EXHIBIT 13
                                
         Portions of 1997 Annual Report to Shareholders
                                
<PAGE 3>                                
                                
Financial Highlights




                                            Year ended December 31,
(in thousands, except per
  share data)                1997       1996      1995       1994      1993

                                                       
Commissions and fees(1)      $124,365   $114,378  $101,998  $ 95,852  $ 94,420
Total revenues(2)            $129,191   $118,680  $106,365  $101,580  $ 97,821
Total expenses               $ 97,553   $ 91,634  $ 83,036  $ 80,994  $ 84,774
Income before taxes          $ 31,638   $ 27,046  $ 23,329  $ 20,586  $ 13,047
Net income(2,3)              $ 19,387   $ 16,498  $ 14,799  $ 13,519  $  8,118
Net income per share         $   2.22   $   1.90  $   1.70  $   1.56  $   0.95
Weighted average number
 of shares outstanding          8,725      8,683     8,699     8,670     8,571
Dividends declared per share $   0.53   $   0.49  $   0.48  $   0.42  $   0.40
Total assets                 $194,129   $179,743  $151,121  $140,980  $134,924
Long-term debt               $  4,093   $  5,300  $  7,023  $  7,430  $ 17,637
Shareholders' equity(4)      $ 77,142   $ 67,286  $ 54,412  $ 44,106  $ 27,246



(1)  See Notes 2 and 3 to consolidated financial statements for
     information regarding business purchase transactions which impact
     the comparability of this information.
(2)  During 1994, the Company sold 150,000 shares of its investment in 
     the common stock of Rock-Tenn Company for $2,314,000, resulting in
     a net after-tax gain of $1,342,000, or $0.16 per share.
(3)  During 1995 and 1994, the Company reduced its general tax
     reserves by $451,000 and $700,000, or $0.05 and $0.08 per share,
     respectively, as a result of reaching a settlement with the Internal
     Revenue Service on certain examination issues. See Note 9 to consolidated
     financial statements.
(4)  Shareholders' equity as of December 31, 1997, 1996, and 1995, included
     net increases of $6,744,000, $6,511,000 and $4,836,000,
     respectively, as a result of the CompanyOs application of SFAS 115,
    "Accounting for Certain Investments in Debt and Equity Securities."

<PAGE 18>

Management's Discussion and Analysis
of Financial Condition and Results of Operations

General

In April of 1993, Poe & Associates, Inc., headquartered in Tampa,
Florida, merged with Brown & Brown, Inc., headquartered
in Daytona Beach, Florida, forming Poe & Brown, Inc. (the "Company").
Since that merger, the Company's operating results
have steadily improved. The Company achieved pre-tax income from
operations of $31,638,000 in 1997 compared to $27,046,000 in 1996 and
$23,329,000 in 1995. Pre-tax income as a percentage of
total revenues was 24.5% in 1997, 22.8% in 1996 and 21.9% in
1995. This upward trend is primarily the result of the Company's
achievement of revenue growth and operating efficiency
improvements.

     The Company's revenues are comprised principally of
commissions paid by insurance companies, fees paid directly by
clients and investment income. Commission revenues generally
represent a percentage of the premium paid by the insured and are
materially affected by fluctuations in both premium rate levels
charged by insurance underwriters and the volume of premiums
written by such underwriters. These premium rates are established
by insurance companies based upon many factors, none of which is
controlled by the Company. Beginning in 1986 and continuing
through 1997, revenues have been adversely influenced by a
consistent decline in premium rates resulting from intense
competition among property and casualty insurers for expanding
market share. Among other factors, this condition of prevailing
decline in premium rates, commonly referred to as a "soft
market," has generally resulted in flat to reduced commissions on
renewal business. The possibility of rate increases in 1998 is
unpredictable.

     Revenues are further impacted by the development of new and
existing proprietary programs, fluctuations in insurable exposure
units and the volume of business from new and existing clients,
and changes in general economic and competitive conditions. For
example, stagnant rates of inflation in recent years have
generally limited the increases in insurable exposure units such
as property values, sales and payroll levels. Conversely,
the increasing trend in litigation settlements and awards has
caused some clients to seek higher levels of insurance coverage.
Still, the Company's revenues continue to grow through quality
acquisitions, intense initiatives for new business and
development of new products, markets and services.
The Company anticipates that results of operations for 1998 will
continue to be influenced by these competitive and
economic conditions.

     During 1996, the Company acquired three general insurance
agencies, an insurance brokerage firm and several books of
business (customer accounts) which were accounted for as
purchases. During 1997, the Company acquired three general
insurance agencies and several books of business
(customer accounts) which were accounted for as purchases. On
August 1, 1997, the

<PAGE 19>

Company acquired all of the outstanding stock
of Shanahan, McGrath & Bradley, Inc. This transaction was
accounted for as a pooling-of-interests; however, the financial
statements for all prior periods were not restated due to the
immaterial nature of the transaction.

     Contingent commissions may be paid to the Company by insurance
carriers based upon the volume and profitability of the business placed with
such carriers by the Company and are generally received in the first
quarter of each year. In the last three years, contingent commissions have
represented 3.2% to 4.7% of total revenues.

     Fee revenues are generated principally by the Service
Division of the Company, which offers administration and benefit
consulting services primarily in the workers' compensation and
employee benefit self-insurance markets. Florida's legislative
reform of workers' compensation insurance, as well as certain
market factors, have resulted in increased competition in this
service sector. In response to the increased competition, the
Company has offered value-added services that enabled it to
increase 1997 fee revenue over that recognized in 1996. For the
past three years, service fee revenues have ranged from 9.8% to
10.6% of total commissions and fees.

     Investment income consists primarily of interest earnings on
premiums and advance premiums collected and not immediately
remitted to insurance carriers, with such funds being held in a
fiduciary capacity. Investment income also includes gains and
losses realized from the sale of investments, although in 1996
and 1995, such sales were minimal and realized gains and losses
were immaterial. In 1997, investment income included a $303,000
realized gain from the sale of the CompanyOs investment in Fort
Brooke Bank. The Company's policy is to invest its available
funds in high-quality, short-term fixed income investment
securities.

     The following discussion and analysis regarding results of
operations and liquidity and capital resources should be
considered in conjunction with the accompanying consolidated
financial statements and related notes.

Results of operations for
the years ended December 31, 1997, 1996 and 1995

Commissions and Fees

Commissions and fees increased 9% in 1997, 12% in 1996 and 6% in
1995. Excluding the effect of acquisitions, commissions and fees
increased 6% in 1997, 4% in 1996 and 3% in 1995. The 1997 results
reflect an increase in commissions for all of the Company's
operating divisions, mainly through new business growth. In
general, property and casualty insurance premium prices declined
in 1997; however, certain segments and industries had some
increases in insurable exposure units during 1997.

Investment Income

Investment income increased to $4,085,000 in 1997 compared to
$3,230,000 in 1996 and $3,733,000 in 1995. This increase is
primarily due to higher levels of invested cash and increases in
interest rate returns. Additionally, the 1997 results included a
$303,000 gain from the sale of the Company's investment in Fort
Brooke Bank.

Other Income

Other income consists primarily of gains and losses from the sale
and disposition of assets. During 1997, gains on the sale of
customer accounts were $646,000 compared to $997,000 in 1996 and
$590,000 in 1995.

<PAGE 20>

Employee Compensation & Benefits

Employee compensation and benefits increased approximately 8% in
1997, 10% in 1996 and 5% in 1995. Without acquisitions, employee
compensation and benefits increased 6% in 1997, 5% in 1996 and 1%
in 1995. Employee compensation and
benefits as a percentage of total revenue was 50% in 1997, down
from 51% in 1996 and 52% in 1995. As of December 31, 1997, the
Company had 1,082 full-time equivalent employees compared to
1,075 at the beginning of the year. The increase in personnel in
1997 is related to acquisitions. The 1997 increase in
compensation and employee benefits of $4,670,000 is primarily
attributable to the additional commission expense as a result of
the increased commission revenue.

Other Operating Expenses

Other operating expenses increased 4% in 1997, 11% in 1996, and
remained constant in 1995. Without acquisitions, operating expenses
increased 1% in 1997 and 6% in 1996, and decreased 3% in 1995. Other
operating expenses as a percentage of total revenues decreased to 21% in
1997 from 22% in 1996 and 1995.

Interest and Amortization

Interest and amortization increased $262,000, or 5%, in 1997 and
$703,000, or 14%, in 1996 and decreased $580,000, or 10%, in
1995. The increase in 1997 is due primarily to the write-off of
the remaining intangible assets related to a terminated agreement
totaling $670,000.

Income Taxes

The effective tax rate on income from operations was 38.7% in
1997, 39.0% in 1996 and 36.6% in 1995. The lower effective tax
rate in 1995 is primarily due to the effect
of recording a $451,000 reduction to the general tax reserves as
a result of reaching a settlement with the Internal Revenue Service
("Service") on the Service's outstanding examination issues (see below
for detailed discussion of this adjustment).

     In 1992, the Service completed examinations of the Company's
federal income tax returns for tax years 1988, 1989 and 1990 and
issued Reports of Proposed Adjustments asserting income tax
deficiencies. The disputed items related primarily to the
deductibility of amortization of purchased customer accounts of approximately
$5,107,000 and non-compete agreements of approximately $993,000.
In addition, the Service's report included a dispute regarding
the time at which the Company's payments made pursuant
to certain indemnity agreements would be deductible for tax
reporting purposes.

     In 1994 and 1995, the Company reached agreements with the
Service on all disputed items. These agreements resulted
in payments that reduced the reserve by approximately $349,000.
After considering these reductions, the Company recorded a
$451,000 reduction in the general tax reserve which was recorded
as a reduction to the 1995 income tax provision.

Liquidity and Capital Resources

The Company's cash and cash equivalents
of $47,726,000 at December 31, 1997, increased $15,940,000 from
the December 31, 1996 balance of $31,786,000. During 1997, cash
of $33,027,000 was provided from operating activities, proceeds of $452,000

<PAGE 21>

from sales of fixed assets and customer accounts,
proceeds from the sale of investments of $557,000 and proceeds of
$1,044,000 from the exercise of stock options and issuances of
common stock. Cash was used during 1997 primarily for payments on
long-term debt and notes payable of $2,611,000, additions
to fixed assets of $2,713,000, purchases of investments of
$253,000, acquisitions of businesses of $3,067,000, repurchase of
common stock of $5,860,000 and dividend payments of $4,636,000.

     The Company's cash and cash equivalents of $31,786,000 at
December 31, 1996 increased $3,436,000 from the December 31, 1995
balance of $28,350,000. During 1996, cash of $28,621,000 was
provided from operating activities, proceeds of $984,000 from
sales of fixed assets and customer accounts, proceeds of
$1,118,000 from sales of investments, and proceeds of $748,000
from the exercise of stock options and issuances of common stock.
Cash was used during 1996 primarily for payments on long-term
debt of $4,223,000, additions to fixed assets of $4,630,000, purchases
of investments of $881,000, acquisitions of businesses of $12,254,000,
repurchase of common stock of $1,802,000 and dividend payments of $4,245,000.

     The Company's cash and cash equivalents of $28,350,000 at
December 31, 1995 increased $5,165,000 from the December 31, 1994
balance of $23,185,000. During 1995, primary sources of cash were
$21,208,000 from operating activities, $1,469,000 from sales of
fixed assets and customer accounts, and $106,000 from the
exercise of stock options and issuances of common stock. Cash was
used during 1995 primarily for payments on long-term debt of
$2,132,000, additions to fixed assets of $5,321,000,
purchases of investments of $1,208,000, acquisitions of
businesses of $6,005,000 and dividend payments of $4,149,000.

     The Company's current ratio was 1.14 to 1.0, 1.06 to 1.0 and
1.13 to 1.0 as of December 31, 1997, 1996 and 1995, respectively.
The increase in the ratio at December 31, 1997 was primarily the
result of increased cash.

     In 1994, the Company entered into a revolving credit
facility with a national banking association that provides for
borrowings of up to $10,000,000. On borrowings under this
facility of less than $1,000,000, the interest rate is the higher
of the prime rate or the federal funds rate plus 0.50%. On
borrowings under this facility equal to or in excess of
$1,000,000, the interest rate is LIBOR plus 0.50% to 1.25%,
depending on certain financial ratios. A commitment fee is
assessed in the amount of 0.25% per annum on the unused balance.
The facility expires in November 1998. No borrowings were
outstanding against this line of credit as of December 31, 1997
and 1996. Borrowings would be secured by substantially all the
assets of the Company, subject to existing
or permitted liens.

     The Company has a credit agreement with a major insurance
company under which $4,000,000 (the maximum amount available for
borrowings) was borrowed at December 31, 1997 at an interest rate
equal to the prime rate plus 1%. The amount available under this facility
decreases by $1,000,000 each August through the year 2001, when it will
expire.

     The Company believes that its existing cash, cash
equivalents, short-term investment portfolio, funds generated
from operations and the availability of the bank line of credit
will be sufficient to satisfy its normal financial needs through
at least the end of 1998. Additionally, the Company believes that
funds generated from future operations will be sufficient to
satisfy its normal financial needs, including the required annual
principal payments of its long-term debt and any potential future
tax liability.

<PAGE 22>

Consolidated Statements of Income



                                             Year ended December 31,
(in thousands, except per
  share data)                             1997          1996           1995
                                                            
Revenues
Commissions and fees                     $124,365      $114,378      $101,998
 Investment income                          4,085         3,230         3,733
 Other income                                 741         1,072           634
     Total revenues                       129,191       118,680       106,365

EXPENSES
Employee compensation and benefits         65,067        60,397        55,073
Other operating expenses                   26,509        25,522        22,951
Interest and amortization                   5,977         5,715         5,012
     Total expenses                        97,553        91,634        83,036

Income before income taxes                 31,638        27,046        23,329
Income taxes                               12,251        10,548         8,530
Net income                               $ 19,387      $ 16,498      $ 14,799
Basic and diluted earnings per share     $   2.22      $   1.90      $   1.70
Weighted average number of shares
  outstanding                               8,725        8,683          8,699



See notes to consolidated financial statements.

<PAGE 23>

Consolidated Balance Sheets



                                                         December 31,
(in thousands, except per share data)             1997                1996

                                                              
ASSETS
Cash and cash equivalents                      $ 47,726             $ 31,786
Short-term investments                            1,299                1,087
Premiums, commissions and fees receivable        62,148               62,940
Other current assets                              6,507                7,307
     Total current assets                       117,680              103,120

Fixed assets, net                                11,863               12,085
Intangibles, net                                 49,593               50,167
Investments                                      11,480               11,288
Other assets                                      3,513                3,083
     Total assets                              $194,129             $179,743

LIABILITIES
Premiums payable to insurance companies        $ 74,598             $ 73,570
Premium deposits and credits due customers        7,035                7,329
Accounts payable and accrued expenses            15,826               11,130
Current portion of long-term debt                 5,339                5,365
     Total current liabilities                  102,798               97,394

Long-term debt                                    4,093                5,300
Deferred income taxes                             3,951                3,603
Other liabilities                                 6,145                6,160
     Total liabilities                          116,987              112,457

SHAREHOLDERS' EQUITY
Common stock, par value $0.10 per share;
  authorized 18,000 shares; issued 8,738
  shares at 1997 and 8,656 shares at 1996           874                  866
Additional paid-in capital                         -                   1,671
Retained earnings                                69,524               58,238
Net unrealized appreciation of
  available-for-sale securities, net of tax
  effect of $4,312 at 1997 and $4,163 at 1996     6,744                6,511
   Total shareholders' equity                    77,142               67,286
   Total liabilities and shareholders' equity  $194,129             $179,743



See notes to consolidated financial statements.


Consolidated Statements of Shareholders' Equity

(in thousands, except per share data)



                Common Stock       Additional          Net Unrealized
                                   Paid-in   Retained   Appreciation
                  Shares  Amount   Capital   Earnings  (Depreciation)  Total
                                                     
Balance,
 January 1, 1995  8,635  $864      $2,241    $35,660    $5,341         $44,106
Net income                                    14,799                    14,799
Acquired and
 issued for stock
 option plans and
 employee stock
 purchase plans     47     4         318        (216)                      106
Tax benefit from
 sale of option
 shares by
 employees                            55                                    55
Net decrease in
 unrealized
 appreciation of
 available-for-
 sale securities                                          (505)          (505)
Cash dividends
 paid ($0.48 per
 share)                                       (4,149)                  (4,149)

BALANCE,
 DECEMBER 31,
  1995         8,682   868       2,614        46,094      4,836        54,412
Net income                                    16,498                   16,498
Acquired and
 issued for
 stock option
 plans and
 employee
 stock
 purchase
 plans          (26)  (2)         (943)        (109)                   (1,054)
Net increase
 in unrealized
 appreciation
 of available-
 for-sale securities                                     1,675          1,675
Cash dividends
 paid ($0.49 per
 share)                                      (4,245)                   (4,245)

BALANCE,
 DECEMBER 31,
 1996         8,656 866         1,671        58,238     6,511          67,286
Net income                                   19,387                    19,387
Acquired and
 issued for
 stock option
 plans and
 employee
 stock
 purchase
 plans          57   6        (1,693)       (3,129)                    (4,816)
Shares
 issued in
 acquisition    25   2            22          (336)                      (312)
Net increase
 in unrealized
 appreciation
 of available-
 for-sale securities                                            233       233
Cash dividends paid
 ($0.53 per share)                            (4,636)                  (4,636)

BALANCE,
 DECEMBER 31,
 1997       8,738 $874      $  -             $69,524         $6,744  $ 77,142



See notes to consolidated financial statements.

<PAGE 25>

Consolidated Statements of Cash Flows



                                                 Year ended December 31,
(in thousands)                              1997         1996        1995

                                                            
CASH FLOWS FROM OPERATING ACTIVITIES
Net income                                 $ 19,387     $ 16,498     $ 14,799
Adjustments to reconcile net income to
 net cash provided by operating activities:
     Depreciation and amortization            8,051       7,471         6,487
     Provision for doubtful accounts            -          (100)           31
     Deferred income taxes                      199         966        (2,191)
     Net gains on sales of investments,
      fixed assets and customer accounts       (962)     (1,001)         (537)
     Premiums, commissions and fees
        receivable decrease (increase)          823      (6,287)          200
     Other assets decrease (increase)           570        (699)          235
     Premiums payable to insurance companies
       increase                                 607       8,982         1,393
     Premium deposits and credits due
       customers (decrease) increase           (294)      1,259          (900)
     Accounts payable and accrued expenses
      increase                                4,696       1,713         1,115
     Other liabilities (decrease) increase      (50)       (181)          576
Net cash provided by operating activities    33,027      28,621        21,208

CASH FLOWS FROM INVESTING ACTIVITIES
Additions to fixed assets                    (2,713)    (4,630)        (5,321)
Payments for businesses acquired, net of
  cash acquired                              (3,067)   (12,254)        (6,005)
Proceeds from sales of fixed assets and
  customer accounts                             452        984          1,469
Purchases of investments                       (253)      (881)        (1,208)
Proceeds from sales of investments              557      1,118            642
Net cash used in investing activities        (5,024)   (15,663)       (10,423)

CASH FLOWS FROM FINANCING ACTIVITIES
Payments on long-term debt                   (2,611)    (4,223)        (2,132)
Proceeds from long-term debt                   -           -              500
Exercise of stock options and issuances
 of stock                                     1,044        748            106
Purchases of stock                           (5,860)    (1,802)           -
Tax benefit from sale of option shares
 by employees                                  -           -               55
Cash dividends paid                          (4,636)    (4,245)        (4,149)
Net cash used in financing activities       (12,063)    (9,522)        (5,620)

Net increase in cash and cash equivalents    15,940      3,436          5,165
Cash and cash equivalents at beginning of
 year                                        31,786     28,350         23,185
Cash and cash equivalents at end of year    $47,726    $31,786        $28,350



See notes to consolidated financial statements.

<PAGE 26>

Notes to Consolidated Financial Statements

Note 1  Summary of Significant Accounting Policies

Nature of Operations

Poe & Brown, Inc. (the "Company") is a diversified insurance
brokerage and agency that markets and sells primarily property
and casualty insurance products and services to its clients. The
Company's business is divided into five divisions: the Retail
Division, which markets and sells a broad range of insurance
products to commercial, professional and individual clients; the
Professional Programs Division, which develops and administers
property and casualty insurance solutions for professionals
nationwide; the Commercial Programs Division, which serves
individual large accounts of commercial groups and trade
associations, providing primarily property and casualty and
employee benefits coverage; the Service Division, which provides
insurance-related services such as third-party administration and
consultation for workers' compensation and employee
benefit self-insurance markets; and the Brokerage Division, which
markets and sells excess and surplus commercial insurance
primarily through non-affiliated independent agents and brokers.

Principles of Consolidation

The accompanying consolidated financial statements include the
accounts of Poe & Brown, Inc. and its subsidiaries. All
significant intercompany account balances and transactions have
been eliminated in consolidation.

Revenue Recognition

Commissions relating to the brokerage and agency activity whereby
the Company has primary responsibility for the collection of
premiums from insureds are generally recognized as of the latter
of the effective date of the insurance policy or
the date billed to the customer. Commissions to be received
directly from insurance companies are generally recognized when
the amounts are determined. Subsequent commission adjustments,
such as policy endorsements, are recognized upon notification
from the insurance companies. Commission revenues are reported
net of sub-broker commissions. Contingent commissions from
insurance companies are recognized when received. Fee income is
recognized as services are rendered.

Use of Estimates

The preparation of financial statements in conformity with
generally accepted accounting principles requires management to
make estimates and assumptions that affect the reported amounts
of assets and liabilities and disclosures of contingent assets
and liabilities at the date of the financial statements and the
reported amounts of revenues and expenses during the reporting
period. Actual results could differ from those estimates.

<PAGE 27>


Cash and Cash Equivalents

Cash and cash equivalents principally consist of demand deposits
with financial institutions and highly liquid investments
having maturities of three months or less when purchased.
Premiums received from insureds but not yet remitted to insurance
carriers are held in cash and cash equivalents in a fiduciary
capacity.

Premiums, Commissions and Fees Receivable

In its capacity as an insurance broker or agent, the Company
typically collects premiums from insureds and, after deducting
its authorized commission, remits the premiums to the appropriate
insurance companies. In other circumstances, the
insurance companies collect the premiums directly from the
insureds and remit the applicable commissions to the Company.
Accordingly, as reported in the Consolidated Balance Sheets,
"premiums" are receivable from insureds and "commissions" are
receivable from insurance companies. "Fees" are receivable from
customers pertaining to the Company's Service Division.

Investments

The Company's marketable equity securities have been classified
as "available-for-sale" and are reported at estimated fair value,
with the unrealized gains and losses, net of tax, reported as a
separate component of shareholders' equity. Realized gains and
losses and declines in value judged to be other-than-temporary on
available-for-sale securities are included in investment income.
The cost of securities sold is based on the specific
identification method. Interest and dividends on securities
classified as available-for-sale are included in investment
income.

     Nonmarketable equity securities and certificates of deposit
having maturities of more than three months when purchased are
reported at cost, adjusted for other-than-temporary market value
declines.

     Net unrealized gains reported in shareholders' equity were
$6,744,000 at December 31, 1997, $6,511,000 at December 31, 1996
and $4,836,000 at December 31, 1995, net of deferred income taxes
of $4,312,000, $4,163,000 and $3,027,000,
respectively. The Company owned 559,970 shares of Rock-Tenn
Company common stock at December 31, 1997 and 1996 which have
been classified as non-current, available-for-sale securities.
The Company has no current plans to sell these shares.

Fixed Assets

Fixed assets are stated at cost. Expenditures for improvements
are capitalized, and expenditures for maintenance and repairs are
charged to operations as incurred. Upon sale or retirement, the
cost and related accumulated depreciation and amortization are
removed from the accounts and the resulting gain or loss, if any,
is reflected in income. Depreciation has been provided using
principally the straight-line method over the estimated useful
lives of the related assets, which range from three to 10 years.
Leasehold improvements are amortized on the straight-line method
over the term of the related leases.

Intangibles

Intangible assets are stated at cost less accumulated
amortization and principally represent purchased customer
accounts, non-compete agreements, purchased contract agreements, and the
excess of costs over the fair value of identifiable net assets
acquired (goodwill). Purchased customer accounts, non-compete
agreements and purchased contract agreements are being amortized
on a straight-line basis over the related estimated lives and
contract periods, which range from five to 15 years. The excess
of costs over the fair value of identifiable net assets acquired
is being amortized on a straight-line basis over 15 to
40 years. Purchased customer accounts are records and files
obtained from acquired businesses that contain information on
insurance policies and the related insured parties that is
essential to policy renewals.

<PAGE 28>

     The carrying value of intangibles, corresponding with each
agency division comprising the Company, is periodically reviewed
by management to determine if the facts and circumstances suggest
that they may be impaired. In the insurance brokerage and agency
industry, it is common for agencies or customer accounts to be
acquired at a price determined as a multiple of the corresponding
revenues. Accordingly, the Company assesses the carrying value of
its intangibles by comparison to a reasonable multiple applied to
corresponding revenues, as well as considering the operating cash
flow generated by the corresponding agency division. Any
impairment identified through this assessment may require that
the carrying value of related intangibles be adjusted.

Income Taxes

The Company files a consolidated federal income tax return.
Deferred income taxes are provided for in the consolidated
financial statements and relate principally to expenses charged
to income for financial reporting purposes in one period
and deducted for income tax purposes in other periods, unrealized
appreciation of available-for-sale securities, and basis
differences of intangible assets.

Net Income Per Share

In February 1997, the Financial Accounting Standards Board issued
Statement of Financial Accounting Standards (SFAS) No. 128,
"Earnings per Share." The new standard simplifies the computation
of earnings per share (EPS) and increases comparability
to international standards. Under SFAS No. 128, primary EPS is
replaced by "Basic" EPS, which excludes dilution and
is computed by dividing income available to common shareholders
by the weighted-average number of common shares
outstanding for the period. "Diluted" EPS, which is computed
similarly to fully diluted EPS, reflects the potential dilution
that could occur if securities or other contracts to issue common
stock were exercised or converted into common stock.

     Effective January 1, 1997, the Company adopted SFAS No. 128.
All prior-period EPS information is required to be restated. The
Company's basic and fully diluted EPS for the years ended
December 31, 1997, 1996 and 1995 computed under SFAS No. 128 are
not different than previously computed.

Note 2  Mergers

On August 1, 1997, the Company issued 25,471 shares of its common
stock for all of the outstanding stock of Shanahan, McGrath &
Bradley, Inc., an Arizona corporation. This acquisition has been
accounted for as a pooling-of-interests; however, due to the
immaterial nature of the transaction, the Company's consolidated
financial statements have not been restated for
all periods prior to the transaction. The results of operations
of the acquired company from the period January 1, 1997 through
the date of the acquisition have been combined with those of the
Company. The separate company operating results of Shanahan,
McGrath & Bradley, Inc. for periods prior to the acquisition are
not material to the Company's consolidated operating results.

     Effective March 1, 1995, the Company issued 146,300 shares
of its common stock in exchange for all of the
partnership interest in Insurance West, a Phoenix, Arizona
general insurance agency. The merger has been accounted for as

<PAGE 29>

a pooling-of-interests and, accordingly, the Company's
consolidated financial statements have been restated for all
periods prior to the merger to include the results of operations,
financial positions and cash flows of Insurance West. The
individual company operating results of Insurance West prior to
the date of the merger are not material to the CompanyOs
consolidated operating results.

Note 3  Acquisitions

During 1997, the Company acquired three general insurance
agencies and several books of business (customer accounts), which
were accounted for as purchases. The total cost of these
acquisitions was $4,945,000, including $3,067,000 of cash
payments and notes payable of $1,878,000. The total purchase
price was assigned to purchased customer accounts and
other intangible assets.

     During 1996, the Company acquired three general insurance
agencies, one insurance brokerage firm and several
books of business (customer accounts), which were all accounted
for as purchases. The total cost of these acquisitions was
$18,328,000, including $12,254,000 of cash payments and notes
payable of $6,074,000. The total purchase price was
assigned to purchased customer accounts, goodwill and other
intangible assets.

     During 1995, the Company acquired four general insurance
agencies, an insurance brokerage firm and several books of
business (customer accounts), which were all accounted for as
purchases. The total cost of these acquisitions was $7,250,000,
including $5,715,000 of cash payments and notes payable of
$1,535,000. The excess of the total purchase price over the fair
value of net tangible assets acquired of approximately $7,225,000
was assigned to purchased customer accounts, goodwill and other
intangible assets.

     Additional or return consideration resulting from
acquisition contingency provisions is recorded as an adjustment
to intangibles when the contingency occurs. Contingency payments
totaling $154,000 were made in 1997. There were no
contingency payments made during 1996 or 1995. As of December 31,
1997, the maximum future contingency payments related to the 1997
and 1996 acquisitions totaled $1,728,000.

     The results of operations of the acquired companies have
been included in the consolidated financial statements from their
respective acquisition dates. Pro forma results of operations of
the Company for the years ended December 31, 1997, 1996, and
1995, including 1997, 1996 and 1995 acquisitions as though they
occurred on January 1, 1997, 1996 and 1995, respectively, were
not materially different from the results of operations as
reported.

Note 4  Investments



Investments at December 31 consisted of the following:          1997
                                                            Carrying Value
(in thousands)                                          Current   Non-current
                                                             
Available-for-sale marketable equity securities         $    62    $ 11,480
Nonmarketable equity securities and certificates
 of deposit                                               1,237         -
Total investments                                       $ 1,299    $ 11,480


<PAGE 30>



Investments at December 31 consisted of the following:          1996
                                                           Carrying Value
(in thousands)                                          Current   Non-current
                                                            

Available-for-sale marketable equity securities         $   78    $ 11,059
Nonmarketable equity securities and certificates of
  deposit                                                1,009         229
Total investments                                       $1,087    $ 11,288

The following summarizes available-for-sale securities at
December 31:



                                        Gross        Gross
(in thousands)                        Unrealized   Unrealized     Estimated
                              Cost       Gains       Losses      Fair Value
                                                     

Marketable Equity Securities:
1997                          $ 486  $ 11,057      $   1         $ 11,542
1996                          $ 516  $ 10,637      $  16         $ 11,137

In 1997, proceeds from sales of available-for-sale securities
totaled $557,000, resulting in gross realized gains and losses
of $349,000 and ($23,000), respectively. Proceeds from sales of
available-for-sale securities totaled $1,118,000 in 1996,
resulting in gross realized gains and losses of $91,300 and
($71,700), respectively. In 1995, proceeds from sales of
available-for-sale securities totaled $329,000, resulting in gross realized
gains and losses of $42,000 and ($41,000), respectively.

     Cash, cash equivalents, investments, premiums and
commissions receivable, premiums payable to insurance companies,
premium deposits and credits due customers, accounts payable and
accrued expenses, and current and long-term debt
are considered financial instruments. The carrying amount for
each of these items at December 31, 1997 approximates its
fair value.

Note 5  Fixed Assets

Fixed assets at December 31 consisted of the following:



(in thousands)                               1997            1996

                                                      

Furniture, fixtures, and equipment           $ 25,708       $ 23,766
Land, buildings, and improvements                 262            262
Leasehold improvements                          1,009            926
                                             $ 26,979       $ 24,954
Less accumulated depreciation and
  amortization                                 15,116         12,869
                                             $ 11,863       $ 12,085

     Depreciation and amortization expense amounted to $2,924,000
in 1997, $2,697,000 in 1996, and $2,352,000 in 1995.


<PAGE 31>

Note 6  Intangibles

Intangibles at December 31 consisted of the following:




(in thousands)                          1997           1996
                                                 

Purchased customer accounts             $ 54,414    $ 49,985
Non-compete agreements                    11,772      11,722
Goodwill                                  20,189      20,189
Purchased contract agreements              1,143       1,102
                                          87,518      82,998
Less accumulated amortization             37,925      32,831
                                        $ 49,593    $ 50,167



     Amortization expense amounted to $5,127,000 in 1997,
$4,774,000 in 1996, and $4,135,000 in 1995.

Note 7  Long-Term Debt

Long-term debt at December 31 consisted of the following:




(in thousands)                          1997           1996

                                                 

Long-term credit agreement              $  4,000       $  5,000
Notes payable from treasury stock
 purchases                                   879          1,162
Acquisition notes payable                  4,452          4,351
Other notes payable                          101            152
                                           9,432         10,665
Less current portion                       5,339          5,365
Long-term debt                          $  4,093       $  5,300



     In 1991, the Company entered into a long-term credit
agreement with a major insurance company that provided
$10,000,000 at an interest rate equal to the prime rate plus 1%
(9.5% at December 31, 1997). The amount of available credit
decreases by $1,000,000 each August through the year 2001, when
it will expire. This credit agreement requires the Company to
maintain certain financial ratios and comply with certain other
covenants.

     In 1994, the Company entered into a revolving credit
facility with a national banking association that provides for
borrowings of up to $10,000,000. On borrowings under this
facility of less than $1,000,000, the interest rate is the higher
of the prime rate or the federal funds rate plus 0.50%. On
borrowings under this facility equal to or in excess of
$1,000,000,


<PAGE 32>
the interest rate is LIBOR plus 0.50% to 1.25%, depending on
certain financial ratios. A commitment fee is assessed in the
amount of 0.25% per annum on the unused balance. The facility
expires in November 1998. No borrowings were outstanding against
this line of credit as of December 31, 1997 and 1996. Borrowings
would be secured by substantially all the assets of the Company,
subject to existing or permitted liens.

     Treasury stock notes payable are due to various individuals
for the redemption of Brown & Brown, Inc. stock. These notes bear
no interest and have maturities ranging from calendar years
ending 1999 to 2001. These notes have been discounted at
effective yields ranging from 7.9% to 8.75% for presentation in
the consolidated financial statements.

     Acquisition notes payable represent debt incurred to former
owners of certain agencies acquired in 1997, 1996 and 1995. These
notes, including future contingent payments, are payable in
monthly and annual installments through 1999, including interest
ranging from 5% to 6%.

     Maturities of long-term debt for succeeding years are
$5,339,000 in 1998, $1,566,000 in 1999, $1,388,000 in 2000 and
$1,139,000 in 2001.

     Interest expense included in the consolidated statements of
income was $850,000 in 1997, $941,000 in 1996 and $877,000 in
1995.

Note 8  Commitments and Contingencies

The Company leases facilities and certain items of office
equipment under noncancelable operating lease arrangements
expiring on various dates through 2005. The facility leases
generally contain renewal options and escalation clauses based
on increases in the lessors' operating expenses and other
charges. The Company anticipates that most of these leases will
be renewed or replaced upon expiration. At December 31, 1997, the
aggregate future minimum lease payments under all
noncancelable lease agreements were as follows:




                                   
Year ended December 31,               (in thousands)
1998                                  $    4,255
1999                                  $    4,191
2000                                  $    3,701
2001                                  $    3,117
2002                                  $    2,852
Thereafter                            $    4,821
Total minimum future lease payments   $    22,937



     Rental expense in 1997, 1996 and 1995 for operating leases
totaled $5,130,000, $5,108,000 and $4,785,000, respectively.

     The Company is not a party to any legal proceedings other
than various claims and lawsuits arising in the normal course of
business. Management of the Company does not believe that any
such claims or lawsuits will have a material effect on the
Company's financial condition or results of operations.

<PAGE 33>

Note 9  Income Taxes

At December 31, 1997, the Company had net operating loss
carryforwards of $409,000 for income tax reporting purposes that
expire in the years 1998 through 2002. These carryforwards were
derived from agency acquisitions by the Company beginning in
1985. For financial reporting purposes, a valuation allowance of
$38,000 has been recognized to offset the deferred tax assets
related to these carryforwards.

     Deferred income taxes reflect the net tax effects of
temporary differences between the carrying amounts of assets and
liabilities for financial reporting purposes and the
corresponding amounts used for income tax reporting purposes.
Significant components of the Company's deferred tax liabilities
and assets as of December 31, are as follows:




(in thousands)                              1997          1996
                                                    
Deferred tax liabilities:
     Fixed assets                           $ 1,350       $  975
     Net unrealized appreciation of
      available-for-sale securities           4,312        4,163
     Installment sales                           24          108
     Prepaid insurance and pension              746          833
     Intangible assets                          251          368
Total deferred tax liabilities                6,683        6,447
Deferred tax assets:
     Deferred compensation                    1,568        1,386
     Accruals and reserves                      773          965
     Net operating loss carryforwards           159          261
     Other                                      270          270
     Valuation allowance for deferred
         tax assets                             (38)         (38)
Total deferred tax assets                     2,732        2,844
Net Deferred Tax Liabilities                $ 3,951      $ 3,603


<PAGE 34>

     Significant components of the provision (benefit) for income
taxes are as follows:



(in thousands)                               1997       1996        1995
                                                           
Current: 
     Federal                                 $10,332    $ 8,281     $ 9,374
     State                                     1,720      1,301       1,347
Total current provision                       12,052      9,582      10,721
Deferred:
     Federal                                     179        809      (2,037)
     State                                        20        157        (154)
Total deferred (benefit) provision               199        966       (2,191)
Total tax provision                          $12,251    $10,548      $ 8,530


     A reconciliation of the differences between the effective
tax rate and the federal statutory tax rate is as follows:




                                              1997         1996       1995
                                                             
Federal statutory tax rate                    35.0%        35.0%      35.0%
State income taxes, net of federal
  income tax benefit                           3.5          3.3        3.5
Interest exempt from taxation and
  dividend exclusion                          (0.8)        (0.5)      (0.4)
Non-deductible goodwill amortization           0.4          0.6        0.7
Internal Revenue Service examination           --            --       (1.9)
Other, net                                     0.6          0.6       (0.3)
Effective tax rate                            38.7%        39.0%      36.6%



     Income taxes payable were $178,000 at December 31, 1997, and
income taxes receivable were $645,000 at December 31, 1996, and
are reported as a component of accounts payable and accrued
expenses and other current receivables, respectively.

     In 1992, the Internal Revenue Service ("Service") completed
examinations of the Company's federal income tax returns for tax
years 1988, 1989 and 1990 and issued Reports of Proposed
Adjustments asserting income tax deficiencies. The disputed
issues related primarily to the deductibility of amortization of
purchased customer accounts of approximately $5,107,000 and non-
compete agreements of approximately $993,000. In addition, the
Service's report included a dispute regarding the timing at which
the Company's payments made pursuant to certain indemnity
agreements would be deductible for tax reporting purposes.

<PAGE 35>

     In 1994 and 1995, the Company reached a settlement with the
Service on all disputed items. The agreement resulted
in the payment of approximately $349,000, which reduced the
recorded reserve. As such, with all disputed items settled, the
Company recorded a $451,000 reduction in the general tax reserve,
which is recorded as a reduction to the 1995 current income tax
provision.

Note 10  Employee Benefit Plans

The Company maintains a defined benefit pension plan covering
substantially all previous Poe & Associates, Inc. employees with
one or more years of service. The benefits are based on years of
service and compensation during the period of employment. Annual
contributions are made in conformance with minimum funding
requirements and maximum deductible limitations. During 1994, the
defined benefit pension plan was converted to a cash balance
plan. The impact of this change on the plan costs and plan
liabilities was not material. On April 1, 1995, the defined
benefit pension plan was amended to freeze the accrual of further
benefits. The impact of this amendment on the defined benefit
pension plan's liabilities was not material.

     The plan's funded status and amounts recognized in the
Company's consolidated balance sheets are as follows:



                                                          December 31,
(in thousands)                                         1997        1996
                                                             

Actuarial present value of benefit obligations:
Accumulated benefit obligations, including vested
 benefits of $2,475 in 1997 and $2,524 in 1996         $ (2,475)   $ (2,524)
Projected benefit obligations for service rendered
 to date                                               $ (2,475)   $ (2,524)
Plan assets at fair value, principally consisting
  of a group annuity contract                             2,605       2,667
Excess of plan assets over projected benefit
 obligations                                                130         143
Unrecognized net excess of plan assets under
 previously accrued but unfunded pension costs,
 to be amortized                                            494         572
Net prepaid pension costs                              $    624    $    715



     The following assumptions were used in determining the
actuarial present value of the benefit obligations and pension
costs for the years ended December 31, 1997, 1996 and 1995:
discount rate of 7.5%; long-term rate for compensation increase
of 3.5%; and long-term rate of return on plan assets of 6.5% for
1997 and 8.0% for 1995 and 1996.

<PAGE 36>

     Pension costs included in the CompanyOs consolidated
statements of income are comprised of the following:



                                               Year ended December 31,
(in thousands)                          1997          1996           1995
                                                            
Service cost                            $   40        $   36         $  63
Interest cost                              192           177           215
Actual return on assets                   (173)          (83)         (318)
Net amortization and deferral               31           (97)          166
Net pension cost                        $   90        $   33         $ 126



     The Company has an Employee Savings Plan (401(k)) under
which substantially all employees with more than 30 days of
service are eligible to participate. Under this plan, the Company
makes matching contributions, subject to a maximum of 2.5% of
each participant's salary. Further, the Company provides for a
discretionary profit sharing contribution for all eligible
employees. The Company's contributions to the plan totaled
$1,753,000 in 1997, $1,510,000 in 1996 and $1,334,000 in 1995.

Note 11  Stock-Based Compensation and Incentive Plans

Stock Option Plans

The Company has adopted stock option plans which provide for the
granting of options to purchase shares of the Company's stock to
key employees who contribute materially to the success and
profitability of the Company. The Company accounts for these
plans under Accounting Principles Board Opinion No. 25 (OAPB
25O), under which no compensation expense has been recognized. In
October 1995, the Financial Accounting Standards Board issued
Statement of Financial Accounting Standards No. 123, "Accounting
for Stock-Based Compensation" (OSFAS 123O), which is effective
for fiscal years beginning after December 15, 1995. SFAS 123
allows companies to continue following the accounting guidance of
APB 25, but requires pro-forma disclosure of net income and
earnings per share for the effects on compensation expense had
the accounting guidance of SFAS 123 been adopted. The pro-forma
disclosures are required only for options granted subsequent to
December 31, 1994. The Company granted no options in 1995, 1996
or 1997.


<PAGE 37>

     Under its stock option plans, the Company may grant future
options for up to 285,745 shares of the Company's stock to
employees and directors. Options previously granted under the
plans equaled the market price of the stock at the date of grant
and vest over a five-year period. The following schedule
summarizes the stock option transactions from 1995 through 1997
pertaining to these plans:




                             Number of Option Shares    Per Share Option Price
                                                      
Outstanding, January 1, 1995       86,380                   $    7.60
     Exercised                    (60,399)                       7.60
     Canceled                     (10,601)                       7.60
Outstanding, December 31, 1995     15,380                        7.60
     Exercised                     (9,323)                       7.60
Outstanding, December 31, 1996      6,057                        7.60
     Exercised                     (5,729)                       7.60

Outstanding, December 31, 1997        328                   $    7.60



     All of the 328 options outstanding at December 31, 1997 have
a remaining contractual life of 1 year and are fully-vested and
exercisable.

Employee Stock Purchase Plan

The Company has adopted an employee stock purchase plan ("the
Stock Purchase Plan"), which allows for substantially all
employees to subscribe to purchase shares of the Company's stock
at 85% of the lesser of the market value of such shares at the
beginning or end of each annual subscription period. The total
number of shares available for issuance under the Stock Purchase
Plan as of December 31, 1997, was 250,000. As of December 31,
1997, 43,007 shares remained authorized and reserved for future
issuance under this Plan.

     The Company accounts for the Stock Purchase Plan under APB
25, under which no compensation expense has been recognized. Had
compensation expense for the Stock Purchase Plan been determined
consistent with SFAS 123, it would have had an immaterial effect
on the Company's net income and earnings per share for the years
ended December 31, 1997, 1996 and 1995.

<PAGE 38>

Stock Performance Plan

Effective January 1, 1996, the Company adopted a stock
performance plan, under which up to 400,000 shares of the
Company's stock ("Performance Stock") may be awarded to key
employees contingent on the employees' years of service with the
Company and other criteria established by the Company's
Compensation Committee. Shares must be granted, awarded and
vested before participants take full title to Performance Stock.
Of the grants currently outstanding, specified portions will be
awarded based on increases in the market value of the Company's
common stock from the initial price specified by the Company.
Awards vest on the earlier of: (i) 15 years of continuous
employment with the Company from the date shares are granted to
the participant; (ii) attainment of age 64; (iii) death or
disability of the participant. Dividends are paid on awarded and
unvested Performance Stock and participants may exercise voting
privileges on such shares. At December 31, 1997, 248,520 shares
had been granted under the plan at initial stock prices ranging
from $22.75 to $27.50. As of December 31, 1997, 1,200 shares had
been awarded. The compensation element for Performance Stock is
equal to the fair market value of the shares at the date of award
and is expensed over the vesting period. Compensation expense
related to this Plan totaled $175,000 in 1997.

Note 12  Supplemental Disclosures of Cash Flow Information

The Company's significant non-cash investing and financing
activities and cash payments for interest and income taxes are as
follows:




                                               Year ended December 31,
(in thousands)                            1997        1996         1995
                                                          

Unrealized appreciation (depreciation)
 of available-for-sale securities
 net of tax effect of $149 for 1997,
 $1,136 for 1996 and $(317) for 1995     $  233       $  1,675     $  (505)
Notes payable issued for purchased
  customer accounts                       1,878          6,074       1,535
Notes received on the sale of fixed
  assets and customer accounts              187            280         -
Cash paid during the year for:
     Interest                               603            891         896
     Income taxes                        11,193         10,609       9,107



Note 13  Business Concentrations

Substantially all of the Company's premiums receivable from
customers and premiums payable to insurance companies arise from
policies sold on behalf of insurance companies. The Company, as
broker and agent, typically collects premiums, retains its
commission, and remits the balance to the insurance companies. A
significant portion of business written by the Company is for
customers located in Florida. Accordingly, the occurrence of
adverse economic conditions or an adverse regulatory climate in
Florida could have a material adverse effect on the CompanyOs
business, although no such conditions have been encountered in
the past.

     For the years ended December 31, 1997 and 1996,
approximately 20% and 22%, respectively, of the Company's
revenues were from insurance policies underwritten by one
insurance company. Should this carrier seek to terminate its
arrangement with the Company, the Company believes alternative
insurance companies are available to underwrite the business,
although some additional expense and loss of market share would
at least initially result. No other insurance company accounts
for as much as five percent of the CompanyOs revenues.

Note 14  Reinsurance Indemnity

Whiting National Insurance Company ("Whiting"), the Company's
former risk-bearing subsidiary, ceased underwriting operations in
early 1985, and in 1988 entered into liquidation under the
supervision of the New York State Insurance Department
("Department"). Since then, the handling of Whiting's affairs has
been the responsibility of the Department.

     In 1979, the Company agreed to indemnify a ceding insurer
should Whiting fail to perform under a reinsurance contract. As a
result, the Company is directly responsible for the management
and adjudication of claims outstanding under that indemnification
contract. The Company has historically estimated that certain
recoveries related to the indemnity were available to it from the
Whiting liquidation. While none of the underlying facts or
applicable law as to the Company's rights or creditor priority
had changed, the liquidation activities proceeded more slowly
than anticipated, making realization of those recoveries
uncertain. As a result, in 1992 those estimated recoveries were
written off and reserves associated with the underlying indemnity
obligation were bolstered because of adverse loss developments.
Reserves are periodically revised based on developments to date,
the Company's estimates of the outcome of this matter, and the
Company's experience in contesting and settling this matter. As
the scope of the liability or recovery becomes better defined,
there will be changes in the estimates of future costs or
recoveries. Management of the Company does not believe that any
such changes will have a material effect on the Company's
financial condition or results of operations.

<PAGE 40>

Report of Independent Certified
Public Accountants

To the Board of Directors of Poe & Brown, Inc.

We have audited the accompanying consolidated balance sheets of
Poe & Brown, Inc. and subsidiaries as of December 31, 1997 and
1996, and the related consolidated statements of income,
shareholders' equity and cash flows for each of the three years
in the period ended December 31, 1997. These financial statements
are the responsibility of the Company's management. Our
responsibility is to express an opinion on these financial
statements based on our audits.

     We conducted our audits in accordance with generally
accepted auditing standards. Those standards require that we plan
and perform the audit to obtain reasonable assurance about
whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis,
evidence supporting the amounts and disclosures in the financial
statements. An audit also includes assessing the accounting
principles used and significant estimates made by management, as
well as evaluating the overall financial statement presentation.
We believe that our audits provide a reasonable basis for our
opinion.

     In our opinion, the financial statements referred to above
present fairly, in all material respects, the financial position
of Poe & Brown, Inc. and subsidiaries as of December 31, 1997 and
1996, and the results of its operations and its cash flows for
each of the three years in the period ended December 31, 1997 in
conformity with generally accepted accounting principles.



ARTHUR ANDERSEN LLP

Orlando, Florida
January 19, 1998