2017 Best Practices Study-Study Sponsors

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Sales Velocity is a critical metric in determining organic growth. It is defined as this year’s written new business divided by last year’s commissions and fees. Age Banding of Sales Velocity can help a firm assess where new business and growth are coming from and prepare for perpetuation.

x

3.1%

Top Quartile

20.6%

Over age 55 Age 46-55 Age 36-45 Up to age 35

4.3%

x

3.7%

Average

13.7%

2.6%

Comparison Group Average

x Weighted average producer age (WAPA) is 46. x

Up to age 35 10.6%

Effective NUPP, which is the product of an agency’s investment in unvalidated producers (NUPP) and success rate in hiring producers (Producer Success Rate), is expressed as a percentage of net revenue. It is the best overall measure of an agency’s effectiveness in recruiting and developing sales talent. Sales Velocity in this group is down from 15.3% last year to 13.7% this year, fueling the organic growth decline. Sales Velocity in agencies this size is evenly distributed by age, with 6.3% Sales Velocity coming from producers 45 and younger and 7.4% from producers over age 45.

New Business $116,564

Average Book $963,362

Over age 55 31.2%

Commercial P&C

Age 36- 45 23.3%

Personal P&C

$60,174

$381,296

Life/Health/ Financial

$155,642

$1,025,124

Multi- Line

$137,102

$989,747

Age 46- 55 35.0%

x

x

Group Average:

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Agencies in this group have increased their producer

x

investment in the last year, raising Effective NUPP from 0.7% to 0.9%.