2010 Best Practices Study

2010 Best Practices Study

Mgmt. Perspectives

Population Density Agencies with Revenues OVER $5,000,000

Profile

Revenues

Expenses

Less than 50,000

50,000 to 250,000

250,000 to 1,000,000

Over 1,000,000

Profitability

Geographic Region:

% of Agencies Located in Each Region

4.0%

9.8% 14.3% 15.6%

Employee Overview

Net Revenue Growth (Organic)

0.2%

2.8%

-1.2%

0.7%

Producer Info

Pre-tax Profit

14.4% 11.9% 13.0% 13.1%

Staff Service Info

Pro Forma Pre-tax Profit

19.7% 15.7% 17.7% 17.7%

Profitability as % of Net Revenues

Technology

Operating Pre-tax Profit

4.5%

0.7%

2.0%

3.6%

EBITDA

21.8% 16.4% 16.0% 16.1%

Insurance Carriers

Pro Forma EBITDA

27.1% 20.1% 20.7% 20.7%

Appendix

Value Creation “Rule of 20” Score

13.7

12.9

9.1

11.1

Revenue per Employee

$151,905

$164,926

$165,343

$182,085

Productivity

Compensation per Employee

$92,699

$106,961

$110,936

$122,846

Spread per Employee

$59,205

$57,963

$54,408

$59,239

Commercial P&C

$174,644

$202,337

$218,473

$213,456

Personal P&C

$47,487

$55,523

$101,056

$117,338

Pay Levels for Producers

Life & Health / Financial

$109,810

$177,866

$261,134

$274,184

Multiline

$84,853

$233,173

$184,296

$230,339

Commercial P&C

$46,093

$46,311

$50,140

$53,141

Pay Levels for Service / Sales Support Staff

Personal P&C

$43,073

$38,875

$42,570

$49,180

Life & Health / Financial

$37,579

$43,418

$52,595

$53,510

Multiline

*

*

*

*

Commercial P&C

$64,616

$79,082

$75,893

$96,825

Pay Levels for Account Execs

Life & Health / Financial

$41,309

$78,637

$88,393

$82,038

PL - National

12.2

8.9

10.1

7.3

PL - Regional

7.4

7.7

9.2

8.0

Number of Carriers

CL - National

29.2

26.9

30.2

27.9

CL - Regional

11.3

14.5

22.5

28.9

EB - All

21.9

34.4

56.8

48.8

Total PL Comms Placed

*

31.0% 17.3% 29.8%

Service Center Use

Total CL Comms Placed

8.6%

2.7%

2.2%

2.1%

2010 Best Practices Study

% of Agencies Making an Acquisition in the last 12 Months

11.1% 14.8% 15.6% 20.0%

183

*Insufficient Data

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