Allstate has announced that it will be revising its compensation plans for independent insurance agents.
The company will be revising its commission strategy and pay system for agents, with the changes to take affect beginning in 2013. The new changes will be enforced throughout 2013, but the insurer has not yet revealed plans on what will happen thereafter. Allstate’s changes aim to reduce compensation for most agents, save for captive agents that work solely with the company.
The insurer plans to cut commissions by 1%, bringing independent agents’ base commission down to 9% of the premiums they write for home and auto insurance. Originally, the company had planned to cut commissions down to 8%, but later revised its strategy due to backlash from agent groups. In an effort to offset the lowered commission rate, Allstate will also be introducing several new ways for agents to make an additional 6% in bonuses. Currently, agents can only earn a maximum of 14.2% of their total annual premiums. With Allstate’s new plan, agents will be able to earn as much as 15%.
_________________________Random Success Quotes to Remember ~ “People will accept your ideas much more readily if you tell them Benjamin Franklin said it first.” - David H. Comins
Allstate claims to have collaborated with more than 300 agencies in order to revise its original plan. The insurer believes that the new plan will be beneficial to agents and will provide them with incentives to perform well and hopes that the changes reflect the company’s belief that agents are a vital part of its business.