Number of Independent Auto Insurance Agencies in the U.S.

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Number of Independent Auto Insurance Agencies in the U.S.

The total number of independent auto insurance agencies in the United States was 38,000 as of 2016 and employs an estimated 71,810 insurance agents which translates to an average of 1.90 per independent insurance agency. Below you will find details of our calculations, assumptions, and findings.

INDEPENDENT AUTO INSURANCE AGENCIES IN THE U.S.

According to a report released by Independent Insurance Agents and Brokers of America, Inc., the total number of independent insurance agencies operating in the U.S. was 38,000 in 2016, a slight decrease of 500 from 2014 which was 38,500. Back in 1996, the total independent insurance agencies count at 44,000. In 2016, 21.1% of these agencies are considered small (revenue less than $150K annually) and medium-to-small agencies with revenues ranging from $150K to $499K consisted of 53.4%. The remaining 25.5% accounts for medium, medium-to-large, large and jumbo ($10M+ revenue) independent firms. Between 2014 and 2016, 37% of these agencies hired new producers (or also called agents).

Since independent insurance agents' scope does not have a limit in terms of insurance offering, i.e. an independent insurance agency can have options to offer all types of insurance in all line of business such as automobile, accident & health, mortgage guaranty, fire, earthquake, and many more, we safely assumed that all these independent insurance agencies also offer auto insurance. These independent insurance agents can also represent a number of insurance companies, and they don't exclusively work for just one line of business. Thus, it is possible that the total number of independent auto insurance agencies in the United States is also equivalent to the total independent insurance agencies which is 38,000.

AVERAGE AGENTS PER INDEPENDENT INSURANCE AGENCY

To determine the average number of agents working within the independent auto insurance agency industry, we used a report released by Future One, a collaborative program of the Independent Insurance Agents & Brokers of America, Inc., and member companies in 2014, and collaborate it with the 2016 report which stated that 37% of these agencies have hired an agent between 2014 and 2016.

The 2014 report revealed that the average number of staff per independent agency was at 6.2. These staffs consist of non-principal agency managers with an average number of 0.40, non-principal producers or agents with an average number of 1.5, customer service representatives (CSRs) at 2.2 and others (support & admin) at 0.40. From the above-identified staffs, we will only consider the average number of producers which is 1.5.

If in 2014, the total number of independent auto insurance agency was 38,500, then the total number of agents working within this space was 57,750 during this year.

38,500 * 1.5 = 57,750 (number of agents working within independent auto insurance agencies in 2014.)

If between 2014 and 2016, 37% of these agencies hired a new agent and assumed that one agency hired one agent, then the estimated number of agents in 2016 was 71,810. See calculations below.

Number of independent auto insurance agency in 2016 = 38,000
Number of new hires between 2014 and 2016
= 38,000*37%
= 14,060

Number of independent auto insurance agents in 2016
= number in 2014 + new hires
= 57,750 + 14,060
= 71,810

If the estimated number of agents in 2016 was 71,810, then the average number per agency was 1.90.

71,810 / 38,000 = 1.90

CONCLUSION

The total number of independent auto insurance agencies in the United States was 38,000 as of 2016 and employs about 71,810 agents. The calculated average number of agents per agency was 1.90. According to DataUSA, the total workforce of insurance agents in the United States currently stands at 494,407. If the U.S. has 71,810 independent auto insurance agents, then its percentage share of the total workforce is 14.50% [71,810/494,407x100%].

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