2002 Best Practices Study

Analysis of Agencies with Revenues Between $2,500,000 and $5,000,000

REVENUE ANALYSIS

A. % of Revenue by Source

Average

+25% Profit

+25% Growth

Commercial P&C

54.0% 18.4%

56.2% 19.7%

42.6% 17.1%

Personal P&C

P&C Service Fees

0.6% 6.6%

0.1% 9.4%

0.0% 7.3%

Contingent Group L&H

13.9%

10.9%

19.6%

Individual L&H Investments Miscellaneous

3.4% 1.8% 1.3%

1.8% 1.4% 0.4%

8.6% 1.5% 3.4%

Total Revenues

100.0%

100.0%

100.0%

Brokerage Commission Expense

2.4%

0.9%

1.2%

Net Revenues

97.6%

99.1%

98.8%

Revenue by Source

60.0%

50.0%

40.0%

30.0%

20.0%

10.0%

% Total Revenue

0.0%

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 Revenues Derived from Largest Accounts

Largest Commission Account

3.6% 8.8% 1.1%

3.8%

2.8%

High Low

10 Largest Commission Accounts

14.0% 25.5%

17.4%

12.8%

High Low

4.1%

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

6.4% % of Net Revenues

Avg. Commissions Acquired

20.0%

$199,115

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