Two hundred agency principals or producers from independent U.S. P&C agencies shared their thoughts with Aite Group (an independent research and advisory firm focused on business, technology and regulatory issues) and insurance software and agency management systems provider Vertafore on their optimism, revenue and use of technology tools to support their growth.
The results, some of which are highlighted in the following pages (download the full report) provide a snapshot of producers' feelings as we head into another challenging year in a softening P&C market.
Overall, P&C agencies are less focused on aggressive growth in the next three to five years than they are in maintaining the business they currently have. The majority (57%) say they are hoping for moderate growth. This is particularly true for larger agencies, with the number of those saying they look to aggressively grow falling from 67% in 2014 to just 27% this year.
Likewise, optimism among agencies in 2015 was reported slightly lower than it was a year ago (by eight percentage points, from 84% to 76%). It's important to note this sentiment is primarily driven by midsize to larger agencies.
Still, it's not all hand-wringing among producers. Revenue for both personal and commercial lines continues to be positive year over year, with only 5% of agencies reporting a loss — and nearly half of all agencies report low-level increases of 5% or less for both lines; they attribute this growth to various forms of marketing efforts. Further, the use of tech tools to meet sales goals has increased year over year, with more agents embracing advanced customer self-servicing capabilities and social media tools including Twitter and blogs.
Additionally, P&C agencies shared their concerns over threats to their business, and reveal just how much those potential disruptors keep them up at night:
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