92 / 168
2014 Best
Practices Study
Agencies
with Revenues
Between
$5,000,000 and
$10,000,000
92
Analysis of Agencies with Revenues Between $5,000,000 and $10,000,000
Key Benchmarks
Profile
Revenues
Expenses
Profitability
Employee Overview
Producer Info
Service Staff Info
Technology
Insurance Carriers
Appendix
Average
+25% Profit
+25% Growth
Revenues (as % of Gross Revenue)
Commercial Lines
51.5%
45.2%
48.7%
Bonds
1.4%
0.3%
0.6%
Personal Lines
24.1%
28.4%
21.7%
VAS - P&C
1.7%
5.5%
5.6%
Contingent/Bonus
7.8%
9.0%
9.1%
Group Medical
8.4%
7.9%
8.9%
All Other Group
2.2%
1.9%
1.6%
Individual Life & Health
1.2%
1.1%
1.6%
Bonus/Overrides
0.8%
0.2%
1.0%
Investments
0.2%
0.1%
0.1%
Miscellaneous
0.7%
0.4%
1.0%
Total Revenues
100.0%
100.0%
100.0%
Brokerage Commission Expense
1.0%
0.0%
0.1%
Net Revenues
99.0%
100.0%
99.9%
Expenses (as % of Net Revenues)
Compensation
61.7%
56.9%
58.4%
Selling
3.2%
2.7%
3.0%
Operating
14.5%
12.5%
12.3%
Administrative
2.6%
1.9%
3.5%
Total Expenses
82.0%
74.0%
77.2%
Average
+25% Profit
+25% Growth
Pre-Tax Profit
18.0%
26.0%
22.8%
Pro Forma Pre-Tax Profit
1
21.8%
34.9%
23.8%
Operating Pre-Tax Profit
2
10.1%
18.3%
14.0%
EBITDA
3
21.2%
28.2%
26.9%
Pro Forma EBITDA
4
25.1%
37.2%
27.9%
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
4 EBITDA if discretionary expenses
are eliminated and all owners
compensated as employees
Profit/Loss Summary
Profit/Loss
(as % of Net Revenues)