Allstate's Avariciousness Will Destroy Careers And Lives

[RatPak11]

*Allstate, The Modern Day Scrooge...
Allstate's Avariciousness Will Destroy Their Agents, Employees And Their Families.
Does Allstate Not Realize That While Being A Large Corporation, They've Accepted, As Public Policy, The Responsiblity For Peoples Welfare?
Should They Not Be Devoted To The Well Being Of Their Loyal Employees, Their Families, The Public, As Well As Their Customers?
It Is Sad That People Should Work For A Cruel, Heartless And Disgraceful Company Such As Allstate.



*Leaders With Vision Will Not Sleep Until They've Made The World A Better Place.
Leaders Who Are Bean Counters Will Not Sleep Until The Debits Equal The Credits.

http://insurancenewsnet.com/article.aspx?id=157081

Allstate Agent Association: Company to Terminate 3,000 Existing Agents
February 01, 2010

Thousands of existing Allstate agents are to be eliminated within the next two to three years as the company sheds those it thinks are not meeting specified production quotas, according to the National Association of Professional Allstate Agents.

Association Executive Director Jim Fish said more than 3,000 agents are being sent termination notices. Many agents are "older agents -- 50 to 60 years old -- who might be servicing their book of business and maintaining high retention and loss ratios, but that isn't enough for Allstate."

"They (Allstate) are looking to add high-value, production-oriented new agents" to hit marks on new business and premiums the NAPAA says are established by Allstate. Fish said the "so-called" Allstate independent agents are anything but, constantly controlled by the company in "every aspect of the business" from hours of operation and holiday schedules, to personnel requirements, Fish said.

Allstate spokesperson Maryellen Thielen said the company "has not set targets for agency numbers or size."

"We intend to grow and succeed with Allstate agencies," Thielen said. "We’re providing incentives and tools for Allstate agencies to provide a consistently superior customer experience. We’re also incenting agents to grow and enhance the customer service their agencies provide. We’re actively recruiting new agents to further enhance and strengthen our local presence."

NAPAA President Bob Isacsen, who said Allstate "doesn't acknowledge we exist," said the insurer has used agents as a scapegoat for "ineffective leadership."

"You have non-insurance people running the company and running it into the ground, if you ask me," said Isacsen, who owned an agency for 21 years before selling about three years ago to retire. Isacsen, who is now the managing director of risk and insurance services at United Nations Federal Credit Union, said many agency owners will not be able to sell now due to a "dearth of available buyers."

Just before Christmas, a federal judge approved a $4.5 million settlement between the Equal Employment Opportunity Commission and Allstate Corp. to officially end allegations of age discrimination. A class of 90 older former employees of Allstate will share the award. Its lawsuit, filed five years ago, alleged Allstate Insurance Co. violated the Age Discrimination in Employment Act (BestWire, Dec. 22, 2009).

The EEOC alleged Allstate in 2000 began a reorganization plan in which it fired all of its sales agents and offered to make them independent contractors. Part of the plan said that former Allstate sales agents could not be rehired in other, nonagent positions for one year. In the lawsuit, the EEOC said that more than 90% of those agents were older than 40, making the hiring policy in violation of the federal ADEA (BestWire, Oct. 27, 2009).

Allstate said it chose to agree to the settlement to avoid further litigation costs but continued to believe its position was correct and that it would have prevailed in court.

In afternoon trading on Feb.1, shares of Allstate Corp. (NYSE: ALL) stock were selling at $29.83, down 0.33% from the previous close.

[RatPak11]

http://www.thestreet.com/story/10673675 ... en=GOOGLEN

Allstate - Mired in Investment Mess, Cuts Agencies
By Gavin Magor 02/03/10 - 01:43 PM EST

New York (TheStreet) - Allstate (ALL Quote) reported disappointing results through September primarily driven by poor performing investments and has started trimming agencies to compensate for losses. Investors will be expecting to see a positive earnings report for the fourth quarter reflecting these moves or it will be under further pressure from shareholders.

Poor investment returns and pressure on policy income have put pressure on the company. It was overlooked earlier in 2009, in favor of Travelers (TRV Quote), when the DOW was looking for a replacement for Citigroup (C Quote).

The third quarter results included a $552 million loss on securities one quarter after reporting a $365 million gain. With $54.7 billion in invested assets in its life and annuity business, it shrank 5.4% from the first quarter. Bonds grew 4% as a percentage of the portfolio. The net yield underperformance by 42 basis points, compared to the life industry, continues the poor track record. Complaints about CEO Tom Wilson's business strategy have been heard from Allstate agents.

The Chicago Tribune reported on Sunday that Allstate could shed 20% of its agents in the coming years. It appears that the 2008 loss of market share is even being laid at the door of profitable agents. The third quarter of 2009 saw a drop of 2.2% in net premiums written compared to the prior year. Questions have been asked about why a company would get rid of profitable agencies, even suggestions that it is "stupid".

Pressure is growing on Allstate from several quarters. The American Federation of State, County and Municipal Employees pension fund is reported by SNL Financial to be targeting Allstate, among other companies, to address accountability and transparency issues. Allstate is on the list of firms potentially subject to the Obama bank tax.

Additionally, the property and casualty market is softening. SNL projected that industry results for the fourth quarter will show premium income down and with better efficiency, profitability up. Allstate is estimated to have the largest net premiums earned, but its profitability after expenses is expected to be close to Travelers.

Investors might look out for the mortgage-backed securities investments when the fourth quarter is reported. $13.3 billion of MBS and ABS were held at the end of the third quarter. With commercial real estate still under pressure, and the retail market in flux this is still a substantial position, even though it is down 43% since the 2008 year end.

Of the thirteen insurers with a market cap above $10 billion, Allstate's stock has a high P/E ratio of 18.3 versus the average of 9.4. Chubb (CB Quote), for example, has a P/E of 6.2. Despite this, Allstate's price-to-book value of 92.7% is comparable to the average of 91.4% for all insurers but low compared to 129% for the largest insurers. This suggests that it is poor performance rather than a fundamental overvaluation of the stock holding prices down.

The stock offers a 2.7% yield and a price 20% below the analyst consensus target. If the company could improve its results it could provide the patient investor with a handsome reward. After the less-than-stellar appreciation of 27% over 12 months it is long overdue.

Don't look for short sellers, they are not there and this is not a stock to short. Even as the book value per share continues to improve, it is still 16% below the 2007 year end. Another poor performance could see added pressure on Tom Wilson. Allstate reports earnings on February 10.

Reported by Gavin Magor in Jupiter, Fla.

[RatPak11]

*HMMmm, Is this the same company whose slogan is "your in good hands with Allstate" but whose ethics and morals are, at the very least, questionable? The agents are absolutely right to question Allstate's agenda. Even the prior article states Allstate is cutting agencies:


http://www.property-casualty.com/News/2 ... -3300.aspx

Allstate Denies Agents’ Group Claim It Plans To Cut 3,300

By MARK E. RUQUET
Published 2/4/2010

Allstate is denying a charge by an agent group that it has a goal of eliminating more than 3,000 agents in three-to-five years.

Jim Fish, executive director for the National Association of Professional Allstate Agents (NAPAA), said an internal company memo laying out the company’s strategy to grow its business in the future calls for the elimination of up to 3,300 agents whose business has not grown to between $3 million and $4 million or more in premium volume.

The reasoning behind having agencies of this size is to improve customer access to the agency by increasing service availability and hours, he said. To achieve this, agencies will have to expand their support staff, something a smaller agency cannot do, he explained.

In order to reach this target, the company will need to consolidate agencies to achieve the benefits of scale, said Mr. Fish.

Allstate agents are supposed to be independent contractors, he said. Yet, the company is trying to exert an increasing amount of micro-management over the agencies, down to service hours and office design, and a number of agents are getting “fed-up” with the carriers interference.

A company spokeswoman said Allstate has not set any target for agency number or size.

“Our goal is to provide a consistently superior customer experience,” the company said in a statement. “We intend to grow and succeed with Allstate agencies.”

Allstate said in the statement that growing agencies is good for customers, the agencies and Allstate.

“We’ve seen that agency locations in the range of $3 million to $4 million in premiums (between 3,000 and 4,000 policies in force) have the scale to support the staff and other resources needed to provide superior levels of customer service.”

The spokeswoman said the company is providing the tools to allow smaller agencies to grow to these levels the company believes will achieve this goal.

“Some agencies may choose not to take this journey with us, but for agency owners committed to providing consistently superior levels of service, the opportunities have never been better to grow their agencies,” Allstate said.

Mr. Fish said alarm bells went off for agents after the company’s chief executive gave a speech Dec.8.

In that talk at the Goldman Sachs Financial Services Conference, Tom Wilson, chairman, president and chief executive officer for the Northbrook, Ill.-based insurer, outlined the company’s objectives.

During the speech he emphasized that the company is seeking to expand business by emphasizing customer service and addressed its exclusive agent channel.

Among the points of the strategy he outlined, he said, “Our goal is to have fewer, larger agencies that provide a more consistent experience for our customers. This will strengthen our agency force and ensure they remain a significant part of how we serve customers.”

At one time Allstate exclusive agents were employees of the company, but that changed in 2000 when they were made independent contractors, losing pensions and benefits and creating a toxic atmosphere among some.

Agents sued the company, accusing it of age discrimination because many of the affected agents were 50 or older. Mr. Fish alluded to that practice, saying it seems like the company is trying to weed out older producers who have high retention rates and low loss ratios and are not selling a lot of new business.

Aiming to confront the possibility that the company will cut its number of agencies, NAPAA is planning to hold a job fair during its national conference in May in Washington, D.C., said Mr. Fish, “to get agents some solutions.”

[RatPak11]

http://industry.bnet.com/financial-serv ... fire-them/

Allstate Says Bigger Is Better; Agents Say It's Just Easier to Fire Them
By Ed Leefeldt | Feb 6, 2010

The nation’s largest publicly-held home insurance company, Allstate, has been battling with its own agents since 2000 when former CEO Ed Liddy kicked them out of the house and made them independent contractors - except for a few clauses that still tied them to the insurer.

Now Allstate has added a new wrinkle: agencies have to expand and earn between $3 million to $4 million in premium business each year. According to executive director Jim Fish, of the National Association of Professional Allstate Agents, the days of the small Norman Rockwell office with a single kindly old agent are doomed - as are about 3,300 agents.

According to the National Underwriter, an Allstate spokeswoman denies the part about axing the agents, but does admit that the insurer wants to enlarge the size of its agencies to make them more efficient. Allstate CEO Tom Wilson said this at a Goldman Sachs conference in December.

And Allstate isn’t alone. Troubled American car companies are also seeking economies of scale, shutting down small dealerships and focusing on keeping just one major dealer in each area; a practice followed successfully - at least until recently - by Japanese carmakers.

This would allow the property casualty insurer, which like its competitors is suffering from the recession and the decline in premium revenue, to keep offices open longer and, more importantly, get more mileage out of each customer by selling them more products when they walk through the door.

But NAPAA sees this as a way to ease out older agents who’ve already gotten a book of business, while retaining their clients. NAPAA’s website features a Job Fair for soon-to-be-forcibly-retired agents at NAPAA’s national conference in May.

“There are countless stories of … Allstate agents who made the transition to the real world where intimidation of workers is not the cornerstone of success,” says NAPAA’s 68-year-old President Bob Isacsen.

[RatPak11]

*I Think We'll Call This One, "Allstate Lies"...


http://www.insurancenetworking.com/news ... 173-1.html

Update: Allstate Denies Plans to Terminate 3,000+ Agents
Insurance Networking News, February 8, 2010
Pat Speer

Ahead of its earnings call scheduled for this Wednesday, Allstate denied growing reports in online blogs, trade journals and in the general press of its plans to reduce its distribution network by 3,000-plus independent agents.

Maryellen Thielen, senior manager of Financial Communications, Allstate Corporate Relations, told Insurance Networking News that Allstate has not set targets for agency numbers or size, but qualified its goal of seeking to work with agents who can provide “superior levels of customer service.”

“It’s clear that growing agencies is good for our customers, the agencies and Allstate,” she said. “We’ve seen that agency locations in the range of $3 million to $4 million in premiums (between 3,000 to 4,000 policies in force) have the scale to support the staff and other resources needed to provide superior levels of customer service.”

Without specifying the metrics that would be used to measure Allstate’s desired level of customer service, Thielen did say that Allstate will provide smaller agencies with the incentives and resources necessary to meet and exceed those customer expectations.

“Some agencies may choose not to take this journey with us, but for agency owners committed to providing consistently superior levels of service, the opportunities have never been better to grow their agencies,” she said.

Allstate offered the following as examples of specific resources being promoted to their agents “to help Allstate agencies enhance the customer experience—and their success:”

• Agency technology: An Allstate Web site offers a self-assessment tool and other aids to help Allstate agents find opportunities to improve service (e.g., location and staffing) and grow.
• 24/7 support from the Allstate call centers
• Education: Allstate is providing tools to help customers understand their insurance better—for example, through its new “Auto Insurance Made Simple” brochure
• Detailed customer research down to the agency level
• Added support for Allstate premier service agencies, the designation for its highest performing agencies (based on business results and customer experience)

Analysts, meanwhile, are hedging their bets on Allstate’s earnings call, stating that, on average, the company is expected to report earnings per share (EPS) of $1.01. Last quarter (sequential), Allstate reported EPS of $0.99, missing consensus estimates of $1.01. For the full year, the company is expected to post EPS of $3.39, predict analysts.

[RatPak11]

http://www.tradingmarkets.com/news/stoc ... 75172.html

Allstate: Agent Loyalty Index Resulting in Better Performance
Posted on: Fri, 12 Feb 2010 16:33:46 EST

NORTHBROOK, Ill., Feb 12, 2010 (A. M. Best via COMTEX) --
There are fewer Allstate agencies in the United States than there were two years ago as some agencies have grown, while others have decided not to grow with the company, said Thomas J. Wilson, chairman, president and chief executive officer of Allstate Corp.

During a conference call with analysts to discuss the corporation's fourth-quarter earnings, Wilson was asked about Allstate's "agent rationalization plan." The chief executive said, "We don't have a rationalization plan, so to speak. What we have is a strategy of making sure we provide our customers with the best service possible and offer all of our products and services in the best way with the most experienced people we can."

All agencies "did a better job for their customers," as performance was improved in all regions, Wilson said. Allstate has "started putting standards in on performance as it relates to the 'agency loyalty index.'" On its Web site, the National Association of Professional Allstate Agents quotes from a form letter it says was sent to agents, which informs them about the agency loyalty index.

"In customer-facing areas of the company, we will be tracking results and managing employee performance down to the individual level," NAPAA quoted the letter. "Minimum acceptable agency standards will be set around your agency loyalty score."

Wilson said those that "did not make the transition are leaving the organization." In a statement Allstate said "some agencies may choose not to take this journey with us."

The NAPAA -- a group the association admits Allstate does not recognize -- recently said the insurer plans to let more than 3,000 agents go. NAPAA said Allstate has set agency marks for new business and premiums and if they are not met, they are being sent termination notices. Allstate said it has not set targets for agency numbers or size (BestWire, Feb. 1, 2010).

Wilson told analysts that as the business gets more competitive and complex, "agencies need to be larger so that they can have more experienced people in them." The number of agencies in the United States has gone down the past couple of years but the number of licensed sales professionals has gone up during the same time, he said.

In a statement, Allstate said agency growth is good for customers. "We've seen that agency locations in the range of $3 million to $4 million in premiums have the scale to support the staff and other resources needed to provide superior levels of customer service."

"To help smaller agencies get on track and grow over time, we are providing agencies with the incentives and resources necessary to meet and exceed customer expectations," Allstate said.

Asked if he thought Allstate would see agent-related lawsuits, Wilson said he did not see it as a risk. "I see it as a benefit to those agencies that are doing a great job for the customers," Wilson said. "This raises the overall bar and raises our position in the marketplace."

NAPAA has said agency owners may find it difficult to sell due to a lack of buyers. Wilson said Allstate would "provide for a transition" and help owners sell or, if there are no buyers, "we will buy it from them and then we have a variety of ways in which we take care of those customers."

Allstate Insurance Group currently has a Best's Financial Strength Rating of A+ (Superior).

In afternoon trading on Feb. 12 shares of Allstate Corp. (NYSE: ALL | Quote | Chart | News | PowerRating) stock were selling at $29.38, down 0.10% from the previous close.

(By Chad Hemenway, associate editor, BestWeek: Chad.Hemenway@ambest.com)