2013 Best Practices Study

2013 Best Practices Study

Key Benchmarks Mgmt. Perspectives 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

10.2% 11.6% 7.9% 9.3% 8.8%

Net Revenue Growth (Organic)

6.9% 8.9% 10.0% 11.8% 10.3%

Pre-tax Profit

20.1% 14.6% 14.3% 14.9% 13.6%

Pro Forma Pre-tax Profit

22.5% 18.4% 17.3% 20.1% 18.1%

Profitability as % of Net Revenues

Operating Pre-tax Profit

12.2% 7.0% 5.4% 7.0% 7.5%

EBITDA

24.9% 17.1% 18.0% 17.6% 16.6%

Pro Forma EBITDA

27.3% 21.0% 21.0% 22.7% 21.1%

Value Creation “Rule of 20” Score

21.1

19.9

21.0

22.6

21.3

Revenue per Employee $170,133 $167,372 $177,201 $176,521 $198,161 Compensation per Employee $102,067 $111,083 $115,544 $116,296 $121,067 Spread per Employee $68,787 $56,289 $61,656 $56,111 $69,095

Productivity

Commercial P&C

$154,744 $212,976 $211,581 $196,998 $206,088

Personal P&C

$56,636 $95,550 $91,252 $82,040 $96,860

Pay Levels for Producers

Life & Health / Financial

$143,337 $231,604 $214,463 $202,515 $226,697

Multiline

$138,607 $263,547 $301,907 $204,075 $219,321

Commercial P&C

27.3

37.7

51.9

34.1

45.9

Total Number of Service / Sales Support Staff per Line of Business

Personal P&C

15.9

9.3

9.4

10.2

8.1

Group Life & Health

9.3

12.4

25.3

6.9

11.9

Multiline

*

*

*

*

*

Commercial P&C

22.9% 20.2% 19.7% 17.9% 20.2%

Total Service / Sales Support

Personal Lines

23.3% 22.5% 27.7% 25.7% 23.1%

Staff Payroll as % of LOB Revenue

Group Life & Health

19.6% 14.9% 15.9% 12.2% 15.4%

Multiline

*

*

*

*

*

Personal Lines

23

22

20

25

20

Number of Carriers

Commercial Lines

38

50

65

69

58

Life & Health

37

51

56

44

68

Total PL Comms Placed (as % of PL Revenues) Total CL Comms Placed (as % of CL Revenues)

25.8% 21.7% 25.7% 24.5% 26.2%

Service Center Use

2013 Best Practices Study

12.5% 1.8% 1.3% 3.1% 5.0%

% of Agencies Making an Acquisition in the last 12 Months

27.3% 36.0% 35.3% 25.0% 36.8%

198

*Insufficient Data