Non-financial measures a brokerage should watch
The non-financial measures an insurance brokerage should watch beside its management accounts, and how to pair each with a figure from the books.
By Achekam · · 4 min read · For Insurance businesses in South Africa, Nigeria, Kenya
By the time a brokerage's commission falls in the management accounts, the damage was done months earlier. Clients drifted away at renewal because quotes took too long. A good account executive left, and her book followed her. Claims queries sat unanswered for a fortnight and a corporate client quietly moved its business. The income statement records all of this faithfully, but late, after the decisions that caused it.
The measures that warn you in time are mostly not financial. This piece suggests which ones a brokerage in South Africa, Nigeria or Kenya should watch, why they matter, and how to pair each with a figure from the books so the two tell one story.
What the financial figures show too late
AccountingTools explains that non-financial measures such as defect rates, delivery times, customer retention and employee turnover matter in management accounting because they reveal operating problems that financial data may not show promptly.
In a brokerage, the "defects" are errors on schedules and policy documents; the "delivery times" are how long a client waits for a quote, a policy or an answer on a claim. A rising error rate or a slowing response shows up in the operation weeks or months before it shows up as lost commission.
Three measures every brokerage can track
Keep the list short enough that someone actually updates it every month.
Client retention. Of the policies due for renewal this month, how many renewed with you? Track it by insurer and by account executive. A drop concentrated in one person's book or one insurer's products tells you where to look.
Service times. Pick two or three you can measure honestly: days from quote request to quote sent, days from acceptance to policy documents delivered, days to first response on a claim. Average them monthly and watch the trend.
Staff turnover. Who joined, who left, and from which team. In a brokerage, people carry relationships; turnover among client-facing staff is a leading indicator of retention trouble.
Two more are worth adding once the first three are routine: the number of complaints received, and the share of client-facing staff whose qualification records are complete and current. Keeping representative qualification files covers the second.
Management accounting looks forward
AccountingTools defines management accounting as a branch of accounting that helps managers make decisions, focusing on a business's revenues, expenses and asset usage. It describes it as future-oriented, spotting issues to improve future performance, whereas financial accounting is historically oriented.
That is why non-financial measures belong in the monthly pack rather than in a separate HR or operations report. AccountingTools gives examples of management accounting information that mix the two kinds: cash on hand, capital budgeting analyses, inventory record accuracy, loan covenant compliance, the order backlog, the percentage of overdue receivables and project profitability. For a brokerage, the "order backlog" is the pipeline of quotes and renewals still to be placed, and the percentage of overdue receivables is the share of fees and premiums due from clients that are past their terms.
Pairing each measure with a figure from the books
A non-financial measure on its own invites argument. Paired with a financial one, it explains it.
| Non-financial measure | Pair it with | Where the figure comes from |
|---|---|---|
| Client retention | Commission income, this period against the last | Management accounts |
| Service times | Fee income and new-business commission | Management accounts |
| Staff turnover | Payroll cost and headcount | Payroll reports |
| Overdue client balances | Fees and premiums outstanding by age | Receivables aging |
In Achekam, the management accounts show an income statement for a chosen period beside the period before and a balance sheet at period end, both added up from the business's own journals and exportable as PDF or CSV. If commission is posted to separate accounts by insurer, retention by insurer and commission by insurer can be read side by side; commission income by insurer explains that set-up.
Receivables are aged into 0-30, 31-60, 61-90, 91-120 and over 120 days, with overdue totals, which gives the overdue percentage AccountingTools mentions without any extra work.
Headcount and staff movements from payroll
Payroll reports in Achekam show cost, headcount and staff movements by month and by department. That gives the staff-turnover measure a firm base: the joiners and leavers come from payroll, not from memory, and the department view shows whether turnover is concentrated in claims, sales or administration.
Read it beside the retention figures. If client retention fell in the same month that account executives left the sales team, the connection is worth a conversation; if retention held up, the handover worked.
Making it a habit
A warning before you start: a measure that people are judged on tends to get managed rather than improved. If quote turnaround is counted from the moment a request is logged, requests stop being logged until someone is ready to quote. Define each measure precisely, measure it from records nobody can quietly adjust, and use it to ask questions rather than to hand out blame.
Put the non-financial measures on the first page of the monthly pack, above the income statement, with last month's figures beside them. Note in one line what changed and why. After a few months, the measures start telling you about next quarter's commission before it happens, which is the point of watching them. A brokerage that pairs this with a cash view will find worst, likely and best cash cases a natural companion.
AccountingTools' overview of management accounting explains how management accounting differs from financial accounting and why non-financial measures belong in it.
Choose your three measures this week, decide who records each one and where, and put them on page one of next month's pack.
General guidance only, not advice on your own circumstances. Tax and payroll rules change: check the current position with the authority or your adviser.
