2004 Best Practices Study

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

EXPENSE ANALYSIS A.

Expenses Analysis (as a % of Net Revenues)

EXECUTIVE PERSPECTIVES

+25% Profit

+25% Growth

Average

Compensation Expense Total Payroll

50.4% 8.2% 58.6% 1.1% 0.8% 1.2% 3.2% 3.6% 0.9% 0.7% 1.2% 0.8% 0.8% 1.6% 1.1% 0.5% 0.3% 0.6% 1.4% 0.4% 0.6% 0.6% 1.4% 0.3% 0.3% 0.6% 3.3% 14.3% 79.4% 20.6%

39.8% 7.9% 47.8% 1.0% 0.9% 1.2% 3.1% 3.6% 1.0% 0.7% 1.3% 0.7% 0.2% 1.5% 0.8% 0.5% 0.1% 0.3% 1.4% 0.3% 0.5% 0.4% 1.6% 0.3% 0.2% 0.0% 2.6% 12.7% 66.2% 33.8%

50.8% 8.8% 59.6% 1.0% 1.0% 1.5% 3.5% 3.7% 0.9% 0.7% 1.3% 0.9% 0.3% 1.5% 1.7% 0.5% 0.1% 0.3% 1.2% 0.4% 0.9% 0.9% 0.9% 0.3% 0.5% 0.6% 3.2% 14.4%

Benefits

PROFILE

Total Compensation

Selling Expenses

T&E/Conventions

Automobile

Advertising/Promotions

Total Selling

REVENUES/ EXPENSES

Operating Expenses Occupancy

Telephone

Postage

Supplies/Printing

FINANCIAL STABILITY

Dues/Subscriptions/Contributions

Taxes/Licenses

Insurance

Professional Fees

Equipment Rental/Maintenance

Bad Debts

EMPLOYEE OVERVIEW

Outside Services

Information Technology Education/Training

Miscellaneous

Total Operating

PRODUCER INFO

Administrative Expenses Amortization

Depreciation Officer-Life

Interest

SERVICE STAFF INFO

Other

Total Administrative

Total Expenses Pre-Tax Profit

88.4 80.6%

19.4%

TECHNOLOGY

70%

Average

60%

+25% Profit

50%

+25% Growth

INSURANCE CARRIERS

40%

30%

20%

% Total Net Revenue

10%

APPENDIX

Compensation Expense

Operating Expense

Administrative Expense

Selling Expense

88