Captive sellers are known as they are because they employ an in-house, or should we say, “captive” sales force. Some examples of these kinds of sellers are Allstate and State Farm. The largest home insurer in the US is State Farm, with a total “capture” of 24.2% of the 24 billion dollars in homeowner polices every year. Following closely behind is Allstate with a 12.5% share in the homeowner polices.
The reason why they offer such low costs is that they pay commissions of about 8% to their salespeople compared to other average commissions of 13 – 20% at agency writers.
{ Comments are closed! }