2001 Best Practices Study

Analysis of Agencies with Revenues Between $500,000 and $1,250,000

“We add together our carrier profit sharing dollars and our net increase in commission income from the prior year. A percentage of that total is set aside for our bonus pool. Then I prorate the bonuses paid to each person based on their salary and some other factors. I feel that my folks are excited about writing good quality business because they know their bonuses come out of that pool.” “We just hired a lady from our local bank who had an incredible customer service attitude. She now handles all our claims.” “At our monthly roundtable discussions we discuss a potpourri of things – carrier appetites, market changes, new discoveries from CE classes, things that went wrong and how they could have gone right. We revitalize ideas that we haven’t been using, what ever has gotten each of our attentions over the last 30 days.” “Each month we send one of four letters to specific groups of clients; for example, thanking new clients for their business. All of them have satisfaction response cards enclosed. We get a tremendous number back. I share the results of the cards at our staff meetings. What a great way to keep employees motivated and to communicate the importance of our service.” “We email newsletters and other general information but always give the client or prospect the option to have their name removed from the list.”

Employee turnover is low at Best Practices agencies due in great part to their work environment. The agencies interviewed indicated that they try to create a happy, friendly environment where people feel empowered to do their jobs, are supported and encouraged to grow both personally and professionally, and are rewarded for high performance. Both monetary and non-monetary reward systems are used as incentives. Monetary rewards are structured to control expenses if goals are not met but to reward generously when they are exceeded.

C OMMUNICATIONS –

E MPLOYEE , C LIENT , AND C ARRIER Because of the close relationships that Best Practices agencies have with their employees, clients, and carriers, they tend to be good communicators. A variety of vehicles are used with employees including regular meetings to share ideas, address problems and concerns, and monitor progress on goals. Financial information is shared to help clarify agency goals, successes, or problem areas. Employee manuals and reviews are also used to help communicate and clarify important themes, procedures, and behaviors. Frequent contact is viewed as critical in successful client communications and is achieved in a variety of ways including newsletters, regular face-to-face meetings, surveys, telephone calls, and regular correspondence. Technology permeates most of the day-to-day communications with insurance carriers – voice mail, email, fax, and upload – but, regardless of the vehicles used, the top agencies stressed the importance of open and honest communications with their company partners.

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