Every customer is interested in knowing the state of affairs at their concerned insurance agency to be up to date with the matters. As such it is also a part of the know- how process to find how agencies are performing and operating.
A recent survey on the best practices reported by the Independent Insurance Agents and Brokers of America , also known as the Big “I” analyzed the performances of more than 217 of the top insurance agencies in the nation, this report offers a timely and useful benchmark for the evaluation of agency operations. Especially when it comes to different ways to look at profitability. In the surveyed agencies with revenue between $5mn to $10mn, there can be a 30% difference in measures of profitability.
For instance, let us consider the spread per employee, which is also the difference between revenue per employee and the compensation per employee. This is therefore an excellent metric of productivity because it is able to calculate the employee contribution to the business organization before the overhead expenditures. At an average, the spread is about $64,733. Likewise, agencies with a 25% plus profit the spread is likely to be $89,868, which happens to be a 32% difference in total.