2014 Best Practices Study

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

Revenue Growth by Source (continued)

Key Benchmarks

Profile Revenues

Average

+25% Profit

+25% Growth

Group Medical L&H Renewals 1

87.2% 9.3% 0.0% -3.5% -3.5% 77.8% 14.2% 0.0% -7.9% -7.9% 65.6% 31.5% 0.6% -2.9% -2.3% 92.9% 13.5% 0.9% 6.6% 7.5% -3.8% 6.8% 7.7% 13.4% -6.5% 8.4% 7.8% 8.6% 9.1%

91.1% 7.4% 0.0% -1.5% -1.5%

87.7% 9.0% 0.0% -3.3% -3.3%

Expenses

New Business 2

Profitability

Acquired Revenues 3

Organic Growth 4

Employee Overview

Total Growth 5

Producer Info

All Other Group L&H Renewals 1

* * * * *

97.4% 14.8%

Service Staff Info

New Business 2

Technology

0.0%

Acquired Revenues 3

Insurance Carriers

12.3% 12.3%

Organic Growth 4

Total Growth 5

Appendix

Individual L&H

77.5% 16.3% 0.0% -6.2% -6.2%

74.5% 45.4%

Renewals 1

New Business 2

0.0%

Acquired Revenues 3

19.8% 19.8%

Organic Growth 4

Total Growth 5

Total Commissions & Fees (P&C, L&H) Renewals 1

92.7% 12.5%

95.6% 16.9%

New Business 2

0.1% 5.2% 5.2%

0.0%

Acquired Revenues 3

13.9% 13.9%

Organic Growth 4

Total Growth 5

Brokerage Commission Expense Growth Net Commissions & Fees Growth (Organic) 6 Net Commissions & Fees Growth (Total) 7

13.7%

*

5.2% 5.3%

14.5% 14.5%

*Insufficient Data Other Income P&C Contingent Income Growth L&H Bonus Income Growth Investment Income Growth Gross Revenue Growth Net Revenue Growth (Organic) 8 Net Revenue Growth (Total) 9 1 Renewal Revenues as a % of prior year’s total revenues for this line of business. This figure is impacted by attrition (loss or retention of accounts) and by changes in premium and commission levels. The higher the %, the more favorable the results. 2 New Revenues as a % of prior year’s total revenues for this line of business. The higher the %, the more favorable the results. 3 Acquired Revenues as a % of prior year’s total revenues for this line of business. The % indicates the significance of acquired business.

3.3%

31.5%

-27.7%

*

*

-4.3%

2014 Best Practices Study

5.9% 6.0% 6.1%

18.6% 19.1% 19.1%

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

4 Growth in Revenues from prior year excluding acquired revenues. 5 Growth in Revenues from prior year including acquired revenues. 6 Growth in Total Commissions & Fees ( less Brokerage Commission Expense) from prior year excluding acquired revenues. 7 Growth in Total Commissions & Fees ( less Brokerage Commission Expense) from prior year including acquired revenues.

8 Growth in Net Revenues ( Gross Revenue less Brokerage Commission Expense ) from prior year excluding acquired revenues. 9 Growth in Net Revenues ( Gross Revenue less Brokerage Commission Expense ) from prior year including acquired revenues.

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