2007 Best Practices Study

Agencies with Revenues Between $2,500,000 and $5,000,000

Executive Perspectives

Profile

Revenues/ Expenses

Financial Stability

Employee Overview

Producer Info

Service Staff Info

Technology

Insurance Carriers

Appendix

result, technology is not leading to disintermediation, but instead is leading to improved operating efficiencies for those firms that can effectively utilize it. As important as technology is, productivity is still going to be driven by the quality of your personnel and how effectively they are trained and utilized. Their effectiveness and productivity can be enhanced by the third key, which is an on-going commitment to enhance systems and workflows. Not only can improvements in this area lead to improved productivity, but like technology, they can also improve the quality of the service provided to customers and can improve the quality of life for the employees. The Best Practices agencies also report that improved productivity for producers is going to come from the recognition of and rewards for superior performance. Best Practices agencies have found it advisable to provide superior pay and benefits, for superior performance. Keys to Maximizing Productivity (Top 5 Listed in Order of Frequency Mentioned) 1. Cutting-edge technology 2. Effective recruiting and training of qualified personnel 3. On-going system and workflow analysis and improvement 4. Recognition of and rewards for production 5. Open, effective communication and teamwork

Top Challenges (Top 5 Listed in Order of Frequency Mentioned) 1. Hiring and retaining quality personnel

2. Recruiting and developing producers

3. Rates / the soft market

4. Attracting prospective clients

5. Satisfying carrier requirements

The other challenges identified by these Best Practices agencies included the challenge of writing new business and the challenge of satisfying the requirements of their carriers. In a soft property and casualty market, the ability to attract new customers can be aided by the improved pricing that can be delivered in such a market. At the same time, a soft property and casualty market can make it more difficult to achieve the requirements of carriers to produce a growing book of business when the existing book is shrinking. There was a period in time where a lot of industry observers felt that technology was going to lead to disintermediation and the decline of the insurance agency/brokerage business. That, obviously, has not happened. As a matter of fact, the Best Practices agencies are now reporting that technology is one of the key tools that they are using to maximize their productivity. In addition to improving productivity, technology also has the ability to improve the quality of service provided to employees, it can provide better management information and it can improve the quality of life for the employees of the agency. As a Maximizing Productivity

60 2007 Best Practices Study | Agencies with Revenues Between $2,500,000 and $5,000,000 | Executive Perspectives