Renewal Against New Business
Renewal commission is the steady floor and new business is the growth. An agency that cannot see the two apart cannot tell whether this year was won or simply inherited.
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Know What Your Book Is Actually Earning
Commission arrives in lumps, gets clawed back without warning, and lands in the same account as money that was never yours. Sorted properly, the book stops being a guess.
Bookkeeping For Insurance Agencies And Brokers In Chillicothe, OH
An agency's income does not behave like a shop's. One deposit from a carrier can cover thirty policies, six months of renewals, a chargeback on a policy that lapsed in March and a producer split that has not been paid out yet. Recorded as a single line it tells you nothing, and by the time the year closes nobody can say which part of the book paid for itself.
The work here is unpicking that: commission tied back to the statement it came from, money held for carriers kept where it belongs, and a set of reports that shows what the agency earned rather than what passed through the account.
- Carrier commission statements reconciled to the deposits they produced
- New business and renewal commission tracked as separate lines
- Chargebacks and cancellations recorded against the policy that caused them
- Premium collected on a carrier's behalf held apart from agency income
- Producer splits and referral arrangements settled from the same numbers
- Contingent and profit-sharing income recognised without distorting the month
Premium You Hold Is Not Money You Earned
Agencies that collect premium before passing it to the carrier are holding somebody else's money. It sits in the account looking exactly like every other dollar, and on a bank balance it is indistinguishable from a good month.
Kept separate in the books, it stops being a trap. The agency can see its own cash without the carrier's cash flattering it, and the amount owed onward is a number you can check rather than a shortfall you find later.
What The Book Will Tell You Once It Is Sorted
What Cancellations Cost
A policy that lapses takes its commission back. Recorded against the policy rather than buried in a net deposit, the pattern shows up while there is still something to do about it.
Earnings By Line Of Business
Personal lines, commercial, life and health do not carry the same margin or the same effort. Split out, the mix you are quietly building becomes a decision instead of an accident.
The Year One Cheque Decides
Contingent and profit-sharing income usually arrives once, well after the year that earned it, and it is often the difference between a flat year and a good one. Dropped into the month it lands, it makes one month look extraordinary and every other month look thin by comparison.
Handled properly it is spread across the period it relates to, so the underlying trend stays readable. That matters most when a lender, a partner or a buyer is looking at the accounts and needs to see what the agency actually does month to month.
Services These Owners Use Most
The engagements that come up again and again in this kind of business.
Can You Say Which Half Of The Book Paid For Itself?
Most agency owners can name their biggest carrier. Far fewer can name their most profitable one.