144 / 168
2015 Best
Practices Study
Agencies
with Revenues
Over
$25,000,000
144
Analysis of Agencies with Revenues Over $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
53.6%
56.1%
55.9%
Bonds
4.3%
4.8%
6.4%
Personal Lines
6.1%
5.8%
2.1%
VAS - P&C
1.7%
1.0%
3.1%
Contingent/Bonus
6.1%
6.7%
5.5%
Group Medical
18.6%
15.8%
20.5%
All Other Group
5.0%
5.2%
3.8%
Individual Life & Health
1.2%
1.6%
0.6%
Bonus/Overrides
1.7%
1.9%
1.1%
Investments
0.5%
0.3%
0.4%
Miscellaneous
1.2%
0.7%
0.6%
Total Revenues
100.0%
100.0%
100.0%
Brokerage Commission Expense
2.5%
1.9%
2.7%
NET REVENUES
97.5%
98.1%
97.3%
Expenses (as % of Net Revenues)
Compensation
65.5%
59.0%
68.5%
Selling
4.2%
3.6%
4.7%
Operating
13.4%
10.9%
12.0%
Administrative
3.2%
1.9%
1.8%
TOTAL EXPENSES
86.4%
75.5%
86.9%
Average
Top 25% Profit Top 25% Growth
Pre-Tax Profit
13.6%
24.5%
13.1%
Pro Forma Pre-Tax Profit
1
14.3%
23.9%
15.8%
Operating Pre-Tax Profit
2
6.2%
16.9%
6.6%
EBITDA
3
16.9%
26.4%
15.8%
Pro Forma EBITDA
4
17.6%
25.9%
18.5%
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)