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Key Benchmarks
Profile
Revenues
Expenses
Profitability
Employee Overview
Producer Info
Staff Service Info
Technology
Insurance Carriers
Appendix
84
Analysis of Agencies with Revenues Between $5,000,000 and $10,000,000
2012 Best
Practices Study
Agencies with
Revenues Between
$5,000,000 and
$10,000,000
Average
+25% Profit
+25% Growth
Revenues (as % of Gross Revenue)
Commercial Lines
46.3%
40.6%
47.4%
Bonds
2.0%
0.8%
1.9%
Personal Lines
21.4%
23.2%
17.5%
Value Added Services
0.7%
1.8%
0.1%
Contingent/Bonus
6.9%
7.6%
7.6%
Group Medical
11.6%
13.2%
17.8%
All Other Group
3.1%
4.2%
3.2%
Individual L&H
2.8%
2.1%
0.6%
Bonus/Overrides
0.9%
0.5%
1.2%
Investments
0.4%
0.4%
0.6%
Miscellaneous
1.3%
0.4%
2.3%
Total Revenues
100.0%
100.0%
100.0%
Brokerage Commission Expense
1.1%
0.2%
0.2%
Net Revenues
98.9%
99.8%
99.8%
Expenses (as % of Net Revenues)
Compensation
66.6%
60.2%
66.5%
Selling
3.1%
2.9%
3.5%
Operating
14.0%
13.0%
12.6%
Administrative
2.9%
2.6%
0.6%
Total Expenses
86.7%
78.8%
83.2%
Pre-Tax Profit
13.3%
21.2%
16.8%
Pro Forma Pre-Tax Profit
1
18.7%
32.8%
23.4%
Operating Pre-Tax Profit
2
5.5%
13.2%
8.0%
EBITDA
3
16.6%
23.2%
18.0%
Pro Forma EBITDA
21.9%
34.8%
24.7%
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