Agency partnerships have grown tremendously. Since 2013 when Insurance Journal began tracking the Top 20 Agency Partnerships, the total combined property/casualty revenue for all 20 agency networks has more than doubled.
In 2013, the combined total P/C revenue for all 20 agency partnerships totaled $1,647,936,120. In 2019’s Top 20 Agency Partnership ranking (see the Aug. 5, 2019 issue of Insurance Journal), that figure reached $3,815,161,620.
“Agency networks are experiencing strong growth and have not reached their full potential,” believes Steve Pearson, president of ISU Network, which ranks #2 on the list.
Agencies of all sizes continue to seek out the services and clout of agency networks. “Small agencies or startups are looking for market access. Meanwhile, larger agencies have all the markets they need but often seek to join a community of sophisticated agencies similar to their own,” Pearson told Insurance Journal.
Matt Masiello, CEO of SIAA, the largest agency partnership in Insurance Journal’s ranking, says networks are here to stay. But he and others know, not every one of them will make it. Networks, like agencies, are being pushed to offer more and more every day.
“Simply providing market access and some local profit-sharing aggregation is now the ‘price of admission,'” Masiello told Insurance Journal. (see Special Report on page 24) “Anyone can do aggregation and agents can access markets in dozens of different models – it just depends on the model that works best for them.”
Pearson says that smaller networks and clusters are finding they can’t match the results and benefits of larger professionally managed networks.
“Smaller groups often have static membership and are self-managed by participating agencies – often rotating part-time management roles each year,” he said. “Often the largest agencies in these groups contribute the most premium, pay more of the expenses, contributes more of their time, and brings the majority of benefits other members enjoy.”
He sees principals of larger agencies joining bigger networks where they can earn the same or more revenue without the management headaches.
Whatever the case, networks are numerous and offer value and benefits that go far beyond the early days of market access. Networks have become permanently woven into the fabric of the independent agency system and the system is stronger for them.
Was this article valuable?
Here are more articles you may enjoy.