2010 Best Practices Study

Analysis of Agencies with Revenues Between $10,000,000 and $25,000,000

Mgmt. Perspectives

Adjusting to Health Care Reform The passage of “Obamacare” has resulted in unprecedented teeth-gnashing in the insurance industry as carriers, providers and brokers have all been working feverishly to understand and plan for an uncertain future. We asked the BPS brokers between $10 - $25 million how are they adjusting to what has already been passed. After all, as a group, employee benefits revenue represents over 20% of their total revenue. Interestingly, this group is not panicking. In fact, most say they are not making immediate changes to their operation, but instead are monitoring the legislation. 1. Become positioned as the client’s “go-to” information resource for healthcare reform, via whitepapers, seminars, videos, Twitter, etc. 2. Expand more aggressively into selling voluntary products 3. Move upstream to write larger group cases, focusing on those over 50 lives 4. Proactively change the method of broker compensation from commissions to fees 5. Become trusted advisor to clients by offering consultative value added resources such as wellness, actuarial, etc. to lower healthcare costs Top Adjustments (Top 5 Listed in Order of Frequency Mentioned)

Facing Challenges The combination of a weak economy and soft insurance market are the two biggest challenges frustrating leaders of agencies of all types and sizes.

Profile

Revenues

Expenses

Profitability

Top Challenges (Top 5 Listed in Order of Frequency Mentioned )

Employee Overview

Producer Info

BPS agency leaders tend to be a naturally optimistic group – pressing forward and investing in the future, regardless of the market. Many are expressing concerns about an aging workforce. As one principal stated “Our ability to remain independent long term will be predicated on our ability to attract, develop and retain young, successful producer talent.” BPS agencies are working hard to ensure they are well-positioned to face whatever challenges the market brings, and to prosper in the future. growth is slow but expenses continue to rise 5. Maintaining employee morale during an era of stagnant wages and economic uncertainty 1. Hiring talented people, especially producers 2. Succession and perpetuation – planning for the transition of their firm’s leadership and ownership to the next generation 3. Finding ways to grow organically, despite the headwinds of the marketplace 4. Maintaining profitability when organic

Staff Service Info

Technology

Insurance Carriers

Appendix

2010 Best Practices Study

“One of the challenges we face as an agency is determining where and how to allocate our talent and carrier resources to achieve the greatest impact and success for our partners and employees.”

Agencies with Revenues Between $10,000,000 and $25,000,000

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