133 / 204
2013 Best
Practices Study
Agencies
with Revenues
Between
$10,000,000 and
$25,000,000
133
Analysis of Agencies with Revenues Between $10,000,000 and $25,000,000
Key Benchmarks
Mgmt. Perspectives
Profile
Revenues
Expenses
Profitability
Employee Overview
Producer Info
Service Staff Info
Technology
Insurance Carriers
Appendix
Facing Challenges
Perhaps the single greatest unifying attribute of Best
Practices agencies is the way they respond to the
challenges they face. Like firemen who run into -
rather than out of - burning buildings, these agents
elevate their game when things are difficult.
Three years ago, BPS agencies described their greatest
challenge as the combination of a weak economy and
a soft insurance market. Today, with the economy
growing and P&C premiums on the rise, agency
owners have focused their attention elsewhere. Their
focus is on “people” issues. With the Baby Boomer
generation now in retirement mode, agency owners
must continue to grow their businesses, even while
they try to replace many of their most valuable long-
term employees. The firms that do the best job in
building their talent base over the next several years
will clearly emerge as winners.
“Our growth in benefits has slowed down because we’ve been spending
a large amount of time guiding our existing clients. At the same time, we
are bullish on the future, especially for larger groups.”
Top Challenges
(Top 5 Listed in Order of Frequency Mentioned
)
1. Recruiting high potential producers
2. Recruiting technical talent, particularly in
specialty areas
3. Perpetuation planning to ensure
continued private ownership
4. Increasing the books of all producers, so
as to reduce reliance on a small group of
high performers to drive agency growth
5. Creating producer book of business
succession plans to ensure a smooth
transition of an agency’s key customer
relationships from one generation to the
next
Top Adjustments
(Top 5 Listed in Order of Frequency Mentioned)
1. Take responsibility for being clients’ “go
to” advisor on issues relating to healthcare
reformby becoming an expert in how
the law is affecting small and mid-size
employers
2. Adopt a fee-driven compensation model
to remain competitive on larger groups,
while preserving adequate profit levels
on small groups
3. Strengthen service offerings around
compliance and analytics, focusing on
larger (over 100 lives) groups
4. Diversify into ancillary products and
services
5. Get engaged in state policy decision-
making structure to wield influence on
policy and to keep informed of coming
changes