The total set of clients and policies an agency (or producer) manages, and the recurring commission income they generate.
Book of Business
The total set of clients and policies an agency (or producer) manages, and the recurring commission income they generate.
A book of business is the portfolio of active clients and policies belonging to an agency or an individual producer, along with the premium and commission it produces. It is the central asset of an agency.
The value of a book depends on more than size:
- Retention — how sticky the clients are,
- Loss ratio / profitability — how carriers view it,
- Mix — personal vs. commercial, and concentration by carrier or industry.
Books are bought and sold; agency valuations are commonly expressed as a multiple of revenue or commission. When a producer leaves, ownership of "their" book (and any non-solicitation terms) is a frequent point of contention, which is why clean records in the management system matter.