2002 Best Practices Study

2002 B

EST

RACTICES

TUDY

XECUTIVE

PDATE

For First Time Readers of the Study

The annual

Best Practices Study

originated in 1993 as an initiative to help independent agents

build the value of their most important asset, their agencies. By studying the leading agencies

and brokers in the country, the Independent Insurance Agents and Brokers of America (IIABA)

hoped to provide member agents with meaningful performance benchmarks and business

strategies that could be adopted or adapted for use in improving agency performance, thus

enhancing agency value.

The IIABA retained the principals of Reagan Consulting to create and perform the first study of

The Best Practices of the Leading Independent Insurance Agencies in the United States

. Today,

the annual updates continue to provide important financial and operational benchmarks, and the

study is recognized as one of the most thoughtful, effective and valuable resources ever made

available to the industry.

The leading agencies included in the annual study must be nominated for participation. Once

every three years, the insurance companies participating in the IIABA’s Council for

Best Practices

and the Executive Directors of IIABA’s state association affiliates nominate the agencies they

believe to be among the best. The 700-800 nominated agencies are then invited to participate

and asked to complete an in-depth survey detailing their most recently completed fiscal year end

results. From the 300+ agencies submitting data, the top 30 in each revenue category are

included in the study for the next three years and earn the status of a “

Best Practices

agency.”

They are scored and ranked objectively for inclusion on the basis of Account Retention Rates,

Revenue Growth, Productivity, Profitability, and Financial Stability. Participation in

The Best

Practices Study

has become a prestigious recognition of the superior accomplishments of the top

insurance agencies in each of the six size categories studied.

What’s New This Year?

The

2002 Best Practices Study Executive Update

continues to follow the performance of the 180

agencies selected as

Best Practices

agencies in the 2001 Study. Although the study updates

only a subset of the financial and operational benchmarks found in last year’s study, we have

added a much requested piece of new information -- the number of full-time employee