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2007 Best Practices Study | Agencies with Revenues Between $1,250,000 and $2,500,000 | Revenues/Expenses
Agencies with Revenues Between $1,250,000 and $2,500,000
Appendix
Insurance
Carriers
Technology
Service
Staff Info
Producer
Info
Employee
Overview
Financial
Stability
Revenues/
Expenses
Executive
Perspectives
Profile
Average
+25% Profit
+25% Growth
Revenue/Expense/Profit Summary
Compensation
0%
10%
20%
30%
40%
50%
60%
70%
5 Profit
rowth
Selling
Operating
Administrative
Expenses (as % of Net Revenue)
Average
+25% Profit
+25% Growth
Revenues (% by Source)
Commercial Lines
49.4%
42.1%
55.4%
Bonds
1.8%
3.9%
2.0%
Personal Lines
25.6%
29.6%
21.0%
VAS - P&C
0.2%
0.0%
0.0%
Contingent/Bonus
11.2%
12.5%
11.7%
Group Life & Health
6.5%
5.0%
6.3%
Individual Life & Health
2.9%
4.2%
1.3%
VAS - L&H
0.3%
0.0%
0.0%
Bonus/Overrides
0.9%
1.5%
0.0%
Investments
1.0%
1.3%
1.6%
Miscellaneous
0.3%
0.0%
0.7%
Total Revenues
100.0%
100.0%
100.0%
Brokerage Commission Expense
1.3%
1.6%
0.0%
Net Revenues
98.7%
98.4%
100.0%
Expenses (as % of Net Revenues)
Compensation
57.9%
49.0%
56.7%
Selling
4.5%
3.5%
5.8%
Operating
15.3%
14.6%
18.7%
Administrative
1.2%
0.7%
1.0%
Total Expenses
78.9%
67.9%
82.1%
Pre-Tax Profit
21.1%
32.1%
17.9%
Pro Forma Pre-Tax Profit
1
28.0%
45.0%
27.0%
Operating Pre-Tax Profit
2
7.8%
16.5%
4.6%
EBITDA
23.2%
33.4%
19.9%
Pro Forma EBITDA
3
30.1%
46.2%
29.0%
1
Pre-tax Profits if
discretionary expenses
are eliminated and all
owners compensated as
employees
2
Pre-tax Profits excluding
income from
contingents, bonus and
investment income
3
EBITDA—Earnings
Before Interest Taxes
Depreciation and
Amortization