2021 Best Practices Study

Executive Summary

Agencies between $10.0 Million and $25.0 Million in Revenue

Production

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.

2.8%

Top Quartile

20.1%

Over age 55

3.9%

Age 46-55

•

Age 36-45

Average

12.5%

3.8%

Up to age 35

1.9%

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 8.7%

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 category delivered the second lowest Sales Velocity in this year’s Study (12.5%). At $100,425, multi-line producers in the $10.0M-$25.0M group boasted the highest new business results in this year’s Best Practices Study . Further, the freshman classes’ contribution to Sales Velocity was only 15%, an indication that more young producer hiring may be in order.

New Business

Average Book

Over age 55 35.6%

Commercial P&C

$87,207

$751,136

Age 36- 45 22.5%

Personal P&C

$61,438

$319,448

Life/Health/ Financial

$68,381

$692,299

Multi- Line

$100,425

$789,215

Age 46- 55 33.2%

•

Effective NUPP

•

Group Average:

Producer Success Rate 51.7%

NUPP

Effective NUPP

•

1.4%

0.7%

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