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NASFA
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NASFA Frequently Asked
Questions
What is NASFA?
NASFA is the National Association of State Farm Agents.
It is a nationwide association of State Farm agents that
NASFA, a Professional Association of State Farm
Independent Contractor Agents, endeavors to: Provide
timely and insightful information to our membership;
foster a spirit of camaraderie and professional
fellowship; work tirelessly to maintain the Independent
Contractor status and entrepreneurial opportunity of our
member agents.
How long has it existed?
NASFA was incorporated in 1973.
What territory does it cover?
NASFA has members in all 50 states and Canada. The
significance of that fact is discussed later under the
question “associational standing”.
Does NASFA represent all agent contracts?
NASFA is proud to have members holding every agent
contract. Whether it is the LA540, AA660, AA3,4, AA97 or
the AA05, from the 1950’s through the second decade of
the 21st century NASFA is proud to represent agents of
all contracts. Recognizing the difference between the
contracts, NASFA strives to address each contract’s
different needs.
What is NASFA’s philosophy?
NASFA’s philosophy can best be summarized from its
By-laws which say the purposes of the association shall
be:
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To establish effective and continuing communication
and promote cooperation between State Farm Agents.
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To encourage and develop professionalism in the
ranks of Career State Farm Agents. To promote sound
business principles and practices in multiple line
insurance sales and maintain the highest code of
ethics.
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To further the public image of the Independent
Contractor State Farm Agent by promoting continued
educational development, professional awareness and
public relations.
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To further the mutually beneficial relationship
between State Farm Agents, this Association and the
State Farm Insurance Companies.
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To preserve and expand the Independent Contractor
status of State Farm Agents. To preserve and expand
State Farm’s position in the insurance industry.
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To establish a clearing house for information on
professional, economic, social, legal and
legislative matters influencing our business.
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To establish and maintain a viable national
organization to foster our goals.
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To consider and resolve, by all lawful means, the
common problems of Career State Farm Agents through
cooperative action. To advance the common purposes
of NASFA members. To promote activities designed to
enable the industry to conduct itself with the
greatest economy and efficiency and maintain the
spirit of true competition.
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To afford due consideration to and expression of
opinion upon questions affecting the Career State
Farm Agent and the financial, commercial and
industrial interests of the nation, and to promote
the common business interests of the membership.
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To cooperate with other professions and
organizations.
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To conduct or engage in all lawful activities to
further these purposes.
Isn’t NASFA a bunch of agents who want to complain
all the time?
No, NASFA is not just a bunch of whiners and
complainers. NASFA was formed and continues to represent
agents who have a vital interest in the success of their
agencies. Rather than being composed of lazy agents,
NASFA has many very successful large agents as a part of
its membership. NASFA is there to help level the playing
field between agency and State Farm. As State Farm’s
interest in agents continues to diminish the
significance and importance of membership in a trade
organization such as NASFA becomes even more critical.
Does NASFA help agents?
Yes! NASFA does help agents. It has helped its member
agents with its member benefits, its legal fund and
legal counsel.
What is the NASFA Legal Fund?
The NASFA Legal Fund is money set aside by NASFA to
assist agents in their lawsuits against State Farm. When
the NASFA Board determines that an agent’s issue is of
significance to all agency it has, when certain
conditions are met, given $25,000 contributions to those
lawsuits.
How is legal counsel a NASFA member benefit?
As part of your membership in NASFA, you are entitled to
call NASFA legal counsel without charge for
consultation. That benefit alone is worth the cost of
the membership. There is no restriction on the number of
phone calls nor the issues presented.
What other member benefits are there to joining NASFA?
NASFA is all about communication. There is a quarterly
magazine which covers a variety of topics in depth, of
interest to agents. In addition, as issues come up,
NASFA issues its legendary NASFAX which is an
Association to member communication highlighting issues
for agency. In addition, NASFA maintains a website which
has a list serve for use of the membership, archived
data, as well as current information. Finally, NASFA has
an annual meeting where member agents get together to
discuss current issues and renew old friendships.
Can I be fired for joining NASFA?
Never in the history of the organization has any State
Farm agent ever been terminated for being a member of
NASFA.
Why does State Farm hate NASFA?
State Farm rigidly believes that nothing should come
between it and its ability to deal with the agent
workforce. Since it views NASFA as an intermediary, it
has never been supportive of the organization.
What is the difference between NASFA and the new
association, North American Association of Independent
Contractor Agents (NAAICA)?
As with any new organization the North American
Association of Independent Contractor Agents (NAAICA)
does not have the institutional experience in dealing
with agent issues. It does not have the organization or
size of NASFA which can become critical depending how
issues are going to be presented. While the new
association says it is for State Farm agents, its name
would suggest otherwise.
What is associational standing?
Associational standing is the right of organizations
such as NASFA to represent individuals without the
necessity of bringing a lawsuit in the name of one
individual. NASFA has won that right previously in the
United States District Court for the District of
Columbia. With that precedent and the geographic
coverage of NASFA it will be able to represent its
membership again in the future. No other association can
claim that right. It is not derivative, no one else can
use it because we were successful.
Has NASFA ever sued State Farm?
Yes! In the historic lawsuit of NASFA v. State Farm
decided in the District of Columbia, NASFA was, in part,
successful in changing State Farm policy. In that case
the Partner Agent Program was for all intents and
purposes stopped. The Select Agent Program was changed
as a consequence too.
Where does NASFA stand on “just cause” for
termination?
NASFA has always supported just cause legislation and
litigation. NASFA has tried for years both national and
various state levels to obtain just cause legislation to
protect agents. The State Farm agent’s agreements do not
afford that protection. Given the tremendous investments
agents make, it is only right to insist on termination
only for just cause. In addition, NASFA has supported
agent litigation over the years contesting that issue.
What about the SECA Tax?
One of NASFA’s proudest moments was the ability to
support litigation and legislation which established the
rule that SECA tax may not be charged on termination
payments for retiring agents. For those agents who do
receive those benefits, this has amounted to an
approximate $15,000.00 per year benefit. NASFA further
supported the codification of that litigation in the
Internal Revenue Code.
Has NASFA changed State Farm policy?
Yes! When the AA97 contract was first announced, NASFA
took the time, money and effort to successfully make
that contract optional. With a strong advertising
campaign and a hard look at the relevant facts, State
Farm determined that it could not insist upon the
implementation of that agreement unilaterally and
instead offered it as an option. NASFA then further
offered each agent an analysis as to how that change
would affect them. |
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