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Analysis of Agencies with Revenues
Between $5,000,000 and $10,000,000
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
99.4%
97.4%
107.1%
Personal P&C
99.6%
94.1%
98.6%
P&C Service Fees
61.6%
*
61.6%
Group L&H
86.0%
92.3%
82.1%
Individual L&H
57.8%
48.2%
81.6%
Total Commissions & Fees
96.1%
93.5%
103.7%
Average
+25% Profit
+25% Growth
Revenues Acquired Per Transaction
$0
$500,000
$1,000,000
$1,500,000
$2,000,000
$2,500,000
$3,000,000
average
high
Multiple of Revenues Paid
0.0x
0.5x
1.0x
1.5x
2.0x
high
low
Pricing Structure Used
42%
44%
46%
48%
50%
52%
54%
56%
variable
fixed
What was Acquired
Book of Business
Agency
Primary Currency Used
Stock Cash Both
Page 70
2003 Best Practices Study