We are not breaking news when saying that Texas is in a boom. The state that arguably has the most available area left to develop is making good use of it. This growth certainly hasn’t happened overnight and certainly won’t stop overnight either. The question remains, how will this growth effect the Insurance Industry.
The four major metropolitan areas; Austin, Dallas, Houston & San Antonio have sustained leading unemployment rates even with such rapid influx of new residents. The U.S. Census reported the following statistics for population growth from July 2010 to July 2011.
#1. Dallas, TX – avg. 345.3 new residents/day
#2. Houston, TX – avg. 301.6 new residents/day
#9. Austin, TX – avg. 151 new residents/day
*Courtesy Austin Business Journal http://bit.ly/LErrop
This rapid growth has not prevented new residents from finding jobs. The major industries; Energy, Technology, Healthcare & Finance have sustained growth over the past ten years to avoid major layoffs while opening new positions. As unemployment & the economy was the hot-button issue for the 2012 Presidential Election, neither candidate cited the growth and success of the Lone Star State.
Forbes, often known for their “Top 10” lists, ranked the fastest growing cities from 2001 to 2011.
#2. Austin, TX 44.9%
#7. Houston, TX 31%
#9. San Antonio, TX 29%
#10. Dallas/Fort Worth, TX 27.9%
Courtesy Forbes Magazine http://onforb.es/15iOUpH
One would imagine that with such rapid growth, the competition to find a job with decent salary would be beyond difficult. Strangely enough, the exact opposite is to be said as the four major Metropolitan Areas in Texas all made the top 15 in Lowest Unemployment Rates, according to the Bureau of Labor Statistics.
#3. Austin, TX 5.5%
#8. San Antonio, TX 6.0%
#12. Houston, TX 6.1%
#14 Dallas 6.2%
US Average 5/2013 7.5%
*Courtesy Bureau of Labor Statistics http://1.usa.gov/bkALp4
What does all of this mean for insurance professionals? First, it shows that business are growing which correlate directly to premium size for all risks rated by number of employees or payroll size. This means larger policies & more commissions for the agency.
Second, those businesses that are growing may be changing operations or offer a larger variety of products or services. This means that the agent should be reevaluating the risk, adding whatever endorsements necessary or maybe even reclassification. That being said, if it is an endorsement that requires additional premium it means more earned commission.
Third, more citizens means more insureds. More insureds means more policies. More policies mean more earned commissions
See the trend here?
As insurance agents, we should not let the growth in Texas intimidate, upset or deter us from writing more business. In such turbulent economic times, we are fortunate enough here in Texas to be expanding at this rate.
That being said, it is important to have the markets available to accommodate all of your current and prospective insurances. Having a reliable, competitive and motivated MGA & Surplus Lines Broker such as AUI, Inc will give you the confidence & support needed to solicit & write new business.