Why more effort is not your growth problem
According to Insurance Journal, the U.S. property and casualty industry finished 2024 with a $22.9 billion net underwriting gain and a 96.6 combined ratio, its first underwriting profit in four years after a $21.3 billion underwriting loss in 2023.
On the personal lines side, the Consumer Federation of America reported that typical homeowners saw premiums rise about 24 percent from 2021 to 2024, with the average premium reaching roughly $3,303 per year for a standard policy.
Carriers are back in the black and more selective about the books they want. That puts pressure on agencies to run tighter, more profitable accounts. The issue in most shops is not effort. Your team is already working hard.
The real drag on growth is where that effort is going.
When effort stops turning into growth
Spend a week listening inside almost any independent agency, and you will hear some version of:
- “I would prospect more, but I am buried in service work.”
- “We cannot raise minimums; the team will revolt.”
- “It is just a quick change, I will take care of it.”
Under those comments, the same structural problems show up again and again:
- Producers doing CSR work on small, noisy accounts
- C-tier accounts getting A-tier responsiveness
- No firm floor on what belongs in the book today versus what slipped in during softer years
In that environment, more effort does not equal more growth. It just equals more burnout.
What “the wrong account” actually looks like
“Wrong” does not simply mean “small premium.”
The wrong accounts are usually the ones where:
- Cost to serve is higher than the commission and fees
- The client is high friction, with late payments, frequent changes, and constant “emergencies.”
- There is no real upside, meaning no meaningful cross-sell, no referral influence, and no path to larger lines
By contrast, the right accounts tend to share three traits:
- Healthy revenue per account
- Predictable and reasonable service patterns
- Future upside, whether that is growth, cross-sell, or influence in a target niche
If you do not deliberately sort those groups, your team will treat them as equals. That is exactly how growth stalls while everyone still feels “busy”.
A simple way to see the cost to serve
You do not need a consultant or a full data warehouse to get most of the insight. Start with a rough but honest estimate.
Pick one segment and walk through this:
- Choose a segment
Examples: personal lines, small BOP, contractors, habitational. - Estimate annual touchpoints per account
Include calls, emails, certificates, remarkets, billing rescues, and “quick questions”. - Estimate minutes per touchpoint
Be honest. That “two-minute” call is usually 15 to 20 minutes by the time notes and follow-ups are finished. - Calculate hours per account per year
The formula is: (Touches×Minutes)÷60 - Assign a fully loaded hourly cost
Salary plus benefits plus overhead for CSRs, account managers, and any producer time that gets pulled into service. - Compare that cost to annual commission and fees.
Example:
Small commercial account
Commission: $1,500
12 service touches per year at 20 minutes each, about 4 hours
Loaded cost: $70 per hour
Cost to serve: 4 × $70 = $280
Gross margin before overhead: $1,500 – $280 = $1,220 dollars Now compare that to a messy personal lines account:
Personal lines account
Commission: $400
18 service touches per year at 20 minutes each, about 6 hours
Same $70 per hour
Cost to serve: 6 × $70 = $420 dollars
You are effectively paying to keep that account on the books.
Run this across a sample of your book, and you will quickly see where time is being burned for very little return.
Tiering your book: A, B, and C
Once you have a feel for margin and effort, you do not need perfect precision. You need direction.
Build a simple A, B, and C model:
- A accounts
Top 10 to 15 percent by revenue. Strong margins. Clear upside in growth, influence, or cross-sell. - B accounts
Solid, profitable core business that behaves well and renews consistently. - C accounts
Low revenue and or low margin. Often high friction and low upside. They consume an outsized share of service time.
Then write a few clear rules. For example:
- Revenue (commission plus fees) above X with a margin above Y percent goes to A
- Revenue above X but margin below Y percent goes to B
- Revenue below X, or consistently high touch and low revenue, goes to C
Even if the first pass is rough, it is far better than pretending every account deserves the same attention.
Aligning your service model to those tiers
Tagging accounts is only the first step. The real leverage comes from changing how you serve each tier.
For A accounts:
- Named account manager or dedicated pod
- Proactive annual or semi-annual reviews
- Strategic conversations around limits, coverage gaps, risk management, and growth
- Priority handling of service issues and remarkets
For B accounts:
- Clear SLAs and expectations
- Structured review cycle
- Solid, reliable service without “drop everything” priority
For C accounts:
- Digital first and template-driven communication wherever possible
- Self-service or portals for routine documents and standard requests
- Dedicated low-touch service workflows so C work does not interrupt A and B accounts all day
You are not neglecting clients. You are matching service level to the economics of each relationship.
Producers, minimums, and saying “no” on purpose
If producers are still allowed to write anything with a pulse, the wrong accounts will keep flooding in.
Three levers matter most:
- Minimum revenue thresholds
Decide the minimum annual commission or fee for new business. Below that level, accounts either move into a low-touch segment or do not come into the book.
- Protected selling time
Producers should not be spending half of every week in service mode. Route tickets and calls to CSRs or account managers first. Producers are pulled into service only when there is a clear reason.
- Comp plans that reward book quality
Tie part of producer compensation to margin and mix, not only total premium. A smaller, clean, scalable book is worth more than a larger, chaotic one.
This is what “growth requires prioritisation, not just effort” looks like in practice. You are deciding what not to sell and what not to keep.
A 30-day reset you can actually run
Here is a practical way to start without blowing up your agency.
Week 1: Pull the data
- Export the last 12 months from your AMS, including account, premium, commission or fees, line of business, producer, and policy count.
- For two or three key segments, estimate touchpoints, hours, and cost to serve using the method above.
Week 2: Draft A, B, and C tiers
- Apply simple rules for A, B, and C using revenue and margin.
- Flag:
- Bottom 10 to 15 percent by margin as likely C
- Top 10 to 20 percent with clear upside as likely A
- Bottom 10 to 15 percent by margin as likely C
Week 3: Set rules and communicate them
- Define service standards for each tier.
- Set the new minimum revenue level for what producers can write going forward.
- Explain the “why” to your team: fewer fires, more time for the right accounts, healthier growth.
Week 4: Implement one concrete change
Pick one clear move:
- Move a set of C accounts into a standardized, lower-touch workflow
- Raise the minimum size for new accounts starting next quarter
- Launch a retention or cross-sell campaign focused only on A accounts
Then schedule a quarterly review of your tiers and margins. Treat this like you treat loss ratio, contingency targets, or carrier scorecards. It becomes an operating habit, not a one-time clean-up.
The bottom line
The market has already rewarded carriers for getting more disciplined. The same thing is coming for agencies.
You do not control rates or catastrophe losses. You do control which accounts you take on, how you tier them, and how much of your team’s time each one is allowed to consume.
Growth will not come from working harder on a random mix of businesses. It will come from:
- Writing and keeping the right accounts
- Matching service levels to actual economics
- Protecting producer time for selling, not firefighting
When you stop letting the wrong accounts own your calendar, the same effort your team is already giving starts to show up where it should: in cleaner numbers, calmer operations, and real, sustainable growth.