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2007 Best Practices Study | Agencies with Revenues Between $10,000,000 and $25,000,000 | Executive Perspectives
Appendix
Insurance
Carriers
Technology
Service
Staff Info
Producer
Info
Employee
Overview
Financial
Stability
Revenues/
Expenses
Executive
Perspectives
Profile
Agencies with Revenues Between $10,000,000 and $25,000,000
Keys to Their Success
Not surprisingly, people issues are at the top of the list
for factors most critical to agency success. Hiring and
retaining the right people were viewed as the primary
keys to success. As one agency owner put it, “Finding
the right people is more difficult than ever – for
everyone, not just for us. When we really isolated the
cost to replace anyone, from the receptionist to a top-
notch producer, it became clear to us that we had to
become world-class at keeping the good people we’d
already hired.” These “people investments” are indeed
significant – 90% of agencies in this group hired new
producers last year – at an average wage of almost
$70,000 – and 87% of agencies plan to hire
additional producers in the coming year.
Writing new business remains a high priority for this
group as well – new business produced per P&C and
Life & Health producer averaged $114,755 and
$130,896, respectively. One of the top agents in this
group pointed out: “Excellent service is the cost of
doing business in this industry, it’s not a distinctive. If
you’re not providing great service, you’re going to
find yourself out of business. Sales … new business …
that’s where the separation between the pretenders
and the winners emerges.”
Challenges They Face
The soft P&C market continues to take its toll on even
the best agencies in the business. Although the soft
market was almost universally identified as a major
concern, agents in this group nonetheless posted
excellent organic growth rates – the average agency in
this group grew P&C fee and commission income by
15.5%. Needless to say, to grow at these rates in a
soft market, these
Best Practices
agencies are writing
significant volumes of new business.
Despite this new business success, the second most-
frequently mentioned challenge among for agencies
remains the development and maintenance of a sales
culture. It is clear that the “sales culture” question is a
dynamic, rather than static, issue for even the best
agencies – it is not a “once and done” issue, but one
requiring constant attention.
As mentioned earlier, people are key to success in the
insurance distribution business. Recruiting,
developing and retaining excellent employees remains
a key challenge for
Best Practices
agencies in this
group.
With regard to insurance carriers, company
consolidation, higher and higher volume requirements
and a perception of ever-changing strategies are
frequently identified as primary challenges.
Factors Most Critical to
Agency’s Success
(Top 5 Listed in Order of Frequency Mentioned)
1. Top caliber sales and support team
2. Low employee turnover
3. Relentless focus on generating new
business
4. True partnership with key markets
5. Constantly measuring, adjusting and
improving
Top Challenges
(Top 5 Listed in Order of Frequency Mentioned)
1. Soft P&C market conditions
2. Developing and maintaining sales
culture
3. Finding, developing and retaining
employees
4. Leadership development
5. Satisfying carrier appetites