2015 Best Practices Study

Analysis of Agencies with Revenues Between $2,500,000 and $5,000,000

Key Benchmarks Profile

Expenses (as % of Net Revenues) — continued

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

Average

Top 25% Profit Top 25% Growth

ADMINISTRATIVE EXPENSES Amortization of Intangibles

1.6% 0.2% 0.6% 0.6% 2.9% 77.8% 22.2% 25.2%

2.0% 0.0% 0.6% 0.9%

1.0% 0.2% 0.1% 0.9%

Officer Life

Interest

Other

Total Administrative

3.6%

2.3%

TOTAL EXPENSES

66.9% 33.1% 36.4%

77.4% 22.6% 24.4%

PRE-TAX PROFIT (LOSS)

EBITDA

Average

Top 25% Profit Top 25% Growth

Expense Growth Over Prior Year Compensation Expense

8.0% 0.1% 7.7% -5.9%

0.9% -3.6% 4.0%

14.8%

Selling Expense

2.6%

Operating Expense

15.0%

Administrative Expense

-10.2%

0.4%

EBITDA—Earnings Before Interest, Taxes, Depreciation and Amortization

Expenses (as % of Net Revenues)

Average

Top 25% Profit

Top 25% Growth

60%

57.9%

56.9%

50%

47.9%

40%

30%

20%

14.0%

11.4% 13.3%

2015 Best Practices Study

10%

4.0% 4.1% 4.0%

2.9% 3.6% 2.3%

0%

Agencies with Revenues Between $2,500,000 and $5,000,000

Compensation

Selling

Operating

Administrative

65

Note: See page 163 for an explanation of column headings