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...rrent operations (profitability, staffing, expense controls, working capital, ...

...ion about principals. 2. Agency-staffing information, describing the position...-liability exposures and thus surplus lines risks. The property may be a very ...

... sales The philosophies on these operational issues need to be explored, and an agreement reached on how the combined entity would handle each of six functions for Life, Group, Personal and Commercial lines: sales, marketing, placement, client service claims, accounting, and administration. AUTOMATION In conjunction with the operational issues, the extent to which automation will be integrated with the systems and procedures of the firm need to be determined. Which computer system will survive the business combination? 4. Financial Strength and Productivity Ratio for Each Party ... . Melding the best structures and employees is the most difficult aspect of any business combination. Each party is usually too close to its own operations and employees to be able to pick and choose which ones are better for the new entity. A third party can greatly assist. Examples of varying operational structures include the following: Having a small commercial accounts unit that services and sells all accounts under a certain size, instead of having all CSRs handle small accounts Functioning on an alphabetical basis instead of by producer unit Centralizing the marketing/ ... operation and what weaknesses need attention. The ratios should be compared to those of other agencies of similar size and agencies writing comparable accounts. The results should also influence the values placed on each entity, since they reflect the management of the current operations (profitability, staffing, expense controls, working capital, and so forth) . The ratios should include the following as a minimum: Expenses by line item as a percentage of revenues Revenue, expense, and profit per employee P&C or Life/Group commissions per producer ...

... marketing person should even visit the risk with the producer. The goal is to transfer the marketing responsibility from the producer to the marketing department. This allows the producer to focus on new sales rather then handle the details of marketing a piece of business, especially the administrative responsibilities of obtaining the quote. Centralization should streamline the marketing process for an agency. Since the contact with the underwriters will be limited to just a few people, a good rapport can be developed. Consistency with the applications and better hit ratios will also win ... Continual coordination with the sales manager or department is key to its success. A central marketing department may be needed when more than one of the following is true: The agency has a number of producers submitting new business regularly. CSRs have little or no time to assist the producers with new business submissions. Producer/company relations are strained and need attention. Company volume commitments have been promised. In-house underwriting authority exists. The agency can afford to separate this function. The primary goal of a centralized marketing department is to free ... addition to a reasonable flat salary. Review the cost of compensation for the marketer in conjunction with adjusting producer compensation, since the producers are the beneficiaries of the marketer's efforts. ONE LAST THOUGHT Don't attempt a half-hearted venture down the marketing department path. The process, staffing, and structure should be well thought out and must be accepted by everyone- otherwise it won't work. A centralized marketing department is not for everyone, but those who effectively implement it will experience an increase in new sales and efficiency. Once it's incorporated, ...

...sonnel, or hire an additional administrative or customer service person to tak... decreased training time, decreased staffing needs, and more efficient monitor...