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Understanding the Best Practice Tools
Use these to help plan your agency ’ s strategic path forward .
B y definition , a best practice is a method or technique that has been generally accepted as superior to any alternatives because it produces results that are superior to those achieved by other means or because it has become a standard way of doing things . KAIA members are consistently looking for ways to improve their agencies , whether that be finding ways to better market the agency , enhancing the customer experience , maintaining positive relationships with carrier partners , or streamlining agency workflow procedures .
The Big ‘ I ’ offers a series of best practice resources that can be utilized to benchmark your agency against peers and can provide a helpful roadmap for managing your agency . This article will highlight the Best Practices suite of resources and research available to members to help them better understand where they are today and to develop a clearly defined strategic path forward .
Big ‘ I ’ Best Practices Resources and Industry Research :
• Market Share Report : Working with A . M . Best Co . this report provides market share data that offers an updated assessment of the state of the independent agency system . This report provides a global perspective to understand marketplace trends by distribution channel and growth in overall personal and commercial premiums . Keep in mind that data used is several years old which allows it to mature and takes into account yearly adjustments that can be made by carriers .
• Agency Universe Study : This study is a cooperative effort by the Big ‘ I ’ and about 20 carriers and its purpose is to track changes in the independent agency system and to identify the challenges facing agents and relevant trends . The management summary is available for purchase at a cost of $ 79.95 .
• Best Practices Study : A study lead by Reagan Consulting , the Best Practices study provides agencies with financial and operational benchmarks . Agencies of varying revenue sizes across the United States are nominated to participate in the study . 2016 was the last full study and these benchmarks were updated in 2017 and will in 2018 as well . Some of the key metrics provided in the study include : average organic growth , profitability , average number of employees , revenue per employee , compensation per employee , sales velocity , information on books of
DAVID HULCHER KAIA Executive Director
business by producer , and much more . Reviewing the best practices study will get your agency thinking not only about how you compare to others but ways to measure the success of your operation so you can continue increasing agency value .
• Best Practices Comparison Spreadsheet : Want to know how your agency specifically stacks up to the Best Practices agencies ? Reagan Consulting has created a spreadsheet that any member can complete . It is free and can be found with the 2017 Best Practices update .
• Guide to Producer Contracts : This resource provides guidance on creating an effective agency producer agreement . Some of the important items addressed include compensation , non-compete , non-piracy , and non-disclosure , vesting of commissions and more . With the challenge of finding talented producers , how confident are you that you have your agency ’ s producers agreement set up appropriately ? Of course , the legal services provided by KAIA ’ s Will Larson is also available if needed in this area .
• Top Producers – Discover , Train , Reward : This guide explores the cost analysis of hiring producers , finding the ideal candidate , compensation formulas , suggestions for training producers , and producer activity planning information .
• Joint Planning Tool : Put this tool in the category of an oldie but goodie . It is designed to assist in creating more productive relationships with your carrier partners . I find the Joint Planning Tool to be useful in helping understand where you currently are and charting a strategic path forward .
All of these Best Practices tools and research can be found on the Big ‘ I ’ s national website . To check out these resources , visit bit . ly / BigIBestPractices . These tools can be useful in creating benchmarks to measure success and can help define your strategies going forward . Finally , please feel free to contact me with any questions and realize that KAIA is your champion , here to aid in the success of our members .
4 KANSAS INSURANCE AGENT & BROKER | March - April 2018 |