2004 Best Practices Study

AGENCIES WITH REVENUES BETWEEN $5,000,000 AND $10,000,000

Keys to Maximizing Productivity Improvements in technology and employee training & development have fueled staggering increases in overall productivity since the beginning of the Best Practices Study in 1993. Since then, revenues-per-employee have jumped from $92,873 to $145,591 for agencies in this revenue

EXECUTIVE PERSPECTIVES

category, an increase of 56.8%. In 1994, the average commercial lines CSR in this group man- aged a book of business totaling $295,475. Today, the average commercial lines CSR is responsible for a book that averages $383,422, an increase of 30%. Over this same period, Life & Health CSRs have seen their average books of business increase 68%, from $251,793 to $423,872. Interestingly, personal lines productiv- ity has not fared so well. In 1994, the average CSR managed a book of business totaling $127,033. In this year's Study, the average CSR's personal lines book totaled only $112,320.

PROFILE

Keys to Maximizing Productivity (Top 5 Listed in Order of Frequency Mentioned)

1. Effective use of automation/technology tools 2. Streamlined processes, procedures, guidelines, standards 3. Good planning and analysis / goal setting and monitoring results 4. Goal oriented pay / bonus program 5. Team work

REVENUES/ EXPENSES

FINANCIAL STABILITY

EMPLOYEE OVERVIEW

Keys to Achieving a Competitive Advantage People are also at the center of the issue of developing and maintaining a competitive advantage. The practice of hiring, developing and empowering excellent employees remains the most-cited keys to maintain competitive advantage for agencies in this Best Practices group. Beyond this, other competitive strategies include a heavy focus on niche/target marketing, a constant introduc-

PRODUCER INFO

tion of additional products and value- added services, and a focus on cross-sell- ing. These strategies pay significant divi- dends -- account retention results averaged 97.3%, 97.0% and 87.4% for commercial lines, personal lines, and Life & Health accounts, respectively. Overall, revenue growth for these Best Practices agencies averaged 14.2%.

SERVICE STAFF INFO

Keys to Achieving a Competitive Advantage (Top 5 Listed in Order of Frequency Mentioned)

1. Quality of employees and management team 2. Effective carrier relationships resulting from growth, expertise 3. Reputation/agency history/community involvement 4. Niche program knowledge and structure / target market focus 5. Value added services (loss prevention, risk management, safety services, etc.)

TECHNOLOGY

INSURANCE CARRIERS

APPENDIX

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