177 / 204
2013 Best
Practices Study
Agencies
with
Revenues
Over
$25,000,000
177
Analysis of Agencies with Revenues Over $25,000,000
Key Benchmarks
Mgmt. Perspectives
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
54.1%
56.9%
57.4%
Bonds
3.7%
3.9%
5.4%
Personal Lines
6.2%
7.2%
4.6%
VAS - P&C
1.3%
1.0%
2.7%
Contingent/Bonus
5.7%
5.4%
6.0%
Group Medical
17.9%
13.2%
14.7%
All Other Group
6.1%
6.1%
3.9%
Individual L&H
1.4%
2.0%
1.7%
Bonus/Overrides
2.0%
1.5%
1.4%
Investments
0.6%
0.6%
1.0%
Miscellaneous
1.1%
2.1%
1.2%
Total Revenues
100.0%
100.0%
100.0%
Brokerage Commission Expense
2.5%
1.1%
3.7%
Net Revenues
97.5%
98.9%
96.3%
Expenses (as % of Net Revenues)
Compensation
64.1%
58.1%
65.8%
Selling
3.8%
2.9%
3.4%
Operating
13.2%
12.9%
12.2%
Administrative
3.5%
0.9%
3.8%
Total Expenses
84.6%
74.8%
85.3%
Average
+25% Profit
+25% Growth
Pre-Tax Profit
15.4%
25.2%
14.7%
Pro Forma Pre-Tax Profit
1
17.9%
27.0%
18.1%
Operating Pre-Tax Profit
2
7.5%
18.2%
7.0%
EBITDA
3
19.2%
26.4%
19.0%
Pro Forma EBITDA
21.7%
28.3%
22.4%
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)