2017 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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Top Quartile

4.2%

24.6%

Over age 55

Age 46-55

5.3%

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Age 36-45

Average

14.1%

Up to age 35

2.3%

2.3%

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. •

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. For firms in this revenue category, 42.5% of total producer books are serviced by producers over age 55 – the highest percentage in the Study . Sales Velocity is down from 15.4% last year to 14.1% this year, also contributing to the organic growth decline. Commercial lines producers are the most productive in this revenue group, writing the most new business per producer ($50,213) and servicing the largest book per producer ($356,115).

Up to age 35 14.3%

New Business

Average Book

Commercial P&C

$50,213

$356,115

Over age 55 42.5%

Age 36- 45 15.1%

Personal P&C

$31,387

$200,842

Life/Health/ Financial

$22,398

$146,600

Multi- Line

$30,606

$310,800

Age 46- 55 28.1%

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Effective NUPP

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Group Average:

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