2001 Best Practices Study

Analysis of Agencies with Revenues Between $5,000,000 and $10,000,000

AGENCY CHARACTERISTICS

A. Average Total Revenues

$6,667,572

B. Corporate Structure

+25% Profit

Average

+25% Growth

C S

53.3% 36.7%

52.6% 39.5%

52.2% 37.0%

Partnership

0.0%

0.0% 7.9% 0.0%

0.0%

LLC

10.0%

10.9%

Sole Proprietorship

0.0%

0.0%

Average

+25% Profit

+25% Growth

C. Shareholders

Number of Shareholders

7.6

5.6

9.5

High Low

33.0

1.0

44.3% 100.0% 12.5% Average

+25% Profit

+25% Growth

D. Ownership %

% Owned by Largest Shareholder

37.5%

45.0%

High Low

Average

+25% Profit

+25% Growth

E. Shareholder Age

Current Age of Largest Shareholder

54.5

53.9

46.3

F. Population Density of Metropolitan Area Where Home Office Is Located

Average

+25% Profit

+25% Growth

Less than 50,000 50,000 - 250,000 250,000 - 1,000,000 More than 1,000,000

10.0% 13.3% 43.3% 33.3%

10.5% 13.2% 50.0% 26.3%

8.7%

13.0% 52.2% 26.1%

REVENUE ANALYSIS

A. % of Revenue by Source

Average

+25% Profit

+25% Growth

Commercial P&C

53.3% 18.8%

57.1% 13.8%

60.3% 9.1% 1.7% 7.0% 1.6% 1.9% 2.0% 16.4% 100.0%

Personal P&C

P&C Service Fees

1.1% 7.7%

2.2% 7.6%

Contingent Group L&H

12.6%

14.0%

Individual L&H Investments Miscellaneous

2.3% 2.1% 2.1%

2.3% 2.0% 0.9%

Total Revenues

100.0%

100.0%

Brokerage Commission Expense

3.3%

0.7%

8.5%

Net Revenues

96.7%

99.3%

91.5%

108