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2007 Best Practices Study | Agencies with Revenues Between $1,250,000 and $2,500,000 | Financial Stability
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
Financial Stability
Accounts Receivable
Average
Top 25%
Balance Sheet
Current Ratio
1.44:1
2.05:1
Tangible Net Worth (% of Net Revenue)
18.9%
35.8%
Receivables/Payable Ratio
61.2%
5.0%
Aged Receivables
% Receivables Aged Past 60 Days
-88.9%
1.4%
% Receivables Aged Past 90 Days
-83.9%
2.7%
Average
+25% Profit
+25% Growth
Agency Billed vs. Direct Billed by Carrier
% of P&C Revenues that are Agency Billed
24.8%
16.3%
28.9%
% of P&C Revenues that are Direct Billed
68.6%
83.7%
46.1%
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
100.0%
Have strict collection policy
75.9%
Encourage/require use of direct bill
89.7%
Encourage/require use of premium finance
79.3%
Use pre-billing and binder billing
79.3%
Centralize collections & remove producer involvement
48.3%
Charge producers for bad debt-write-offs
51.7%
% of Premium charged back to Producers for bad debt write-offs: 85.7%
% Using