2015 Best Practices Study

2015 Best Practices Study

Key Benchmarks Profile

Regional Analysis Agencies with Revenues OVER $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

10.5% 12.0% 11.0% 9.4% 7.3%

Net Revenue Growth (Organic)

6.2% 6.6% 10.2% 9.1% 9.5%

Pre-tax Profit

16.0% 16.5% 17.2% 19.2% 12.2%

Pro Forma Pre-tax Profit

19.2% 18.5% 17.7% 22.5% 19.3%

Profitability as % of Net Revenues

Operating Pre-tax Profit

8.2% 9.0% 7.2% 10.7% 5.9%

EBITDA

19.2% 18.9% 19.5% 21.2% 15.8%

Pro Forma EBITDA

22.4% 20.9% 20.1% 24.6% 22.8%

Value Creation “Rule of 20” Score

16.4

16.0

17.2

20.4

21.0

Revenue per Employee $178,668 $175,079 $187,405 $184,003 $211,863 Compensation per Employee $109,037 $113,227 $119,687 $116,141 $141,396 Spread per Employee $69,631 $61,852 $67,718 $67,861 $70,467

Productivity

Commercial P&C

$137,769 $215,066 $198,068 $190,843 $228,452

Personal P&C

$63,512 $87,451 $77,573 $76,926 $92,639

Pay Levels for Producers

Group Life & Health / Financial

$143,116 $221,685 $167,736 $206,205 $228,815

Multi-Line

$108,127 $220,323 $243,113 $198,376 $206,309

Commercial P&C

30.0

30.3

30.3

22.0

38.9

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

Personal P&C

14.5

11.7

8.6

12.0

7.2

Group Life & Health / Financial

8.8

14.8

14.9

5.0

23.8

Multi-Line

*

*

*

*

*

Commercial P&C

26.0% 20.1% 19.1% 19.9% 16.6%

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

Personal P&C

25.6% 22.4% 31.2% 25.1% 24.3%

Group Life & Health / Financial

23.6% 15.4% 14.7% 14.5% 15.5%

Multi-Line

*

*

*

*

*

Personal P&C

21.1

26.0

23.2

26.3

19.3

Number of Carriers

Commercial P&C

32.7

66.7

57.6

58.2

62.7

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

34.7

43.9

57.4

51.5

67.3

2015 Best Practices Study

20.3% 19.2% 14.4% 19.9% 30.1%

Service Center Use

8.7% 1.7% 2.2% 2.6% 3.1%

162

% of Agencies Making an Acquisition in the last 12 Months

5.0% 21.7% 33.3% 38.9% 28.6%

*Insufficient Data