2004 Best Practices Study

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INTRODUCTION
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 & Brokers of America (IIABA)
hoped to provide member agents with meaningful performance benchmarks and business strate-
gies 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 nominated agencies are then invited to participate and asked to
complete an in-depth survey detailing their financial and operational year end results. The agen-
cies submitting data are then scored and ranked objectively for inclusion on the basis of Account
Retention Rates, Revenue Growth, Productivity, Profitability, and Financial Stability.
This year, 900 agencies from around the country were nominated in seven revenue categories.
The categories range from "Under $500,000" to "Over $25,000,000" in agency revenues. Over
300 agencies accepted the invitation and submitted data. Only 195 agencies, the top 30 firms in
the first six categories and 15 in the largest revenue category, were included in the study and
earned the status of a "Best Practices agency." Participation in the Best Practices Study has
become a prestigious recognition of the superior accomplishments of the top insurance agencies
in each of the seven size categories studied.
Need More Best Practices Information?
The 2004 Best Practices Study is available in two formats - hard copy and electronically. The hard
copy can be purchased from the IIABA Education Department (800-221-7917). The electronic
version can be accessed via the websites of IIABA ) and Reagan Consulting
( ). From these sites, users can enter the Best Practices Gateway
home page to view an HTML version of the study, download a Best Practices comparison spread-
sheet to compare their year-end results with the study's results, and access the complete family of
Best Practices resources.
As in previous years, the update provides an analysis of agencies by revenue size, by region and
by population density of the city in which they primarily operate. This year the study includes an
analysis of bank-owned agencies.
2004 BEST PRACTICES STUDY
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