Are you thinking about starting an insurance agency but don’t have the budget or don’t know where to start? The State Farm Franchise can give you a great hand.
It offers people like you the possibility of getting involved in the business using their brand name.
With them, you can optimize the initial costs, and you can exploit a well-known brand name.
This can make a huge difference when you just launch a new activity: instead of having to build people’s confidence in a brand new insurance agency that enters the market, you can exploit a well-known name and the clients will arrive more easily.
In this article, we’ll find out anything you need to know about the State Farm Franchise.
Interested In State Farm Franchise?
About State Farm Franchise
As we’ve mentioned, State Farm Franchise is a company that provides insurance services.
It provides its services all across the United States and has its headquarters in Bloomington, Illinois.
State Farm provides property and casualty insurance services but, recently, the company also expanded into the financial services sector.
Now, State Farm also provides banking and mutual funds services.
History Of State Farm Franchise
State Farm was born as a mutual automobile insurance company in 1922. In the beginning, their services were mainly aimed at farmers.
By offering better rates than the competitors, State Farm gained quite a success very early and was able to grow quickly.
Soon, it was able to expand its services to other types of insurance: life insurance, homeowners, and, more recently, banking and financial services.
Today, the State Farm Franchise is one of the largest companies active in the sector of insurance service in the United States.
In 2017, it counted 70,000 employees, and it was servicing 80 million policies throughout the US and Canada.
State Farm Franchise Model
|NO, But A Agency (but it acts like one)
|126.1 billion USD
|Number of agents
|25,000 USD (minimum)
How much does State Farm Agency Owners Make?
|Owner Salary (USD)
The average salary for an Agency Owner at Suzanne Rizer – State Farm Insurance Agent in the United States ranges from approximately $176,776 to $289,485, with an average salary of $209,906.
Please note that these figures may vary based on factors such as location, department, education level, certifications, and additional skills.
Payback Period Of State Farm Franchise
The investment of State Farm is $25,000, and the estimated yearly profit is $209,906. So, to find out how long it will take to earn back the initial investment:
Payback Period = Investment / Yearly Profit = $25,000 / $209,906= 0.11 or 11 months
Based on these figures, it will take approximately 11 months to 2 years to pay back the initial investment for State Farm. This time period could be longer or shorter depending on your sales, revenue, and profit figures.
Training And Support By State Farm Franchise
Legally speaking, State Farm isn’t a franchise because its service isn’t covered by the Franchise Act.
However, they allow you to get involved in their business by allowing third parties to open a State Farm agency.
In this regard, they act like a franchise by all means: they provide support and training, they provide low-cost loans for your initial investment, and you can even obtain furniture and equipment from them at low monthly payments.
Furthermore, when you open a State Farm office, you can exploit the State Farm name for marketing goals.
Term & Renewal
Even though the State Farm Franchise isn’t covered by the Franchise Act, it works like one. If you want to open a State Farm insurance agency, you need their authorization.
In particular, you need to become a Term Independent Contractor Agent. After applying, you need to be selected, and after that, you can start a paid internship (it can last up to 9 months).
After that, you are a TICA and work as a Start Farm insurance agent in your independent office: there is no term or renewal to this state or role.
State Farm Franchise VS Papa Murphy’s
Scared of starting an insurance agency? You shouldn’t. The truth is that with a smaller initial investment, you can end up making a lot more money.
Take a look at a comparison with another business model that may seem simpler. You’ll see that you’ll need a higher budget and to work twice as hard to make the same money.
|No (but it acts like one)
|Number of agents/locations
Is State Farm A Franchise?
State Farm isn’t covered by the Franchise Act, but it works like a franchise: it provides support and training, loans, and it allows you to get involved in their business independently but exploiting the brand name.
How Much Does It Cost To Open A Start Farm Agency?
The minimum costs are about 25,000 USD, but be prepared to spend more.
What Is The State Farm Franchise Known For?
The State Farm Franchise is known for providing insurance services at competitive rates.
How Many State Farm Agents Are There Currently?
State Farm counts about 20,000 agents active in the United States and Canada.
Who owns State Farm?
State Farm is owned by State Farm Policyholders.
Where is State Farm headquartered?
State Farm is headquartered in Bloomington, Illinois. It offers its services throughout North America.
Who founded State Farm?
State Farm was founded in 1922 by a retired farmer and insurance salesman, George Jacob Mecherle.
Amit Gupta is an experienced expert in digital marketing and co-founder of DrFranchises. With more than 11 years of knowledge in franchise digital marketing, SEO, email marketing, and social media marketing, Amit has helped many brands achieve incredible success online. As a passionate entrepreneur and owner of 7 franchises, he continues to study franchise models, looking at costs, revenue, and profitability to guide brands toward profitable growth. When he’s not working on digital marketing, Amit enjoys spending time playing with his beloved dog.