The bi-annual 2010 Agency Universe Study, a collaborationbetween IIABA and Future One, a coalition of insurance companypartners, indicates that the number of independent agencies remainsstable at approximately 37,500 after a steady decade-long declinethat ended in 2006.

Among the findings:

• When the decline began in 1996, there were 44,000 agencies
• The proportion of independent agencies with African-Americanprincipals grew from 1 percent in 2008 to just over 4 percent in2010.
• Of the 37,500 agencies that exist today, 11 percent, or around4,000, were founded between 2008-2010. That figure is equal to thenumber of agencies lost through mergers and acquisition.
• Since 2005, 50 percent of new agencies were located in theSouth; 24 percent were founded in the South Atlantic states–whichincludes Florida–and 19 percent in the West South Central portionof the country that includes Louisiana and Texas. By contrast, only8 percent of new agencies were located in the Northeast, comparedwith 18 percent of older independent agencies. IIABA said theresult may reflect the flexibility of the agency system that allowsit to serve markets that captive agency companies haveabandoned.
• The combination of the soft market and Great Recession of 2008caused a decrease in revenue overall for independent agencies,particularly in commercial lines, mostly hurting larger agenciesthat are more dependent on commercial lines business. However, 55percent of small agencies saw increases in revenue from 2008 to2009, while 25 percent suffered decreases in revenue.
• The cost of technology is a less important issue than in thepast. Marketing the agency effectively over the Internet, securityand ease of use of new real-time functionality have become the topthree technology issues for owners. Carrier websites also havegained ground as the preferred method for agencies and companies todo business.

This report is the 10th in a series of studies on independentagencies that dates back to 1983. Approximately 2,100 agencies wereincluded in the study, which was conducted over the Internet.Copies of the study can be ordered by visiting the IIABA's website.The 23 page book is available as an e-book for$99.95.