Choosing the Right Key Performance Indicators

Though it can be difficult to set aside time for, analyzing the performance of your business is imperative.

It can also be challenging to decide which KPIs (key performance indicators) to track and analyze, especially if you’re just starting out. ClearPoint Strategy suggests:

“A good KPI should act as a compass, helping you and your team understand whether you’re taking the right path toward your strategic goals. To be effective, a KPI must:

  • Be well-defined and quantifiable.
  • Be communicated throughout your organization and department.
  • Be crucial to achieving your goal. (Hence, key performance indicators.)
  • Be applicable to your Line of Business (LOB) or department.”

For insurance agencies, there are countless KPIs that could be monitored. Agencies will differ on which KPIs are most relevant to them depending on their size, audience, and products/services they specialize in.

But, we feel there are six KPIs that all life and health insurance agencies should consider tracking and analyzing regularly. There are several areas of your business covered by these metrics. These areas include commissions, new business, agent production, marketing, customer satisfaction, and customer retention.

1. Actual vs. Expected Commissions

This metric is significant for several reasons, like foreshadowing revenue and to be sure you’re being paid what you’re owed from carriers. A few other reasons an agency may want to track this metric are to make more informed decisions about:

  • Hiring support staff—when will the agency need and be able to hire more staff?
  • Expanding or maintaining their current client base—how much does an agent need to sell to reach their financial goal?
  • Deciding which products to sell—what products will bring the agency substantial revenue? Does the agency need to expand into other areas of business?
  • Identifying new sales opportunities—how will expanding into a new market or simply selling more of the current products affect revenue?
  • Finding missed or inaccurate commissions—are there discrepancies between what the agency expected to receive vs. what was actually received? How does that affect future plans?


$ in actual commissions received (monthly, quarterly, yearly, etc.)
$ in projected commissions (monthly, quarterly, yearly, etc.)
$ in expected commissions from carriers
$ in actual commissions received from carriers

2. New Policies (Per Week, Month, Quarter, Year, and Per Agent)

Using this metric, you can keep an eye on one of the most critical aspects of your business: selling policies. Although taking care of current clients should be the priority, you still put a lot of effort into prospecting and new business.

Looking at the number of new policies coming in weekly, monthly, and yearly is a helpful way to gauge growth at your agency. Using this metric, you can make more informed decisions on when and where to place resources.


# of new policies (per week, month, quarter, year)
# of new policies (per agent in timeframe)

3. Agent Production

Every business monitors the performance of its employees, and an insurance agency is no different. You can use this metric to determine where you can guide struggling agents and where you can continue to encourage and recognize top performers. Not to mention, it helps you identify which of your agents might be most suitable for certain accounts.


# of policies sold per agent
$ in commissions received per agent

4. Top Performing Lead Sources

To grow your agency, you have to be able to identify which lead sources are profitable and which aren’t. You’ll want to look at the close ratio per lead source and the close ratio per agent to identify this.

With this information, you can make strategic decisions on where to place more marketing dollars, where to ask for more effort from your agents, and potential lead sources you can cut resources from.


# of contacts per lead source (prospects, clients, etc.)
# of policies per lead source
$ in commissions received per lead source

5. Retention Rate provides this calculation and example for retention rate:

Retention Rate = ((CE-CN)/CS)) X 100
CE = number of customers at end of period
CN = number of new customers acquired during period
CS = number of customers at start of period

You start the (week/month/year/other period you choose) with 200 customers. You lose 20 customers, but you gain 40 customers. At the end of the period you have 220 customers.

Now do the math:

220 - 40 = 180; 180/200 = .9; .9 x 100 = 90. Your retention rate for the period was 90 percent.”

Agencies must keep a close eye on their overall retention rate. Retention rate is an indicator of client satisfaction. However, it can also help agencies identify internal or external factors that are playing into client retention that they may not have been aware of otherwise. After all, the only way you’re likely to start asking questions or digging into something is if you’re aware of a significant change. And the only way to identify a significant change is by monitoring this metric over time. 


Retention Rate = ((CE-CN)/CS)) X 100 (formula above)

6. Policies Per Client

According to Signalmind, it can be 6-7 times more expensive to acquire a new client rather than keep an existing one. That’s why cross-selling can be an extremely cost-effective strategy for insurance agencies. Besides being economical, cross-selling can also improve client satisfaction and retention.

By keeping track of the average number of policies per client at your agency, you can get a quick feel for if you need to put a stronger cross-sell strategy in place. 


# of policies per contact

# of contacts with one policy

These six KPIs cover the bases for the most significant aspects of your business. Although they aren't the only way to measure the health of your agency, they are a wise place to start if you haven't done so already.

Visualizing the Data

To draw insight from these metrics, you can’t just stare at lines of data. Humans process data best when they can identify patterns and see trends through data visualization.

To do this, you need the right technology. Although many businesses still attempt data visualization through spreadsheets, that process can be very manual and time-consuming. Not to mention, you may want to look at some of these KPIs daily, and spreadsheets don’t offer an efficient way to do that. Thus, many insurance agencies are turning to agency management systems (AMSs) with data tracking and analysis capabilities.

Your agency can track and analyze data using three main methods: advanced searches, real-time graphs and charts, and custom reporting. AgencyBloc, an AMS built for life and health insurance agencies, provides all three of these.

AgencyBloc's Advanced & Saved Searches

A quick way to find specific information is to do an Advanced Search. Using an Advanced Search, you can get very granular with the information you’re trying to retrieve. Plus, if it’s something you’re interested in looking at regularly, you can save the search to view again regularly. 

Advanced & Saved Searches are excellent for information you’re intending to act on immediately and for data points you look at often (even daily). 

AgencyBloc Advanced & Saved Search

AgencyBloc Advanced Search

AgencyBloc's Dashboard Analytics

Dashboard Analytics are AgencyBloc’s most visual way to consume data through the use of charts and graphs covering client, prospect, agent, policy, carrier, commission, and overall agency activity data. When data is presented in this way (known as “Smart Data”), you’re better able to identify patterns. 

This is also a great option for metrics you want to keep a pulse on daily as they are updated in real-time (every time relevant data is updated in AgencyBloc, that will be reflected on the real-time graph or chart).

AgencyBloc Dashboard Analytics

AgencyBloc's New Individual Policies by Month Graph

AgencyBloc's Industry & Custom Reporting

Lastly, AgencyBloc allows agencies to run standard industry reports or build their own custom reports. 

AgencyBloc Custom Reporting

AgencyBloc Custom Reports

This method of gathering and visualizing data proves useful when pulling specific information on a weekly, monthly, quarterly, and yearly basis. It’s also a helpful way to get at those really specific data points because you can filter out whatever you don’t want to see.

So, we’ve given you six KPIs to think about monitoring at your agency, and we’ve looked at a few ways to analyze those metrics. What you need to do now is take those six KPIs and consider if they will work for monitoring performance at your agency. What other metrics will you need to add? Consider what your overall goals are. Do these KPIs allow you to see your progress toward those goals?

Next, you need to examine how you’re currently managing your book of business and how easily data can be pulled and analyzed. Unfortunately, some agencies find that their current way of managing their book doesn’t allow for easy data analysis, so assessing business performance falls to the back burner. 

The bottom line is that you can't make truly informed business decisions unless you have a clear understanding of your agency's performance.

Dive Deeper into Your Agency's Data

How do you make decisions that will impact your team or entire agency? More importantly, how do you ensure you're making the right decision? This guide covers which metrics to track and how to monitor them.

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This blog was originally published on February 7, 2018, and has been most recently updated and republished on November 1, 2022.

Posted by Sarah Rosonke on Tuesday, November 1, 2022 in Reporting & Data Analysis

  1. client retention
  2. commissions
  3. data management
  4. productivity
  5. selling

About The Author

Sarah Rosonke

Sarah is the Design and Content Specialist at AgencyBloc. She creates and designs helpful resources to support life and health insurance agencies in growing and automating their business. Favorite quote: "You'll never do a whole lot unless you're brave enough to try." —Dol ... read more