Hartford just released figures for July, 2013:
467,511 Written Premium, up 16.7%
405,674 Earned Premium
199,880 Incurred Losses
49.3% Loss Ratio
66,820 Growth in WP
134,794 New Business
604 Policies in Force, up from 552 in December
Profit-sharing bonus is based on a 3-YEAR Loss Ratio which is 46.6%…WE ARE LOOKING GOOD NOW (need under 55%).
Since 2011 and 2012 were profitable with Hartford we already have 2 good years plus a good 7 months of 2013 for bonus. Odds are very good.
POLICY GROWTH MATTERS–Last year our PIF was down and the base factor was 1.75% of Written Premium.
If PIF is between 580 to 606 our base factor will be 2.8% (we are at 604 right now),
between 607 to 661 it increases to 3.15%, and between 662 to 717 it increases to 3.45%.
NOTE: SIAA negotiated an additional 1% commission if VIAA writes $250,000 in New Business (our current new business of $134,794 is an annualized rate of $231,075).
So another $20,000+ in new business could be an extra $2500 in commission!
RATE REDUCTION: As of 8/6/13 in Missouri on new Home-owner business Hartford reduced rates on homes between $200,000 and $500,000, but increased rates on homes in protection classes 7-10.
QUALITY COUNTS: Hartford is monitoring each agency based on % of Issued Policies with 3 to 5 stars in their ranking.
They prefer not to write business with only 1 or 2 “stars”. Please review this before issuing a policy. Our Loss Ratios and bonuses depend on it.
USE THEM OR LOSS THEM: Hartford has great coverage and claims service. As the insurance market tightens it is getting more difficult to get a new code/contract. They have been asking agencies to issue 2 policies per month. Over 15 agencies have issued under 3 policies over 7 months and have under $10,000 written premium. This is telling Hartford you don’t want or need them. Due to personnel changes they will be making a decision in October. As an Independent Agent you have to decide what makes sense.