162 / 168
2014 Best
Practices Study
162
2014 Best Practices Study
Key Benchmarks
Profile
Revenues
Expenses
Profitability
Employee Overview
Producer Info
Service Staff Info
Technology
Insurance Carriers
Appendix
Regional Analysis
Agencies with Revenues OVER $5,000,000
Geographic Region:
Northeast Southeast Midwest Southwest
West
% of Agencies Located in Each Region
10.7% 12.7% 9.3% 8.8% 7.8%
Net Revenue Growth (Organic)
8.3% 8.5% 11.1% 8.5% 10.2%
Profitability as %
of Net Revenues
Pre-tax Profit
16.0% 16.6% 15.9% 18.5% 13.3%
Pro Forma Pre-tax Profit
18.8% 20.0% 18.5% 20.8% 19.3%
Operating Pre-tax Profit
8.7% 9.5% 6.0% 11.2% 7.2%
EBITDA
20.4% 18.7% 18.7% 20.6% 16.5%
Pro Forma EBITDA
23.3% 22.1% 21.3% 23.0% 22.4%
Value Creation “Rule of 20” Score
20.5
18.6
20.0
19.7
21.4
Productivity
Revenue per Employee
$175,779 $174,870 $185,636 $183,611 $200,817
Compensation per Employee $107,305 $112,812 $119,522 $116,259 $131,272
Spread per Employee
$68,474 $62,058 $66,114 $67,352 $69,545
Pay Levels for
Producers
Commercial P&C
$146,672 $205,766 $213,707 $170,852 $226,633
Personal P&C
$55,833 $88,579 $76,014 $89,734 $84,181
Life & Health / Financial
$146,320 $232,882 $219,707 $193,891 $217,331
Multi-Line
$101,307 $196,712 $282,598 $185,452 $273,921
Total Number of
Service / Sales
Support Staff per
Line of Business
Commercial P&C
25.3
31.8
43.1
25.5
40.6
Personal P&C
16.0
11.0
9.7
11.4
6.9
Group Life & Health
8.2
15.0
28.6
8.7
20.0
Multi-Line
11.0
*
*
*
*
Total Service /
Sales Support
Staff Payroll as %
of LOB Revenue
Commercial P&C
22.4% 20.5% 19.9% 16.8% 19.5%
Personal Lines
24.8% 22.4% 28.1% 26.1% 23.6%
Group Life & Health
21.1% 15.4% 15.9% 14.4% 14.1%
Multi-Line
9.3%
*
*
*
*
Number of
Carriers
Personal Lines
22.6
26.1
19.6
20.6
16.3
Commercial Lines
36.6
59.3
52.7
56.8
48.5
Life & Health
34.6
47.2
57.2
39.4
65.7
Service Center
Use
Total PL Comms Placed
(as % of PL Revenues)
18.5% 28.0% 33.9% 21.4% 25.4%
Total CL Comms Placed
(as % of CL Revenues)
11.1% 2.1% 0.8% 1.9% 3.0%
% of Agencies Making an Acquisition
in the last 12 Months
18.2% 19.2% 31.6% 16.7% 12.5%
*Insufficient Data