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Analysis of Agencies with Revenues
Between $2,500,000 and $5,000,000
What the Typical Transaction Looked Like:
D. Renewal Revenue as % of Prior Year's Total Revenues for Each Line of Business
This figure is impacted by attrition (loss or retention of accounts) and by changes in premium and commission levels.
The higher the percentage, the more favorable the results.
Commercial P&C
95.2%
94.6%
105.6%
Personal P&C
91.4%
97.7%
96.7%
P&C Service Fees
53.4%
40.0%
65.6%
Group L&H
80.1%
70.6%
78.8%
Individual L&H
52.2%
22.8%
63.8%
Total Commissions & Fees
93.8%
96.6%
105.0%
*-Insufficient Data
Average
+25% Profit
+25% Growth
Revenues Acquired Per Transaction
$0
$50,000
$100,000
$150,000
$200,000
$250,000
average
low
Multiple of Revenues Paid
0.0x
0.5x
1.0x
1.5x
2.0x
average
high
low
What was Acquired
Book of Business
Agency
Primary Currency Used
Stock Cash Both
Pricing Structure Used
0%
10%
20%
30%
40%
50%
60%
variable
fixed
Page 56
2003 Best Practices Study