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155
2007 Best Practices Study | Agencies with Revenues Over $25,000,000 | Revenues/Expenses
Agencies with Revenues Over $25,000,000
Appendix
Insurance
Carriers
Technology
Service
Staff Info
Producer
Info
Employee
Overview
Financial
Stability
Revenues/
Expenses
Executive
Perspectives
Profile
Revenue Growth by Source
(continued)
Average +25% Profit +25% Growth
Value Added Services - L&H
Renewals
68.9%
*
*
New Business
36.2%
*
*
Acquired Revenues
0.0%
*
*
Organic Growth
5.1%
*
*
Total Growth
5.1%
*
*
Total Commissions & Fees
Renewals
92.9% 88.1% 101.3%
New Business
17.0% 17.2% 19.0%
Acquired Revenues
3.0%
2.6%
0.4%
Organic Growth
10.5%
7.1% 20.3%
Total Growth
13.5%
9.6% 20.7%
P&C Contingent Income Growth
3.0%
0.9% 17.1%
L&H Bonus Income Growth
14.1%
*
7.4%
Investment Income Growth
33.0% 51.3% 12.6%
Total Revenue Growth
13.3% 10.2% 21.9%
Brokerage Commission Expense Growth
-0.1%
-1.2%
6.0%
Net Revenue Growth (Organic)**
10.6%
8.2% 21.4%
Net Revenue Growth (Total)
13.5% 10.5% 21.8%
*Insufficient Data
Future Revenue Growth Strategies
% of Total Responses
Study participants were asked
to indicate their three most
important strategies for
enhancing or achieving future
revenue growth.
1
2
3
Access to Better Carriers
0.0% 0.0% 0.0%
Advertising/Promotions
0.0% 0.0% 0.0%
Agency/Book of Business Acquisitions
20.8% 16.7% 12.5%
Cross-Selling/Total Account Development
4.2% 20.8% 25.0%
Producer Recruitment/Development
58.3% 20.8% 16.7%
New Business Initiatives—Prog Dev/Niche Marketing
16.7% 20.8% 25.0%
New Business Initiatives—Referrals/Centers of Influence 0.0% 16.7% 16.7%
New Business Initiatives—Strategic Alliances
0.0% 4.2% 0.0%
Other*
0.0% 0.0% 4.2%
With:
1
—Critically Important
2
—Very Important
3
—Important
*Includes website marketing/sales, expanded geographic footprint, higher retention, creating a captive, better support/CSR training &
recruiting, value added services
**Organic growth rates
for the most recently
completed fiscal year
varied widely by region
due in part to the effect
of Hurricane Katrina on
coastal exposure pricing.
As a result, the AVERAGE
organic growth rates
achieved by the Best
Practices Agencies were
skewed upward. As
such, readers of this
study might prefer to
benchmark off of the
MEDIAN organic growth
rate, which is the mid-
point of the data when
the results are ranked in
descending order.
MEDIAN
Organic Growth Rate:
8.9%