2007 Best Practices Study

Agencies with Revenues Between $1,250,000 and $2,500,000

Executive Perspectives

Profile

Revenues/ Expenses

Financial Stability

Employee Overview

Producer Info

Service Staff Info

Technology

Insurance Carriers

Appendix

Services/Other Products Provided (as % of Agencies Providing) Average

+25% Profit

+25% Growth

Loss Control/Engineering

18.8%

0.0% 0.0% 0.0% 0.0% 0.0%

0.0% 0.0% 0.0%

Worker’s Comp Claims Adjusting/Admin (TPA) Group Health Insurance Claims Adjusting/Admin (TPA)

0.0% 6.3% 6.3%

Self Insurance Programs

33.3%

Risk Management Consulting

18.8% 43.8% 37.5% 18.8% 25.0% 31.3%

0.0%

Premium Financing (in-house vs. 3rd party)

60.0% 40.0%

100.0%

Pension/Profit Sharing/401K Human Resource Consulting

0.0% 0.0%

0.0% 0.0%

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

33.3%

40.0%

0.0% 0.0%

Other*

6.3%

0.0%

*Includes P&C loss adjusting, HR website, pool administration, paralegal and legal, MyWave, background checks, wellness, and management consulting

Acquired Revenues

Average Commissions Acquired

% of Agencies Acquiring

Percentage of Net Revenues

Acquisitions Made in Last 12 Months

3.3%

$120,523

7.1%

What the Typical Transactions Looked Like Revenues Acquired per Transaction

Multiples of Revenue Paid

Average

* * *

Average

* * *

High

High

Low

Low

*Insufficient Data

“I hate to think what our new business would look like if we were focusing exclusively on main street business. The niches that we’ve developed have really allowed us become the most knowledgeable people in the state on certain risks. Many of the generalists in this agency are really finding it a tough go in this market.”

37 2007 Best Practices Study | Agencies with Revenues Between $1,250,000 and $2,500,000 | Revenues/Expenses