblend provided for additional returnswithout increasing the overall risk levelcompared to stocks.Inflation and Long TermPurchasing PowerThe ultimate goal of any investmentstrategy is to maintain purchasing powerfor the long run. While governmentreports suggest that inflation is “wellcontained,” the question arises whetherthe official inflation reports are actuallycapturing the true price inflation picture.42 — Exclusivefocus Summer 2012

Performance of TIPS vs. Other Asset Classes in Periods of Rising and Easing InflationMarch 1998 through December 201230%TIPS have performard well since their 1998 inception, but they haveunderperformad real asset classes in periods of rising inflationRising InflationEasing Inflation15%8.45.912.412.014.510.5 10.7 10.5 9.75.37.80%-1.1-6.8-9.5-15%TIPS a Natural Resource Commodities c Gold REITs d Stocks e Bonds fEquities bAs of December 31, 2011Source: Bloomberg, Cohen & SteersPast performance is no guarantee of future results. Investors cannot invest directly in an index. There is no guarantee that any historical trend illustratedabove will be repeated in the future, and there is no way to predict precisely when such a trend will begin. The information presented above does not reflectthe performance of any fund or other account managed or serviced by Cohen & Steers, and there is no guarantee that investors will experience the type ofperformance reflected above.(a) TIPS are represented by the Barclays Capital U.S. Government Inflation-Linked All Maturities Index.(b) Natural Resource Equities are represented by the S&P 500 Energy Index (50%) and the S&P Materials Index (50%).(c) Commodities are represented by the Dow Jones-UBS Commodity Index.(d) REITs are represented by the FTSE MARKET Equity REITs Index.(e) Stocks are represented by the S&P 500 Index.(f) Bonds are represented by the Barclays Capital U.S. Aggregate Bond Index.The Benefits of Asset Class Diversification2002-2011Higher Reward(% annualized total return)121086420100% Real Assets Blend a Natural ResourceEquities dREITs b100% Bonds e Commodities c0 5 10 15 20 25 30Higher Risk (% standard deviation)As of December 31, 2011, Source: Bloomberg, Cohen & Steers.Past performance is no guarantee of future results. The information presented above does not reflect the performance of any fund or other account managed orserviced by Cohen & Steers, and there is no guarantee that investors will experience the type of performance reflected above. An investor cannot invest directly inan index.(a) The Real Assets Index Blend consists of equal allocations of 20% each to commodities, REITs, natural resource equities, gold and variable rate notes. (b)REITs are represented by the FTSE NAREIT Equity REIT Total Return Index. (c) Commodities are represented by the Dow Jones-UBS Commodity Index. (d)Natural Resource Equities are represented by a 50/50 blend of S&P Energy Index and S&P Materials Index. (e) Bonds are represented by the Barclays CapitalU.S. Aggregate Bond Index. (f) Stocks are represented by the S&P 500 Index. Portfolio diversifiers are equally divided between gold and Variable Rate Notes,represented by the Barclays Capital U.S. Government/Credit Float-Adjusted 1-5 year index. Volatility is measured by standard deviation, a commonly used statisticalmeasure of risk.If you have children in college or aredriving a car or are faced with medicalexpenses, the widely reported inflationrates of the CPI (Consumer Price Index)appear rather unrealistic. The AmericanInstitute of Economic Research developedtheir Everyday Price Index (EPI)– which unlike the Government’s CPI– includes food and energy while excludinghousing. As a result for 2011 the CPIwas reported at 3.1% whereas the EPIcame in at a more realistic 7.2%. Thisdiscrepancy is important because whenpeople feel the impact of inflated expenseswithout a corresponding increasein wages, they have less money to spendelsewhere, which leads to a less robusteconomy. EfMarkus Bruderer is vice president of UN-FCU Financial Advisors. He has morethan 20 years of private banking experiencedomestically and in Europe. Prior tojoining UNFCU, he was with Bank JuliusBaer & Co. Ltd, N.Y. and Deutsche Bank,N.Y. He can be reached by phone at (212)324-3902 or by email at mbruderer@unfcuadvisors.com.Summer 2012 Exclusivefocus — 43

sales and marketingOvercome Objections and Close the Saleby John BoeUnfortunately, the first two ordersmany new salespeople receive are“Get out and stay out!” It is onlynatural for your prospect to procrastinatewhen asked to make a decision involvingmoney. As a general rule, people arehesitant to commit to purchasing a productor service until they have convincedthemselves that they need it and are assuredthey are getting it at a fair price.Research indicates a prospect will say noon average five times before they actuallybuy. As a professional salesperson, it isimportant to remember that an objectionis not a rejection of you personally.Believe it or not, objections are a goodsign and you should actually look forwardto them. After all, if your prospectwas not interested in your product or service,they wouldn’t be asking questions.Simply put, an objection is nothing morethan a request for additional information.Top producers not only expect objectionsduring the sales process, theyactually anticipate them.Typically, a prospect’s objections willfall into four major categories; no money,no perceived need, no hurry, or no trust.If you haven’t built trust and rapportwith your prospect, qualified them financially,and conducted a thorough needsanalysis, you can expect them to use objectionsto derail the sales process. Whenaddressing an objection, don’t dump thewhole bale of hay. The majority of salespeoplehave a tendency to overwhelmand bore their prospects by over educatingthem. Many salespeople lengthen theappointment and use up their valuablefall back positions in an attempt to showhow knowledgeable they are. Occasionallyyour prospect’s objection may be disruptiveand therefore, you might want todelay answering it until a more appropriatetime. When you make the decisionto delay your response, I recommend youwrite their question down and ask them,“Would it be ok to address this questionlater on in my presentation?” However, ifthe same objection comes up twice, youshould stop and address it immediately.Steps for Addressingan ObjectionStep 1 - Hear them out and write it downWhen your prospect voices an objection,show concern, treat it with respect,and hear them out. Interrupting whenyou should be listening not only presentsa bad first impression, but it also destroystrust and rapport. Learn to be an activelistener by giving your prospect yourfull and undivided attention. Avoid thetemptation to think about your responsewhile your prospect is speaking. An activelistener is not only listening to whattheir prospect is saying, but is also tryingto discover the meaning behind theirwords. Research indicates that 65% ofour communication is nonverbal. Therefore,it is vitally important to pay attentionto body language and listen for voiceinflections. In addition to observing yourprospect’s gestures, you must learn to bemindful of your nonverbal signals as well.Before you begin responding to yourprospect’s objection, it is vitally importantthat you understand their specificconcern. Even though you may haveheard the same objection many timesbefore, you must avoid the temptationto begin addressing their concernsprematurely. Otherwise, you run therisk of shooting yourself in the foot byvoicing an objection they had not evenconsidered. I recommend you get in thehabit of restating the objection in yourown words to gain agreement prior toresponding. In this step it is importantto remember that your intention is notto address their concerns, but simplyto hear them out and write them downwithout comment. Never argue or evenregister disappointment with their objections,just acknowledge them. It is a goodidea to take notes and occasionally nodyour head affirmatively to let them knowthat you are tracking with them.Once you have listed all of your prospect’sobjections, conclude this step bysaying, “Bob and Mary, if your concern(s)can be addressed to your complete satisfaction,at this point, can you think ofanything else that might keep you fromgoing ahead with this decision today?” Ifadditional objections are brought up, addthem to the list and ask the question againto gain commitment. Obviously, it doesnot make sense to go to step two if there isreluctance to go ahead with the decision.44 — Exclusivefocus Summer 2012

Step 2 - Feed it back for clarificationFeeding the objection back in the formof a question provides your prospect an opportunityto expand upon their concern.For example, if your prospect said theydon’t have the money in their budget, youwould simply feed it back in a nonjudgmentalway by saying; “You don’t have themoney in your budget?” This techniquegreatly reduces the perception of pressure.By giving your prospect the opportunity toexplain their statement, they will frequentlyanswer their own objection. Another goodreason to clarify the objection is to makecertain you are addressing their exact concernand not inadvertently creating a newone. Some objections are of greater importanceto your prospect than others. A prospectwill often use insignificant objectionsin an attempt to stall or delay the closingsequence. After you have clarified the objection,ask your prospect how importantthat concern is to them. After all, not everyobjection is really important.Step 3 - Answer the objection and“Touch Close” the SaleWhen addressing an objection try tostay big picture, but be prepared to providedetails upon request. Use graphs,charts, numbers, and/or testimonials ifthe big picture approach isn’t effective.During this important step, pay particularattention to your prospect’s bodylanguage gestures. Once your prospectagrees that their objection has been resolved,let them watch you cross it offyour list. Continue this deliberate processuntil each and every objection hasbeen resolved. Complete this step byasking, “At this point can you think ofanything else that might keep you fromgoing ahead with this purchase today?” Ifthey say no, proceed with confidence tothe final step and ask them for the order.Step 4 - Ask for the Orderand Expect a DecisionTransition into this step by saying,“Bob and Mary, am I correct in sayingthat it appears you both have convincedyourselves in the merits of this purchase?”If you sense the least bit of hesitation, excuseyourself by saying, “Bob and Mary,I can tell that you need a moment to discussthis information in private, so I amgoing to get a cup of coffee and give youtime to make your decision.” This techniquedramatically reduces the likelihoodof your prospect taking the informationhome to “think about it.” Keep in mindthat you may have to ask for the orderseveral times before you get the sale; somake sure to vary your closing questions.The key to overcoming objections andclosing the sale is to remain professionaland be persistent without becoming argumentativeor defensive. Knowing howto effectively address your prospect’s objectionsbrings you closer to their finalquestion, “Where do I sign?” EfJohn Boe presents a wide variety of motivationaland sales-oriented keynotes andseminar programs for sales meetings andconventions. John is a nationally recognizedsales trainer and business motivationalspeaker with an impeccable track record inthe meeting industry. To learn more, visitwww.johnboe.com or call 937-299-9001.Free Newsletter available on website.Reporting “Questionable Business Practices” to AllstateNAPAA receives many inquires from agents who call to complain about unethical conduct by other agents. Itseems unethical behavior is becoming more commonplace, which is why it is up to the agency force to policeitself. And reporting bad behavior is easy and will help protect our rates. Following are selected excerpts fromthe www.AlertLine.com website, operated by Global Compliance, a third-party provider contracted by Allstate.“The Allstate i-Report process is designed to allow employees and non-employees to report potential compliance,unethical business practices and/or raise business issues.”“The Allstate i-Report Process is based on these principles:• Fairness: Every concern will receive individual consideration and be evaluated consistent with the commitmentof Allstate to the employees.• Promptness: Concerns will be promptly directed to areas within the company that have the authority andresponsibility to review, investigate and resolve the issues.• Safety: Concerns can be voiced without fear of retaliation.• Confidentiality: Concerns will be kept confidential. Information will be disclosed only to those who needto know in order to review, investigate and respond to your concern.”“Global Compliance Services (“GCS”), pursuant to an agreement between its clients, provides a website tocollect from employees and others wishing to report information. This information includes but is not limited toallegations of misconduct, questionable business practices, violations of a company’s code of conduct or otherevents and behavior which may result in harm, injury or liability. The information collected and submitted is forwarded,without review or modification by GCS, to the client’s designated contacts.”To file a report, agents should go to www.AlertLine.com or call 800.427.9389.Summer 2012 Exclusivefocus — 45

featureAdjuster Pay StymiedA Field Adjuster’s PerspectiveFor this issue of Exclusivefocus Ithought I would touch on a fewof the subjects that are raw pointsfor claims employees. First, there is anew way that the company believes willhelp the company grow – we call it the“Act Like an Owner” concept. Keep inmind that we in the claims departmentare all employees, so acting like an owneris foreign to us. We didn’t come to workat Allstate to become entrepreneurs; wewere hired as employees, who wantedsecure jobs helping Allstate customerswith their claims. Of course, we wantedbenefits too, which is another reason wedidn’t opt to become independent adjusters,most of whom are independentcontractors without benefits.The Act Like an Owner program hasseveral things the company wants employeesto do. Before we go any farther,however, you should be aware that thisprogram is tied to our pay. If we can’t accomplishthe items they want us to do, itnegatively affects our pay.Here is the downside of the approachto which they have mandated for claims.They want ideas from us, but they arenot interested in them unless it makesthe company lots of money and costsnext to nothing to implement. I guessthis is good for profits, but the employeesget nothing for their ideas except asmall thank you. Also, tying this to anemployee’s pay has created problems becausemanagers are shifting their ownresponsibility for coming up with ideasto lesser claims employees by expectingpeople to volunteer to do the work theyshould be doing. If you don’t participatewith ideas to share, it affects your pay.For one thing, idea sharing counts as50% on your performance review, so ifyou haven’t been a “team player,” its notlikely you’ll get a pay increase.This predicament has prompted somepeople to volunteer to do some of theirmanager’s work. When this occurs, theemployee who “volunteers” is not workingon the job they were hired to do. Say,for instance, they are field adjusters, assignedto inspect damage for customers.When they concentrate solely on theirjob, it improves customer satisfactionand retention. But if they are doing littlethings for their manger, they are turningin some assignments unfinished.When they don’t complete the normalwork schedule for the day, it slows thingsdown. The assignment could be set foranother day, delaying the inspection.The assignment could also be given toanother adjuster to handle even thoughhe or she has a full schedule. Either way,it has a negative affect on the customerand other employees.There is no way this should be happening!Upper management in the companyagain has failed to see what is goingon. They think the concept of being anowner of the company is a good thing.It might be, if it were applied correctly.But it should not be tied to wages nortied to doing extra work for managers.Instead it should be a program that looksfor better ways to enhance the customerexperience. This includes listening andempathizing with them as well as doingyour best to help them. This alone willhelp the company grow. It will also helpthe agents also who work hard trying toget and retain their customers by creatingmore good will in the communitieswhere they do business.Claims management thinks us in termsof teams. Everything we do in claims dois measured and compared to others inour peer group, or “team.” Managementestablishes arbitrary numbers that theyexpect us to reach. If you don’t reachthem, it affects your pay. They wanteach of us to help others so they willalso achieve good numbers. But, if yourpay is based on peer performance howmuch should we be willing to share? Ifyou share all you know then maybe yourpeers will begin to outperform you. Theperson you helped might now be out performingyou and then your assessmentfor performance pay is adversely affected.I know this sounds crazy but it is howit works. Instead of acting as the incentiveit was intended to be, this program ishaving the opposite effect for many of us.Another thorn in the side for fieldadjusters is the re-inspection process,which is another way the company controlsyour pay. Here’s how the re-inspectionprocess works: After the adjusterhas completed an assignment it could beassigned to another adjuster who looksat how the estimate was written. There-inspectors scour the original estimatelooking for any and all errors made bythe first adjuster, which is how they justifytheir jobs. They don’t have to answerto the customer or the repair shop, onlyto their boss. They can look at what youdid and make arbitrary calls. Sometimesthey’ll say you paid too much to have thecar repaired and other times they’ll sayyou didn’t pay enough.Here’s the rub. If a re-inspector saysyou paid too much, he doesn’t have to goto the shop and get an agreed price forthe “right” amount. If the first estimateis off and you are overpaid, wouldn’t itmake sense for the re-inspector to try toget the overage back? But as nonsensicalas it sounds, they don’t have to. Thisis why everyone knows the re-inspectionprocess has nothing to do with the estimateor dollar amount; it only has to dowith wage control. Maybe it’s their wayof keeping the adjusters honest, but it46 — Exclusivefocus Summer 2012

sure looks like overkill to those of us inthe field.Just think how much Allstate couldsave if they didn’t have re-inspectorsfollowing the field adjusters around. Itwould not be just their pay, benefits andexpenses, but also that of their managersand all of those above them. The amountof money the company spends for pay,benefits and expenses for these people isin the millions of dollars. Does the re-inspectionprocess really save the companyenough money to justify the expense?The re-inspection process is broken.It slows the claims process down, whichcan affect customer retention and satisfaction.The re-inspectors don’t have toworry about that because it all falls backonto the laps of the field adjusters. It isvery demoralizing for the adjusters whoare working as hard as they can to keepthe company profitable and help the customerat the same time. And just likethe Act Like an Owner program, there-inspection process affects the fieldadjuster’s pay. The re-inspectors makesubjective judgments with no one to answerto and the results are subject to peercomparison, which determines if a payraise is merited or not. But now, it seemsthe only way for a person to get a payraise is to kiss your immediate manager’sbackside.I, as well as many others, hope Allstatesees the light and throws out these processes.If the company wants to grow andbe prosperous, it needs to treat the employeeswith respect. Don’t demoralizethem. Changing these processes wouldbolster our spirits and smiles would replacefrowns, which would make the customerexperience all that much better.Many of us understand that the companyis going though some difficulttimes and wants to implement new ideasto become more profitable, which is inthe best interest of all of us. All of us atthe bottom are in this together. We wantwhat is best for the company, the customerand the employees. My question iswhere is upper management – why aren’tthey onboard?I didn’t vote my shares of stock for Mr.Wilson or the current board of directors;I don’t know anyone who did. Needlessto say, those I know are disheartened bythe prospect of his continued tenure. Heconsistently misses his objectives andthen he is handsomely rewarded. Thatdoesn’t happen when you are a field adjusterno matter how good you are, andit certainly doesn’t happen if you’re anAllstate agent. EfhumourWords with AllstateBy Brian SpillmanIenjoy words. I like playing Scrabble, Wordswith Friends, and crossword puzzles.Words have meaning and connotations.Sometimes words have two different meanings,but they definitely mean something.You can’t just throw words togetherand make up your own meaning. Youcan’t say something like, “I walked tothe carrot yesterday and glued a poodle.”That would make no sense. Allstate, onthe other hand, seems to enjoy throwingwords together that have no meaning.They do it often and with great relish.Here’s a fun quote that was just sent outfrom the company to our region with regardto a new PUP policy being introduced: “Weask that agents do not write customers intothe new policy until it is available.” Okay,how could we? It’s NOT AVAILABLE!Am I the only one who sees this?Another recent entry for the MostMeaningless Quote award is this gem:the RMBC is bringing us “enhanced decisionexcellence” this year. What? Whatin the hell is that? Although I believe Imay have achieved enhanced decisionexcellence when I chose a high-fiber cerealover Sugar Corn Pops this morning.So maybe I’ll let that one slide.Here’s one I don’t understand: “Webest protect our customers when we collectthe appropriate premium to reflectthe risk.” Huh? I would say that thecompany best lines its pockets when itcollects the “appropriate” premium – butthis has nothing to do with protectingour customers. Perhaps it was just atypo. Maybe they really meant to typethe word “shareholders” in place of theword “customers,” it would have mademuch more sense. We best protect ourcustomers when we pay out claims in afair and consistent manner.This next example is old, but it’sone of my favorites. Our underwritingguidelines read as follows: “We willaccept up to 2 incidents per operator.A not-at-fault accident counts as oneof these incidents.” So someone with2 tickets would be accepted – right?Wrong! You see, one of the two incidentsMUST BE a not-at-fault accident.I had no idea that “counts as” and“must be” meant the same thing. Awshucks, that Allstate is so tricky!So next time you want to throw somewords together to form a meaninglesssentence, just call a company representative.They’ll be happy to help – fromthe Philippines, or Ireland, or… EfSummer 2012 Exclusivefocus — 47

an agent’s perspectiveSabotageSubmitted anonymouslyWarningThe acts described in this article arevile and disturbing. This story is true,which makes the reading not for the faintof heart. If you are a newer agent, muchof what I’ve written here may seem incredulousor far-fetched, but in time, asyou learn more about the company youwork for, you will come to understandthat I have spoken the truth.BackgroundI started my Allstate agency fromscratch about 6 years ago. I was appointedduring a push to add a large number ofagents in my state. In my territory therewere dozens of newer scratch agencies.As far as I can tell, I am the last of thesescratch agencies still standing.I started as a one-man shop withoutan insurance background and with littletraining. I really struggled for the firstfew months and thought I was nevergoing to make it. However, after a fewmonths of trial and error, things startedto click. Shortly thereafter, I becameone of the top producing agencies in thearea – ranking 4th out of 30 agents – andwas actually able to purchase a small,$400,000 agency down the road. By thetime I got my agency rolling, I began tosee a lot of the agents I went throughtraining with fall by the wayside. Someof them were just lousy agents, but manyof them had potential. Allstate simplyfailed to nurture these new agents andprovide them with the tools to succeed.I could write dozens of articles aboutthe misinformation and outright lies toldto me during my appointment process.This misinformation and deception putevery new agent at a high risk of failure.Allstate’s ineptness in developing newagencies and its failure to be a good businesspartner has destroyed the lives ofmany who invested everything they hadinto their agencies. I really believe thatmost of these good people would nothave elected to become Allstate agents ifthey knew upfront that they were signingsuch a lopsided contract; one where Allstatehas all of the power, leaving agencyowners with virtually no rights. Whilenewer agents may not realize this yet,they soon will. Most tenured agents haveseen this firsthand and fully understandthat their businesses are subject to thewhims of management control, despitetheir status as so-called independentcontractors.Though the beginning of my story issimilar to many other agents, I believethe story I’m about to tell is unique andsomething that other agents need to beaware of. This is a story about the insidesabotage of my agency by my businesspartner... Allstate.The past few years have been reallybad in our state. Allstate has lost a largeamount of market share and about halfof its agencies. In addition, most of themanagement team has either been firedor quit. I’ve really struggled for the lastcouple of years too, as Allstate’s rates havegone from being a little on the high side48 — Exclusivefocus Summer 2012

to embarrassingly high. In past years, Imaintained a great retention ratio andhave company plaques on my office wallsto prove it. But for the past year or so I’vebeen bleeding policies at an unprecedentedand alarming rate due to massive rateincreases over the past three years.IncentivesAllstate doesn’t seem to understandhow incentives work. They also don’tseem to get that if you partner with someone,both parties must have equivalentincentives and mutual goals. What is myincentive to spend money advertising forEmerging Business products, like renters,when I have to spend more than I’ll make?Sure, the recognition for writing the businessis fine, but it doesn’t pay the bills. ButAllstate’s ulterior motive is not for us tomake money selling these policies; insteadit would appear they are engaging in adeceptive ploy to dupe shareholders intobelieving that they are increasing theirPIF in a meaningful manner. But as weall know, auto is meaningful PIF, EB isnot – and they cannot seem to grow theauto side of the business.Apparently, Allstate believes that bythreatening agents with the consequencesof missing their Expected Results – possiblyresulting in the termination of theircontracts – is a good way to force themto spend money advertising for EB productsthat do little to build solid books ofquality business. For smaller agencieslike mine, cash flow is everything. I simplycan’t afford to waste a ton of time ormoney chasing renters policies that havean annual premium of $150 or less whenI could spending the same amount targetingmore stable products with higherpremiums, such as home and auto. Thenthere is the service aspect. I get paid thesame for 10 renters’ policies as I do forone $1,500 homeowner policy. I have todo 10 times the work to write the businessand then next year when half of themmove and the other half don’t renew, myretention drops and I have to make fiveaddress changes. Allstate seems to forgetthat agents are paid on premium volumeand not policy count.Sure, I could get a “bonus” if I sell a lotof renters policies and hit my other expectedresult categories, but that is onlyif I hit all the other nonsense goals Allstatesets. If I miss just one goal – in onecategory, by one policy or by one dollar –I might as well not do any work towardsany of the goals. Again it’s about incentives.If I have to hit $20,000 in AFSproduction to receive a bonus or to keepfrom being considered a “bad agent,”does it really matter if I produce $1,900or $19,000? I still get nothing and mybusiness is on the line, even though thereis a large gap between those two productionnumbers.My strategy has always been to investin advertising that generates a positiveand quick return on my investment.If I cannot produce a constant positivecash flow, I can’t operate my agency. Allstate’sgoal has been to force me to advertisefor them, to sell products to makethem money, at my expense. I believethis is also why Allstate is now requiringsuch large cash reserves of its newagents. The more reserves an agent has,the more they can advertise for Allstate.Of course, agents hope their ‘investment’will someday turn a profit. In mostpartnerships, the principles have mutuallybeneficial incentives to make theirarrangement work. Perhaps, this is whyso many of Allstate’s partnerships havefailed. Agents put up $25,000, $50,000and now $75,000 of their own moneyand spend years building their agenciesonly to be kicked out the door virtuallypenniless while Allstate reaps the fruitsof their labor.Financial ServicesI would love to do more with financialproducts. I thought this was a great opportunitywhen I came on board and Istill think so. However, I ran into someserious issues here.In the past few years, I have foundmyself spending an inordinate amountof time trying to justify and explain theongoing series of rate increases we’ve hadin my state. Every rate increase damagesmy credibility, especially if my customershops around and finds out they can findbetter coverage (earthquake included)for half the price. This raises doubtsabout me in their minds and makes mecome across as a shady used car salesmaninstead of a trusted financial expert. Asa result, it is hard to convince them tospend more money on AFS products.Furthermore, due to the fact that Ispend 60 to70 hours a week workingon my P&C business. It consumes mytime and limits the amount of time I amable to invest in educating myself to thepoint where I feel comfortable managingpeople’s investment and retirementfunds. Though I am licensed in variableproducts, I do not feel that I havethe skill set to do my customers justice.Allstate knew I did not have a financialbackground going into this business, butthey were unconcerned and promisedthey would provide with the educationand people to partner with.I might be in the minority here, butI wouldn’t want a financial advisor withlimited investment knowledge managingmy retirement funds, especially if Iknew he was only doing it to save his job.Maybe this is just me, but I like to treatmy customers the way I would want tobe treated and for me to try to convincethem to buy their retirement funds fromme –when I don’t fully understand whatI am selling – would be unethical.At least in my area, the EA/EFS partnershipsimply hasn’t worked effectively.Allstate can’t seem to hire or retain EFSsin our area, even with a $5,000+ referralincentive. I understand this is true inother parts of the country too. The fewEFSs I have worked with have causedmore lost business than they have gainedand added more frustrations than I need.Back to incentivesThis brings me back to incentives. Aswe know, Allstate has structured its financialrequirements in such a way that ifyou do not hit a minimal amount of production,you get wacked on everything.On top to that, the targets are constantlymoving and many times year-end goalsaren’t announced until late in the firstquarter – and sometimes even later. As asmall agency that relied on the cash flowfrom the P&C side, I did not have thetime or resources to hit my minimum financialproduction amount. Because therequired amount was so large and my resourceswere so limited, I had to make abusiness decision and I chose to focus onP&C in order to maintain my cash flow.Summer 2012 Exclusivefocus — 49

I had no incentive to increase my financialresults because any production underthe minimum threshold was the same asdoing no production!I should point out that my numbersfor P&C were always really good for newproduction, retention, and profitability.Once again, the wall in my office isadorned with plaques that confirm thisand I was also designated as a PremierService Agency in 2009.As a small scratch agency, cash flowmeans everything and my goal was tobuild a good P&C base, so I could hiresomeone and focus more energy on financialservices, commercial insurance,and specialty items. I believe these addedservices are important and would makemy agency more complete. However,with Allstate’s cost-shifting, extreme rateincreases, and constant general alienationof its customer base, I spend mostof my time trying to save my home/autocustomer base.The setupEach year I’ve struggled to producethe minimum $1,000 in variable productioncredit. In fact, most years it seemsthat I’ve had to purchase products just tokeep my affiliation with Allstate – andlast year was no different.Knowing I needed to meet my minimumsecurities requirement before theJune 30th deadline, I decided to increase aVUL I had on myself. Since I’ve receivedlittle to no training on financial services,I wanted to make sure what I was doingwas correct. Furthermore, since Iwas paying for the coverage increase outof my pocket, I needed to ensure I wasincreasing the policy by enough to meetmy minimum requirement without goingoverboard. So I decided to contactAllstate Financial Services for assistance.AFS told me that I could increase myVUL and that it would provide me withthe credit needed to go towards my minimumsecurities production requirement.However, they could not tell me howmuch coverage I needed sell myself to getthe production amount I needed. Theytold me I would have to contact AF comp,which turned out to be another dead end.They told me that they could only calculateproduction credit after the changewas made and the policy was issued.As a last resort, I contacted my AllstateField Sales Leader, who had onlybeen my FSL for a few weeks. She saidshe could assist me in calculating theamount I needed to increase my policy.She also gave me a good talking to aboutneeding to work towards my ExpectedResults and that I shouldn’t put myselfin this position. I agreed and tried to explainthat I would like to do more, but mycustomers – who were being battered byhuge homeowner rate increases of 35%to 100% – were taking up a large amountof time. Of course, I also explained thatnew production is much easier when youhave decent products to sell.At this point, I informed her that Ihad been trying to sell my agency for ayear or so. But because there were virtuallyno qualified buyers in my area andsince about half of the agencies in myarea are listed for sale on Allstate’s website,I hadn’t had much luck getting out. Ialso explained that due to a business loanon my agency, I didn’t want to take TPPbecause the first 6 payments would go tothe bank, leaving me no income while Isearched for a new job in a hard market.I told her all I needed was to make sureI hit my required FS numbers so that Icould either sell my agency or see if Allstatewould revamp its pricing so I wouldhave competitive products to sell.She showed me how to increase myVUL and calculated out how much Ineeded to increase my policy by to producejust over the required $1,000 productionlimit. I did as she instructed andsubmitted the paperwork. Because wewere getting close to the deadline, I wasdiligent in following up on everything.When I was told by AFS, shortly beforethe deadline, that everything had completed;I breathed a little sigh of relief.It was around this time that I receiveda letter from Allstate saying I had notbeen hitting my Expected Results andthat I was on the naughty list. I was toldthat I needed to make improvementsover the next 6 months and that the letterwas simply a warning.Where things become crookedShortly after my new production reportcame out, I noticed that the variableproduction credit amount was justbelow the $1,000 yearly requirement,even though I increased my VUL as instructedby my FSL.I contacted my FSL immediately andshe stated she didn’t understand what theproblem was and that she would investigateit for me. She also told me I shouldcontact AF Comp. Here is where thingsgot really strange. AF Comp emailedme and told me I had hit my productionamount for the year. However, some ofthe other reports showed I did not. MyFSL told me that she was double checkingeverything and told me not to worry.A few weeks went by and I hadn’theard anything from my FSL. WhatI did receive was a certified letter fromAllstate Financial stating that my contractwith them had been terminated forfailing to meet my minimum productionrequirements. My stomach immediatelyturned sour. The first thing I did waspick up the phone to call the FSL andwhen I received no answer, I left messagefor her to call me back. Then I decidedto email her and when I opened my InboxI saw there was an email stating thatshe had been promoted and that we nowhad a new FSL. Somehow, I was gettingthe feeling I had been had. To this dateI’m not sure if the FSL was just that incompetentor if I was being setup, but itseemed a lot like sabotage to me. In caseyou are wondering, I never heard fromher again, ever.For the next few weeks, I contactedeveryone I could think of to get helpwith my predicament. During this time Ireceived another certified letter, this onefrom Allstate Insurance stating that dueto losing my FS contract they were terminatingme, effective November 30th.My new FSL told me there was nothingshe could do, but she would help metry and find a buyer for my agency. Shenever sent any buyers my way.For five months I asked various peopleto please review my termination. I informedeach of them that I had documentationshowing I had enough credit,and that everything I did was at my manager’sdirection. I received no assistancefrom any of the departments I reachedout to, or from any of the dozen or sopeople I contacted about the problem. In50 — Exclusivefocus Summer 2012

fact, few of them even bothered to returnmy voicemails or respond to my emails.I even asked if perhaps they would considerpostponing termination a month orso in order to make it through the Holidaysfor my family’s sake. But once again,I was greeted with either no response ortold nothing could be done.In short, I was being terminated, andunless I hired a lawyer, which I could notafford, November 30th would be my lastday as an Allstate agent. By September Ihad resigned myself to the fact that therewas no hope for my business. Meanwhile,my business partner was destroyingmy livelihood and was all set to stealthe customer base I had built up. Theyhad tarnished my name by placing a terminationfor cause on my U5, which anyfuture employer could access. In short,my business experienced corporate sabotagedelivered at the hand of my businesspartner.Facing seemingly insurmountableodds, I started to look for a new job. Thisdidn’t go well considering the hard jobmarket and the fact I had to disclose tofuture employers that I was being terminatedfrom Allstate due to poor production.I also started the process of shuttingdown my agency and began liquidatingsome assets. Ironically, I terminated theVUL that I just increased because I knewI would no longer be able to make thepayments. Moreover, my policy as wellas my other variable business had alreadybeen transferred to another agent. Ofcourse, by cancelling the policy, I lost everythingI had paid into the VUL overthe years due to the surrender charge. Iguess this worked out to be a little extra“bonus money” for Allstate!Like any good agent, I had built astrong relationship with many of my customers.Because Allstate does such a badjob of integrating customers with newagents, I wanted to give my customers aheads up that I would no longer be withAllstate come November 30th. I didn’twant them coming to my office and beingsurprised to find my doors locked. Idid this as a courtesy to my customers,who I love and respect, unlike my greedybusiness partner who only sees them asdollar signs. I also destroyed or gave away$500 to $1000 worth of Allstate promoitems – everything form coffee mugs tobusiness cards – which I had purchasedover the years. But Allstate had a trick upits sleeve and these two acts would comeback to haunt me…Allstate’s new trick….ReaffiliationAbout 15 days before I was to be terminated,I had a discussion about mysituation with a woman from Allstatewho was responsible for collecting mycustomer files. I told her what happenedand she sounded a little alarmed. Sheasked me to send her the “documentation”I had about my case, so I did. Thenext day I received a frantic phone callfrom Allstate Financial asking me to signand return the “reaffiliation” paperworkthey would send overnight to me.Reaffiliation? I was shocked at firstbecause this wasn’t something I was expecting.Then my surprise turned to anger.For months I asked dozens of peoplefor help, but no one bothered to take thetime to review my situation. Then byhappenstance and in the final momentsof my career, someone finally takes aninterest and reviews my documentationand suddenly, they wanted me backagain. Apparently what they saw was socut-and-dried wrong, they had to reversetheir initial decision and get me to reaffiliateimmediately. It’s obvious theyweren’t doing this out of the goodness oftheir hearts, but to cover their own asses!Since, I had already started the processof moving on with my life, I told themI needed to think about it. After mullingit over for a day, I made some minorrequests to resolve the situation for bothparties. Here were my requests:1. That Allstate correct my U-5.2. That Allstate pay me the fair marketvalue for my agency – as determined by athird party – and paid in a lump sum.3. That Allstate pay the pre-paymentpenalty on my loan.After being wrongfully terminatedand having my business practice dis-Summer 2012 Exclusivefocus — 51

scratch and turn it into a lifelong career.For five years I took home pennies, whileinvesting everything – money, time andhealth – into my agency. I spent 60+hours a week working, sitting at a desk,trying to establish my agency. I startedwith zero policies and over five years,grew to over 900 policies. Those are 900policies that I busted my ass and spentmy own money to obtain, while Allstatedid virtually nothing, except demandmore. After five years, I thought I wouldhave some breathing room, but as weall eventually find out, Allstate is neversatisfied. What I have is a greedy, underhandedpartner that is attempting toswindle me out of my livelihood.Quick TipsI’ve been conned, swindled, fired, andreaffiliated. I’ve had the indignity of havingto tell friends, family, leinholders andfuture employers that I was terminatedby Allstate, only to be stuck back hereagain knowing that any day, I will haveto go through the same process all overagain.So, because of my Allstate experience,I would like to offer you some the followingwords of advice:I was presented with Allstate’s marketingmaterial showing how great the ExclusiveAgent opportunity was. I askeda lot of questions during the hiring process,but because I was new to the industry,I did not know I should have asked tosee a copy of Allstate’s Exclusive AgentAgreement – along with any pertinentcontract supplements – before committingto the process. By the time I actuallyreceived a copy of the contract to sign, Iwas too far into the process to back-out,regardless of what it might have said.I will tell you this… anyone signing acontract with any insurance carrier thatbasically says…The agent must do anything and everythingthe company says;The company establishes how many andwhat kind of policies the agent must sell;The agent must meet any arbitraryproduction goals set by the company –which are subject to change at any time– or face losing their agency;Cover all expenses related to the operationsof the agency;Keep your agency open 44 hours perweek and mandate that you are openfor business the day after Thanksgiving,Christmas Eve and New Year’s Eve;Coerce agents into meeting certainstaffing numbers in order to increaseagent compensation;Acknowledgement that any customersyou write are the company’s property andthat they can be taken away with 90 daysnotice (120 days in California);Agree that the company can changeagent commissions at its own discretionwith a 90 day notice without input fromthe agent and regardless of the profit theagent has historically provided to thecompany;Agree to a one-sided, unilateral contractwherein the agent is devoid of anyrights, except the right to terminate thecontract with a 90 day notice.… is not signing the contract of a partnership.By signing such a contract, youare agreeing to a career of indenturedservitude and all you are getting in returnis the HOPE that you will one day makethis lopsided contract work enough sothat you can have some sort financial independence,as did the Allstate agents ofyesteryear.Working for minimum wageWith my agency’s low loss ratios andgrowth from zero policies to 900 pluspolicies, I’ve given Allstate an excellentreturn, especially considering that theirinvestment in me was minimal. But forme, the investment was great and myreturn was minimal. Does it make sensethat we, the producers of corporate profits,are nickel and dimed to death on ourcompensation? If I look back at the sacrificesI’ve made in terms of the investmentsI’ve made into my agency, whichinclude my time, efforts and financialcontributions, I would not be surprisedif my take-home pay was less than minimumwage.For anyone lookingto stick aroundAgents are working harder than everfor less compensation, customers are gettingless coverage at higher premiumsand stockholders continue to see tepidperformance, but the people at the topare not suffering. I don’t understand howa major company can lose market sharequarter after quarter, fail to significantlyincrease it share price and only increaseprofits sporadically while its senior executivesreceive lavish raises and perks.They miss their goals and are somehowrewarded. Yet when agents miss theirgoals, even if they are enormously profitable,they are sacked.It might be too late for me, but as JimMorrison famously said, “They got theguns, but we got the numbers.” It’s timewe take action! Last summer, Allstateannounced that it would change its basecommission to 8%, a 20% cut – which Icontinue to believe is its ultimate plan.Agents should not have to sacrifice 20%of their pay when the CEO receives a20% increase in his pay as he runs thecompany we love into the ground.Independent agents, including Allstateindependent agents, earn a basecommission of 15% on average. Theyrun their agencies as they see fit and,most important, they provide customerswith the policies and coverages theyneed, instead of being told what to sell.At Allstate, we are treated as employeesor independent contractors, dependingon what suits Allstate at that particularmoment. We are always treated as theservants of the Allstate Fat Cats and it’stime for a revolution!My advice is… if you plan on being along-term Allstate agent, you better jointogether and be prepared to fight. Notonly to save your businesses, but to saveAllstate. Greedy corporate executivesat the top are draining the essence outof our company, sending their zombie,flesh-eating managers across the countryspreading their disease and low morale.These people are draining nickels anddimes from the agents, customers, andshareholders so they can stuff their pocketswith dollars and they won’t give upuntil Allstate is void of life. Let’s take ourcompany back.I wish to remain nameless in hopes ofavoiding Allstate’s vindictive nature andcruel legal wrath. EfSummer 2012 Exclusivefocus — 53

fed up with this company and its horrendousbusiness practices would be anunderstatement. I am not a young guy,bright-eyed and bushy-tailed. Plain andsimple, I am a middle-aged businessmanwho feels like he’s been had. I’ve cometo the conclusion that this company hasvery little hope going forward unlessTom Wilson and his failures become athing of the past — sooner rather thanlater. Today – almost the last day of themonth – I sat through another one oftheir ubiquitous meetings; a basic rehashof the same nonsense I’ve heard quarterlyfor better than a year. To conducta business meeting for a sales organizationduring the last week of the month isindicative of how out of touch these peopleare with the daily operations of thebusiness. What I see happening is thatleadership is cannibalizing the companyto realize short-term profitability. I onlyhope the shareholders catch on quickly.I apologize for taking the long wayaround this question, but frankly, I needsome help selling this thing. I am verywary of letting my FSL know that Iam thinking of this. As I understand it,NAPAA can help guide me through thisprocess. Any assistance provided wouldbe greatly appreciated.Thanks for everything that you andNAPAA do.Editor’s response: Yes, NAPAA doeshave some resources available to help sellyour agency. Currently, your best option isto find an outside buyer on your own andstrike a deal – which should include securinga substantial down payment and a signednon-disclosure agreement – before you presentanything to Allstate. That way, theydon’t know your book is for sale, giving youthe element of surprise. When your deal isready, you should present it to your RVP asdescribed in the R3001 Supplement. Manyagents make the mistake of telling theirFSL, which creates an immediate conflict ofinterest because the FSL, who earns a bonuson new hires, will try to line up a host ofpre-qualified buyers who seem to be schooledin low-ball tactics that will only hurt youin the end.We have several other resources availablein the member’s section of our website. TheAsset Purchase Agreement is reserved foragents who have been a member for two yearsor more. You can obtain this document onceyou’ve paid your 2nd year dues in full. Feelfree to contact us by telephone or by e-mailwith any specific questions you may have.One more question please, can TPP bevoluntary? In other words, can I throwup my hands and simply say, “I’m done”and receive TPP?Editor’s response: Yes, but you must givethe company 90 days notice.I am glad to know you are working thecommission shortage issue. I wish you thebest of luck on this. Give ‘em hell becauseI smell a rat in this... it just does not makesense. I am down 20% per month on myrenewals starting last December and therehas been no plausible explanation whatsoever.They just say it is all correct. WOW!I hope you catch them!Jim, I don’t think there is an agent inmy region who isn’t running scared or sickand tired of being put on the firing line.Have you heard about the meetingsthat they have started with folks whohave opened an agency within the lastyear? Those agents have to go beforeregional management with their businessplans in hand. I also understandthat two people from Home Office sit inwith them and the whole ordeal is put onvideo and tape recorded.I know that once they finish with thosewho have to go before this “board,” theywill start with everyone else. When doesthe madness stop, or does it?Editor’s response: Requiring agents to presenttheir business plan in front of all those ofthose managers is the ultimate in intimidationtactics. Apparently, they want agents toknow they are dead serious about achievingthe goals they set. Imagine what will happennext year when the agents who have missedtheir goals have to meet with them againnext year. This is management by intimidationand it will not stop until agents stand uptogether and say they’ve had enough – whichcan be done through NAPAA.A few months ago, I received a phonecall from a potential outside buyer whosaid he had been told that I wanted tosell and was given all the information regardingmy agency, including the informationfrom my CSRP. At the time, Ihad no interest in selling.What bothered me was that the buyerclaimed that he received my informationfrom Allstate upper management inmy region. I didn’t know that my resultsand my gross income were public knowledge.I immediately called the managerand asked where he had gotten informationthat I wanted to sell and he said myname was on a “list.” I said it would havebeen nice if I had been notified so I couldverify if it was true or not. He apologizedand he mentioned if I change my mind,let him know.I was curious if you have heard thisbeing done before? I guess any agencycould be “for sale” for the right price, butwhat happened with me is not, in myopinion, good business.Thanks for writing. Ethical managers askif they can share the agent’s information withpotential buyers. It seems that the company isdoing all it can to force tenured agents intoselling, which has led managers to engage inunscrupulous behavior. It sounds like managementin your region has identified you assomeone they would like to replace; otherwise,why would they even mention to anyone thatyou might be interested in selling? We don’tbelieve this is standard procedure in mostregions, but it is happening with increasingfrequency, as managers get more pressure tohire new agents.It appears the company continues toimplode as well as destroy people.Wanted to let you know I have beencontacted on a continuous basis by FSLswanting to recruit me as an Allstateagent, even though I was terminated almosttwo years ago.I have received form emails for the last56 — Exclusivefocus Summer 2012

two years. I finally responded with profanitylaced emails. It seems idiotic thatthese recruiters would send out emails toa person’s CareerBuilder résumé.Then yesterday, I received a voice messagefrom a recruiter, which I promptlycalled back. As I listened to him explainthe opportunity and hear him say “Wehad to get rid of a lot of agents and needednew blood…” then he said, “Well whatdo you know, you used to be with us.....”I proceeded to tell him what I thoughtof him and the company in general.I may have mentioned to you beforethat the manager who recruited me aswell as terminated me, came in for aninterview at my new employer. Managementcame to get me to identify her andthen brought her to my office after theinterview. Interestingly enough, all shecould do was cry and talk about what Allstatedid to her. Without saying anythingmore, I simply told her look at what theyhave done to PEOPLE. That is whathappens when you decide to work for thedevil and ignore the decision. I made afew other statements to her that were notpersonal but very direct. When we werefinished, I escorted her downstairs viathe freight elevator as she did not wantanyone to see her makeup smeared...Jim, I continue to commend you on yourgood work and I hope at some point therewill be light at the end of the tunnel forall the effort you and Nancy have made.I do believe that God will ultimately havethe last say on all of this. I read some ofthe postings on ALLBlue Blog and whatamazes me is how everyone wants to benefitfrom somebody else sticking theirnecks out and complain. Then they won’teven join NAAPA... incredible…Editor’s response: Good to hear from youand “kudos” to you for putting those FSLs intheir place. I also appreciate your commentsabout Nancy, me and NAPAA.Is the new variable compensation programbeing challenged in court?The Variable Compensation will requireagents to meet certain behaviorsin order to earn back the 10% commissionswe are losing. These behaviors arenot revenue producing, but revenue depleting.Hence, a commission percenthas been removed and replaced withnon-revenue producing behaviors suchas Good Hands Certification, minimumstaffing, local presence assessments, andcustomer experience survey results.Editor’s response: We discussed your question,and find nothing in the agent contractthat precludes Allstate from doing whateverit wants regarding agent commissions. Infact, they could simply reduce the commissionwithout giving agents an opportunityto replace it. Nothing in the contract offersthe agent any protection from this.Notwithstanding any breach of the contractualagreement between Allstate and itsagents, the only other way to get into courtwould be if they somehow violated a state orfederal law. Our attorneys have not foundany laws governing the relationship of independentcontractors with regards to themethod of compensation for work.If your question is referring to the age-oldargument – which we still believe to be the case– that Allstate agents are not really independentcontractors, then yes, it could be added tothe list of other independent contractor vs. employeeinfractions. But getting a day in courthas not been easy. We have consulted withnumerous law firms over the past five yearsand we have not found one that is interestedin taking the case on a full contingency basis.There was a firm that was willing to take thecase, but asked agents for $2,000 upfront, butthere was not enough agent participation.I am located in a Midwestern state andI am thinking of going independent. Doyou have any recommendations regardingthe independent agent cluster groups thatadvertise in Exclusivefocus? The one that Ihave in mind is Couri Insurance Associates.Would you happen to have any informationabout them before I call them?Thanks for writing. For a couple of reasons,NAPAA cannot make recommendations.Besides the differences between agencycontracts, there are liability issues to worryabout. We always recommend that agentsget copies of the contracts for the group theyare considering, read them thoroughly andconsult an attorney, if necessary. That said,I can say that we get very few complaintsabout any of the groups that advertise inour publications. I am familiar with CouriInsurance because they are headquarteredin Wisconsin where I was an agent for 28years. You might want to contact Couri andany other agent network groups you’re interestedin, and ask them for some referencesfrom ex-Allstate agents.I’m retiring mostly due to the fact mypartner was forced to sell his agency. Wewere one of the last 2-man offices inthe country. When he left, my expensesdoubled and with the capital gains lawspossibly changing soon and I turn 66 thissummer. I know these are weak excuses,but the money just isn’t there. This companyhas changed in ways I could havenever imagined and I don’t see a solidfuture in the cards. I pray to God thatmy buyer has the fortitude to make it inthis increasingly toxic atmosphere. I haveenjoyed my relationship with you guys.Thanks for all your help and good luck.Nancy: You’re the most generous andsupportive person I have ever run into,and I sincerely thank you for your advice.My very best regards to both you and Jim.After 20 years, I am no longer an Allstateagent and am very happy about it,as are many other Allstate agents whohave parted ways with Allstate. I wantto take this opportunity to thank youand NAPAA’s Board of Directors for thewonderful work you’re doing to keep Allstate’smanagement honest and, of course,for your wonderful advice during my decision-makingprocess when I was thinkingof leaving Allstate. Your support wasmuch appreciated. I wasn’t sure if the timewas right for me to leave, but now I knowthat I made the right decision.I also have to admit that I was oneof lucky ones in that I was able to sellmy book of business for a great priceand with little interference. Allstate inSummer 2012 Exclusivefocus — 57

its infinite wisdom wanted my buyer tobecome big overnight and was willingto finance the high-end sale price of mybook of business. I just couldn’t afford tomiss the opportunity, especially with allthe commission turmoil discussions thatwere taking place at the time. Once againthank you for the great work you are doingand your support for all these years.It looks like things are progressing okayfor the sale of my agency this fall. MyFSL stopped in for a visit last week andtalked like it was a done deal. The buyer isa bit confused as to why he needs $50,000in the bank, not to mention coming upwith the financing. I had told him upfrontthere will be no holding a note. He sayshe has the money now and just has to gothrough the Allstate process now – I surehope they don’t try to spoil my sale. Anyway,I offered to stay on part-time so hewould have the licensed LSP he needs,but both he and his wife are licensed, sohe may already be planning to ‘trim thefat’ from agency expenses.Incidentally, way to go at the shareholder’smeeting! I think I may buy one share,and then head over to the meeting next year.After 28 years of working 70 to 80hours a week trying to deliver the Promise,I have decided to retire and work foran independent agent. The new Houseand Home product was an indicatorthat Allstate does not want to be in thehomeowner market. They then changedto SRM 6 and hid the rate increases. Italso gave them an opportunity to runcredit and, at the same time, told us weneeded to get permission.They are excited about their new commercialproducts. However, when I was anew agent, we were also excited and I wroteand lost a $300,000 book of commercialbusiness. In 2003, I purchased two booksof business, which gave me a $4,000,000book, six employees and two offices.In 2006, Tom Wilson got scared andclosed down earthquake coverage in mystate and we did not have an alternative forsix months. Needless to say, Wilson’s lackof understanding the competition cost meover $1,000,000 in premium, and $100,000in income per year. By the time I sold mybook, it had drifted down to $2,800,000and Tom’s income did not suffer.After 28 years of being an agent, notone Regional Vice President, not oneAssistance Vice President and not oneRegional Sales Manager had the courtesyto thank me for my service or wishme well. My FSL did wish me well, butonly after I told her I was retiring andonly then did she remember.Allstate has become heartless and theagents will never trust them again. Thenon top of it all, the company wants totake away commission dollars from theagents so it can claim more profits, whichmeans more money for Tom Wilson.Way to go Tom; thanks for looking outfor those who made this company great!Thanks for all you do at NAPAA andkeep up the good fight.To my fellow Allstate agents:In May 2012, I “celebrated” my 30thyear with Allstate. My office is located ina small rural community of approximately10,000 people with just over 9,000households. Believe it or not, there areten insurance offices listed in the phonebook for my town and there are numerousother offices within 7 miles. Most ofthem are independent agencies.Like many other Allstate agents 30years ago, I started at the Allstate boothin a Sears store. In those days, we weretruly able to take care of our customers –from underwriting to claims. It was niceto be able to talk to and reason with theunderwriters who were assigned to us.Of course, every so often the companywould rotate them so that they didn’tget too comfortable with us or do us toomany favors. The customer service andclaim reps were great too. They didn’t rotateoften and we got to know them andthey really tried to help us.During those years, we had the powerto make a difference. Then came thechanges; first the NOA program. Thiswas followed by tightened underwritingand new restrictions. Soon after, thecompany terminated our positions asemployee agents and the EA programbegan. I accepted each new challenge believingthe company was principled, andfair. I tried each new program that waspresented over the years.As I look back over the past 8 to 10years, I realize how stupid it was to allowmyself to be intimidated into spendingmoney on the new programs that managementdreamed up. During the past 8years, I increased staff and participatedin a multitude of programs. Unfortunatelyfor me, doing so used up 90% ofthe retirement funds that I had accumulatedover the years. After my financialwell dried up, I had little left to spend onmarketing programs and, as you mightexpect, I received my termination letter,effective June 1, 2012.Someday, I believe Allstate will eventuallyrealize the mistakes it made withall these changes. Good agents havelost their life savings, yet the companyremains in denial of the truth. If theythink they can cover everything up withadvertising campaigns where they feigncompassion by giving away teddy bears,they are sadly mistaken.In the end, I do not regret my timewith Allstate. Actually, the first 15 yearswere quite good. I look forward to thenew paths I have chosen. I will be pursuingsomething more in tune with myspiritual nature. I intend to study Reiki,as well as equine and canine anatomy.Once I become proficient, I hope to aidin the healing and relieving of pain inhorses and large dogs. In the meantime,you will all be in my prayers – wishinggreat success to all of you.Respectfully yours,Barb HanleyLetters and articles submittedto NAPAA may be edited forclarity, space, grammar, syntaxand suitability.Names of agent contributors will onlybe published with writer’s permission.Letters and othersubmissions can bee-mailed toExclusivefocus@napaaUSA.orgor mailed to:NAPAA, P.O. Box 7666,Gulfport, MS 3950658 — Exclusivefocus Summer 2012

Confidential NAPAA Membership ApplicationName:______________________________________ Off Ph:_______________________ Cell__________________________Street:________________________________________________ E-Mail:__________________________________________City:________________________________________ State:_____ ZIP:__________Agent since__________(year)Comment?MEMBERSHIP SECTIONRegular (Gold) Membership q Annual: $350 q EFT: $29 /moElite Membership (includes Producer Online Subscription) q Annual: $475 q EFT: $39 /moTo Activate Producer Online Subscription only:User Name _____________ Password _____________PAYMENT SECTIONq CHECK – Annual: Please make payable to NAPAA.q CREDIT CARD – Annual: I authorize this amount to be charged to my credit card.(Please complete the information below)Card type: q VISA q MasterCard q Discover q American ExpressName on account _________________________________________ Amount to be Charged: $__________ (Annual only)Account Number __________________________________________ Expiration date __________ Security code________Address on Card _______________________________________________________________________ZIP____________Signature of Cardholder _______________________________________________ Todays Date _____________ (1/12 EF)q EFT (PAM) - Monthly (attach or fax voided check)I understand that the amount stated above will be deducted from my checking account every month until instructed otherwise.I have enclosed a voided check and understand that the withdrawals will occur on or about the 20 th of every month.Authorization Signature: _____________________________________________________________Date ____________PLEASE FAX or MAIL APPLICATION TO:National Association of Professional Allstate Agents, Inc.P. O. Box 7666, Gulfport, MS 39506-7666Call Toll-free: 877.627.2248 • E-Mail: HQ@napaausa.org • Fax Toll-free: 866.627.2232Please include your generous donation to the NAPAA Action FundSummer 2012 Exclusivefocus — 59

the NAPAA market placeAgencies for Sale Agencies for Sale Agencies for Sale Agencies for SaleArizonaScottsdaleRobrobertocammarata@msn.com480-734-7574Asking Price: $524,950PIF: 2,891 Premium: $2,455,000Number of Staff: 381 ALI, 85% retention. Alreadyhave $9,000 of AF credit and5 policies (April 2012). Stafftrained. Rent under $1100/month. Will help with transition.TucsonHarold Broc BroccolettiA070725@ALLSTATE.COM520-744-3994Asking Price: $375,000PIF: 1,518 Premium: $1,515,114Number of Staff: 135 yr agent, same location over10 years, rent $922/mo.ArkansasFort SmithGary Richardsongrichardson@allstate.com479-651-8200Asking Price: $550,000PIF: 2,516 Premium: $2,759,600Number of Staff: 2Office 6 years old 1350 sf, oncorner with great traffic. LR

the NAPAA market placeAgencies for Sale Agencies for Sale Agencies for Sale Agencies for SaleNevadaLas VegasHoward M Shawhowardmshaw@allstate.com702-365-1392Asking Price: $472,500PIF: 1,574 Premium: $2,100,000Number of Staff: 3ALI 90. Retention 92.34, LR49.4. Agent 65, Retiring after 34years.New MexicoSilver CitySimon G Ortizsgortiz0707@gmail.com575-534-5192Asking Price: NegotiablePIF: 1,975 Premium: $1,950,000Number of Staff: 3Since 1988. New, beautifulbranded office.North CarolinaAshevilleMike Gentilinigentilini@bellsouth.net828-712-0707Asking Price: NegotiablePIF: 3,900 Premium: $3,234,000Number of Staff: 431 yr agency in beautiful BlueRidge Mountains. Option tolease or purchase spacious,modern office, F&E (7 workstations)included. LR 39%, 90+%Retention.North DakotaGrand ForksLeland Jelinekljelinek2@gra.midco.net701-746-9330Asking Price: NegotiablePIF: 1,227 Premium: $1,000,000Number of Staff: 15 yr Ret 91.90. ALI 86, $435/month, same location 20+ yrs.Only EA in town.OklahomaNormanLouis Hemphilllouishemphill@allstate.com405 -360-7656Asking Price: Please callPIF & Premium: Call for detailsTwo nearby agencies for sale,call for details.Rhode IslandJohnstonMelanie Grossimelaniegrossi@allstate.com401-233-3800Asking Price: $325,000PIF: 1,162 Premium: $1,476,040Number of Staff: 4Excellent, busy location, veryLOW LR. Experienced (20+ yr)staff. 810 sf office, $1,100/mo.F&E included.TexasAustinLeezaubyaj@yahoo.com512-630-6699Asking Price: $770,000PIF: 3,047 Premium: $3,200,000Number of Staff: 1.5Since 1989, two agencies havecombined BOB of 3.2 million,2.5 miles from each other.AustinBlake Simpsonblakesimpson@allstate.com512-923-3004Asking Price: $455,000PIF & Premium: Call for detailsRetention 92.08, LR 52.75,Please contact via email, orevening by phone.UtahWest JordanRyan Daviswhosgameisit23@gmail.com801-562-8866Asking Price: Please callPIF: 1,180 Premium: $1,065,000Number of Staff: 2VermontBrattleboroMichael Dornerdorninc@yahoo.com802 -380-0014Asking Price: $520,000PIF: 2,464 Premium: $2,271,000SALEPENDING!VirginiaSpringfieldLarry A Bronstonelbronstone@gmail.com703-967-8287Asking Price: $725,000PIF: 2,286 Premium: $2,939,736Number of Staff: 4Several locations, VAEd Hogg (Rep)ehogg9@gmail.com703-862-8168Asking Price: NegotiableSeveral locations, call fordetailsWashingtonSpokaneRichard CerenziaRCerenzia@allstate.com509-326-3069Asking Price: $175,000PIF: 938 Premium: $720,000Number of Staff: 14 yr agent, ALI 91%, Retention91, LR 42%,SpokaneDick Triesch & Michael Mc-Clanedickjtriesch@yahoo.com509-768-0957 (Mike)Asking Price: make an offerPIF: 1,987 Premium: $1,675,349Number of Staff: 1Since 1989, retention 91.38, LR43.28. ALI 83.The NAPAA market place…where buyers meet sellers.Place your classified ad here for just $99 per issueof Exclusivefocus(Price reduced to $50 if ad is in conjunction with online ad.)For more information, go to www.napaausa.org, or contactNAPAA at 877-627-2248, or HQ@napaausa.org.Summer 2012 Exclusivefocus — 61

NAPAA Boardof Directors2011-2012Administrative OfficesJim Fish, Executive DirectorP. O. Box 7666Gulfport, MS 39506Ph # 877-269-3474Nonmembers: Call 563-564-1800ExecutiveDirector@napaausa.orgNancy Fish, Association ManagerP.O. Box 7666Gulfport, MS 39506Ph #877-627-2248Nonmembers: Call 563-564-1800Fax #866-627-2232hq@napaausa.orgPlease email HQ@napaausa.org tocontact our officers and directors.Include the name of the person inthe subject line.OFFICERSBob IsacsenPresidentHoboken, NJDale RevelsImmediate Past PresidentKissimmee, FLDebe Campos-FleenorExecutive Vice PresidentTucson, AZIsmael Melendez, Jr.TreasurerFederal Way, WAJudy OstSecretaryBattleground, WADIRECTORSAl Bullard, Floral Park, NYEd Hogg, Fairfax, VAGreg Thompson, Burleson, TXLezlee Liljenberg, Arlington, TXExclusivefocusNational Association ofProfessional Allstate Agents, Inc.P.O. Box 7666Gulfport, MS 39506-7666Phone Toll Free (877) 627-2248Toll Free Fax (866) 627-2232Web Site www.napaausa.orgEmail HQ@napaausa.orgNonmembers: call 563-564-1800Jim FishExecutive EditorP.O. Box 7666Gulfport, MS 39506Phone (877) 269-3474 • Fax (866) 627-2232Exclusivefocus@napaausa.orgNonmembers: call 563-564-1800Exclusivefocus and DirectExpress are official publicationsof NAPAA - The National Association ofProfessional Allstate Agents, Inc. No part of this publicationmay be reproduced without prior written permissionof the publisher. It is the policy of this publicationto reflect the professional thoughts and attitudes ofour members and to advance the professionalism of theinsurance industry to the ultimate benefit of the insuringpublic.The views expressed by NAPAA, or any of its positionsrelative to its activities and those of its members’ actions onbehalf of this organization, are expressly those of NAPAA,and do not reflect the views or the opinions of Allstate InsuranceCompany, or any of its affiliates.Letters to the Editor: All letters must include an addressand a daytime and evening phone number. Wereserve the right to edit letters for clarity and space.This issue of Exclusivefocus magazine may containarticles of interest submitted to NAPAA by outside authors.NAPAA is not responsible for the opinions, adviceor accuracy of any information provided therein.NAPAA’s Mission StatementNAPAA is dedicated to the success of AllstateExclusive Agency Owners and to advance theindependence and entrepreneurial spirit of ourmembers.NAPAA’s GoalsOur goals are subject to alteration, influenced bya constantly changing environment and the needsand wishes of our members.NAPAA encourages its members to activelyparticipate in the process of defining and refiningour Mission, Goals and Positions.Our General Goals:• To provide an organization specifically tailoredto benefit Allstate Exclusive Agents• Monitor legislative and legal issues pertinentto Agents and their clients• Maintain an Action Fund to support issuesbeneficial to agents and clients• Provide reliable communications on all issuesthat affect Agents and the ability to call upon ourmembers to act• Provide Agents with a distinct voice on issuesthat affect them, continually exploring options andsolutions• Make tools and resources available for membersin an effort to increase agency value and success.For more information,please visitwww.napaausa.orgSummer 2012issue of Exclusivefocusbrought to you by theNational Associationof ProfessionalAllstate Agents.62 — Exclusivefocus Summer 2012

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