Recommendations for Selling a Book of Commercial Business Insurance surrounded by Illinois?
Hey there,
I'm an independent agent, working for an independent agency. I am leaving to adopt an offer in another state. I hold a book of business that earns $100,000 commission per year and would like to know the approximate worth of this book (2-3 times?) and the best option for selling it. I am a corporate officer at my current employer and I do not have a non-compete clause.
I would appreciate any suggestions, as I will not be able to serve these customers surrounded by my new state and my current employer will not be able to serve them as economically as I have.
Thank you!
Answers:
Actually, that is quite a small book, especially for commercial. We enjoy single commercial clients in our office that generate that much commision (a hospital comes to mind - next to all of their policies). My personal book, that I handle myself - adjectives changes, questions, sale, etc - generates more than twice that amount of commissions & I work only 30 hrs per week. I enjoy never heard of a producer that could sell a book from the agency when they check out of. The book is owned by the agency, not the producer, the producer just gets a split of the agency commission for their wages. The agency have the contracts with the carriers directly, not the producer. You merely have your license.
Also, a noncompete clause only say that you cannot work for another agency within a certain distance & go the same products (it would be OK to switch agencies & sell personal or enthusiasm instead of commercial in your situation). A nonsolicit clause says you cannot ring up your current clients to sell them insurance in your untried agency, but if they call you for quotes (they heard you be working at the new agency & called you), consequently you can sell to them.
How do you know they will not be as well served after you give notice? I'm sure a new producer will be hired in your place.
Anyway, I don't imagine you can do what you are proposing. Check with your current agency & see, but I doubt it. Your job title does not event. Source(s): Insurance agent
Not enough information. Is the book adjectives with one carrier? How established is it? What's the annual loss ratio and retention rate? Do you split that $100K commission next to your current agency?
See, selling the BOOK to someone that doesn't have a contract with every company where on earth your book is placed, makes it worthless. Selling it to another agent at your current agency, you have to transport the commission split into consideration.
Unless you have the contracts that the business is placed through, and the contracts are sellable (highly unlikely) you're not really selling a book - you're really selling an expiration list. You "might" return with someone at your agency to buy it for half their share of the commissions, over three years - meaning, as the book shrinks through attrition as it's bound to do, the cost go down. That's probably your best bet, I don't see anyone outside that agency buying it. Source(s): agent, 21+ years
In Ohio it is typically 2 times commission. Probably the same surrounded by Illinois. As far as selling approach the independent agencies in your area. They may want to role the book into their own companies, but I guess that won't situation to you once the sale is made.
Related Questions:
I'm an independent agent, working for an independent agency. I am leaving to adopt an offer in another state. I hold a book of business that earns $100,000 commission per year and would like to know the approximate worth of this book (2-3 times?) and the best option for selling it. I am a corporate officer at my current employer and I do not have a non-compete clause.
I would appreciate any suggestions, as I will not be able to serve these customers surrounded by my new state and my current employer will not be able to serve them as economically as I have.
Thank you!
Answers:
Actually, that is quite a small book, especially for commercial. We enjoy single commercial clients in our office that generate that much commision (a hospital comes to mind - next to all of their policies). My personal book, that I handle myself - adjectives changes, questions, sale, etc - generates more than twice that amount of commissions & I work only 30 hrs per week. I enjoy never heard of a producer that could sell a book from the agency when they check out of. The book is owned by the agency, not the producer, the producer just gets a split of the agency commission for their wages. The agency have the contracts with the carriers directly, not the producer. You merely have your license.
Also, a noncompete clause only say that you cannot work for another agency within a certain distance & go the same products (it would be OK to switch agencies & sell personal or enthusiasm instead of commercial in your situation). A nonsolicit clause says you cannot ring up your current clients to sell them insurance in your untried agency, but if they call you for quotes (they heard you be working at the new agency & called you), consequently you can sell to them.
How do you know they will not be as well served after you give notice? I'm sure a new producer will be hired in your place.
Anyway, I don't imagine you can do what you are proposing. Check with your current agency & see, but I doubt it. Your job title does not event. Source(s): Insurance agent
Not enough information. Is the book adjectives with one carrier? How established is it? What's the annual loss ratio and retention rate? Do you split that $100K commission next to your current agency?
See, selling the BOOK to someone that doesn't have a contract with every company where on earth your book is placed, makes it worthless. Selling it to another agent at your current agency, you have to transport the commission split into consideration.
Unless you have the contracts that the business is placed through, and the contracts are sellable (highly unlikely) you're not really selling a book - you're really selling an expiration list. You "might" return with someone at your agency to buy it for half their share of the commissions, over three years - meaning, as the book shrinks through attrition as it's bound to do, the cost go down. That's probably your best bet, I don't see anyone outside that agency buying it. Source(s): agent, 21+ years
In Ohio it is typically 2 times commission. Probably the same surrounded by Illinois. As far as selling approach the independent agencies in your area. They may want to role the book into their own companies, but I guess that won't situation to you once the sale is made.
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