CIC AGENCY MANAGEMENT EXAM QUESTIONS AND ANSWERS
CIC Agency Management
(VERIFIED AND WELL DETAILED ANSWERS) LATEST UPDATE
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1. Types of Agen- 1. Standard lines P&C
cies 2. Personal Lines only
3. Commercial Lines only
4. Non-StandardAuto
5. Life & Health Agency
6. Combination of the above
2. Banks vs. Agen- 1. How much will the agency culture change if your agency is acquired by a bank?
cies 2. Banks are governed by very specific federal and state laws that require them to
function in a certain manner.
3. Banks tend to be more formal (in terms of rules, dress code, etc.) than agencies.
4. When acquired, will agency management remain the same? Who will agency
management report to? How much leeway will the bank's agency manager have?
3. Publicly Traded 1. What role does Wall Street play in the agency culture? Is the focus on long term
vs. Privately Held or next quarter's results? What role does stock price play?
2. Publicly traded agencies are more focused on near term objectives.
3. Publicly traded agencies are more focused on achieving a higher rate of return
(20 - 25%) than on employee satisfaction.
4. Exclusive vs. In- 1. Ability / Inability to place business with other carriers. This is determined by the
dependent exclusive carrier and is based on a variety of factors including type of business,
location, etc. Can be frustrating to staff and owners.
2. Agency owners (and employees) get frustrated when exclusive carriers shut
down production (i.e. homeowners in Florida).
3. Exclusive Agents tend to be smaller and less sophisticated in terms of automation
and training.
5. Single Location Multiple locations require additional systems and procedures to make sure all
vs. Multi-loca- employees are treated equally fair.
tions 2. Are employees at one location treated the same as employees in a different
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location?
3. Is there friendly or unfriendly competition between locations?
6. Large Agencies 1. The more employees you have the less crucial each employee becomes when it
vs. Small Agen- comes to satisfying client needs.
cies 2. The more employees you have the more flexibility you have when it comes to
vacation, holidays, etc.
3. The more employees you have the greater the chance you are required to follow
certain Federal / State / Local non-discrimination laws (See HR Section.)
7. Sales vs. Service 1. Sales focused agencies have a greater emphasis on sales and competition
between employees.
2. Service focused agencies place greater emphasis on satisfying the customer and
may have a tendency to over service them. Is the client profitable? (See Financial
Analysis Case Study).
3. "Bucket shops" focus on as many sales as possible and as little service as
possible.
8. Type of Entities 1. Sole Proprietorship
2. Partnership
3. Limited Liability Company
4. Subchapter S Corporation
5. C Corporation
9. Five stages 1. Existence - The owner is the agency and the agency struggles to remain alive.
of organizational Staffing is minimal and the agency must be creative to grow. There is little or no
growth job specialization. The owner does everything!
2. Survival - The agency is an on-going concern and is trying to make a profit by
balancing revenues and expenses. The agency needs to develop specific direction
and begin staff stratification if it wants to survive and thrive.
3. Success - The agency is profitable and can be:
(a) Stable - Renewals, relatives and referrals. Very service-oriented. Needs to focus
on profitability / cost control since new organic growth is limited.
CIC Agency Management
(VERIFIED AND WELL DETAILED ANSWERS) LATEST UPDATE
Study online at https://quizlet.com/_unjll
1. Types of Agen- 1. Standard lines P&C
cies 2. Personal Lines only
3. Commercial Lines only
4. Non-StandardAuto
5. Life & Health Agency
6. Combination of the above
2. Banks vs. Agen- 1. How much will the agency culture change if your agency is acquired by a bank?
cies 2. Banks are governed by very specific federal and state laws that require them to
function in a certain manner.
3. Banks tend to be more formal (in terms of rules, dress code, etc.) than agencies.
4. When acquired, will agency management remain the same? Who will agency
management report to? How much leeway will the bank's agency manager have?
3. Publicly Traded 1. What role does Wall Street play in the agency culture? Is the focus on long term
vs. Privately Held or next quarter's results? What role does stock price play?
2. Publicly traded agencies are more focused on near term objectives.
3. Publicly traded agencies are more focused on achieving a higher rate of return
(20 - 25%) than on employee satisfaction.
4. Exclusive vs. In- 1. Ability / Inability to place business with other carriers. This is determined by the
dependent exclusive carrier and is based on a variety of factors including type of business,
location, etc. Can be frustrating to staff and owners.
2. Agency owners (and employees) get frustrated when exclusive carriers shut
down production (i.e. homeowners in Florida).
3. Exclusive Agents tend to be smaller and less sophisticated in terms of automation
and training.
5. Single Location Multiple locations require additional systems and procedures to make sure all
vs. Multi-loca- employees are treated equally fair.
tions 2. Are employees at one location treated the same as employees in a different
, CIC Agency Management
Study online at https://quizlet.com/_unjll
location?
3. Is there friendly or unfriendly competition between locations?
6. Large Agencies 1. The more employees you have the less crucial each employee becomes when it
vs. Small Agen- comes to satisfying client needs.
cies 2. The more employees you have the more flexibility you have when it comes to
vacation, holidays, etc.
3. The more employees you have the greater the chance you are required to follow
certain Federal / State / Local non-discrimination laws (See HR Section.)
7. Sales vs. Service 1. Sales focused agencies have a greater emphasis on sales and competition
between employees.
2. Service focused agencies place greater emphasis on satisfying the customer and
may have a tendency to over service them. Is the client profitable? (See Financial
Analysis Case Study).
3. "Bucket shops" focus on as many sales as possible and as little service as
possible.
8. Type of Entities 1. Sole Proprietorship
2. Partnership
3. Limited Liability Company
4. Subchapter S Corporation
5. C Corporation
9. Five stages 1. Existence - The owner is the agency and the agency struggles to remain alive.
of organizational Staffing is minimal and the agency must be creative to grow. There is little or no
growth job specialization. The owner does everything!
2. Survival - The agency is an on-going concern and is trying to make a profit by
balancing revenues and expenses. The agency needs to develop specific direction
and begin staff stratification if it wants to survive and thrive.
3. Success - The agency is profitable and can be:
(a) Stable - Renewals, relatives and referrals. Very service-oriented. Needs to focus
on profitability / cost control since new organic growth is limited.
