Agents are boiling over with frustration at carriers who are focused entirely on growth regardless of loss ratio. Agents know they can grow slowly and profitably, or they can grow quickly with higher loss ratios. There’s a trade-off between growth and profit, so why do carriers forego profits for growth? Shouldn’t carriers be in business to maximize profit?

From the agent’s perspective, companies are cash-flow underwriting. Why else would a company discourage agents from achieving low loss ratios? Yet it’s happening. As shown by the following actual examples, these carriers clearly are sacrificing loss ratios for growth:

o A contingency contract that pays $0 for a 10 percent loss ratio and 0 percent growth on $1 million premium, but pays $25,000 for a 50 percent loss ratio and 4 percent growth

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