Description

Extremely profitable expanding diversified benefits & worker's compensation insurance agency is for sale, also includes some life insurance sales & 401k income. Every renewal is managed personally by the Seller; even for the small cases the staff is always there to do the appointment and/or re-shop the account to preserve premium service. This adds tremendous persistency and the ability to round out accounts and cross sell the client easily at each subsequent meeting or appointment. Significant additional net income exists for a larger strategic player with direct access to worker's compensation markets that have overlap with the Sellers' principal carriers, since he is mostly making 7-10% commissions on the majority of the business written through MGA's. The worker's compensation division is worth roughly $600k annually so a Buyer with direct carrier relationships and/or profit sharing would show an immediate bump in top line and net revenue on Day 1 after Closing. For the group/worker's compensation accounts there are 2 cases that are over 500 lives, 15 cases that are 101-500 lives, 18 cases that are 51-100 lives, 34 cases that are 26-50 lives, and 239 that are 2-25 lives. NDA is required for comprehensive Confidential Information Memorandum created Brokers.

Detailed Information

Facilities: A 4.5 year lease is in force, and the Seller is paying $1.25 per foot for 5,000 square feet. There is an opt-out clause as part of the current lease agreement and there will be no penalty or cost incurred by the Buyer should a true "roll-up" transaction take place. The current layout includes 8 offices and an open bullpen area with a kitchen. Renewal options are readily available.

Competition: Any local or quasi-regional / national privately or publicly held insurance agency with industry expertise in commercial and benefits insurance would be defined as a direct competitor. However, with the complexity of benefits there are very few competitors that work as hard for their clients as their advocate.

Growth & Expansion: There are over 325 separate corporations that the Seller is presently servicing, so the golden goose is for a sophisticated diversified P&C operation to cross sell other commercial insurance solutions like general liability, E&O, surety & potentially secure an array of personal lines coverages as well across the entire pool of 8,000 lives that encompass the entire book of business being purchased.

Financing: If the price and deal structure is right.

Support & Training: Seller envisions teaming up with a strategic partner to continue growing the operations of the Company being sold and theoretically if the Buyer has a shortfall in benefits the Owner can come in and cross-pollinate and cross sell using his vast industry expertise and sales acumen. Perfect synergy is a group that wants to focus on continued controlled growth over the next 5 to 10 years.

Reason for Selling: Team up with a larger organization to grow both enterprises.

Posted Jun 9, 2016

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