2001 Best Practices Study

Analysis of Agencies with Revenues Greater Than $10,000,000

CSR Summary

Average Book Serviced/CSR (Commissions)

Average Pay as % of Book Serviced

$700,000

30%

$600,000

$500,000

20%

$400,000

$300,000

10%

$200,000

$100,000

0%

$0

Commercial P&C

Group L&H Personal P&C Multi-Line

Commercial P&C Group L&H

Personal P&C

Multi-Line

Average Top 25%

FINANCIAL STABILITY

A. Current Ratio

A current ratio greater than 1:1 indicates that cash and assets with short-term maturities are sufficient to meet a firm's short-term obligations.

Average

Top 25%

Liquidity/Current Ratio

1.04:1

1.28:1

B. Tangible Net Worth

The tangible net worth is an important measure as it represents the net value of the corporation if it were liquidated. A low or negative tangible net worth impacts a firm's ability to invest in new opportunities, develop new products, hire new employees, make other capital expenditures and handle stockholder redemption obligations.

Average

Top 25%

Tangible Net Worth (as % of Net Rev)

5.9%

24.3%

C. Receivables

1. Receivables/Payables Ratio

This factor measures the collection practices of an agency, with a lower ratio representing more timely collections. (Calculated by dividing total receivables by total payables at a given point in time.) Average Top 25%

Receivables/Payables Ratio

59.7%

26.7%

2. Aged Receivables

Average

Top 25%

Over 60 Over 90

11.7%

4.8% 1.8%

5.5%

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