According to results from the Reagan Consulting Organic Growth and Profitability (OGP) survey, 2015 may be the year of disillusionment.

Independent insurance agents and brokers reported a 5.8% organic growth rate in the first quarter of the year—a drop from last year’s 6.2% Q1 results.

“Organic growth seems to be hanging in there despite some alarming trends in p-c pricing,” says Kevin Stipe, president of Reagan Consulting. “Right now, agency organic growth is defying gravity. And the question is: How long will that continue?”

While all lines grew at a slower pace in 2015 than 2014, commercial lines took the biggest hit with a 1.8% year-over-year growth decline from 8.4% to 6.6%. Group benefits posted a 4.5% growth rate and personal lines 1.3%—down 0.5% and 1.5% from Q1 2014, respectively.

“If those pricing trends hold for p-c, it’s inevitably going to have a negative impact on agency organic growth—not to make it go negative, but to pull it down closer to 3-4%,” Stipe says. And as the market continues to soften, “it’s going to inevitably slow organic growth for the industry overall.”

The good news? Stipe says “firms today are better positioned to take control of their circumstances than in the past and to fight the effects of a soft market.”

The confidential survey results from 130 mid-size and large agencies and brokerage firms reflect similar optimism from agents and brokers themselves, who project a 6% organic growth rate for 2015. That’s down from last year’s 7% projection, but amid a turbulent national economy and shifting market trends, it’s a good sign.

“They know their business,” Stipe says. “For the better firms, they’re really focused on their own ability to grow market share by writing new business and taking business away from their competitors.”

Currently, the firms that hold a clearly positive position are private brokers, who posted a 5.8% organic growth rate compared to 4% for publicly held companies. But Stipe says that’s not uncommon. “Private agencies have to focus on organic growth generally because they don’t have the capital to effectively compete for acquisitions with public brokers,” he says. “That distinction has been there traditionally and continues to be.”

A key metric Reagan measured in this year’s OGP survey to help determine where an agency can generate new client revenue is “sales velocity”: a metric calculated by dividing this year’s total new business by the prior year’s total commissions and fees. Results reveal that the top 25% of firms achieved a 16.7% sales velocity, compared to just 8.8% for the bottom 25%.

“Firms are really focused on that because that’s the one thing that they can really do to grow even if the market goes really soft,” Stipe says. “Historically, agents and brokers were victims of circumstances, but today they are fighting harder. I think they’re savvier about saying, ‘We’ve got to control what we can control. And cranking up our sales velocity is a way to offset the impact of the soft market.’”

Overall, Stipe calls profitability results “business as usual.” Although the high hopes of Q1 2014’s 29.9% EBITDA (earnings before interest, taxes, depreciation and amortization) average—an all-time high for Q1—didn’t carry over to 2015, margins remain strong at 29% even.

“The big story right now is what is going to happen to growth with the softening p-c market,” Stipe says. “Who knows? Maybe the market will turn and it won’t remain soft. Maybe those agents will be wrong. Or maybe they’ll write so much new business that they’re able to overcome it.”

Morgan Smith is IA assistant editor.