46 / 191
2010 Best
Practices Study
Agencies
with Revenues
Between
$1,250,000 and
$2,500,000
46
Analysis of Agencies with Revenues Between $1,250,000 and $2,500,000
Mgmt. Perspectives
Profile
Revenues
Expenses
Profitability
Employee Overview
Producer Info
Staff Service Info
Technology
Insurance Carriers
Appendix
Average
+25% Profit
+25% Growth
Revenues (as % of Gross Revenue)
Commercial Lines
50.4%
53.4%
51.7%
Bonds
2.0%
3.7%
1.6%
Personal Lines
28.5%
23.6%
32.9%
Value Added Services
0.1%
0.0%
0.1%
Contingent/Bonus
9.1%
10.3%
6.9%
Group Medical
4.9%
3.4%
3.4%
All Other Group
0.8%
0.0%
0.9%
Individual L&H
2.4%
4.3%
1.9%
Bonus/Overrides
0.4%
0.2%
0.1%
Investments
0.6%
0.6%
0.3%
Miscellaneous
0.6%
0.5%
0.1%
Total Revenues
100.0%
100.0%
100.0%
Brokerage Commission Expense
1.1%
0.0%
2.6%
Net Revenues
98.9%
100.0%
97.4%
Expenses (as % of Net Revenues)
Compensation
58.1%
43.8%
58.1%
Selling
3.2%
3.2%
2.7%
Operating
15.7%
13.7%
14.3%
Administrative
2.8%
2.1%
4.4%
Total Expenses
79.8%
62.9%
79.4%
Pre-Tax Profit
20.2%
37.1%
20.6%
Pro Forma Pre-Tax Profit
1
26.1%
44.0%
24.9%
Operating Pre-Tax Profit
2
8.0%
21.8%
8.5%
EBITDA
3
23.4%
38.4%
24.7%
Pro Forma EBITDA
29.3%
45.3%
29.0%
1 Pre-tax Profits if discretionary expenses are
eliminated and all owners compensated as
employees
2 Pre-tax Profits excluding contingents, bonus
and investment income
3 EBITDA—Earnings Before Interest Taxes
Depreciation and Amortization
Profit/Loss Summary
Profit/Loss
(as % of Net Revenues)
Profitability