2020 Best Practices Study

Definitions

Sales Velocity

Age Banding of Sales Velocity

Sales Velocity is a critical metric in determining organic growth. It is defined as this year’s written new business divided by last year’s commissions and fees. Age Banding of Sales Velocity can help a firm assess where new business and growth are coming from and prepare for perpetuation.

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3.3%

Top Quartile

20.6%

Over age 55

3.4%

Age 46-55

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Age 36-45

Average

13.2%

4.4%

Up to age 35

2.0%

Comparison Group Average

Book of Business per Producer (commissions and fees)

Book of Business by Age

Notes & Definitions

• Weighted average producer age (WAPA) is 46. •

Up to age 35 8.3%

Effective NUPP, which is the product of an agency’s investment in unvalidated producers (NUPP) and success rate in hiring producers (Producer Success Rate), is expressed as a percentage of net revenue. It is the best overall measure of an agency’s effectiveness in recruiting and developing sales talent. This revenue group’s freshman class (producers under age 35) contributed the least to Sales Velocity (15%) of all the revenue categories. Commercial P&C and L/H/F producers in this revenue category generated effectively the same new business results ($93,252 and $93,314, respectively). Agencies in this revenue category are investing heavily in young producers, as they have the highest NUPP (1.7%) in the Study .

New Business

Average Book

Commercial P&C

Over age 55 36.3%

$93,252

$848,384

Age 36- 45 27.1%

Personal P&C

$55,545

$355,682

Life/Health/ Financial

$93,314

$852,896

Multi- Line

$124,448

$998,513

Age 46- 55 28.3%

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Effective NUPP

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Group Average:

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 42