REMEMBER! It's all about me....take care of yourself.....It's a business decision ....... we've all heard it! They will soon pay the devil his dues for short term profit gain. Scary days are coming. Be ready.
55 replies (most recent on top)
@2nry McKinsey and our other paid consultants are like blind squirrels. Their models and predictions are right less than the local weatherman. But we should definitely listen to them this time because, well.....
Actually not missing the point, the facilities argument has always been just a lame excuse/propaganda. Most of, if not all of the offices were paid off decades ago and cost very little to maintain. We spent over 6 billion dollars on the hubs (buy/lease back-25 years) and all the relo/turnover expenses. Many of the offices we closed and are going to close will sit unsold for years and years. That means they still have to be heated, cooled, self-insured and maintained and the expense does not go away. It will take decades to recoup the expense savings for the horrible hub decisions and we may never given the WFH situation and new realities. Yes I agree with the point the past is the past and companies have to do what they think to try to survive. Great high salaries.....and great benefits???.....in the last 8 years 12,000 jobs have been eliminated, mostly claims, no new pension for 2021 and most Prof/Tech jobs have been moved to low paying Para-Professional jobs... so that has no validity. The problem with people with no tenure or history don't understand...this was addressed decades ago and there is a better solution. You can afford to pay someone 40K a year and help the company/expense and not locate someone in Bloomington, Phoenix, Dallas or Atlanta. 40K a year in OK, LA, NE, KS, AL, rural areas etc....WFH...allow the company to save money and get good dedicated employees that want to stay. 40K in these areas go as far as 60-70K in the hubs... Our Exec understand this, don't want that, and again they treat people poorly and make them leave....(their business model) which is a completely different problem vs making changes to save the company for the long term, they are independent on each other. As they/Execs have stated they need a large amount of bodies (talent) to run through...The point is, I disagree with their business model....I think there is a better way to change, modernize and be employee centric. Yes will it still result in less people, sure...but it has nothing to do with the past or old SF. Companies have done better than this in the last decade bring in change, even prior to COVID, and it works! What people really don't understand is employees are really not an expense problem for SF, regardless of the execs propaganda. It just an easy out for them like most exes that are not accountable and are incompetent. Employee expense is roughly 9-10% of overall premium dollars, our 2nd lowest expense other than taxes and fees. Let me break it down for you....if an average premium for 12 months for an auto is $680 then $68 dollars of that is for employee expense. Also 15% of that is for agents which is $102! If we eliminate 50% of all employees/jobs that saves about $34 a policy so it would make the average premium $646! We are not loosing business to Geico and Progressive because SF's premium is $34 dollars higher a year then our competitors, we are loosing because we are paying more for claims then we owe because of a c-appy, untrained workforce, low morale, overpaid agents and lacking of strategic planning and technology investment. We are doubling down on stupid and will can/let go a lot of tenured employees that know how to do their job and replace them with more lemmings in the hubs (compounds the problem) to eventually fire them too when the company and market share shrink even further.
The real point you’re all missing is: The past is gone. End of story. If SF did what some of you want, and kept everybody on with great salaries and benefits in expensive facilities.....it would soon go under. Then you’d all be screwed anyway. So in order to survive it has to change. And that means fewer people, in fewer places. But that’s much better than no people in no places.
Leadership and systems and marketing are corrupt trash. And their partnerships
Actually no the previous post is not wrong, when you try to support a position by just looking at one point in time you are getting it completely wrong. When we maintain that kind of growth we had this year for another 4,5 years then you will have a valid point. The "exception to the rule" horrible mental disease that soooo many people in our society suffer from today and have one dimensional short sighted perspectives that lead to chaos!
If you take the last 5 years of growth at SF (worse over the last decade) including this year it only averages out to around 305K new autos per year. Homeowners is not what drives our business or profit. Remember just a couple of years ago we lost almost a million auto policies one year and 400k the next year, so we are barely getting back to even. In that same time frame Geico and Progressive have averaged over 2 million new autos every year. As stated, SF has only grown a million autos twice in the last 2 decades. We are not competition for Geico and Progressive no matter what propaganda is repeated over and over again to get people to buy in. The information you quote about this year is correct and SF is financially strong, which no one disagrees with, but people are missing the point as I stated earlier. We are celebrating scoring a touch down and getting a couple of first downs and the other team is winning SuperBowls and championship. They are growing premium faster and still gaining more market share. When that continues to happen over time it starts compounding as SF starts loosing the advantage of size and war chest/money. This post was about State Farm's action to tackle this huge problem of loosing the advantage/market position they've held for some many years. Geico and Progressive automated most transactions and underwriting a decade ago and we are just now making some headway in that area and over a decade late to the game. When we get caught up it will already be too late. The distribution system is a huge expense/burden, they will continue to automate jobs away, create omni-channel distribution systems and will continue to bring in a low skilled/low capacity, high turnover work force. Pensions are only great for very tenured employees that are lucky enough to make it to at least 55 or god forbid 62. Run your pension calculator at 55 then deduct $500-$600 a month for health care and it is basically nothing. Gets better at 62...but good luck! I wouldn't count it and/or it not getting bought out. We can debate that all day too! All the trolls that try to argue are missing the point. You are basically arguing....SF only beats it's employees 1 day a week and the other 5 companies down the road beat their employees 3 times a week...so you should be thankful and should stop complaining.... The bottom line is SF is a mess and the actions it is going to take will be on the back of a lot of good people without regard of how many people lives it will destroy. Yes that is "Corporate America" but that still does not make it right or give validity to short sighted arguments.
Take a read through this..article below. This is the model we are following. Geico and Progressive, USAA are way ahead. SF, Allstate, Nationwide, Farmers, and Liberty Mutual are not and the ones loosing policies/market share to Geico and Progressive. Means basically all underwriting will be automated and about 60% of claims jobs will go away in the next 8-9 years! That is thousands of people loosing their jobs at SF....(yes it will create some new roles too) but the 10,000 employees in the LOC that will probably get the ax in the next year or two! Hence the title of this post is accurate ....Get ready!!!!! If you have SF tattooed on your forehead...great...and drink SF red Kool-Aid for breakfast every morning good for you...but it will not save you from being collateral damage like the rest of the poor souls that get destroyed by the same ignorant, immoral, clueless leadership that has plagued SF for decades.
https://www.mckinsey.com/industries/financial-services/our-insights/insurance-productivity-2030-reimagining-the-insurer-for-the-future#
Also those with very short memories or tenures remember we lost almost 12 Billions dollars just 4 years ago! Also after all the change in the last 7-8 year our expense ratios are still not even close to Geico and Progressive.
https://newsroom.statefarm.com/2017-state-farm-financial-results/
@1nnx good point and this is exactly why SF bought Gainsco to get a foothold in the non-standard market.
This last post is spot on.
Keep in mind also that Prog writes a lot of nonstandard business plus a LOT of commercial auto. I mean avg truckers premium are 15000 -20000 a pop. These are the premium that sf doesn’t write
There’s a lot of inaccuracies here. Yes, SF is having a banner year. Will finish with 1.7M auto growth and do so PROFITABLY. This is almost an unimaginable turnaround from 1-2 years ago. Total policy growth is 2.5M with fire and life results, both above goal, included.
Only once has auto growth been higher, in 1999 during the “big dog” campaign, but we lost a lot of money.
For all the naysayers on this board, you should tip your cap. SF handled the pandemic about as well as a company could have, which included a lot of pro-employee flexibility and policies.
Is SF perfect? Far from it. There are legitimate criticisms some of which I agree with. But there are many here you never acknowledge the positives, like a fully funded pension, 5+ weeks vacation, life leave etc.
As far as Geico and Progressive. Most of the info in previous posts are wrong.
Fact 1. SF outgrew Geico in Q3, the first quarter we’ve beaten them in 8 years.
Fact 2. Progressive is outgrowing Geico, not the other way around. Progressive is on pace for their best year ever, projected at 2.6M auto gain.
Fact 3. Amazingly, SF outgrew progressive in the month of November. First time in over a decade.
Fact 4. People on this board confuse auto market share and penetration. Will Progressive pass us in market share? Maybe, probably, but I unlikely in 2022 given our unexpected performance.
Fact 5. Market penetration is the number of cars insured, and they are no where near us, and won’t pass us. Market share is total premium dollars. What this means is Geico and Progressive on average charge more than SF does. Which we should be proud of.
Personally, I think the number of autos insured is a better metric.
Overall, SF is very financially stable.
More histrionics by a childish wing nut. Yes, please cite your facts-they don’t exist. And don’t skip your meds. LOL!
Best Year’s in SF history...we scored a touch down but still lost by 35! Good job!!! The usual clueless trolls that never show facts, numbers or anything real to support a position. Despite one of our “best” years our auto growth and premium growth is still behind Geico and Progressive and if you question it I can and will post the numbers. SF is still on target to be 2 by 22 and 3 by 24 and every insurance publication and our execs acknowledge it.. That’s why they have started saying it is about total premium ...but that only last a short time too....ask Allstate or go look at their board. Those poor people are f-cled!!!!!!!! The real reason for no layoffs yet is because we were so understaffed to begin with and working the sh-t out of everyone! The highest 1st year quit rate of any company in the US for 2019 pretty puts all the trolls in the trash where they belong so shut up! The continued downsizing plan will be expedited in 2021 if you do think that ok..... just remember that when you can’t afford new skinny jeans for the BLM rally, tattoos or beard cream and borrow money from your mommy,
If they are doing so well, why are they forcing people to move, layoff, and tearing up families not to mention the unhealthy anxiety they force onto associates? Oh yeah! Business decisions.
Pms-this is going to be one of the best years in SF history. Substantial auto growth, larger than Progressive and slightly less than Geico. Profit in both auto and fire. Capital position strongest in history. Sorry but your somewhat comical histrionics doesn’t match the facts. Peddle your fantasies elsewhere.
Pjs-are you in HS? Your post reads like it. Don’t worry there will be another prom.
Yes, scary times are coming. They are bollddddd now that we have some growth this year and the job market is not good. Unfortunately our auto growth is still a joke compared to Geico and Progressive. Progressive broke records this year and will add almost 3 million new autos! Since we took such large rate decreases they are having to pay the "Devil" his dues. You can get away with bad claim service and handling.... but when you slash rates the indemnity payments start k–ling you. Remember rate decreases cause agent comp to go way down! You are going to get to find out about the future operating model this year and people are going to sh-t their pants. Hold on and you have no idea what you are in store for. Exec is going to throw everyone around like a sack of sh-t and just dare you to leave or complain. Honestly you have not seen anything yet and I promise it is beyond your wildest dreams.....
It’s just business, don’t you love how they say that like it’s 1985 and you can go work at some company around the corner for a few months until your next full time job.
“Oh Prudential laid me off so I just swung a hammer and picked up a shovel until Fidelity picked me up.” Said no one in 2020