Want to increase the value of your insurance agency before you sell? Start here.

Improve the total value of your agency when you're ready to sell by taking these three actions.

Whether you're planning an exit strategy in the near future or just want to be prepared for the day you decide to sell, increasing your agency's value is a smart and strategic move. In this post, we'll explore 3 ways to increase your insurance agency's value, outlining actionable steps you can take today to set yourself up for future success.

Simple Steps That Can Raise Your Insurance Agency Value

1. Accelerate Your Growth

Buyers pay a premium for agencies growing at an above-average pace.

A significant fear for a buyer is that their acquired business may shrink. Whether the buyer is on the smaller side, a regional player, or a national PE-backed agency, sellers with core revenue growth are attractive. As a result, buyers tend to pay a premium multiple for agencies growing above average pace.

Ask yourself: What’s already working to drive sales? Can you pick up the pace?

Try:

• Hiring commission-heavy producers

• Doubling down on your most effective marketing

• Launching cross-sell campaigns

• Securing enterprise lead-flow partnerships

2. Cut the Waste

Cutting expenses and improving profits will drive your value higher.

There are typically a ton of areas where agency owners can cut expenses that won’t negatively impact growth. Since most agency acquisitions are valued as a multiple of EBITDA, improving profits is a guaranteed strategy to drive your value higher.

Pull out your P&L and a magnifying glass. What is necessary for growth and what isn’t?

• Are your compensation plans efficient?

• Are there vendor or tech contracts worth renegotiating?

• Is your marketing spend actually producing ROI?

3. Reevaluate Your Office Footprint

Consolidating locations can lead to a higher sales price.

Whether it be for generational decisions, past acquisitions, or due to previous partnership alliances, many agency owners have multiple leases for various agency locations.

Review your lease contracts and evaluate your options.

Unless eliminating a location could prove detrimental to retention or growth, consolidating locations is an easy way to reduce an often significant expense, leading to a higher EBITDA and eventual sales price.