How To Sell An Insurance Agency

It's been 17 years since we had a major recession in America and it's been 5 years since we had the blip COVID recession. Over the last 95 years since the start of the Great Depression America has a recession once every 5 years. We have had 2 recessions in 17 years, so we are long overdue for another.

We only mention this as many think that the good times for selling their independent P&C insurance agencies will go on forever. It won't. 15 years ago, good agencies were selling for 1.5x to 1.8x annual commissions. Now most agencies go for 2.5x to 3.0x annual commissions.

Don't risk a secure retirement because you waited too long to sell.

Please call or email us at Ron Christopher Co., Inc. if you would like to talk shop about selling your agency:

Ph: 614-398-2830
Email: [email protected]

If you have any inkling of selling your independent insurance agency in the next few years, you'll want to start collecting financial due diligence for potential buyers now. One of the big slowdowns between buyers and sellers is the collection and distribution financial due diligence to the buyer. Typically buyers are seeking to review such financials documents like:

-3 years of P&L statement (as well as YTD numbers)
-3 years of corporate tax statements

3 years of P&L's and tax statements are the minimum required documents needed by buyers in order to go forward. If you have these documents ready-at-hand when the buyer asks for them, you'll look very professional and well-organized. If it takes you weeks or even months to collect these items, the buyer may become disinterested and move on.

If you have any questions about selling your independent P&C insurance agency, please contact us at:

[email protected]
-614-398-2830

When selling your insurance agency, it's important to consider the impact of capital gains' taxes. Many sellers will start the process of selling their agencies only to change their minds once they realize how much they'll pay in taxes upon completion of the sale. Depending on your income level, most people will pay either 15% or 20% of the money they receive to the federal government in taxes. This is in addition to any taxes you will owe at the state level. In short, contact a qualified CPA today to talk about the subject before you get too far into the selling process.

If you have any further questions about selling your independent insurance agency, please contact us at Ron Christopher Co., Inc.:

Ph: 614-398-2830
Email: [email protected]

We are happy to announce that we've completed our 14th Mergers & Acquisitions transactions in 2017 with an independent insurance agency in Washington State. If you are seeking to either buy or sell an insurance agency, please contact us.

Ph: 614-398-2830, Email: [email protected]