The insurance brokerage industry faces a constant struggle to recruit new sales talent, a struggle that often leads brokerages to look beyond the traditional sources of recruits to tap into other industries.

The key is sales ability, according to industry observers, recruiters and brokers themselves. If a brokerage recruits an experienced salesperson from outside the industry, that person can always be taught the intricacies of the insurance industry, they say.

“If someone has had success in selling, I think the best predictor of future behavior is past behavior,” said Timothy J. Cunningham, managing director at Optis Partners L.L.C in Chicago. “It's a way to diversify the sales gene pool,” he said.

“To hire a successful sales professional, you have to go through arduous screening and testing,” said John Wepler, president of Marsh, Berry & Co Inc. in Willoughby, Ohio. You'll find people whose “DNA is new-client origination.”

MarshBerry launched its MarshBerry Producer Recruiting Program about seven years ago, he said. MarshBerry does the recruiting, testing, placement, compensation plan and training, among other things. The average producer in this program writes between $45,000 to $55,000 in new business commissions in the first year and $75,000 to $85,000 by the end of the third year of joining a brokerage or agency, he said.

“We've placed 170 of these producers with a 71% successful validation rate,” said Mr. Wepler. “You've got find the right person, and then you have to place them in an environment that's tailored to allow them to succeed.”

%%BREAK%%

“One size does not fit all,” said Sharon Emek, president and CEO of New York-based staffing service Work At Home Vintage Employees L.L.C., or WAHVE. “The smaller brokers aren't recruiting as much from outside, because the amount of training is daunting,” she said.

”You have to recruit and look for people who are good in their industry,” Ms. Emek said. “You can teach them the content.”

Bill Baker, president and partner of Dallas-based Schul Baker Partners, launched a program called First Steps about two years ago. The program involves bringing experienced younger salespeople in the earlier part of their career who have demonstrated excellent sales skills in another area, and then “bringing them on board in an insurance brokerage company where we put together yearlong training, coaching, mentoring and development program,” he said.

“Over 35% of our people are either female or minority, so it's also helping diversity,” he said.

Hiring people from outside the industry has several advantages, he said. “Because they're not used to renewal income, they tend to be better business development people,” he said. “Because they don't have a book of business, they have to 'eat what you kill' each year, so they're more aggressive, and because they don't know what they don't know, they're not afraid to go after big clients.”

There is, however, no one particular industry that produces the bulk of outside recruits, say observers.

A client of Mr. Baker's said hiring people from outside the insurance industry allows a brokerage to approach individual industries with people who understand the fine points of that industry.

%%BREAK%%

“To add people to the construction team we would be looking for people who speak construction,” said Diana Kiehl, executive vice president and chief administrative officer for Alliant Insurance Services Inc. in Newport Beach, Calif. She said successful brokerage hires could have been “selling almost anything in the construction industry.”

These salespeople come in with a “circle of influence,” meaning they know key people within the target industry, no matter what it is, she said. “What is important is you put structure into your development process, but you set about a good education process, both external and internal.”

“Keep your expectations realistic as they develop their experience. Make sure they have a terrific mentor,” she said.

“Probably over 50% of our professional staff comes from outside the industry,” said Mike Mitchell, vice chairman of the Graham Co. in Philadelphia. He said the independent brokerage has been recruiting from outside the insurance industry for almost 30 years.

Mr. Mitchell said the brokerage's chairman and CEO, William Graham, said that when the company looked solely at the insurance industry for new talent, it ended up looking at only 2% of the available pool. Mr. Mitchell said that Mr. Graham said, “I can't teach people to be smart and work hard, but I can teach them insurance.”

The company created a training arrangement with continuing education, said Mr. Mitchell. The fields that have been most successful for the Graham Co. are attorneys, accountants and engineers, as well as graduates of the military academies. People in those fields are very detail-oriented, he said. Some become sales people, while others become claim personnel and risk management consultants, he said.

%%BREAK%%

“They have to be in classroom for six months, and they work side by side with a mentor for maybe 2½ years,” said Mr. Mitchell. “We have a full training department and have 10 full-time people in the department,” out of 165 in the home office.

Ms. Emek said successful recruits often have a financial services background, including banking, consultants and accountants. But looking beyond that field, Ms. Emek said, “teachers make great sales people.”