2005 Best Practices Study

AGENCIES WITH REVENUES BETWEEN $2,500,000 AND $5,000,000

EXPENSE ANALYSIS

A.

Expenses Analysis (as a % of Net Revenues)

2005

+25% Profit

+25% Growth

Average

Compensation Expense Total Payroll

52.0%

40.5%

44.5% 10.8% 55.3%

Benefits

9.0%

8.8%

PROFILE

Total Compensation

61.1%

49.3%

Selling Expenses

T&E/Conventions

1.2% 0.9% 1.4% 3.6% 3.5% 0.9% 0.6% 1.3% 1.0% 0.7% 1.7% 0.8% 0.5% 0.2% 0.5% 1.2% 0.4% 0.4% 0.6% 1.1% 0.3% 0.3% 0.3% 2.7%

1.2% 1.1% 1.5% 3.8% 2.7% 0.8% 0.6% 1.0% 0.7% 0.4% 1.5% 1.0% 0.8% 0.1% 0.2% 1.1% 0.4% 0.2% 0.8% 0.9% 0.3% 0.5% 0.4% 2.9% 11.4% 67.3% 32.7%

1.4% 1.1% 1.5% 4.0% 3.6% 0.9% 0.6% 1.5% 0.9% 0.4% 1.2% 1.1% 0.6% 0.0% 0.6% 1.1% 0.4% 0.1% 0.6% 0.8% 0.2% 0.1% 0.5% 2.1%

Automobile

Advertising/Promotions

Total Selling

REVENUES/ EXPENSES

Operating Expenses Occupancy

Telephone

Postage

Supplies/Printing

FINANCIAL STABILITY

Dues/Subscriptions/Contributions

Taxes/Licenses

Insurance

Professional Fees

Equipment Rental/Maintenance

Bad Debts

EMPLOYEE OVERVIEW

Outside Services

Information Technology

Education/Training

Miscellaneous

Total Operating

13.6%

13.2%

PRODUCER INFO

Administrative Expenses Amortization

Depreciation Officer-Life

Interest

SERVICE STAFF INFO

Other

Total Administrative

Total Expenses Pre-Tax Profit

80.9% 19.1%

74.6% 25.4%

TECHNOLOGY

60%

Average

50%

+25% Profit

40%

+25% Growth

INSURANCE CARRIERS

30%

20%

% Net Revenue

10%

0%

Compensation Expense

Operating Expense

Administrative Expense

Selling Expense

54