Exhibit 13.0


LIQUIDITY AND CAPITAL RESOURCES

The insurance brokerage industry is not capital intensive. The Company has
historically been profitable with a positive cash flow from operations and has
consequently been able to finance its operations and capital expenditures from
internally generated funds. Funds restricted as to the Company's use (primarily
premiums held as fiduciary funds) have not been included in determining the
Company's liquidity.

In February, 1993, the Company entered into a $20 million unsecured revolving
credit agreement (the "Credit Agreement") with two banks. Loans under the Credit
Agreement are repayable no later than February, 1998, and bear floating interest
rates over the term of the loan. In February, 1993, a loan was funded for $20
million. The Company simultaneously entered into interest rate exchange
agreements which fixed the rate of interest payable on the loan. The Company
retired the $20 million loan in the fourth quarter of 1994 and has fully
satisfied all obligations associated with the loan. The Company also recognized
a gain of $656,000 in closing out the interest rate exchange agreements. The
Credit Agreement remains in effect and as of December 31, 1995, there are no
borrowings currently existing under this agreement.

The Company also entered into two term loan agreements (the "Term Loan
Agreements") that have outstanding balances of $1.9 million and $1.5 million at
December 31, 1995. Loans under the Term Loan Agreements are repayable in equal
annual installments no later than January 11, 1998, and June 15, 1998,
respectively, and bear interest rates over the terms of the loans of 6.64% and
6.30% respectively.

The Credit Agreement and Term Loan Agreements require the maintenance of certain
financial requirements. The Company is currently in compliance with these
requirements.

The Company also has line of credit facilities of $17.5 million and $10.0
million which expire on April 30, 1996 and February 28, 1997, respectively. No
borrowings currently exist under these facilities.

The Company paid $14.7 million in cash dividends on its common stock in 1995.
The Company's dividend policy is determined by the Board of Directors and
payments are fixed after considering the Company's available cash from earnings
and its known or anticipated cash needs. In each quarter of 1995, the Company's
Board of Directors declared a dividend of $.25 per share which is $.03 or 14%
greater than each quarterly dividend in 1994. In January, 1996, the Company
announced a first quarter dividend of $.29 per share, a 16% increase over the
quarterly dividend in 1995.

Net capital expenditures for fixed assets amounted to $9.4 million, $7.5 million
and $7.8 million in 1995, 1994 and 1993, respectively. In 1996, the Company
intends to make additional capital improvements of approximately $10.5 million
to upgrade and modernize existing space, furniture and equipment.

In 1988, the Company adopted a plan, which has been extended through June 30,
1996, to repurchase its common stock. Under the plan, the Company repurchased
437,000 shares at a cost of $15.1 million, 1.4 million shares a cost of $43.8
million and 225,000 shares at a cost of $7.0 million in 1995, 1994 and 1993,
respectively. The 1994 common stock repurchases, in part, caused the weighted
average shares outstanding to decrease by 590,000 shares from 1993 to 1994. The
repurchases were funded entirely by internally generated funds and are held for
reissuance in connection with exercises of options under its stock option plans.
Under the provisions of the plan, the Company is authorized to repurchase
approximately 360,000 additional shares through June 30, 1996. The Company is
under no commitment or obligation to repurchase any particular amount of common
stock and at its discretion may suspend the repurchase plan at any time.

 

The Company believes that internally generated funds will continue to be
sufficient to meet the Company's foreseeable cash needs, including non-operating
cash disbursements such as anticipated dividends, capital expenditures and
repayment of borrowings under its loan agreements if the Company so determines.

Due to changes in the United States federal income tax laws, effective in 1994,
the Company began providing for U.S. income taxes on the undistributed earnings
of its foreign subsidiaries. Prior to 1994, the Company did not provide for U.S.
income taxes on the undistributed earnings of certain foreign subsidiaries
($19.2 million) which are considered permanently invested outside the United
States. See Note 13 of the Notes to Consolidated Financial Statements. Although
not available for domestic needs, the undistributed earnings generated by
certain foreign subsidiaries referred to above may be used to finance foreign
operations and acquisitions.