Agency Compensation 360: Q2 Insights

What Independent Agencies Need to Know About Compensation Benchmarking

Compensation decisions are getting harder for independent insurance agencies.

Talent is more expensive. Employees have more visibility into pay. Agencies are competing with banks, financial firms, carriers, other agencies, and remote employers. At the same time, many agencies are trying to grow revenue without simply adding more people.

That is why compensation benchmarking matters.

The Agency Compensation 360 Study gives independent agencies access to real-time compensation, benefits, staffing, outsourcing, and workforce trend data built specifically for the independent agency channel

What is Agency Compensation 360?

Agency Compensation 360 is a national benchmarking study designed for Big “I” state association members and independent insurance agencies.

The study looks beyond salary alone. It includes:

• Salary and commission structures
• Bonuses and incentive plans
• Benefits and PTO trends
• Remote and flexible work practices
• Staffing models
• Outsourcing trends
• Hiring and growth expectations

The goal is simple: help agencies make smarter, less emotional compensation decisions using real data.

Why does compensation benchmarking matter?

Agencies need to know whether they are leading, matching, or lagging the market.

Without benchmark data, compensation decisions often become reactive. Agencies may overpay to fill a role, underpay loyal employees, or create internal equity issues without realizing it.

Benchmarking helps agency leaders answer questions like:

• Are we competitive for this role?
• Are new hires being paid more than long-term employees?
• Are our benefits helping or hurting recruiting?
• Are we comparing ourselves to similar agencies?
• Are we building a compensation model we can sustain?

Key insight: payroll is a major agency expense

According to the study, average payroll expense is about 43% of total agency revenue nationally.

But that number can vary significantly by state, agency size, region, and business model. That is why the ability to filter the data matters.

An agency in a rural market may not need to match urban compensation levels. A larger agency may have very different benefits expectations than a smaller firm. The more specific the comparison, the more useful the data becomes.

Why filters are so important

The real value of Agency Compensation 360 is not just the national data. It is the ability to drill down.

Agencies can filter by:

• State
• Region
• Agency size
• Revenue
• Role
• Line of business
• Community type
• Growth profile

That means agencies can compare themselves to more relevant peer groups instead of relying on broad averages.

For example, a smaller rural agency may discover that offering stronger PTO or flexible work options gives it a competitive advantage without dramatically increasing payroll costs.

Compensation is more than salary

A strong compensation strategy includes more than pay.

Agencies should think about four major areas:

• Salary, commission, and bonus
• Benefits
• Learning and development opportunities
• Work environment and flexibility

Some agencies may choose to match the market on salary but lead the market in culture, flexibility, or professional development.

The key is knowing your philosophy and communicating it clearly.

Define your compensation philosophy

Every agency should decide where it wants to sit in the market.

Do you want to:

• Lead the market?
• Match the market?
• Lag the market?

There is no single right answer. But there should be a clear answer.

Your compensation philosophy should align with your agency’s values, growth goals, budget, culture, and talent strategy.

Watch for internal equity issues

One of the biggest risks agencies face is pay imbalance.

In some cases, newer employees are entering agencies at higher pay levels than more experienced, long-term employees. That can create morale issues, retention problems, and long-term compensation challenges.

Agencies should regularly review:

• New hire pay
• Existing employee pay
• Role-based compensation
• Bonus eligibility
• Career development opportunities

The goal is not to fix everything overnight. The goal is to create a “true north” and move toward a more consistent model over time.

Benefits can be a competitive advantage

The study also shows wide variation in benefits.

For example, health insurance availability can change significantly depending on agency size and location. Larger agencies are more likely to offer group benefits, while smaller agencies may have more opportunity to stand out with PTO, flexibility, or other perks.

One practical idea: reconsider traditional PTO models.

Instead of increasing PTO only through tenure, some agencies are moving toward more generous PTO from day one. This can help attract talent and create a more modern, equitable benefits structure.

Agencies should compare people, technology, and outsourcing

Hiring is not the only growth strategy.

Agencies are increasingly asking:

Do we need to hire a person, improve our technology, or outsource this work?

Agency Compensation 360 includes outsourcing data that can help agencies understand what others are outsourcing, including IT, payroll, accounting, bookkeeping, and other operational functions.

This helps agencies make smarter staffing decisions based on workload, cost, efficiency, and growth goals.

How agencies can use the dashboard

Once an agency completes the study, the analytics dashboard becomes available.

Agencies can use it to:

• Benchmark specific roles
• Compare salary ranges
• Review benefits trends
• Evaluate PTO models
• Analyze outsourcing costs
• Understand regional differences
• Support budgeting and hiring decisions

Dashboards can also be exported as PDF reports for internal planning conversations.

Bottom line

Compensation is no longer a guessing game.

Independent agencies need a clear compensation philosophy, reliable benchmark data, and a plan that balances pay, benefits, culture, development, and long-term sustainability.

Agency Compensation 360 gives agencies the data they need to make better decisions and build stronger teams.

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Watch now to learn more about Agency Compensation 360 and how it can help your agency.