{"id":18549,"date":"2020-06-01T15:02:25","date_gmt":"2020-06-01T19:02:25","guid":{"rendered":"https:\/\/www.insurance-canada.ca\/?p=66570"},"modified":"2020-06-01T15:02:25","modified_gmt":"2020-06-01T19:02:25","slug":"u-s-independent-insurance-channel-braces-for-coronavirus-economy","status":"publish","type":"post","link":"https:\/\/blog.lifeinsurance-orleans.ca\/index.php\/2020\/06\/01\/u-s-independent-insurance-channel-braces-for-coronavirus-economy\/","title":{"rendered":"U.S. Independent Insurance Channel Braces for Coronavirus Economy"},"content":{"rendered":"

Agents, brokers post record-setting start to 2020, reports Reagan Consulting<\/h3>\n

Atlanta, GA (May 21, 2020) \u2013 The independent agency channel posted an exceptionally strong first quarter (Q1) of 2020, which will help them maintain momentum through the troubled COVID-19 economy, according to Reagan Consulting.<\/p>\n

Agents and brokers logged organic growth exceeding 5.0% for the ninth consecutive quarter. At 6.6%, it\u2019s their highest Q1 growth since Reagan launched the Organic Growth and Profitability (OGP) survey in 2008. Meanwhile, since the close of Q4 2019 and the onset of shelter-in-place directives, agents and brokers lowered their expectations for organic growth this year by three percentage points to 4.1%, reports Harrison Brooks, Reagan Consulting partner.<\/p>\n

\u201cWhile it\u2019s too early to tell the ultimate impact of this global pandemic, OGP survey participants are signaling that they believe it will only pump the brakes on growth rather than bring it to a halt,\u201d says Brooks.<\/p>\n

If agents and brokers prove correct in their predictions, \u201cIt would be an astonishing success and further illustrate the resilience of the insurance brokerage industry,\u201d he adds.<\/p>\n

<\/a><\/p>\n

The organic growth of personal lines declined for the second consecutive first quarter to 2.8%, but commercial lines posted an organic growth rate of 8.4% \u2014 \u201cthe largest since Q1 2014,\u201d says Brooks. Group benefits \u201cincreased materially,\u201d he adds, from 3.8% in Q1 2019 to 5.8% in Q1 2020.<\/p>\n

<\/a><\/p>\n

Agency profitability increased from 27.8% in Q1 2019 to 29.3% in 2020. At the same time, contingent income rose from 6.2% in Q1 2019 to 13.3% in Q1 2020.<\/p>\n

In addition, operating profits in Q1 2019 were 11.6%, but rose to 12.8% in Q1 2020. These increases \u201ccould not come at a better time,\u201d observes Brooks, but he also notes some agencies have cut employee compensation to preserve profitability. As well, he cautions that \u201cprofitability results are always inflated by cash-basis contingent income during the first quarter of the year. Margins will decline throughout year.\u201d<\/p>\n

Brooks advises agents and brokers to remember that the firms thriving after the Great Recession of 2008-2009 were those \u201cthat opportunistically invested in growth\u201d during the recession. \u201cMoves made by agents and brokers in the coming months will likely dictate who prospers in the years ahead,\u201d he says.<\/p>\n

For further observations and commentary on the unusual first quarter of 2020, contact Harrison Brooks at Reagan Consulting, 404.869.2537 or [email protected]<\/span><\/a>.<\/p>\n

About the Survey<\/strong><\/p>\n

Reagan Consulting has conducted its quarterly survey of agency growth and profitability since 2008, using confidential submissions from nearly 200 mid-size and large agencies and brokerage firms. Approximately half of the industry\u2019s 100 largest firms participated in this quarter\u2019s survey. The OGP survey is the industry\u2019s preeminent survey of mid-size and large privately held brokers.<\/p>\n

Each participating agency receives a customized, confidential report of its performance compared with the overall survey results, along with Reagan\u2019s quarterly commentary of industry trends affecting agents and brokers. For information on participating in the OGP survey, contact Michelle Appelbaum at 404.233.5545 or [email protected]<\/span><\/a>.<\/p>\n

About Reagan Consulting<\/b><\/h4>\n

Reagan Consulting is a management consulting firm providing strategic consulting, valuation, capital raising and merger-and-acquisition (M&A) services to the independent insurance distribution system. The firm\u2019s services for insurance agents and brokers, bank-owned agencies and other participants in the insurance distribution marketplace include: appraisals of fair market value, capital raise advisory, mergers and acquisitions advisory, ownership perpetuation planning, strategic planning facilitation, key employee compensation and equity plan design, and agency performance benchmarking. Reagan Consulting co-developed the well-known Best Practices Study and produces the quarterly Organic Growth & Profitability benchmark survey.
For more information, visit ReaganConsulting.com<\/a>.<\/p>\n

Source: Reagan Consulting<\/i><\/p>\n

Tags: coronavirus<\/a>, epidemic<\/a>, independent agents<\/a>, Reagan Consulting<\/a>, United States (USA)<\/a>
\nRead the original article at Insurance-Canada.ca <\/a><\/p>\n","protected":false},"excerpt":{"rendered":"

Agents, brokers post record-setting start to 2020, reports Reagan Consulting Atlanta, GA (May 21, 2020) \u2013 The independent agency channel posted an exceptionally strong first quarter (Q1) of 2020, which will help them maintain...<\/p>\n","protected":false},"author":578,"featured_media":0,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":[],"categories":[],"tags":[],"jetpack_featured_media_url":"","_links":{"self":[{"href":"https:\/\/blog.lifeinsurance-orleans.ca\/index.php\/wp-json\/wp\/v2\/posts\/18549"}],"collection":[{"href":"https:\/\/blog.lifeinsurance-orleans.ca\/index.php\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/blog.lifeinsurance-orleans.ca\/index.php\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/blog.lifeinsurance-orleans.ca\/index.php\/wp-json\/wp\/v2\/users\/578"}],"replies":[{"embeddable":true,"href":"https:\/\/blog.lifeinsurance-orleans.ca\/index.php\/wp-json\/wp\/v2\/comments?post=18549"}],"version-history":[{"count":0,"href":"https:\/\/blog.lifeinsurance-orleans.ca\/index.php\/wp-json\/wp\/v2\/posts\/18549\/revisions"}],"wp:attachment":[{"href":"https:\/\/blog.lifeinsurance-orleans.ca\/index.php\/wp-json\/wp\/v2\/media?parent=18549"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/blog.lifeinsurance-orleans.ca\/index.php\/wp-json\/wp\/v2\/categories?post=18549"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/blog.lifeinsurance-orleans.ca\/index.php\/wp-json\/wp\/v2\/tags?post=18549"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}