Would you be surprised to learn that a slight majority of the successful young producers studied by Reagan Consulting, an Atlanta-based insurance industry consulting firm, were recruited right out of college and most of the rest came from another industry? How about that the producers who had GPAs in school under 3.0 (a B average) achieved validation(i.e., the income they brought into the agency equalled the compensation and other expenses incurred by the agency for them) over 6 months sooner than those who had GPAs of 3.5 or above? These are just a few of the background facts that were common among successful young producers discussed by Brian McNeely of Reagan Consulting in his presentation to the IIAG annual convention at the beginning of this month.
That presentation was based on the study conducted by Reagan Consulting in 2009 of 91 successful young producers, who were under 30 years old and selling commercial P&C or employee benefits products. The validity of that study was confirmed in 2012 when Reagan Consulting followed up with the young producers and found that 80 of them were still working for the same agency in a sales position and all but one of the others were still in sale positions with other agencies. The one who was not had left the business to have a baby. The average new commercial P&C business production in 2012 for the producers who agreed to participate in the follow up study ranged from almost $41,000 a year for producers in agencies with less than $1.25 million in annual revenue to over $100,000 for producers in agencies with over $25 million in annual revenue. Not bad for any producer, young or old.
Specialization with office support and value added services was one of the five keys to success for the young producers studied by Reagan Consulting. The others were training in insurance and sales techniques, mentoring, and developing relationships with referral sources. Not surprisingly, training and supportive mentoring were found to be the most important of these keys to success. Along these lines, the May 30, 2013 edition of the IA Insurance News and Views spotlighted an article by John Graham on how to act like a salesperson. In his article, Mr. Graham discusses eight basic principles that every salesperson should live by, and it would make good reading for all producers, but especially young ones just starting out. None of these principles are new, but if learned and implemented they would get a young producer off to a good start. (Click here for the article.)
At their core, all insurance agencies are sales organizations. If they want to be successful, they must sell insurance policies. That makes finding, developing, and retaining good producers one of the most critical things a successful insurance agency must do. It is especially important for agencies to find and then develop good young producers. To review the 2009 Reagan Consulting study that discusses how this can be done click here and for the 2012 follow-up report click here.