2021 Best Practices Study

Executive Summary

Agencies between $2.5 Million and $5.0 Million in Revenue

Production

Definitions

Sales Velocity

Age Banding of Sales Velocity

•

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.

2.5%

Top Quartile

23.8%

2.8%

Over age 55

Age 46-55

4.7%

•

Age 36-45

Average

14.2%

Up to age 35

4.2%

Comparison Group Average

Book of Business per Producer (commissions and fees)

Book of Business by Age

Notes & Definitions

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

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. This group tied for the highest Sales Velocity results in this year’s Study (14.2%). At 1.0%, this group scored the second lowest in terms of producer investments (NUPP), an

Up to age 35 13.1%

New Business

Average Book

Over age 55 34.6%

Commercial P&C

$75,167

$614,413

Personal P&C

$47,999

$237,430

Age 36- 45 26.8%

Life/Health/ Financial

$16,387

$168,974

Multi- Line

$44,163

$526,367

Age 46- 55 25.5%

•

Effective NUPP

•

Group Average:

indication that more young producer investment is likely warranted.

Producer Success Rate 68.3%

NUPP

Effective NUPP

1.0%

0.7%

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