Starting an Agency is more viable option than an Acquisition
Posted: Mon Sep 05, 2011 8:41 pm
Captive Agents and Independent Agency producers start Independent Insurance Agencies more so than any other type of Insurance experience, I would guess these groups make up at well over 80% of new agency principals, perhaps even 90%. However a good number of those who are looking to acquire an Insurance Agency. Unless you are looking to acquire a non-standard auto agency, a captive agency or an IA you work for, purchasing a preferred Independent Agency is very unlikely to happen. There are a number of reasons for this, including the competition to buy an agency, let alone nearly all quality IAs sell to another existing Insurance Agency. Very few if any sellers want to sell to an inexperience owner, there is too much risk involved, additional work needed to get carrier appointment and the training a non-experienced owner. A much better option is to start your own agency, there are more resources than ever to help you start your own agency, including the number of clusters, alliance and network groups that are now in operation. Technology is another factor, it’s getting cheaper and better, allowing you to run with less office space than ever. After several years or so of getting established, purchasing an quality IA can be a viable option.