2004 Best Practices Study

AGENCIES WITH REVENUES UNDER $500,000

F.

Parent Corporation

Average

EXECUTIVE PERSPECTIVES

% of Participating Agencies

For more detail on bank-owned agency performance, see Observations of Bank-Owned Agencies on page 175 of this Study.

Owned by Another Corporation

0.0%

Description of Parent Corporation Financial Institution

PROFILE

0.0% 0.0% 0.0%

National Broker

Other

REVENUES/ EXPENSES

G.

Plans for Future Ownership of Agency

Average

Sell to Employees/Family

41.7%

FINANCIAL STABILITY

Sell to Third Party in 1 to 5 years

8.3%

Sell to Third Party in 6 to 10 years

12.5%

Sell to Third Party in 11+ years

29.2%

EMPLOYEE OVERVIEW

Merge with Privately-held Agency

0.0%

Uncertain at this point

8.3%

PRODUCER INFO

The significant number of agencies planning to sell to a third party in the future reflects the difficulty this group has in recruting and developing internal future owners. It also reflects the desire by many to retain close ownership until retirement, leaving a third party sale the only option available. Having made this strategic decision, they now face the challenge of building an organ- ization that will have value for and be attractive to a third party buyer when the time comes.

SERVICE STAFF INFO

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

TECHNOLOGY

+25% Profit

+25% Growth

Average

Less than 50,000

62.5%

60.0%

55.6%

INSURANCE CARRIERS

50,000 - 250,000

20.8%

23.3%

25.0%

250,000 - 1,000,000

16.7%

16.7%

19.4%

More than 1,000,000

0.0%

0.0%

0.0%

APPENDIX

10