P R A D

chapter 2 The Challenge and How to Address It

53% Employee benefits success rate 56% Commercial lines success rate 59% Personal lines success rate

56% Overall success rate of producer hires in the insurance distribution system in the past five years

Source: Baseline survey

Well, we have it – the definitive numbers for the success rates of producer hiring within our industry: 56% for all producers, 56% for commercial lines, 53% for employee benefits, and 59% for personal lines. This data is drawn from the actual results of 562 firms with 4,641 producer hires over the past five years. We dug deeper into a subset of 1,505 of these producers to learn more about their stories. We now know how long, on average, it took these producers to validate and we know the average size of the books of business they generated. This deeper dive provided invaluable insights into how the best producers in the study outpaced the average. Here are the composite findings for the average successful producers we studied and also for those judged to be the most successful:

Composite Findings

Commercial lines

Employee benefits

Average success rate 1

56%

53%

Average months to validation (for those successful) 2

32

33

5 th year book of business (successful) 2, 3

$300-$400K

$400-$500K

High success rate 4

10%

12%

5 th year book of business (highly successful) 2, 3

$500-$750K

$500-$750K

1 Baseline survey 2 Supplemental survey 3 Excludes producers who brought a book of business or were assigned any accounts 4 Producers exceeding normal expectations

Shocking Results - A Real Industry Problem

Shocking is clearly the best word to describe the industry’s producer hiring data over the past five years. Based on detailed information gathered from over 100 firms, covering over 1,500 producers hired over the past five years, the number hired from outside the insurance industry is a mere 35%.

3 Producer Recruiting & Development Study