Founder of AgencyPoint in California Says Many Agencies Put Accounting on Backburner

By | February 8, 2024

Many small- to mid-sized agencies aren’t putting much thought into accounting, relegating the important function to the backburner by opting to use local accountants, agency management systems that may not be sufficient, or even relatives to keep track of their money.

That has been the experience of the founder of Diamond Bar, California-based PFS Global, which recently launched AgencyPoint, a new venture focused on assisting agencies with accounting services.

“The majority of clients that come to us don’t have a proper accounting system in place,” said PFS founder Aaron Stocks. “Very rarely do we run into an agency that does have a proper accounting system in place.”

PFS Global has been around for more than 15 years, but the new push with AgencyPoint has been to expand deeper into the insurance market. AgencyPoint is targeting agencies above $750,000 in revenue across the U.S., however they are bringing on smaller clients too.

Every agency needs some formal accounting system, but many struggle with the function, according to Stocks. That is why he’s optimistic about launching the new endeavor and he’s projecting rapid growth.

“There’s a huge need for it,” he said.

Firms using an agency management system to do their accounting are often using a version that is underpowered for a broader purpose. Many of these systems, for example, do not keep track of important items like accounts payable and accounts receivable, Stocks said.

Those using local accountants who are unfamiliar with insurance have put themselves at the mercy of several disadvantages.

First, these accountants often do not know common insurance terms, making communication and understanding difficult, he said. They also often do not know trust reconciliation, they don’t understand fiduciary and nonfiduciary funds, or carrier commission reconciliation.

“Most of the time we’ll go into an agency and they’re not even reconciling their trust account,” Stocks said.

According to Stocks, each AgencyPoint department head specializes in that particular service they are handling, and everyone at the firm is well-versed in the insurance industry.

The goal of AgencyPoint will be to implement bookkeeping, tax, and payroll practices for agencies. Other services they provide include trust accounting, data entry, operating reconciliation, commission reconciliation, management reporting, accounts receivable, accounts payable, and premium payables.

Insurance industry partners Mick Hunt of Premier Strategy Box, Chris Paradiso of Paradiso Insurance, and Carey Wallace of AgencyFocus are advising AgencyPoint on their continued growth in the industry and how to best serve independent agents. They are coming on board as owners of PFS.

Topics California Agencies

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