2010 Best Practices Study

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

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

8.1%

$295,746

9.9%

Employee Overview

Producer Info

What the Typical Transactions Looked Like Revenues Acquired per Transaction

Multiples of Revenue Paid

Staff Service Info

Average

$198,858 $400,000 $46,576

Average

0.88x 1.00x 0.75x

Technology

High Low

High Low

Insurance Carriers

Appendix

Revenue by Account Concentration Average

+25% Profit

+25% Growth

% of Revenue Derived from: Largest Account

4.3%

3.2%

6.4%

High Low

23.2%

1.0%

10 Largest Accounts

13.3% 32.8%

13.2%

14.3%

High Low

3.2%

Average

+25% Profit

+25% Growth

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

30.7% 15.8% 31.9%

30.5% 15.6% 39.5%

28.7% 18.0% 30.8%

Disability

Dental & Vision

Retirement/Pension

4.0% 7.7% 1.2% 1.5% 7.2%

2.9% 8.7% 0.2% 0.0% 2.5%

1.9%

Worksite/Voluntary/Supplement

11.4%

Long-Term Care

1.1% 0.0% 8.1%

2010 Best Practices Study

Employee Benefits TPA

All Other

*Excludes Group Medical

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

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