Agency owners are leaking 9.8% of EBITDA each year.
How?
Contingent commissions are barely missed. Producers are focused on accounts that gravitate toward lower margin products. And carriers are underpaying on some policies.
Solving each of these problems adds pure margin to an agency’s bottom line, which is further multiplied when considering the valuation of an agency.
We’re plugging this gap for agency leaders with Commission Intelligence.
The problem
Too many agency owners are flying blind, stuck in “commissions hell”, and spending all of their time reactively reporting commissions, when they should be using commissions as a strategic lever to drive profit.
ABP Insurance was in exactly this position. Take it from them:
“We didn’t know – are we writing too much non-standard auto that has lower commissions? While the premium numbers can look good, they can be deceiving.” – Steve Soliday, Director Sales and Analytics
What we shipped
We’re adding dollars to the bottom line for agency owners with Commission Intelligence.
Commission Intelligence is automated commission reconciliation and insight for agencies, MGAs, and wholesalers. It includes:
- Carrier statement parsing: avoid re-keying carrier statement data, eliminate weeks of work each month, and avoid commission errors. For more info on parsing, read about AccountAim Ingest here.
- Carrier statement reconciliation: ensure carrier statement commission data matches your AMS. Eliminate commission mispayments and recover commission due to carrier error.
- Commission calculation: eliminate the weeks-long commission calculation exercise and get your team focused on more strategic work. Configure and calculate complex producer splits and overrides automatically, so producer compensation is always ready to go.
- Producer commission portal: build trust with producers by giving them a self-serve place to review commissions earned and paid at the policy level.
- Contingent commissions tracking: track progress on all contingent and supplemental commission opportunities. Drive EBITDA margin by focusing producers on hitting goals.
When agency owners have real-time visibility into what they’ve sold, earned, and received, they can coach producers to work the higher-margin accounts and hit contingent commissions.
What’s wrong with the alternatives?
Before AccountAim’s Commission Intelligence, agencies were running commissions one of three ways, but they rarely solved complicated commissions challenges for agencies and MGAs.
Excel is flexible but it’s time-consuming, error prone, and hard to audit. Native commissions modules within agency management systems are effective for simple data models, but don’t capture the complexity of policy endorsements, business-specific sales nuance, or complex producer splits. And horizontal compensation tools are flexible but they aren’t tailored enough to the specific commissions problems within insurance.
All of this leads to ongoing commissions headaches and leaked profit. After trying all of these options, read how ABP finally automated commissions with AccountAim here.
“We were in excel hell for years. Merging sheets, manual entry, and hours of reconciliation. We tried every solution including leading AMS vendors with no luck.” – Mark Stone, Owner & VP Operations
The impact of Commission Intelligence
With Commission Intelligence, agencies and MGAs can expect:
- 60 hours saved per month
- Hundreds of thousands of EBITDA recovered
- 25%+ boosts to agency valuation
“We’re able to run our business in a much more proactive, data-driven, and strategic way thanks to AccountAim’s Commission Intelligence.” – Mark Stone, Owner & VP Operations
Book a commissions consultation
If you think you’re leaving EBITDA on the table, book a commission consultation with us here. We’ll chat through your commissions structure, process, and reporting to evaluate if there is room for improvement.