2001 Best Practices Study

A NALYSIS OF A GENCIES WITH R EVENUES B ETWEEN $5,000,000 AND $10,000,000

B EST B USINESS P RACTICES A NALYSIS

“Consistency in terms of who services each account is critical. We are in a relationship business. If clients experience regular turnover among those handling their account, we will lose them. Much of the business we pick up comes to us for that reason.” “A year ago we realized that employees were using voicemail to as a tool to manage their workflow, at the expense of our customers. We have drastically reduced the use of voicemail to ensure our customers have access to our people.” “Making it clear that an owner of our firm is available to be reached at home at nights or on weekends has provided a great sense of security to our key accounts.” “Careful screening of all employees with a psychological evaluation has been key to getting the right people in place.” “Thoughtful and fair evaluation of performance allows us to reward those achieving top results. We monitor customer contact and use a peer review process to evaluate performance. We then provide bonuses that far exceed the levels of our competitors.” “We pay an ‘at-the-market-wage’ and focus on creating the best possible environment for our people, i.e. one that is highly communicative, supportive and fun. As a result, we never lose people.”

C USTOMER S ERVICE AND S ATISFACTION

Best Practices agencies in this revenue size group generally have a very large number of customers to keep satisfied. To complicate matters even further, these agencies generally have a number of different customer segments to deal with (program business, personal, affluent personal, small commercial, large commercial, etc.), each with very different servicing requirements. Common Best Practices emerge, however, regardless of the actual levels of servicing required: prompt and fair claims processing, highly talented and motivated employees, frequent communications, a commitment to quality, timely transaction turnaround, quality carrier representation, and a willingness to act as an insured’s advocate in a time of need.

H IRING , D EVELOPING , AND R EWARDING E MPLOYEES

Best Practices agencies realize that their success is primarily a function of the quality of their employees. Therefore, it comes as no surprise that these agencies focus extensively on developing the highest caliber employees possible. The Best Practices identified in support of this objective include: extensive pre-employment screening and testing, referral bonuses, merit-based compensation, extensive professional development programs, ownership/equity opportunities, an “empowered” environment, open and honest communications, and procedures for dealing with ineffective employees quickly. Although the labor market has loosened a bit recently, finding the necessary quantity of talented employees remains a significant challenge, specifically in the sales arena.

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