2001 Best Practices Study

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

AGENCY CHARACTERISTICS

A. Average Total Revenues

$1,833,232

B. Corporate Structure

+25% Profit

Average

+25% Growth

C S

56.7% 40.0%

52.6% 42.1%

52.2% 43.5%

Partnership

0.0% 3.3% 0.0%

0.0% 5.3% 0.0%

0.0% 4.3% 0.0%

LLC

Sole Proprietorship

Average

+25% Profit

+25% Growth

C. Shareholders

Number of Shareholders

2.5 6.0 1.0

1.4

2.6

High Low

D. Ownership %

65.6% 100.0% 16.6% Average

+25% Profit

+25% Growth

% Owned by Largest Shareholder

81.3%

65.2%

High Low

E. Shareholder Age

Average

+25% Profit

+25% Growth

Current Age of Largest Shareholder

51.6

47.9

52.3

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

Average

+25% Profit

+25% Growth

Less than 50,000 50,000 - 250,000 250,000 - 1,000,000 More than 1,000,000

20.0% 43.3% 16.7% 20.0%

18.4% 42.1% 15.8% 23.7%

19.6% 43.5% 15.2% 21.7%

REVENUE ANALYSIS

A. % of Revenue by Source

Average

+25% Profit

+25% Growth

Commercial P&C

47.0% 26.2%

57.6% 19.8%

39.0% 19.4%

Personal P&C

P&C Service Fees

2.7% 7.7% 8.5% 4.3% 2.0% 1.8%

7.8% 8.5% 2.2% 0.9% 1.4% 1.7%

6.8% 8.0%

Contingent Group L&H

12.2%

Individual L&H Investments Miscellaneous

9.6% 3.1% 1.9%

Total Revenues

100.0%

100.0%

100.0%

Brokerage Commission Expense

3.3%

3.2%

2.6%

Net Revenues

96.7%

96.8%

97.4%

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