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How to Achieve Personal Lines Revenue Goals

Step-by-step processes for determining how many new clients are needed to maintain or increase revenue were shared by members of the Personal Lines Practice Group at this month’s teleconference.

Practice Group Chair George Pester of JKJ outlined questions to consider:

Step 1. What was last year’s revenue?

  • Determine last year’s revenue. Then apply your historical retention rate with any adjustments based on current conditions either positive or negative.
  • Make an assumption on rate and exposure base increases.
  • Determine your revenue goals.
  • Calculate the difference between the anticipated revenue and revenue goals.

Step 2. Set your monthly goals

  • Determine the total written premium and average commission needed to close the gap in your revenue goal.
  • Divide the goal by the average account premium to determine the number of new accounts needed.
  • Determine that number by 12 to find the number of new accounts needed each month.

Define Ideal Client

It’s helpful to sit down with the team to determine the ideal client, Pester said. His ideal client meets the following description:

  • Client Goals: Wants appropriate coverage at a fair premium. Wants a collaborative, consultative relationship. Not a transactional purchaser of products and services. Values a personal relationship with insurance representatives at all times.
  • Personal Challenges/Concerns: Protecting wealth accumulated over a lifetime. Valuing good service even if due to a bad claims experience because she was with the wrong insurance company. Coverage meets exposures. Risk management services. Competitive premium.
  • Demographic:
    • Established in job and career.
    • Average or above income.
    • Understands the need and value of insurance.
    • Habitation: Home, condo, co-op owner. Possibly has vacation home and “toys” such as sports cars or boats.
    • Location: Stable or growing community.
    • Story: Married with children. Active board member or involvement with community. Volunteering and giving back to her local community is important.

Talking to carriers about achieving mutual goals for the coming year also is important. Some carriers, however, expect a minimum amount of premium and no longer offer bonuses for exceeding goals. “Some expect growth rates from us that they aren’t even achieving themselves.”

Another agency looks at the attrition rate in three-year cycles, as well as each producer’s projected new business. “We plan for achieving 75 percent of the goal to be cautious.”

Identify At-Risk Accounts

One agency asks producers to identify the 20 accounts that are most likely to be in jeopardy, and discuss how to preserve them. A typical issue is clients who are moving into assisted living. “We make every effort to explain that we can continue serving them almost anywhere in the country.”

Direct Writers

If competition with direct writers is an issue, be sure to review coverage for uninsured and under-insured motorists. This is an area where large claims occur, and direct writers are usually not competitive or as good as assessing the needs.

Agency Structure

It helps to have a person dedicated to new business. Some agencies have found it is easier to train a college recruit with no knowledge than to train someone with limited insurance knowledge and who may find it hard to overcome outdated habits.


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