4 Reasons You Shouldn't Use Excel Spreadsheets to Process Commissions

Processing Commissions in Excel Spreadsheets

Excel is Powerful, but It’s Not Ideal for Commissions Processing

There are plenty of business uses for Excel Spreadsheets, but processing your agency’s commissions shouldn’t be one of them.

When you process commissions, you’re downloading carrier statements and paying out commissions based on your commission schedules or, rather, your commission payment agreements with your agents.

There’s a lot of calculations that go into splitting out the payments at various points, and, yes, Excel is a powerful mathematical tool. But, processing commissions isn’t just math; it’s a process in which you want to ensure accuracy, identify missed commission payments, communicate accuracy to your agents, and analyze overall sales performance.

Because processing commissions is so much more than mathematical calculations, Excel Spreadsheets won’t suffice for four major reasons:

  • Errors
  • Time-Consuming
  • Ineffective Audit Trail
  • Restricted Analyzation


Excel Spreadsheets are manual. Yes, they do the math for you, but you have to set up those calculations, and one wrong click or delete can mess the entire sheet up. So, you can see the accuracy problem here.

According to Gartner, Inc., when companies move from Excel Spreadsheets to commission-based software, they reduce errors by over 90%. Over 90%.

"Organizations that abandon manual processes and spreadsheets and adopt...incentive compensation technologies, reduce errors by over 90%, processing times by over 40%, and IT/administrative staffing for ICM by more than 50%."

One of the largest accuracy-issues insurance agencies worry about when it comes to commissions processing is finding missed commission payments. When you are using a method like Excel spreadsheets that is open to errors, it makes it difficult to identify missed commission payments.

Find missed commission payments with AgencyBloc


It takes considerably more time to process commissions in an Excel spreadsheet than it does in commissions-specific agency software. One sales manager admits that he actually spends 90% of his time creating and/or editing the spreadsheet with the new numbers, and, thus, has no time to actually analyze the data. And as any insurance agency owner knows, time is the last thing you have. You’re busy writing up new business and communicating with current clients. Even if you have a dedicated person who does all of your commissions processing in an Excel spreadsheet, there are most likely other tasks you’d like them focusing on (like actually analyzing the data, as that sales manager pointed out).

Ineffective Audit Trail

Depending on how you’re organizing all of your spreadsheets, you may not have an adequate audit trail. You want a way to quickly pull up past payments received and payments paid out to agents for E&O reasons, and there’s not a great way to organize this information in Excel. If you’re using Excel spreadsheets, hopefully you’re saving each spreadsheet separately for each month or keeping one spreadsheet per year with separate tabs for each month, but then you already know how time-consuming that is. Not to mention, finding information later on can be frustrating.

As you pay your agents each month, they probably want to be reassured that they’re being paid correctly. Within Excel, there’s not a way to print out separate statements for each agent unless you build them in separate documents and update each month after you’ve finished processing and writing checks. Commissions software will often automatically generate a PDF that you can send to your agents with the amount they’re being paid and the calculations that went into it (their commission agreement percentage or a flat amount, for example). This is helpful and assuring for agents to know they’re being paid accurately or to point out someone when they’re not.

Restricted Analyzation

Obviously the main reason for processing commissions is to pay the correct people, but wouldn’t you like to analyze that information as well? Learn from it to make smarter business decisions in the future? For example, from your commissions data you can learn:

  • Who are my top producing agents?
  • What products bring in the most money?
  • Did I miss any commission payments?
  • What are my projected commissions for next year?
  • What have I received thus far vs. what I’m expecting to receive?

All of these questions are important to address, and it can be difficult to address them solely in Excel.

Though it is possible to analyze data in Excel, it is a much more manual process than what you’ll have to do in commissions software. With Excel, you highlight the cell data you’d like to analyze and make a graph or chart out of it. That graph or chart will change as you add new data, but manual entry always lends itself to human error.

Commissions software, once initially setup, will automatically do the math and show you graphs and charts of your current data (depending which software you use—AgencyBloc does display real-time graphs). You always have the ability to run reports from the software or to do an in-depth search, but you won’t have to manually create visuals for the valuable information like the questions we listed above.

Projecting Commission Example in AgencyBloc

I’m Currently Using Excel—What should I do?

If you’re looking for a more efficient way to manage your commissions than using Excel, an agency management system is what you’re looking for. Though moving to a new system seems daunting (it doesn’t have to be!), you’ll thank yourself a million times over when your life is made easier when it comes to processing, tracking and analyzing commissions.

Want to see what commissions processing looks like inside an agency management system? Schedule a 1-on-1 demo here.

[Free eBook] The Agency's Guide to Commissions: Efficient Processing, Uncovering Misses, & Analyzing Performance

In this eBook, we discuss how agencies are better managing their commissions—everything from processing and tracking to projecting and monitoring performance.

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Kelsey Rosauer

By Kelsey Rosauer on March 24, 2016 in Commissions Processing

Kelsey is the Marketing Brand Specialist at AgencyBloc. She plans and creates educational resources to help our customers organize, automate & grow their insurance agency. Favorite quote: "I am convinced that life is 10% what happens to me and 90% how I react to it." —Charles R. Swindoll  More articles


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