Going into 2024, the consensus question was how steep the decline would be — rates were expected to soften, recession loomed, and the cost of capital had climbed. The Best Practices Study found the opposite: "the news is not just good — it's historically good." Read alongside the prior two editions, the 2024 study is less a one-year result than a claim about structural resilience. The deep-cut metrics behind it are the BPS deep tracks; this is the strategic context.
§ 01 · The inversionBracing for decline, finding a record.
The study attributed the strength to two forces: the seventh straight hard P&C market, and a U.S. economy that "settled into a more regular rhythm" with 2.5% GDP growth. Organic growth improved in most tiers; profitability stayed historically high; and the Rule of 20 cleared 20 in every tier for the third consecutive year — the metric the study calls the single best read on agency health. The three-year persistence is the real claim. One record year is luck; three is a structure.
§ 02 · What recoveredThe warning that reversed.
The metric the 2023 study flagged as its "cautionary tale" — decelerating sales velocity — reversed. In 2024, every revenue category exceeded the critical 12–13% new-business baseline, with averages running 13.4%–15.8%. Producer investment held too: net unvalidated producer payroll cleared the 1.5% healthy threshold in all six tiers. The engine the prior year worried about had been rebuilt, and the spend that rebuilt it persisted. On the aggregate scorecard, nothing was broken.
§ 03 · The crack underneathThe smallest-tier producer collapse.
The aggregate hid a structural failure at the bottom of the market. Across three studies, the under-$1.25M tier's producer success rate — the share of new producer hires who reach validation — fell from 65.9% to 39.5% to 21.0%. A 45-point collapse in two years means roughly four in five new producer hires at the smallest agencies now fail. And the failure is invisible on the profit line: the same tier's margin actually rose.
| Smallest tier (under $1.25M) | 2022 | 2023 | 2024 |
|---|---|---|---|
| Organic growth | 8.2% | 6.4% | 5.4% |
| Pro Forma EBITDA margin | 32.7% | 26.6% | 30.9% |
| Producer success rate | 65.9% | 39.5% | 21.0% |
The reading is uncomfortable: a smallest-tier agency can post a strong margin and a healthy Rule of 20 while quietly losing its ability to build the next generation of producers. Profitability is a lagging comfort; the producer pipeline is the leading risk.
An agency that can no longer grow its own producers has already chosen its endgame — it just hasn't dated the decision. When four in five hires fail, organic build is no longer a strategy, and sale or perpetuation becomes the only rational path.
§ 04 · AI and the consolidation warningThe study's sharpest line.
The 2024 conclusion placed AI on a thirty-year timeline of industry-shaping events — beside the Great Recession, the Affordable Care Act, and COVID-19 — the first time the study elevated it from watchlist to historical milestone, framing it as another disruption the channel has the resilience to absorb. And it issued its most explicit consolidation warning yet: that publicly traded and private-equity-backed mega-brokers will continue to absorb independent firms that fail to invest in their growth engines. Paired with the smallest-tier producer collapse, the warning lands with data behind it — and it is the same structural force described in the great consolidation. For the whole-universe counterpart to this top-quartile view — what the median agent felt in the same year — see the Future One sentiment.
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Terminology on this shelf
- High watermark
- The study's framing for 2024 — the best operating and financial results in its thirty-plus-year history.
- Producer success rate
- The share of new producer hires who reach validation (self-supporting on commissions) — a measure of pipeline health.
- Sales velocity baseline
- The 12–13% new-business threshold the study reads as evidence of a genuine sales culture.
- Rule of 20
- Organic growth % + ½ × Pro Forma EBITDA %; cleared in every tier for three consecutive years through 2024.
- Top quartile vs. universe
- The study measures top-performing agencies; the whole-universe view (every agency) can read very differently in the same year.