Independent agents and brokers, responding to a years-long softmarket, already have been doing more with less and are implementingfewer of the layoffs and other cost-cutting methods that so manyU.S. businesses have adopted in the past year in response to therecession.

|

In a recent onlinesurvey of almost 500 AA&B readers, nearly 36 percentreported taking no cost-cutting measures over the past year. Whenimplemented, the most common methods were salary freezes (33percent) followed by layoffs (18 percent) and benefits reduction orelimination (17 percent).

|

Respondents also cited economizing methods such as hiringfreezes, reducing work hours, expense review and reduction,“pressuring vendors to reduce rates,” and moving to less expensiveoffice space.

|

Fifty-four percent of respondentssaid their agency staff levels had remained the same over the pastyear, while 12 percent actually reported increases. Slightly morethan 10 percent reported staff reductions of less than 3percent.

|

This appears to be in line with the 2008 IIABA Agency Universestudy, which indicates that on average, agencies are employingfewer full-time-equivalent (FTE) employees in 2008 than in 2006–9in 2008 versus 11.2 in 2006.

|

To keep up with increased workloads, the vast majority–73percent–reported various examples that they were simply workingharder, while 16 percent were making part-time positions intofull-time jobs, and 9 percent were outsourcing some businessfunctions.

|

Other methods cited to keep up with work included streamliningworkflows, reallocating job responsibilities and improvingtechnology.

|

When staff reductions were implemented, they were primarily inCSR functions, at 67 percent, followed by 12.5 percent inadministrative and 7 percent in producers.

|

For agencies that did report cost cutting, 46 percent trimmedtheir marketing budgets, followed by reductions in new businessefforts (30.5 percent) and business retention (29 percent).

|

Other areas where agencies cut back included personal linesmarketing, travel budgets and business retention–in many cases,because those customers were going out of business.

|

More efficient use of agency automation systems is picking upthe slack for increased workloads, with 28 percent of respondentssaying they upgraded their current systems, 27 percent adding newtechnology such as scanning, and 27 percent reprioritizing currentworkloads.

|

Finally, respondents reported a number of agency changes made inresponse to the economy, including:

|

o Making producers more responsible for customer service

|

o Adding dual monitors

|

o Increasing efforts to go paperless

|

o Using e-mail and direct billing for more accounts

|

o More phone contact with clients instead of face-to-facemeetings

|

o “Doing our own janitorial work.”

Want to continue reading?
Become a Free PropertyCasualty360 Digital Reader

  • All PropertyCasualty360.com news coverage, best practices, and in-depth analysis.
  • Educational webcasts, resources from industry leaders, and informative newsletters.
  • Other award-winning websites including BenefitsPRO.com and ThinkAdvisor.com.
NOT FOR REPRINT

© 2024 ALM Global, LLC, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.