2013 Best Practices Study

Analysis of Agencies with Revenues Between $2,500,000 and $5,000,000

Key Benchmarks Mgmt. Perspectives Profile Revenues Expenses Profitability Employee Overview Producer Info Service Staff Info Technology Insurance Carriers Appendix

Developing New Producers Although most of the leading firms are utilizing a structured, multi-faceted approach to producer development, the specific approaches vary considerably. The most commonly reported element within these producer development strategies is “mentoring,” generally provided by one of the firm’s more seasoned and successful producers. The roles of the mentors vary by firm but are typically hands-on and include active participation such as “going with the new producer on all sales calls to make sure they are confident and understand the risks.” In addition, most emphasize structured training and education, including in-house training programs, courses offered by insurance companies, continuing education programs and seminars/webinars. Third- party sales coaches and consultants are also utilized. Although the cost of training can be significant, several firms emphasized the correlation between their willingness to invest resources in education and training and their ability to successfully develop producers.

“requiring candidates to be interviewed by the entire management team.” Although these firms are successfully developing producers, they don’t suggest they have cracked the code. Most acknowledge their approach is not set in stone but continually reviewed for improvement. As one executive stated, for us “producer development is an established program but also an evolving program.” Adjusting to Health Care Reform Due to the continued uncertainty relative to healthcare reform many agencies find planning for their employee benefits business to be a continued challenge. As a result, one of the most common responses to the question of current adjustments pursued in employee benefits was “no change.” Some added that, because employee benefits represents a relatively small portion of their total business, they were comfortable waiting for the dust to settle. Other firms, however, are taking a more proactive approach. For these, the primary emphasis is on communicating with clients and educating them on their options and requirements under the Affordable Care Act. As one agency shareholder put it “We are placing a major focus on education for both prospects and existing customers in order to become the resource to help them through the uncertainty.” Others agree with the potential to distinguish themselves in the marketplace if they seize the “opportunity to educate clients and prospects.” But the ability to serve clients through this time of change, whether through proactive education or simply being responsive, places a premium on internal education. Many of these leading firms describe actively watching and studying the situation so as to be responsive to clients and prepared to act strategically. As expressed by one agency executive, “Due to the total uncertainty of the situation, we are attending multiple seminars to ensure we understand all ramifications of the new law.” Another said simply “We are studying everything we can find on the subject.”

Keys to Developing New Producers (Top 5 Listed in Order of Frequency Mentioned) 1. Mentoring 2. In-house training and oversight 3. Insurance company schools 4. Third-party sales coaches/consultants 5. CIC training

Qualifying producer candidates can be a challenge for even the most successful firms. Some report success working with recruiters while others emphasized the importance of being thorough in qualifying a candidate before an offer is made. This includes multiple testing, multiple interviews and/or

2013 Best Practices Study

Agencies with Revenues Between $2,500,000 and $5,000,000

“Producer development is an established program, but also an evolving program.”

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