After a couple of years of minimal (or even negative) organic growth and declining profit margins, insurance agents and brokers have put some halfway decent numbers on the board so far in 2011: Organic growth stands at 3.3 percent for the industry through the second quarter, and agents and brokers are projecting organic growth of 4.5 percent for the full year.

And as growth has rebounded, so has broker profitability, as measured by EBITDA margin. Once consistently above 20 percent, EBITDA margins dropped to 16.8 percent in 2009. However, agents and brokers are projecting a return to 20-percent margins for 2011.

So it seems as if things are moving in the right direction. But can this momentum last? To answer that question, we have to look at what has driven the performance turnaround this year.

Recommended For You

Want to continue reading?
Become a Free PropertyCasualty360 Digital Reader

Your access to unlimited PropertyCasualty360 content isn’t changing.
Once you are an ALM digital member, you’ll receive:

  • Breaking insurance news and analysis, on-site and via our newsletters and custom alerts
  • Weekly Insurance Speak podcast featuring exclusive interviews with industry leaders
  • Educational webcasts, white papers, and ebooks from industry thought leaders
  • Critical converage of the employee benefits and financial advisory markets on our other ALM sites, BenefitsPRO and ThinkAdvisor
NOT FOR REPRINT

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