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2007 Best Practices Study | Agencies with Revenues Between $2,500,000 and $5,000,000 | Financial Stability
Agencies with Revenues Between $2,500,000 and $5,000,000
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
1.15:1
2.03:1
Tangible Net Worth (% of Net Revenue)
8.9%
26.8%
Receivables/Payable Ratio
43.4%
-3.5%
Aged Receivables
% Receivables Aged Past 60 Days
5.0%
1.4%
% Receivables Aged Past 90 Days
-1.7%
0.3%
Average
+25% Profit
+25% Growth
Agency Billed vs. Direct Billed by Carrier
% of P&C Revenues that are Agency Billed
32.1%
29.4%
38.1%
% of P&C Revenues that are Direct Billed
64.5%
70.6%
61.9%
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
100.0%
Have strict collection policy
83.3%
Encourage/require use of direct bill
93.3%
Encourage/require use of premium finance
86.7%
Use pre-billing and binder billing
90.0%
Centralize collections & remove producer involvement
43.3%
Charge producers for bad debt-write-offs
66.7%
% of Premium charged back to Producers for bad debt write-offs: 78.0%
% Using