Allstate California has hit hard against its agents from the folks I’m talking to. Large 50% down payments and agents are fuming and plenty are ready to throw in the towel.
Buckle up
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Allstate is really good at selling policies online. 39% of all new business is a result of the direct channel. In fact, Allstate Direct has 75% retention ratio. Moreover, direct’s 5 year loss ratio is 12% higher than agent based business and priced 7% less than agent generated business. Meanwhile, more and more disenfranchised former Allstate agents non competes are expiring. I wonder what they are going to do now? The wolves 🐺 are in the hen house and they are hungry!. This will be the 3rd quarter in a row that Allstate misses their consensus Wall Street numbers. Let me tell you this it will be a good opportunity for Allstate to buy back some of their own shares at a deeply depressed price. Don’t get sore buy some more! It’s pretty safe to say some heads are going to roll. The bell will toll for thee and there is going to be one upset CEO who can’t raise prices fast enough as more profitable high lifetime value customers walk out the back door.
California has always been an insurance dumping ground. 50% down payment is not a big deal. We offer considerable dis for pay in full and many take advantage of it. Agents complain about every little change.