Average Number of Clients Per P & C Agents?

[lmspeir]

How many clients would you say an average P & C agent have? Some have told me that 1500 is about average. What say you?

 

[djs]

Are you talking clients (i.e., households) or policies? I assume you are referring to personal lines, not commercial?

In figuring this out, you probably need to weed out those with under 5 years in business, or they will pull the average way down. Face it, they start with 0 and it can take a while to grow.

I have no idea what the average is, but I would say that under 2000 policies an agency will always struggle. It seems to me that every 800-1000 policies is a new challange in an agency.

My view of the evolution:
First 800 policies: Agents try to do it themselves. You can't make it, but can't afford to hire help.

Finally hire someone: Up to 1500 policies, things are now good. Upon first hiring them, you didn't eat so you could have the money to pay your help. They went out for dinner every week, you drool over the leftovers.

At 1500 policies, and 2 CSR's later, you are financially okay again, even adding lettuce to your spam sandwich for lunch. Still spending to much time doing service work because the CSR is overloaded. Only way to grow is to hire another person.

Now, you have 2 office people, but again, back to drooling over their lunch, hoping they don't catch you. You think how great it would be if you could just get rid of their salaries and manage it yourself!

Growing to 2000 policies, you can now afford to eat out once a week, as long as you skip eating the day before and the day after. You are happy that you can drool over your own leftovers, though you quickly realize that you ate the whole happy meal and even licked the fry bag.

Now, you are thinking, if I can hire one more person, I can finally quit servicing clients and get back to selling full time. If I sell full time and get up to 2400-2500 policies, maybe I could afford a BigMac once a month.

You hire the new person, the other 2 quit. Now, you are flush with cash, but can no longer see the front door due to the paperwork scattered every where. Yes, you have a paperless office, but you have no idea how to use it.

In short, I know a lot of agencies with 1500 policies, they struggle. I know a number with 1500 clients, about 3500 policies and they do okay, but the agents role is significantly different. I have no idea what the average is, but I would guess 1500 policies wouldn't be far off.

Dan

 

[Benefits Man]

djts, are you suggesting it's almost impossible to be a well off p&c agency owner?

 

[FL P&C Broker]

Are we talking about a single agent working at an agency or an agency in whole?

 

[djs]

I'm just suggesting insurance as a whole (or almost any small business) is much tougher than it sounds when someone is trying to recruit you into the job. Also, everything I said is true for Life and Health, just the numbers change.

FL - Good question. How many agents work at an agency? In most P&C places (AAA excluded), there is 1. State Farm always has 1. Allstate always has 1. Farmers has 1, etc. Licensed CSR's or licensed producers are different, they don't have 'agent' contracts, they have producer contracts.

Large agencies can skew numbers. New agencies skew them the other way.

Dan

 

[Air Jer]

I know of a commercial agent who does just fine with 100 clients. He never goes over 100; when he does, he finds away to rid himself of the smaller accounts, thus, his average premium per account climbs. He is my role model.

 

[JCK818]

When do you think a new agency (with experianced agents), will hit 2000 policies. You think within 2 years it is a attainable goal?

Are you talking clients (i.e., households) or policies? I assume you are referring to personal lines, not commercial?

In figuring this out, you probably need to weed out those with under 5 years in business, or they will pull the average way down. Face it, they start with 0 and it can take a while to grow.

I have no idea what the average is, but I would say that under 2000 policies an agency will always struggle. It seems to me that every 800-1000 policies is a new challange in an agency.

My view of the evolution:
First 800 policies: Agents try to do it themselves. You can't make it, but can't afford to hire help.

Finally hire someone: Up to 1500 policies, things are now good. Upon first hiring them, you didn't eat so you could have the money to pay your help. They went out for dinner every week, you drool over the leftovers.

At 1500 policies, and 2 CSR's later, you are financially okay again, even adding lettuce to your spam sandwich for lunch. Still spending to much time doing service work because the CSR is overloaded. Only way to grow is to hire another person.

Now, you have 2 office people, but again, back to drooling over their lunch, hoping they don't catch you. You think how great it would be if you could just get rid of their salaries and manage it yourself!

Growing to 2000 policies, you can now afford to eat out once a week, as long as you skip eating the day before and the day after. You are happy that you can drool over your own leftovers, though you quickly realize that you ate the whole happy meal and even licked the fry bag.

Now, you are thinking, if I can hire one more person, I can finally quit servicing clients and get back to selling full time. If I sell full time and get up to 2400-2500 policies, maybe I could afford a BigMac once a month.

You hire the new person, the other 2 quit. Now, you are flush with cash, but can no longer see the front door due to the paperwork scattered every where. Yes, you have a paperless office, but you have no idea how to use it.

In short, I know a lot of agencies with 1500 policies, they struggle. I know a number with 1500 clients, about 3500 policies and they do okay, but the agents role is significantly different. I have no idea what the average is, but I would guess 1500 policies wouldn't be far off.

Dan

 

[Bertolinoins]

I don't think you can come up with an average for all agents but I would guess:

Personal Lines:
Standard market agents: 800-1000
non standard auto 1200-2000

Commercial Lines:
Small Business ($25k and under) 400
Middle Market (25-250k) 150ish
Large Commercial (250+) Under 75
National Brokers: 50 or less

 

[FLInsa]

If you are talking about personal lines then Dan's post above is a very good snapshot of where most agents need to be. However, I prefer to be a 90% commercial 10% personal agency for many reasons.

Furthermore, I prefer to have 10 $50k commercial clients then to have 250 personal lines clients. Less work!

 

[mariemerganser]

For personal lines, what does everyone think a manageable number of policies for one agent to handle before having to hire a CSR?