You’re probably aware that buying an insurance agency requires an enormous investment of energy, time, and funds. It doesn’t matter if you’re planning to expand your business or if it’s your first foray into the insurance industry – you should consider a few important factors before making a decision.
What Are the Factors You Need to Consider Before Purchasing an Insurance Agency?
Before you make the leap, it’s extremely important to fully understand your motivation. Whether you’re someone who’s passionate about growth, or you’re looking to fulfill your lifelong, you should be sure that buying this business will best serve your motives.
Moreover, you also need to understand the seller’s motivation. This will help you decide whether the insurance agency would make a sensible investment.
Your Own Financial Capacity
Another important factor to seriously consider is your own financial capacity. Ask yourself if you have the ability to obtain financing in order to back a leveraged buyout. Perhaps you’re planning on asking the owner of the agency to offer owner financing. Whatever the case may be, just make sure that you go into the deal with a clear and realistic plan in mind.
The Agency’s True Value
You have to remember that everyone is looking for a good deal. Before you decide to make a purchase, you need to know if the agency is profitable. You can start by looking into its physical assets, financial and risk management, history of its sales, and its employees.
Knowing these things will help you decide if you should be making this investment.
Buying an Insurance Agency?
Whether you need help in finding an agency to purchase, agency valuation, financing assistance, managing the buying process, or guidance in deal terms, Energia Consulting Partners LLC is here for you!