More than 25 percent of independent agency owners and principals are planning to retire or change careers and sell their firms sometime in the next five years, according to a new survey that explores agent attitudes about insurance companies, conducted by Channel Harvest Research.
The survey of independent agents on their attitudes regarding carriers — on a wide range of issues — was sponsored by Insurance Journal.
Respondents who identified themselves as a principal or owner of an agency were asked about long-term plans for owning their firms. Those questions included when they expect to leave the agency and what they plan to do with it, the challenges they anticipate, and to where they would turn for advice and other forms of help.
When asked what would lead them to some day sell their firms, two out of three owners said retirement. About a third of agents hope to sell to family members. The remainder is anticipating a sale to employees, partners or other agencies, although many had not yet identified a prospective buyer.
Regardless of who they imagined buying them out, most respondents discussed a wide range of challenges that would need to be overcome.
“Agents clearly are asking carriers to help them in several different ways, and given the potential to lose large numbers of established appointed agencies, carriers should consider how they can support these would-be retirees,” said Steve Craig, project director for Channel Harvest. “Helping these agents will help provide carriers qualified sales reps in the future.”
Carriers are well positioned to offer advice, respondents said. A sizable number of agency owners appear willing to listen to carriers for suggestions on how best to approach their perpetuation challenges. There were several types of answers that went beyond providing advice: Agents not interested in family transfers would like help finding prospective buyers. Several owners speculated about the carriers’ ability to provide some form of financing.
Another set of suggestions focuses on ways carriers could support a smooth and successful transition from one owner to another. The responses included several specific suggestions for ways carriers could help.
About the Survey
The study, “2012 Survey of Agent-Carrier Relationships,” is the fifth in a series examining independent agents’ views on marketplace issues. The survey was sponsored by Insurance Journal and conducted by Channel Harvest Research — a partnership between Campbell Communications and Aartrijk.
The survey instrument covered more than 90 separate questions. More than 1,500 agents responded to the survey and passed validation criteria. Quantitative survey results are presented in a variety of formats, including importance rankings of specific carrier attributes, ratings of specific companies on attributes, industry issues, and open-ended agency comments about what breaks out superior carriers from the pack. Information quoted in this article and the included graph is based on preliminary data and final survey findings could differ slightly.
For information on obtaining the survey report, contact John Campbell at email@example.com or 202-363-2069.