Insurance Fraud Investigation Break-Even Analysis: $172K Monthly Revenue

Fixed costs $103.6K/mo Overhead plus payroll

Contribution margin 43% After variable spend

Break-even revenue $242K/mo Monthly target

Break-even timing Month 21 Model crosses zero

Break-even calculator

Test monthly revenue against variable expenses and fixed monthly costs to see when this investigation service clears break-even.

Lean Base Full

Monthly revenue Revenue sets how much margin is left to cover fixed monthly costs. $ Low volume High volume Variable expenses Use direct costs that rise with each case, like field work, data, travel, and commissions. $ Tight costs Heavy costs

Money available to cover fixed costs $166,267 $233,333 revenue - $67,066 variable expenses

Margin ratio

71%

Covers fixed costs

Yes

Fixed monthly costs Use the monthly cost base your margin must cover, including office and payroll. $ Light overhead Heavy overhead

Break-even chart Revenue Total costs

Which expenses are fixed and which move with sales for an insurance fraud investigation service?

Cost classification

Break-even gets shaky when case-level spend is buried in overhead. Keep fixed monthly burn separate from revenue-linked fieldwork, licensing, commissions, and travel so contribution margin shows the real path to Month 21 break-even.

Expense	Cost	Break-Even Treatment	Common Mistake
Office rent and utilities	Fixed	Include $12,500 per month in baseline overhead before case volume.	Treating lease spend as flexible when revenue dips.
Professional liability insurance	Fixed	Include $3,200 per month as required operating overhead.	Underbudgeting required coverage for investigative work.
IT infrastructure and security	Fixed	Include $4,500 per month as a security baseline.	Ignoring the minimum systems needed to handle case data.
Salaried investigators and admin	Semi-fixed	Model Year 1 payroll at $898,000, then step it up as staffing expands.	Hiring ahead of signed carrier volume.
Field investigation direct costs	Variable	Apply 18.5% of revenue in the first year to case-level fieldwork.	Missing mileage, surveillance hours, and field supplies.
Technology and data licensing	Variable	Apply 8.5% of revenue in the first year for usage-linked tools and data.	Treating data tools as free margin.
Travel and client support expenses	Semi-variable	Apply 1.2% of revenue in the first year, then adjust for remote case mix.	Ignoring how travel changes by case type.
Marketing program	Semi-fixed	Plan the $180,000 first-year budget separately from contribution margin.	Assuming leads convert instantly at the $8,500 CAC.

How does break-even change from lean launch to base ramp to full capacity in this insurance fraud investigation service?

Scenario table

Revenue scales faster than the cost base, so break-even moves from a lean cash burn in Year 1 to Month 21 in Year 2 and a profit cushion in Year 3. The catch is utilization: weak carrier flow keeps the base case tight.

Planning figures only; case mix, utilization, and collection timing will change the result.

Scenario	Monthly Revenue	Variable Costs	Fixed Costs	CM Ratio	Operating Profit	Break-Even Signal
Lean launch, Year 1	$101.8k	$31.6k	$130.3k	69.0%	-$721k	Still below break-even; it needs cash runway.
Base ramp, Year 2	$233.3k	$67.0k	$173.4k	71.3%	-$84k	Break-even lands in Month 21, so carrier pipeline discipline matters.
Full capacity, Year 3	$395.0k	$104.7k	$214.4k	73.5%	$911k	Above break-even, but it still depends on utilization and retainer growth.

What breaks the break-even plan if carrier volume slips or field costs jump?

Stress test

The plan is tight at $1,719k monthly break-even. Slow carrier onboarding, travel-heavy surveillance, higher subcontractor rates, or software commitments before signed volume can push that higher fast.

Stress Case	Changed Assumption	Break-Even Revenue	Revenue Gap	Risk Signal
Current plan	No change.	$1,719k	$0 cushion	No margin for error.
Revenue shortfall	Revenue slips 15% below plan to $1,461k.	$1,719k	$258k gap	A 15% miss opens a fast cash hole.
Fixed-cost pressure	Overhead rises 10% to $1,305k.	$1,891k	$172k gap	Even small overhead creep matters.
Margin pressure	Variable load rises from 31.0% to 36.0%.	$1,854k	$135k gap	Travel and subcontractor costs can erase margin.
Combined pressure	Revenue falls 15%, overhead rises 10%, and margin drops to 64.0%.	$2,040k	$579k gap	Top-line miss and cost creep hit at once.

What should you verify before signing the lease and scaling this insurance fraud investigation service?

Founder checklist

Do not lock the office, fleet, or full payroll until signed carrier work, evidence handling, and cash runway line up with the model. Break-even lands in Month 21, but the cash trough hits -$744k in Month 20 and payback takes 45 months.

1Carrier pipeline$12.5K/mo

Don't sign the $12,500 office lease until the $180,000 marketing budget and $8,500 CAC produce enough signed carrier accounts to cover it.

2Fixed overhead$28.8K/mo

Check that rent, insurance, IT, legal, admin, supplies, training, and memberships stay supportable before you add more payroll.

3Contribution margin69% CM

Year 1 variable costs total 31.0%, so every service mix you sell has to preserve that margin after field work, tech, commissions, and travel.

4Staff ramp8 to 25 FTE

Only expand into multi-state coverage when the team can scale from 8 FTE in Year 1 to 25 FTE in Year 5 without slowing case work or evidence quality.

5Cash cushion-$744K

Fund past the Month 20 cash low, the Month 21 break-even point, and the 45-month payback window before you commit to full launch.

6Capex staging$405K capex

Stage the $85,000 surveillance package, $95,000 forensics tools, $150,000 case system, and $75,000 fleet so evidence handling is live before field deployment.