Industry News

Jump in earnings, increase in digital, importance of education and ongoing optimism are among the key findings of the annual NU/PIA survey of agents.

WASHINGTON – The nation’s professional, independent insurance agents are optimistic, they are making greater use of digital tools, and they think that a commitment to education is an essential element of a successful agency. 

These were among the findings of the 2022 National Underwriter (NU)/PIA Independent Insurance Agent Survey. 
 
“A can-do attitude has always been a characteristic of independent agents, along with  adaptability and resilience. And that is what we found in this year’s survey,” said PIA CEO Mike Becker. “This installment of the Independent Insurance Agent Survey also reveals that more agents are offering their clients the option of digital engagement and using digital tools for greater reach, deeper connections and more business.”

The survey found that independent agents overwhelmingly rely on relationships, great service, and coverage expertise to differentiate themselves from the competition.   

The most cited points of business differentiation were relationships (84.5%) and service (83.1%). Independent insurance agents are far less likely to rely on price competition in their marketing. 

Increase in Agency Earnings

Responses to the survey questions about both agency production and gross earnings show continued improvement year-over-year. Agencies reporting increased production increased by 17% (to 66.7%) while those reporting declines in production decreased by 17.2%, (to 15.2%). 

Significantly, this year’s survey revealed a big increase in overall gross income earnings over a 12 month period. Comparing 2021 to 2020, the number of agencies reporting that their earnings increased rose by 19.2% (to 66.5%) and the number of agencies reporting that their earnings declined went down 15.6% (to 16.4%). This was a big improvement.

The findings on earnings demonstrate that both agency production and earnings continue to improve, a trend that was also noted in direct informal feedback from many PIA members. However, challenges for some agencies remain.

Importance of Education

Many respondents pointed to the need for continuing education and ongoing professional development. They said both are “indispensable” to the agency’s ongoing success. 
Fully 77.7% of respondents said education is either indispensable to, or an important element of, an agency’s success. A majority (53.3%) require that employees earn designations. A majority encourage employees to take classes that are knowledge-based regardless of CE (65.6%). There is a strong preference for providing a monetary bonus as an incentive for taking education classes (87.3%).

Acceptance of Digital Grows

In the 2021 survey, when asked to rank what elements of the agent-client experience are well-suited to online service, only 21.2% of those responding said “establishment of trust” was well served by digital interactions. Asked the same question this year, the positive response increased to 29.0%. 

Survey results indicate increasing acceptance on the part of agents who have successfully incorporated digital into their interactions with customers is steadily increasing. These uses go beyond simple transaction processing such as premium payments and claims. 

“We can totally interact with our clients for any service need from quoting, writing and servicing our policies without ever meeting face to face if clients prefer that method,” noted one survey participant. “We have a digital marketing and quoting presence. We like face to face, but the majority of new clients we are on-boarding prefer a digital/virtual experience.”

That’s the right approach, according to PIA CEO Becker. “You have to meet people where they want to be met. Some clients may be comfortable with more in-person contact. But increasingly, more customers prefer doing more digitally,” he said.

Future Outlook

Despite challenges, agents remain optimistic. One such survey respondent pointed out that industry watchers have long predicted the demise of the traditional insurance agency, but that didn’t happen. 

“Twenty years ago, TIME Magazine said insurance agencies were a dying institution,” this person wrote. “We are still here as people find out that waiting on line to talk with someone different every time is not so great… Independent agents are solid!”

The 2022 NU/PIA Independent Insurance Agent Survey

Founded in 1931, PIA is a national trade association that represents member insurance agents and their employees who sell and service all kinds of insurance, but specialize in coverage of automobiles, homes, and businesses. PIA’s web address is www.pianational.org.