2001 Best Practices Study

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

Revenue by Source

70.0%

60.0%

50.0%

40.0%

30.0%

20.0%

10.0%

0.0% % Total Revenue Commercial P&C

Personal P&C P&C Service Fees

Contingent Group L&H Individual L&H

Investments

Average +25% Profit

+25% Growth

Average

+25% Profit

25%Growth

B. % of Revenue by Line of Business

14.8% 5.2% 17.3% 8.8% 3.1% 3.0% 2.8% 7.6% 1.4% 1.0% 12.9% 14.4%

12.8%

18.4%

Workers Compensation Commercial Liability Commercial Package

6.6%

5.8%

21.4%

18.2% 11.9% 4.4% 2.5% 2.7% 6.3% 0.3% 0.4% 9.4% 10.3% 37.5% 37.5% 62.5% 100.0% 87.5% 50.0% 75.0% 50.0%

8.0% 3.8% 5.2% 4.2% 6.5% 5.1% 1.4% 0.3%

Commercial Auto

Commercial Property Surety/Contract Bonds

Commercial Umbrella/Excess

Personal Auto Homeowners

Personal Package

Third Party Administration

Other

20.2%

C. Other Products/Services Provided

% Providing +25% Profit

Average 44.8% 27.6% 62.1% 100.0% 75.9% 13.8% 34.5% 34.5%

+25% Growth

Claims Adjusting/Administration Self Insurance Programs Risk Management Consulting Pension/Profit Sharing/401(k) Human Resource Consulting Bonding/Surety

50.0% 50.0% 50.0% 100.0% 75.0% 12.5% 37.5%

Employee Leasing Products & Services (PEOs) Investment Products (Securities, Stocks, etc.)

0.0%

D. % of Revenues Derived from Largest Accounts

Average

+25% Profit

+25% Growth

Largest Commission Account

2.8%

2.0%

2.8%

High Low

12.8%

1.0%

10 Largest Commission Accounts

11.0% 32.9%

10.3%

13.9%

High Low

2.1%

E. Revenues Derived from Acquisitions Made in Last 12 Months % of Agencies Acquiring

Avg. Commissions Acquired

3.2% % of Net Revenues

30.0%

$221,252

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