18 / 186
Revenue/Expense/Profit Summary
Profitability
AGENCIES WITH REVENUES UNDER $500,000
EXECUTIVE
PERSPECTIVES
PROFILE
REVENUES/
EXPENSES
FINANCIAL
STABILITY
EMPLOYEE
OVERVIEW
PRODUCER
INFO
SERVICE
STAFF
INFO
TECHNOLOGY
INSURANCE
CARRIERS
APPENDIX
17
Average
+25%
Profit
+25%
Growth
Revenues (% by Source)
Commercial Lines
37.1%
23.2%
34.2%
Personal Line
51.7%
68.5%
54.3%
P&C Service Fees
0.3%
0.1%
1.1%
Contingent/Bonus
5.4%
2.7%
6.1%
Group Life & Health
2.6%
4.0%
0.8%
Individual Life & Health
1.8%
1.2%
3.2%
Investments
0.3%
0.0%
0.1%
Miscellaneous
0.9%
0.2%
0.2%
Total Revenues
100.0% 100.0% 100.0%
Brokerage Commission Expense
2.6%
1.4%
0.6%
Net Revenues
97.4.%
98.6%
99.4%
Expenses (as % of Net Revenues)
Compensation
49.8%
29.5%
47.9%
Selling
6.3%
7.3%
5.9%
Operating
19.8%
18.1%
18.3%
Administrative
4.3%
3.6%
3.7%
Total Expenses
80.2%
58.4%
75.8%
Pre-Tax Profit
19.8%
41.6%
24.2%
Pro Forma Profit
1
26.0%
55.5%
33.9%
Operating Pre-Tax Profit
2
12.4%
36.5%
11.5%
Pro Forma EBITDA
3
30.3%
59.1%
37.6%
% Total Net Revenue
Average
+25% Profit
+25% Growth
60%
30%
20%
10%
Pre-Tax
Profit
Pro Forma
Pre-Tax Profit
Operating
Pre-Tax Profit
1
Pre-tax profit when discretionary expenses (bonuses, compensation, and perks) made for the benefit of
the owners, based solely on ownership, are removed (i.e., removing expenses that would not be
incurred if a third party owned the agency).
2
Pre-tax profit minus contingents, bonus and investment income.
3
EBITDA = Earnings before Interest, Taxes, Depreciation and Amortization
40%
50%