2004 Best Practices Study

2004 BEST PRACTICES STUDY

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 (www.iiaba.com) and Reagan Consulting (www.reaganconsulting.com). 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.

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