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.
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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
|Business Model||Insurance agency|
|Franchise||NO, But A Agency (but it acts like one)|
|Finance||126.1 billion USD|
|Number of agents||20,000|
|Initial Investment||25,000 USD (minimum)|
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.
|Company||State Farm||Papa murphy’s|
|Business Model||Insurance agencies||Restaurant chain|
|Initial Investment||25,000 USD||300,000 USD|
|Franchise Fee||None||25,000 USD|
|Franchise||No (but it acts like one)||Yes|
|Number of agents/locations||20,000||1,500+|
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.
Amit Gupta is the founder of DrFranchises – a digital marketing agency that helps brands rank #1 on Google Maps through local SEO strategies. Amit has over 11 years of experience in digital marketing, SEO, email marketing, and social media marketing. He’s also the owner of multiple franchises and has helped countless brands achieve success online. When he’s not working, Amit can be found playing with his dog.