IIAA Surveys Agent Leadership On Company Relations

N/Adependent agents feel the overall state of their company relationships has improved or remained the same in recent years—but they see a wide disparity in the quality of each company relationship based on specific factors, according to a survey by the <%=company%> of its national and state association agent leaders.

Thirty-five percent of the independent agent respondents to the confidential survey felt the overall state of their company relationships had improved over the past two years, while 33% felt they remained the same. Some 21% of the respondents felt their company relationships were somewhat worse, and 10% indicated that their relationships were better with regional companies but worse with the nationals.

Agents are facing a significant revenue squeeze, given the highly competitive commercial lines market, and therefore are very positive about companies that provide production incentives as well as financial support for acquisitions, new producers and new automation, according to Jeffrey M. Yates, IIAA CEO for industry and state relations.

Profit sharing agreements, which can amount to five percent to seven percent of an agent's revenue, are particularly important to agents. "Agents have major concerns about companies that use their profit-sharing agreements to leverage growth rather than to evaluate the agent's overall profitability to the company," said Yates. The survey results reflect concern about separate personal and commercial lines profit-sharing agreements and unrealistic growth expectations, and show that agents feel such agreements should have stop-loss provisions that respond in catastrophe situations.

Much of the positive feedback focused on company interest in writing business. The respondents valued most those companies with strong field support, good service, local offices with underwriting capability and underwriters available in agents' offices. A weakness identified by the agents was the failure of some companies to clearly communicate to their agents the types of business they particularly wanted to write or were successful in writing.

The agents also felt companies should do more to promote the independent agent in their advertising. Some 52% of agents responding felt that company consumer advertising does not directly benefit their agencies, while another 27% of the agents saw only a limited benefit.

"Agents are definitely seeing improvements from several of their companies in products, service and more attention to a partnership relationship," said Yates. "They really appreciate the training and marketing support they are receiving from some of their companies and would like to see more of the companies use the Best Practices joint planning process with them.

"At the same time," Yates added, "some company actions are causing a deterioration in service and relationships, such as multiple distribution, company mergers and acquisitions, and failure to use technology that furthers the agency's ability to transact business in a consistent way with multiple companies using single entry of data."