Salaries, Total Income Skyrocketed in 2023 But Satisfaction with Compensation Waned

Insurance agency employees and producers on average made more money in 2023 but, overall, employees reported lower satisfaction with their compensation than in 2022, a year when overall satisfaction rose, according to the latest Agency Salary Survey, published annually by Insurance Journal.

Changes in overall salary and total income skyrocketed again in all categories in 2023.

Management/agency owners/principals and support staff/CSR/account executives saw large increases in total income change from 2022 to 2023, while the producer/sales category revealed a significant positive total income change but at a slightly lower rate than the previous year. (See page 29.)

Surprisingly, satisfaction with compensation declined in 2023 even though salaries and total income rose. While the 2022 Agency Compensation Satisfaction Index reflected an increase over the previous year (3.61 overall in 2022 up from 3.41 overall in 2021), this year’s Agency Compensation Satisfaction Index showed decreases except with support staff.

Satisfaction with compensation declined to an average of 3.36 in 2023 from 3.61 in 2022 based on a scale of 1-to-5 where “5” equals “most satisfied.” (See Agency Compensation Satisfaction Index chart, page 29.):

• Management/agency owners/agency principals reported a compensation satisfaction score of 3.79 in 2023, down slightly from 3.85 in 2022.
• Producers/sales reported satisfaction of 3.12 in 2023, down from 3.39 in 2022.
• Support staff/CSR/account executives reported a satisfaction score of 3.16 in 2023, up from 3.11 in 2022.

The score for overall satisfaction was higher when agencies offered employee benefits, both hard benefits (such has group health, life/disability, dental, profit sharing, 401(k) plans, IRAs and flexible savings accounts) and soft benefits (such as childcare/day care, education reimbursement and paid family leave). (See Employee Benefit Satisfaction Index, page 32.)

Employee benefit satisfaction ranked highest when agencies offered added benefits such as profit sharing (3.8), pension plans (3.77), education reimbursement (3.73), and paid family leave (3.72). The survey found that in nearly all employee benefit categories queried, employees showed more satisfaction with overall compensation when those benefits were offered. The one exception this year was a slight decline in satisfaction when offered employee stock ownership plans (ESOP).

As noted, the survey revealed an upward trend in total compensation for all agency positions this year. Management/agency owners/principals saw the highest increases in total compensation, according to this year’s survey.

The 2024 Agency Salary Survey — based on nearly 700 responses nationwide — showed total income changes, including salary plus additional compensation such as profit sharing, bonuses, and other income, were:

• Agency owners, principals and management total income increased the most in 2023 — a 16.1% increase in total income in 2023, compared to an 8.0% increase in total income for 2022.
• Producers/sales total income increased 12.6% for 2023, compared to a 13.6% increase in 2022.
• Agency support staff total income showed a 9.6% increase for 2023, compared to a 5.0% increase for 2022.

Salaries only (excluding bonus and incentive income), rose again in 2023 and at a higher rate than in 2022:

• Salaries for agency owners, principals and management rose 13.8% in 2023, compared to 5.3% in 2022.
• Producers/sales reported average increases in salary of 11.9% in 2023, compared to 9.3% in 2022.
• Salaries for agency support staff rose 8.0% in 2023, compared to 5.6% in 2022.

Insurance Journal’s Agency Salary Survey collected about 700 responses from agency owners and employees nationwide via an online survey in January 2024. Paul Osbourne, director of information systems at Demotech Inc., assisted with analysis of this year’s results. For more information, contact Andrea Wells at: awells@insurancejournal.com.