January 18, 2016 BankingFinancialInsurance

State Farm

State Farm was founded in 1922 by George Jacob “G.J.” Mecherle. And from the start, it was driven by innovation.

Annette R. Martinez, State Farm’s VP of Human Resources, told us “(Mecherle) looked at the insurance industry and said, ‘I have a new idea.’ And he went and actually pitched this to an insurance company. They said, ‘Hey, this is the way we do it here. If you want to do it that way, go start your own company.’

“Sure enough, he did.

“And 94 years later, we’re the number 1 auto and homeowner insurer in the country.”

State Farm employs over 70,000 people. In addition, it contracts with 17,000 agents who act as its sales force. Many companies work with insurance brokers who can sell products from a variety of firms, but State Farm agents sell State Farm products exclusively.

Another way State Farm is different is that it’s a mutual company, meaning that it’s owned by its policy holders. This allows State Farm to make decisions based on long term results, instead of being driven by rapidly changing market forces the way a stock-based company might be. Being owned by its customers also helps create a special bond between them and State Farm.

State Farm’s mission statement is “To help people manage the risks of everyday life, recover from the unexpected, and realize their dreams.” Martinez expanded on this, telling us, “We’re an organization that helps others. We don’t sell a tangible product. We sell something that we hope you’ll never have to use. But if you have to use it, we want to be here (for you).” State Farm typically processes 35,000 claims a day.

Along the same lines, “Like a good neighbor, State Farm is there” is more than  a mere motto, it’s at the core of the company’s culture. It represents not only the firm’s attitude towards its customers, but how it treats its employees…and how they treat each other. According to Martinez, “We tell our children, if you ever travel (and) have a problem, go talk to a State Farm agent. Let him know you’re part of the State Farm family. They will help you out, they will be kind, they’ll make sure they get you to the right place. Those are your resources.

“And if you move, if you’re looking for a day care, if you’re looking for a place to get your hair cut, rely on the people who are around you who have become your family.”

Martinez added, “State Farm being a family to our employees translates well into our customers.”

In This Episode:

Guest:  Annette R. Martinez, Vice President of Human Resources

Company website: https://statefarm.com

Careers page: https://statefarm.com/careers

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