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2007 Best Practices Study | Agencies with Revenues Between $5,000,000 and $10,000,000 | Financial Stability
Agencies with Revenues Between $5,000,000 and $10,000,000
Appendix
Insurance
Carriers
Technology
Service
Staff Info
Producer
Info
Employee
Overview
Financial
Stability
Revenues/
Expenses
Executive
Perspectives
Profile
Financial Stability
Accounts Receivable
Average
Top 25%
Balance Sheet
Current Ratio
1.34:1
1.98:1
Tangible Net Worth (% of Net Revenue)
7.2%
27.1%
Receivables/Payable Ratio
55.4%
9.1%
Aged Receivables
% Receivables Aged Past 60 Days
17.5%
2.4%
% Receivables Aged Past 90 Days
11.2%
1.9%
Average
+25% Profit
+25% Growth
Agency Billed vs. Direct Billed by Carrier
% of P&C Revenues that are Agency Billed
35.4%
23.5%
33.1%
% of P&C Revenues that are Direct Billed
61.2%
76.5%
66.9%
Receivable Management Practices
Participants were asked to indicate which practices they utilized and to score the practices’ effectiveness where
1=NOT
EFFECTIVE
and
5=EXTREMELY EFFECTIVE.
1
2
3
4
5
Management reviews receivables regularly
96.4%
Have strict collection policy
75.0%
Encourage/require use of direct bill
89.3%
Encourage/require use of premium finance
82.1%
Use pre-billing and binder billing
75.0%
Centralize collections & remove producer involvement
46.4%
Charge producers for bad debt-write-offs
85.7%
% of Premium charged back to Producers for bad debt write-offs: 86.5%
% Using