2003 Best Practices Study
Analysis of Agencies with Revenues Between $2,500,000 and $5,000,000
What the Typical Transaction Looked Like:
Revenues Acquired Per Transaction
Multiple of Revenues Paid
$0 $50,000 $100,000 $150,000 $200,000 $250,000
0.0x 0.5x 1.0x 1.5x 2.0x
average
low
average
high
low
Pricing Structure Used
0% 10% 20% 30% 40% 50% 60%
variable
fixed
What was Acquired
Primary Currency Used
Stock Cash Both
Book of Business
Agency
D. Renewal Revenue as % of Prior Year's Total Revenues for Each Line of Business This figure is impacted by attrition (loss or retention of accounts) and by changes in premium and commission levels. The higher the percentage, the more favorable the results.
Average
+25% Profit
+25% Growth
Commercial P&C
95.2% 91.4% 53.4% 80.1% 52.2% 93.8%
94.6% 97.7% 40.0% 70.6% 22.8% 96.6%
105.6% 96.7% 65.6% 78.8% 63.8% 105.0%
Personal P&C
P&C Service Fees
Group L&H
Individual L&H
Total Commissions & Fees
*-Insufficient Data
Page 56 2003 Best Practices Study
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