Book quality is where diligence concentrates, because two agencies of identical revenue can carry very different risk depending on how that revenue is distributed. The stratification series shows a clean structural pattern: account size scales with the agency, and the largest agencies are — counterintuitively — the most diversified. This is the book-quality slice of the Best Practices trend data; the companion BPS trend reference indexes all seven themes.
§ 01 · Account stratificationWhere the revenue sits.
The smallest agencies derive the majority of commercial revenue from sub-$5K accounts; the largest derive nearly half from accounts over $50K. The mix shifts steadily with size — a structural reflection of the commercial-client base each tier serves.
| Commercial revenue (2022) | Accounts < $5K | Accounts > $50K |
|---|---|---|
| Under $1.25M | 61% | 6% |
| $2.5M–$5M | 42% | 15% |
| $5M–$10M | 34% | 21% |
| $10M–$25M | 25% | 31% |
| Over $25M | 16% | 47% |
§ 02 · Top-10 concentrationThe diversification paradox.
The largest agencies carry the biggest accounts — yet show the lowest top-10 concentration. The over-$25M tier's top-10 accounts make up about 10% of commercial revenue; the smallest tier's run closer to 19%. Scale brings a deeper, broader book that no handful of accounts dominates.
| Top-10 account share (average, 2022) | % of commercial revenue |
|---|---|
| Under $1.25M | 19% |
| $2.5M–$5M | 15% |
| $5M–$10M | 14% |
| $10M–$25M | 14% |
| Over $25M | 10% |
§ 03 · Single-account dependencyThe extreme-risk read.
Single-largest-account dependency is generally manageable — the average largest account runs 2–7% of commercial revenue across tiers, and only a minority of agencies in any band show high dependence (>15%) on one account. But the high-concentration tail is real: a subset of smaller agencies carries 20–31% in their single largest account, which is exactly the kind of key-account risk a buyer prices with representations and holdbacks.
- Account size scales with the agency. Sub-$5K accounts fall from 61% (smallest) to 16% (largest) of commercial revenue.
- The diversification paradox. The largest agencies hold the biggest accounts yet the lowest top-10 concentration (~10%).
- Small agencies depend on volume. The smallest tier rose to 61% of revenue from sub-$5K accounts in 2022 — a high-volume, low-value base.
- Single-account risk is usually manageable. The average largest account is 2–7% of revenue; high dependence (>15%) is a minority.
- A high-concentration tail exists. A subset of smaller agencies carries 20–31% in one account — the diligence flag.
The benchmark is the baseline, not the price.
Best Practices benchmarks don't value an agency — they're the operating baseline a valuation is built on. Concentration is one of the most direct quality signals a buyer reads: a broadly distributed book with a meaningful share of mid-to-large accounts reads as a renewal-predictable premium, while a book with a high top-10 or single-account share carries churn risk a buyer manages with representations and holdback provisions. The smallest tier's reliance on sub-$5K accounts is the structural reason scale buyers underwrite it cautiously.
The way book quality flows into deal structure is the financial & transactional mechanics reference.
What BPS measures. The Best Practices Study tracks the operating and financial results of top-performing agencies, segmented by revenue tier. This brief reflects the 2018–2022 book-quality series.
Stratification. Commercial P&C revenue distributed across account-size bands.
Concentration. The share of commercial revenue from the top-10 (and single-largest) accounts; low / average / high cohorts are reported.
Frequency. The study publishes annually. Milly Books refreshes this brief with each new edition.