Independent Agents Can Expect More Competition for Personal Lines.
Allstate, the nation’s largest publicly held personal lines insurer, has decided to make a full court press in to recruit exclusive agents to represent Allstate in the Bay State. The company tested the waters here three years ago by reentering the Massachusetts automobile insurance marketplace three years ago. That initial foray has been supported by Allstate offices and agencies located in the states bordering Massachusetts. Allstate has now decided to make a full marketing effort here. The first brick and mortar Allstate agency location opened this week in North Andover. Two more additional unnamed locations are slated to open by the end of 2012.
Chris Conner, Sr. Communication Consultant for Allstate, spoke with Agency Checklists about why Allstate decided to come back to the Commonwealth after having been out of this market for 25 years.
“Following the advent of managed competition, we started to look at how a re-entry might work and started slowly with agents in the neighboring states of Connecticut, New Hampshire and Rhode Island who were appointed to sell in Massachusetts. Additionally, we had a direct line via our toll-free number to sell auto insurance here,” explains Connor. “After enjoying a nice three year window, Allstate took stock of the business it was doing here and ultimately decided that it was worth coming back into the Commonwealth. Ultimately, what we saw gave us the confidence to start putting brick and mortar locations back in the state.”
Currently, Allstate has a 34,000 auto insurance policies in Massachusetts which translates into less than a 1% market share. The insurer, however, expects this number to grow as it hires more agents and opens more agency locations. To that end, Allstate has begun actively recruiting agents and agency management personnel through an aggressive marketing campaign in Massachusetts.
For those agents or insurance professionals interested in exploring the idea of becoming an Allstate agent, there are a few things to consider. Unlike other insurers, agents who decide to work for Allstate must enter into an exclusive contract with the company and can only sell Allstate products. At the current time, the insurance products Allstate offers in Massachusetts are auto insurance, life insurance and its full suite of financial products. The company, however, is considering introducing more of its products to Massachusetts in the future.
Interestingly, Allstate is basically a hybrid between an insurer working with independent agents and a direct writer. So, while an Allstate agent can only sell Allstate products, they are independent contractors rather than employees of the company. As such, an Allstate agent retains the economic interest in his or her book of business. This means that an agent who would eventually like to sell their agency and book of business may do so, albeit, that it is sold to another Allstate agent, to Allstate itself, or to an outside buyer (subject to Allstate’s approval.)
While this arrangement might not be something many of our independent agency readers would consider, for those interested intrigued by Allstate’s business model, the lead recruiter in Massachusetts is James West. His direct line is 800.733.7010 ext. 3527.
You can also learn more here about becoming an Allstate agent.