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2007 Best Practices Study | Agencies with Revenues Between $5,000,000 and $10,000,000 | Executive Perspectives
Appendix
Insurance
Carriers
Technology
Service
Staff Info
Producer
Info
Employee
Overview
Financial
Stability
Revenues/
Expenses
Executive
Perspectives
Profile
Agencies with Revenues Between $5,000,000 and $10,000,000
Keys to Their Success
Clearly, for agencies in this revenue category, the most
common answer to the question of “What factors are
most critical to an agency’s success?” would be their
people. The ability to attract, retain and motivate
quality producers, support staff and managers is key
to their success, but it is becoming more difficult due
to the shortage of trained, quality talent within our
industry. This has created the necessity for many to
begin hiring talented sales people and service people
from outside the industry and create the means to
train them.
In addition to finding and hiring these individuals, a
critical success factor will be the ability to make certain
that their agencies are places where the best and the
brightest want to come to work. This happens most
frequently when these agents provide a quality
working environment where people can grow, develop
and be highly successful.
Challenges They Face
As we have seen, people are the most important key
to the success of these firms. It is not surprising that
the biggest challenge faced by these agencies is also
their ability to find and hire talented employees,
particularly producers. These agencies hired an
average of two producers during the last fiscal year
with 70% of those hired coming from another
insurance broker or from an insurance carrier. Twelve
percent (12%) of those hired came directly out of
college, with the other 18% being hired from other
industries. These agencies report that they have been
successful with two out of every three producers that
they are hiring.
These agents also report that they are being
challenged by the soft property and casualty market,
the necessity to do more for their employees, the need
to provide additional services to their customers (in
order to differentiate themselves from their
competitors) and the constant need to add support
staff and infrastructure to respond to the growth that
they are achieving. All of this makes it more difficult
to make a profit. Nevertheless, these firms have been
successful in achieving very attractive levels of
profitability and they have done it through good use
of technology, improved operating efficiencies and
more selectivity in the business that they are writing.
Factors Most Critical to
Agency’s Success
(Top 5 Listed in Order of Frequency Mentioned
1. Finding quality sales and service
employees
2. Driving a sales and service culture
3. Motivating and retaining top
employees
4. Strong carriers and great relations
with them
5. Effectively addressing perpetuation
of ownership and operations
Top Challenges
(Top 5 Listed in Order of Frequency Mentioned)
1. Finding and retaining good
employees
2. Growing in a soft P&C market
3. Growing, but doing it profitably
4. Keeping strong relations with
multiple carriers
5. Providing superior customer service
(differentiating ourselves from our
competitors)