So our overall agent capacity in the Allstate brand has gone down. That said, to your point, productivity has gone up, and so our overall volume has been even better when you adjust for those three states that are not to be named. So Mario, do you want to go there?
Mario Rizzo: Yes. Thanks for the question. So I think the short answer to your question is yes. We — when you look at overall Allstate brand new business production is up about 6.5%. It was up both in the Allstate exclusive agent channel as well as direct. And then if you kind of carve out California, New York and New Jersey. Because you have to remember, the California rate wasn’t effective until February. So we really didn’t start opening things back up until the really the latter part of the quarter. We’re really pleased with how our agents are responding to the changes we’ve made that Tom talked about continue to invest in their businesses, continuing to drive higher levels of average productivity. And despite the fact that we have fewer agents and have restricted — or have been restricting grown in three pretty significant states.
Overall productivity is increasing and absolute production is up. So we’re really happy with the productivity levels of our agents. And as we look to accelerate growth going forward, they’re going to be a core part of how we grow prospectively in addition to things we’ve been talking about with independent agents and the direct channel.
David Motemaden: Got it. Thank you.
Brent Vandermause: We’ll take one more question.
Operator: Certainly. And our final question for today comes from the line of Mike Zaremski from BMO. Your question please.
Mike Zaremski: Hi, great. Thanks for fitting me in. I guess just I know there’s been a lot of talk about growth. And the strategy has been clear you guys have successfully kind of transformed your expense ratio lower, which should help grow direct-to-consumer channel specifically. And I know Allstate has a ton of marketing expertise. But I’m just kind of curious, the direct-to-consumer — customer, my understanding is a bit different than the average current Allstate customer. So is there — are there any different strategies or maybe you kind of — or just go slow to learn as you kind of grow into D2C? Or anything you’d like to — you think we should be thinking about there?
Tom Wilson: Yes. The first — the direct customer does have different needs. So they necessarily want to pay for someone to help them buy insurance, which is why we price our direct insurance under the Allstate brand, cheaper than Allstate-branded insurance bought through an agent because we’re trying to do exactly what our customers want. They also have different ways they want to interact with us. And so we’ve — with our new Transformer growth and new tech stack, it’s really everything from what’s prepopulated into the thing to the offers it presents to the questions you required to. As Mario talked about, we’re down 40% in the time. We’ve been able to add other products to that flow and so increase things like roadside services and sell more products, which lowers our acquisition costs.
So it is different. We’re good at it, we could be better at it. And so we’re working at getting better at it. About two years ago, we really reformed the business, put some new leadership in place and then are updating everything from the technology I talked about to also who you market to. So you mentioned they’re direct, but some of the customers directly, that’s where you go to. Like if you go to people who are shopping all time, then you will get higher risk drivers because they shop all the time as opposed to lower risk drivers don’t shop as much. So it costs more to get the lower risk drivers on board. So we’re working through how do we expand that. We believe that the direct channel has tremendous upside with us to serve those customers who want it that way not just on auto insurance, but things like home insurance and whether it’s protection plans or what we’re doing in we get some stuff going on in the commercial space.
So we think it’s just another way the customer would interact. Often — not a lot of homeowners is sold over direct. We’ll see how successful we are. I believe we can. I mean, people buy direct. So like if your buyouts or probably buy a home insurance from us. And so there’s a great upside. You will notice that when you look over the last couple of years, One of the first places we dialed down new business was in the direct channel. So it was down like 50% or 60%, I think, at 23 or something because we wanted to make sure we maintained our agent force levels of compensation because they have businesses right and this is the revenue that comes into their business. We said, okay, well, this is a temporary window it’s easier for us to concentrate that reduction in new business in the direct channel than it is to spread it amongst a bunch of agents who are now also trying to get through a new comp plan.
That turned out to be a good choice. It gave us the opportunity to build new capabilities. And now we’re hitting the gas side expanding direct. So you should expect to see our direct volume is go up higher as a percentage of new business than it has better in the past. Thank you all for joining us and investing your time in Allstate. We’ll talk to you next quarter.
Operator: This concludes the investor call. You can now disconnect. Good day.
