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Key Benchmarks
Profile
Revenues
Expenses
Profitability
Employee Overview
Producer Info
Staff Service Info
Technology
Insurance Carriers
Appendix
60
Analysis of Agencies with Revenues Between $2,500,000 and $5,000,000
2011 Best
Practices Study
Agencies with
Revenues Between
$2,500,000 and
$5,000,000
Average
+25% Profit
+25% Growth
Revenues (as % of Gross Revenue)
Commercial Lines
51.9%
49.3%
53.6%
Bonds
3.0%
5.6%
3.0%
Personal Lines
22.2%
22.1%
18.3%
Value Added Services
1.2%
4.4%
0.5%
Contingent/Bonus
8.5%
9.2%
7.1%
Group Medical
8.5%
5.0%
10.5%
All Other Group
1.7%
1.0%
1.5%
Individual L&H
1.7%
2.5%
2.9%
Bonus/Overrides
0.3%
0.4%
0.7%
Investments
0.5%
0.3%
0.5%
Miscellaneous
0.2%
0.1%
0.3%
Total Revenues
100.0%
100.0%
100.0%
Brokerage Commission Expense
1.1%
0.3%
0.0%
Net Revenues
98.9%
99.7%
100.0%
Expenses (as % of Net Revenues)
Compensation
62.6%
57.8%
59.0%
Selling
4.1%
3.1%
3.7%
Operating
15.3%
13.9%
13.8%
Administrative
2.4%
0.7%
3.9%
Total Expenses
84.4%
75.5%
80.3%
Pre-Tax Profit
15.6%
24.5%
19.7%
Pro Forma Pre-Tax Profit
1
20.0%
32.5%
20.3%
Operating Pre-Tax Profit
2
6.0%
14.5%
10.3%
EBITDA
3
18.6%
25.6%
24.6%
Pro Forma EBITDA
23.0%
33.6%
25.2%
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