The Annual New Insurance Agency Review Checklist

2026-08-21

A practical annual review checklist for new insurance agencies covering finances, compliance, and growth. Steps you can take this week.

Running a new insurance agency means juggling sales, service, and compliance. An annual review keeps you on track. This checklist covers the key areas to examine each year, with concrete steps you can take now. It is not about theory. It is about what to check, why, and how to do it.

Why an Annual Review Matters

An annual review is your chance to step back and see the whole picture. It helps you catch problems early, like a compliance gap or a cash flow issue. It also helps you plan for growth. For a new agency, this review is even more critical because you are still building systems and habits. Set aside a half day, once a year, to work through this checklist.

The Checklist: 12 Items to Review Annually

1. Financial Health Check

Pull your profit and loss statement for the last 12 months. Compare it to your budget, if you have one. Look at your revenue by line (commercial, personal, life, health). Identify your top 10 revenue accounts. Check your cash flow: do you have at least 3 months of operating expenses in reserve? If not, plan to build that.

Review your balance sheet: assets, liabilities, equity.
Reconcile all bank and credit card accounts.
Review accounts receivable: are any premiums or fees over 60 days past due? Follow up.

2. Tax Obligations and Deadlines

New agencies often miss tax deadlines. Mark these on your calendar:

Estimated quarterly taxes: due April 15, June 15, September 15, and January 15. Pay at least 100% of last year’s tax liability (or 90% of current year) to avoid penalties.
Payroll taxes: if you have employees, file Form 941 quarterly and Form 940 annually.
Business license renewal: check your city or county requirements.
State insurance department fees: some states require annual renewal fees for your agency license.

If you are not sure about your tax situation, talk to a CPA who works with insurance agencies. They can help you with deductions like E&O insurance, marketing, and home office.

3. Compliance and Licensing

Your insurance license has an expiration date. Check it now. Most states require continuing education (CE) credits. Confirm you have completed the required hours. Also check that every producer in your agency has an active license and meets CE requirements.

Verify your agency’s E&O policy is current. Minimum coverage is usually $1 million per claim, $2 million aggregate. Premiums range from $2,500 to $7,500 per year for a new agency, depending on lines and revenue.
Review your trust account procedures if you handle premiums. Are you following state rules?
Check for any new state regulations that affect your agency.

4. Carrier Appointments and Contracts

Review your carrier appointments. Are they still active? Do you have any exclusive arrangements that limit you? Look at your commission schedules. Are you getting the best rates? If you have been with a carrier for a year, you might negotiate a higher commission tier.

List all carriers and their appointment renewal dates.
Check if any carriers have changed their underwriting guidelines or products.
Consider adding a new carrier if you see gaps in coverage for your clients.

5. Client Retention and Satisfaction

Your existing clients are your best source of referrals. Calculate your retention rate: divide the number of clients you had at the start of the year by the number you have now, minus new clients. Aim for 85% or higher. If it is lower, find out why. Send a short survey to clients who left.

Review your top 20 clients. Are they happy? Have you contacted them in the last 6 months?
Check your online reviews. Respond to any negative ones.
Set a goal for client retention for the next year.

6. Marketing and Lead Generation

What marketing did you do this year? Which channels brought in the most leads? Track your cost per lead. For example, if you spent $500 on Google Ads and got 10 leads, your cost per lead is $50. Compare that to a networking event that cost $100 and brought 2 leads, which is also $50 per lead. Use this data to decide where to spend next year.

Review your website: is it up to date? Does it have a clear call to action?
Check your social media: are you posting consistently? What content gets engagement?
Plan your marketing budget for next year. A common range for new agencies is 5% to 10% of gross revenue.

7. Technology and Tools

Your agency management system (AMS) is your backbone. Is it working for you? Are you using all its features? If not, consider training or switching to a different system. Compare costs: popular AMS options range from $50 to $150 per user per month. Also review your other tools: email marketing, CRM, and document management.

Update your software and security patches.
Back up your data. Test the backup.
Review your cybersecurity: do you have multi-factor authentication on all accounts?

8. Staff Performance and Training

If you have employees, review their performance. Did they meet their goals? Do they need more training? For a new agency, cross-training is essential. Make sure at least one other person can handle key tasks if you are out.

Schedule annual performance reviews.
Create a training plan for the next year. Include CE, product knowledge, and soft skills.
Review your job descriptions. Are they accurate?

9. Business Plan and Goals

Your original business plan is a starting point. Update it with actual numbers. Compare your actual revenue to your projections. If you are behind, why? Adjust your goals for the next year. Set specific, measurable goals. For example, “Increase personal lines policies by 20%” or “Add 5 new commercial accounts.”

Write down your top 3 goals for the next year.
Break each goal into monthly action steps.
Review your budget and adjust for the next year.

10. Succession and Continuity Plan

Even as a new agency, you need a plan for if something happens to you. Do you have a buy-sell agreement with another agency? Or a plan to sell your book of business? If not, start one. This is not just for old owners. It protects your family and your clients.

Identify a potential successor or buyer.
Get a valuation of your agency. A rough estimate is 1.5 to 2.5 times annual revenue, but it varies.
Draft a simple continuity plan.

11. Professional Advisors

You should have a team of advisors: a CPA, an attorney, and an insurance consultant. Review these relationships. Are they working well? Do you need to change? If you do not have a CPA who understands insurance, find one. They can save you money on taxes.

Schedule a meeting with your CPA to review your tax strategy.
Review your contracts with your attorney.
Consider joining a local insurance agents association for networking and resources.

12. Personal Development

You are the business. Take care of yourself. Review your own skills and knowledge. What do you need to learn next year? Maybe it is a new line of insurance or leadership skills. Set aside time for reading, courses, or conferences.

List 2 skills you want to develop.
Find a mentor or coach.
Schedule time off. Burnout is real.

How to Use This Checklist

Print this checklist and set aside a half day to work through it. You do not have to do everything in one sitting. Break it into 4 sessions of 2 hours each. For example:

Week 1: Financial and tax items (items 1 and 2)
Week 2: Compliance and carriers (items 3 and 4)
Week 3: Clients and marketing (items 5 and 6)
Week 4: Staff, plans, and the rest (items 7 to 12)

Use a spreadsheet to track your findings and action items. Assign deadlines to each action.

FAQ

Q: How often should I do this review?

A: Once a year is the minimum. Many agencies do a lighter review quarterly, focusing on financials and compliance. The annual review is the deep dive.

Q: What if I find problems during the review?

A: That is the point. Fix them. Prioritize by risk: compliance and tax issues first, then financial, then operational. If you are not sure how to fix something, get help from a professional.

Q: Do I need a CPA for an insurance agency?

A: Yes, if you want to minimize taxes and avoid penalties. A CPA who knows insurance can help with trust accounting, commission income, and deductions. Fees range from $1,500 to $5,000 per year for a small agency.

Q: How much does an E&O policy cost for a new agency?

A: For a new agency, expect to pay $2,500 to $7,500 per year for a $1 million/$2 million policy. The cost depends on your lines of business, revenue, and claims history.

The Bottom Line

An annual review is not busywork. It is how you stay profitable, compliant, and competitive. Use this checklist to find gaps and fix them. Set aside time this week to schedule your review. Your future self will thank you.