2002 Best Practices Study

Analysis of Agencies with Revenues Between $5,000,000 and $10,000,000

REVENUE ANALYSIS

A. % of Revenue by Source

Average

+25% Profit

+25% Growth

Commercial P&C

54.0% 18.0%

45.1% 31.7%

47.8% 23.9%

Personal P&C

P&C Service Fees

1.7% 7.2%

1.2%

1.7% 9.7%

Contingent Group L&H

10.8%

13.5%

6.0% 2.8% 1.9% 0.5%

12.3%

Individual L&H Investments Miscellaneous

2.4% 1.5% 1.7%

2.8% 1.6% 0.2%

Total Revenues

100.0%

100.0%

100.0%

Brokerage Commission Expense

3.0%

0.7%

0.8%

Net Revenues

97.0%

99.3%

99.2%

Revenue by Source

60.0%

50.0%

40.0%

30.0%

20.0%

10.0%

% Total Revenue

0.0%

Commercial P&C

Personal P&C P&C Service Fees

Contingent

Group L&H Individual L&H Investments

Average +25% Profit

+25% Growth

Average

+25% Profit

+25% Growth

B. % of Revenues Derived from Largest Accounts

Largest Commission Account

2.5% 5.8% 1.2%

2.2%

2.2%

High Low

10 Largest Commission Accounts

11.9% 26.7%

10.2%

10.4%

High Low

4.6%

C. Revenues Derived from Acquisitions Made in Last 12 Months % of Agencies Acquiring

10.4% % of Net Revenues

Avg. Commissions Acquired

20.0%

$710,499

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