Many insurance agencies invest little or no time in maintaining accounting records. Let’s face it, with the demands on owners in running day to day operations, who has time? In many cases commission statements and loss ratios can’t be found. Believe it or not, the biggest challenge when selling an insurance agency is proving your annual revenue. We constantly help agency owners contact insurance carriers for commission statements and loss ratios. Here are a few steps to help you organize this information so if and when you decide to sell your agency, it’s ready to show.
- When statements are received file them in a file folder labeled “CARRIER2008”.Maintain a separate folder for each carrier. If you receive the statements electronically, print them. Yes, we’re big proponents of a paperless environment, but it’ll need to be printed eventually.
- Add a worksheet to the top of each folder with a graph of 12 months. When the statements are filed in the appropriate folders, write the amount of the statement in your graph under the corresponding month
- File them alphabetically by carrier in a bankers box. Maintain a separate bankers box for each year.