Have you ever stopped to consider what might happen to the rest of your team when you eventually retire? For agency owners, this is a serious concern. Your team has helped your agency grow, and they depend on your agency for their career and income. With thoughtful retirement planning, you can protect your team when selling your insurance agency.
You’ll Want to Sell Your Agency Eventually
Depending on where you are in career, you may not be thinking about selling your insurance agency yet – but one day, you will.
At some point, you’ll want to retire, either because you’re ready to enjoy the wealth you’ve built or because you need more time to focus on your health or your loved ones. Regardless of your motivation, once you’re ready to exit the insurance industry, selling your book of business is typically the best way to tap into the value you’ve built. However, there’s more to consider than just the dollar amount you receive.
The Impact on Your Team, Your Clients and Your Legacy
Acquisitions can be extremely disruptive for employees. Team members could be laid off, or they may quit because they don’t fit in with the new company culture. The entire process tends to be extremely stressful for workers, and even if things work out eventually, there may be a great deal of uncertainty and apprehension.
All of these issues can trickle down to your clients and, ultimately, your legacy. If your employees leave after you retire, your clients may be left in the hands of strangers, and they may not want to stay. They may also pick up on the general atmosphere of stress and unease. All of this can tarnish the brand you worked so hard to build.
But it doesn’t have to. It’s absolutely possible to sell your agency and secure your retirement while protecting your team, your clients and your legacy. You just need to understand your options and what you want out of the process.
What Do You Want When You Exit?
If you want your exit to go well, you need to know what you want out of it. Most likely, you’ll have multiple priorities, such as:
- Fair Market Value. Money isn’t everything, but it is important. This is a business transaction, and you want to ensure you’re getting a good deal. You may also need adequate funds for your retirement.
- Your Team. Your team has helped you achieve success, and you owe them loyalty. You want to make sure they’ll be in good hands when you leave, not forced out or made miserable by new owners who don’t care about the human element of business.
- Your Legacy. You haven’t just built a book. You’ve built a brand. Your name may be attached to the agency, and you may want to see this name, as well as your operations, survive.
Questions to Ask Before Selling Your Agency
During an agency acquisition, many of the questions involve finances. That’s understandable, and you should definitely make sure the numbers work out, but it’s also important to look beyond the numbers.
Will the new owner:
Retain your current staff? Some buyers do, but others lay off workers soon after the deal goes through.
Elevate a leader within your team? Someone will have to take your place as agency leader. Will this be someone from your team, and will the buyer provide mentorship and guidance?
Preserve your brand? Some buyers just want the book. Others also want to keep the name, staff, services, and operations. Find out which type of buyer you’re dealing with.
Provide an attractive company culture? Look at the company culture of the buyer. Is this a company you would want to work for? If not, your team probably doesn’t want to work for them, either.
How Heffernan Network Handles Acquisitions
Heffernan Network offers two acquisition options.
Option one is a collaboration with Heffernan Network. Heffernan Network acquires the agency but retains your name, staff and services. With this option, you can also identify the next leader, and we’ll provide support to help them in their new role
Option two is a traditional agency acquisition. We’ll leverage our experience and reputation to train and support employees, improve workflows and grow.
Heffernan Network is a wholly owned subsidiary of Heffernan Insurance Brokers, an employee-owned, independent brokerage dedicated to serving our clients, supporting our team and helping our communities. Learn more about our agency perpetuation solutions.
