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2007 Best Practices Study | Agencies with Revenues Under $1,250,000 | Financial Stability
Agencies with Revenues Under $1,250,000
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
1.30:1
2.02:1
Tangible Net Worth (% of Net Revenue)
13.7%
29.4%
Receivables/Payable Ratio
68.4%
7.5%
Aged Receivables
% Receivables Aged Past 60 Days
11.8%
7.2%
% Receivables Aged Past 90 Days
9.4%
3.1%
Average
+25% Profit
+25% Growth
Agency Billed vs. Direct Billed by Carrier
% of P&C Revenues that are Agency Billed
18.2%
16.7%
20.1%
% of P&C Revenues that are Direct Billed
79.0%
72.2%
79.9%
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
94.1%
Have strict collection policy
85.3%
Encourage/require use of direct bill
94.1%
Encourage/require use of premium finance
85.3%
Use pre-billing and binder billing
61.8%
Centralize collections & remove producer involvement
50.0%
Charge producers for bad debt-write-offs
29.4%
% of Premium charged back to Producers for bad debt write-offs: 75.0%
% Using