118 / 168
2015 Best
Practices Study
Agencies
with Revenues
Between
$10,000,000 and
$25,000,000
118
Analysis of Agencies with Revenues Between $10,000,000 and $25,000,000
Key Benchmarks
Profile
Revenues
Expenses
Profitability
Employee Overview
Producer Info
Service Staff Info
Technology
Insurance Carriers
Appendix
Note: See page 163 for an explanation of column headings
Average
Top 25% Profit Top 25% Growth
Revenues (as % of Gross Revenue)
Commercial Lines
50.8%
50.3%
44.6%
Bonds
1.0%
0.6%
0.8%
Personal Lines
15.2%
13.9%
23.4%
VAS - P&C
0.6%
0.6%
0.7%
Contingent/Bonus
6.6%
5.8%
5.2%
Group Medical
14.5%
16.9%
11.6%
All Other Group
5.1%
3.7%
3.5%
Individual Life & Health
2.9%
5.1%
4.9%
Bonus/Overrides
1.5%
2.7%
1.8%
Investments
0.8%
0.3%
1.4%
Miscellaneous
0.9%
0.1%
2.0%
Total Revenues
100.0%
100.0%
100.0%
Brokerage Commission Expense
1.7%
0.6%
1.2%
NET REVENUES
98.3%
99.4%
98.8%
Expenses (as % of Net Revenues)
Compensation
62.8%
57.7%
59.7%
Selling
3.1%
2.9%
3.5%
Operating
13.8%
13.6%
12.8%
Administrative
3.0%
0.5%
3.9%
TOTAL EXPENSES
82.8%
74.6%
80.0%
Average
Top 25% Profit Top 25% Growth
Pre-Tax Profit
17.2%
25.4%
20.0%
Pro Forma Pre-Tax Profit
1
20.2%
30.1%
20.9%
Operating Pre-Tax Profit
2
9.5%
18.3%
13.7%
EBITDA
3
20.0%
26.4%
22.0%
Pro Forma EBITDA
4
23.0%
31.1%
22.9%
1 Pre-tax Profit if discretionary
expenses are eliminated and
all owners compensated as
employees
2 Pre-tax Profit excluding
contingents, bonus and
investment income
3 EBITDA—Earnings Before
Interest, Taxes, Depreciation and
Amortization
4 EBITDA if discretionary expenses
are eliminated and all owners
compensated as employees
Profit/Loss Summary
Profit/Loss
(as % of Net Revenues)