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Why Hiring Millennial Producers is Key to the Future of your Agency

Posted on June 16, 2016 by Mark Sonders

Sonders' Selling Tips

We talk a lot on this blog about how you can leverage technology to become better sales people. But there is also a glaring elephant in the room: statistically, 25% of the insurance industry is going to retire by 2018. 

That's only two years away. 

And with all of the change happening in the industry, I wanted to make sure we are providing you with not only our own opinions about how you can be successful in the future, but the expert opinions of world-class advisors. 

Today's post is an excerpt from our free e-book Managing your agency in the digital era: Strategies and solutions for maximizing employee performance and engagement. My team had the pleasure of interviewing Susan Hughes from Reagan Consulting specifically on the topic of hiring producers, something (statistically speaking) all of you will be doing very, very soon. 

Susan Hughes

If you're an agency principal, take Susan's advice seriously. If you're a younger producer or manager, make sure you pass this along to your principal.  

From the perspective of renowned industry advisor Reagan Consulting, an aging workforce is one of the biggest issues that insurance agencies need to tackle. The solution to these demographic changes lies in recruiting younger talent, yet too few agencies have considered hiring a new generation of producers to ensure the future growth and health of their business.

“We determined that 55–60 percent of agencies in the industry are under-hiring for sales or producer roles,” says Reagan’s Susan Hughes.

Hiring millennial producers

In the fall of 2014, Reagan Consulting released Producer Recruiting & Development: Getting the Attention It Deserves—Achieving the Results You Need. In that study, Reagan looked at the hiring processes and results for nearly 5,000 producers at over 500 agencies.

Hughes says, “We learned that the average hiring practice success rate—the percentage of producers who become fully validated after five years—was 56 percent.

“If only 56 percent of the people you hire become successful on a long-term basis with your agency, that can have some staggering effects on your overall value and profitability,” she continues.

One of the other key issues that Reagan’s survey revealed was that only 35 percent of the producers in the survey came from outside of the insurance industry, including college—a low number for any field.

Looking outside the insurance realm and hiring younger staff can help agencies stay independent and privately owned in this era of mergers and acquisitions. Hughes explains, “In the insurance industry there’s a cycle of passing down ownership and shares of the agency to younger producers. If you don’t have a pipeline of those younger producers in place, then the perpetuation of your private ownership is at risk and a merger or acquisition scenario becomes more likely.”

She continues, “We really counsel agencies to look beyond their immediate needs. By diversifying their investment in talent, they can better serve their sales targets today and ensure that their agency doors stay open tomorrow.”


Mark Sonders

Mr. Sonders is the Senior Vice President of Sales and Marketing at Vertafore. With over 25 years of sales, marketing, and financial experience at companies like Thomson Reuters and Kaplan Financial, Mark’s career has focused on delivering long-term success for his clients in order to help them get the maximum value out of his organizations products and services.

 

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