2010 Best Practices Study

Analysis of Agencies with Revenues Between $10,000,000 and $25,000,000

Revenue by Aquisition

Mgmt. Perspectives

Profile

Acquired Revenues

Revenues

Average Commissions Acquired

% of Agencies Acquiring

Percentage of Net Revenues

Expenses

Profitability

Acquisitions Made in Last 12 Months

17.9%

$533,441

4.0%

Employee Overview

Producer Info

What the Typical Transactions Looked Like Revenues Acquired per Transaction

Multiples of Revenue Paid

Staff Service Info

Average

$1,489,587 $8,345,000

Average

1.27x 2.08x 0.88x

Technology

High Low

High Low

Insurance Carriers

$12,900

Appendix

Revenue by Account Concentration Average

+25% Profit

+25% Growth

% of Revenue Derived from: Largest Account

3.5% 9.2% 1.0%

3.9%

4.5%

High Low

10 Largest Accounts

13.5% 28.9%

16.0%

17.8%

High Low

1.2%

Average

+25% Profit

+25% Growth

“Other” Group Life & Health* Revenue (% from source) Life

23.0% 20.2% 24.7%

22.7% 19.8% 24.0%

32.4% 24.3% 27.9%

Disability

Dental & Vision

Retirement/Pension

5.1% 4.6% 1.7% 0.6%

7.4% 4.3% 2.8% 2.0%

2.6% 3.0% 1.8% 0.0% 8.1%

Worksite/Voluntary/Supplement

Long-Term Care

2010 Best Practices Study

Employee Benefits TPA

All Other

20.1%

17.0%

*Excludes Group Medical

Agencies with Revenues Between $10,000,000 and $25,000,000

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