2015 Best Practices Study

2015 Best Practices Study

Key Benchmarks Profile

Regional Analysis Agencies with Revenues UNDER $5,000,000

Revenues Expenses Profitability Employee Overview Producer Info Service Staff Info Technology Insurance Carriers Appendix

Geographic Region:

Northeast Southeast Midwest Southwest

West

% of Agencies Located in Each Region

8.4% 14.1% 14.1% 7.9% 5.2%

Net Revenue Growth (Organic)

5.4% 8.8% 7.3% 10.6% 11.2%

Pre-tax Profit

21.5% 15.8% 27.4% 22.7% 28.6%

Pro Forma Pre-tax Profit

28.6% 19.5% 30.4% 29.0% 31.2%

Profitability as % of Net Revenues

Operating Pre-tax Profit

10.9% 7.9% 20.8% 14.6% 24.3%

EBITDA

24.9% 19.3% 30.1% 24.8% 30.6%

Pro Forma EBITDA

32.0% 23.1% 33.1% 31.1% 33.2%

Value Creation “Rule of 20” Score

18.8

19.1

24.8

28.2

28.4

Revenue per Employee $146,054 $144,732 $150,692 $176,596 $135,455 Compensation per Employee $81,012 $88,913 $75,339 $91,315 $69,306 Spread per Employee $65,042 $55,819 $75,354 $85,282 $66,149

Productivity

Commercial P&C

$100,111 $148,666 $90,289 $121,260 $103,459

Personal P&C

$67,036 $51,318 $50,261

*

$53,000

Pay Levels for Producers

Group Life & Health / Financial

$48,535 $125,812 $74,901 $76,923 $101,000

Multi-Line

$104,427 $109,973 $103,410 $175,071

*

Commercial P&C

3.6

5.4

3.8

7.0

4.2

Total Number of Service / Sales Support Staff per Line of Business

Personal P&C

5.1

3.5

3.7

3.9

1.7

Group Life & Health / Financial

1.0

1.6

1.1

0.8

1.1

Multi-Line

*

*

*

*

*

Commercial P&C

29.3% 18.9% 14.2% 15.8% 20.0%

Total Service / Sales Support Staff Payroll as % of LOB Revenue

Personal P&C

24.5% 24.7% 20.5% 26.0% 24.2%

Group Life & Health / Financial

15.3% 24.6% 12.5% 10.7% 29.1%

Multi-Line

*

*

*

*

*

Personal P&C

10.4

15.1

11.0

15.1

10.2

Number of Carriers

Commercial P&C

10.7

22.9

15.3

25.3

15.7

Group Life & Health / Financial Total PL Comms Placed (as % of PL Revenues) Total CL Comms Placed (as % of CL Revenues)

7.6

9.6

10.4

23.7

11.2

2015 Best Practices Study

52.2% 9.6%

*

*

*

Service Center Use

2.1% 2.3%

*

*

*

161

% of Agencies Making an Acquisition in the last 12 Months

6.3% 3.7% 7.4% 6.7% 10.0%

*Insufficient Data