Agency Succession Planning

When most of us think about the term Agency Succession Planning, we are concentrated on the internal perpetuation of our businesses through family or other successor owners. However, there is a much more important form of Succession Planning that should be done by every agency as a part of its Strategic Planning cycle. It should be done also as a part of its development plan to make employees more productive for the agency, and as part of the agency’s career path for ‘up-and-coming’ young insurance professionals who will either rise to positions of authority, responsibility and higher compensation in your agency. Or, for those who will use your agency as their learning experience and take that knowledge to their next employer.

The easiest way of explaining an Agency Succession Plan is as follows. A list from the President down to the receptionist. It includes all agency staff with a column next to each name identifying the person who would be most likely to assume the role of the primary job-holder in the event of a catastrophic need for a replacement.

No one wants to even consider that they could be hit by a truck crossing the street this afternoon. But we are, in fact, insurance agents and insuring against risk is our stock in trade. Shame on us if we don’t consider the potential of disaster, whether physical, liability or personal – that would harm our business!

The Succession Plan that identifies the next-in-line for every position allows us to do our homework to prepare those people in the event of a sudden need – or to prepare likely successors for every job in the agency to step into those tasks at some point in the future. This is done to further the agency and its employees, usually at higher levels of knowledge, responsibility and compensation.

Whether your agency is large or small, your employees are asking “Where am I going?” – “is this all there is?” and “How can I earn more money?”.

Until now, most agency owners have not been concentrated on developing employees, whether for the future of the agency, the future of the individual or for the sake of continuous customer service in the event of a death or disability. If we routinely create or update a Succession Plan once each year, it gives us the opportunity to assess whether we will be affected in the event of a loss of any individual to the agency, and to what extent the damage affects us. The Succession Plan should have another column that specifies the development plan for the candidate for the critical role for the next year toward making him/her more capable of stepping into the role, if needed. That Development Plan becomes a part of the employee’s requirement for the next year in order to gain a high performance evaluation in his current job. We have always espoused the principal that the performance of every employee in the agency requires continuous annual development to become either better in the employee’s current role or to develop that employee into a more important and more productive role in the agency.