2004 Best Practices Study

AGENCIES WITH REVENUES BETWEEN $2,500,000 AND $5,000,000

C. Revenues Derived from Acquisitions Made in the Last 12 Months

EXECUTIVE PERSPECTIVES

% of Agencies Acquiring Avg. Total Commissions Acquired

% of Net Revenues

21.9%

$188,700

5.4%

PROFILE

What the Typical Transaction Looked Like:

Multiples of Revenue Paid Average 1.25x High 1.60x Low 1.00x

Revenues Acquired per Transaction Average $181,576 High $490,420 Low $29,615

REVENUES/ EXPENSES

FINANCIAL STABILITY

While the percentage of agencies acquiring revenues is up from last year's 13.3%, the total average revenues acquired is down from last year’s $219,978.

EMPLOYEE OVERVIEW

D.

Group Life & Health Revenue Revenues from this line of business continue to increase in importance for most Best Practices agencies. 87.5% of the firms in this group have GLH revenues. Also see the Insurance Carriers section for the average number of GLH carriers represented.

PRODUCER INFO

SERVICE STAFF INFO

+25% Profit 63.2% 23.6%

+25% Growth 66.3% 30.1%

Average

Health

70.5% 18.3%

Life

Disability

4.8% 3.7% 1.5% 0.3% 0.9%

7.4% 1.4% 3.3% 0.4% 0.7%

1.1% 2.1% 0.3% 0.0% 0.0%

TECHNOLOGY

Dental

Retirement Products

Employee Benefits (TPA)

INSURANCE CARRIERS

All Other

APPENDIX

85