Insurance Agency Business Valuation Formula:

Broker Comments: I have listed a few Insurance agencies for sale and have talked to dozens of Insurance agency buyers in the Arizona market and the above valuation formula appears to be widely accepted. Some buyers have expressed reluctance to offer more than 1.0 times annual commissions if the book of business has a large percentage of non-standard policies. However, because of rarity of independent P&C agencies coming to market and a large buyer demand most Insurance agencies owners have the luxury to just wait for a better offer to eventually materialize. I have also found that some well known Insurance agency franchises are much more difficult to sell vs. Independent agencies. One of the main reasons being that most franchise agencies cant offer a broad menu of different carriers like independents can.