67 / 191
2010 Best
Practices Study
Agencies
with Revenues
Between
$2,500,000 and
$5,000,000
67
Analysis of Agencies with Revenues Between $2,500,000 and $5,000,000
Mgmt. Perspectives
Profile
Revenues
Expenses
Profitability
Employee Overview
Producer Info
Staff Service Info
Technology
Insurance Carriers
Appendix
Revenue by Account Concentration
Average
+25% Profit
+25% Growth
% of Revenue Derived from:
Largest Account
4.3%
3.2%
6.4%
High
23.2%
Low
1.0%
10 Largest Accounts
13.3%
13.2%
14.3%
High
32.8%
Low
3.2%
Average
+25% Profit
+25% Growth
“Other” Group Life & Health* Revenue (% from source)
Life
30.7%
30.5%
28.7%
Disability
15.8%
15.6%
18.0%
Dental & Vision
31.9%
39.5%
30.8%
Retirement/Pension
4.0%
2.9%
1.9%
Worksite/Voluntary/Supplement
7.7%
8.7%
11.4%
Long-Term Care
1.2%
0.2%
1.1%
Employee Benefits TPA
1.5%
0.0%
0.0%
All Other
7.2%
2.5%
8.1%
What the Typical Transactions Looked Like
Revenues Acquired per Transaction
Multiples of Revenue Paid
Average
$198,858
Average
0.88x
High
$400,000
High
1.00x
Low
$46,576
Low
0.75x
Acquired Revenues
% of Agencies
Acquiring
Average
Commissions
Acquired
Percentage of
Net Revenues
Acquisitions Made in Last 12 Months
8.1%
$295,746
9.9%
Revenue by Aquisition
*Excludes Group Medical