In short
An external sale to a national broker or PE-backed aggregator almost always produces a higher number and cleaner liquidity than internal perpetuation. Perpetuation preserves culture and rewards the producers who built the book. The common mistake is choosing perpetuation by default without ever finding out what the agency is worth externally.
60 seconds · anonymous · no email needed
How Sentinel sells an insurance agency →The decision in front of you
Small owner-run agencies typically sell for about 2–3.5x SDE, or roughly 1.5x commission revenue; agencies with roughly $1M+ of EBITDA trade around 7–10x EBITDA, and platform-scale brokerages 10–13x or more, with commercial-lines books at the upper end. These are market ranges, not a quote or a guarantee. Retention rate is the first number every buyer asks for, because it is the closest proxy for how durable the book is. Producer agreements matter enormously: buyers assume any book without enforceable protection can walk, and they price for that assumption.
Perpetuation is usually funded out of future earnings, which means you are financing your own buyout and carrying the risk if the agency stumbles. It preserves the culture, keeps your name on the door and rewards loyal producers. For many owners that is worth real money. Just be clear about how much money, which requires knowing the external number.
What’s your insurance agency worth?
Your free market range in 60 seconds — anonymous, no email needed.
Get a confidential external valuation first. Then model perpetuation properly: the payout period, the discount for risk and delay, and what happens if a key producer leaves midway. Compare after-tax proceeds, not headline figures. Owners who do this frequently find the gap is larger than expected, and some still choose perpetuation, which is a perfectly good outcome as long as it is a decision rather than an assumption.
Small owner-run agencies typically sell for about 2–3.5x seller’s discretionary earnings (SDE), or roughly 1.5x commission revenue. Agencies with roughly $1M+ of EBITDA trade around 7–10x EBITDA, and platform-scale brokerages 10–13x or more, with commercial-lines books at the upper end and personal-lines-heavy books lower. These are market ranges, not a quote or a guarantee. Retention rate, producer agreements and carrier relationships move the number more than premium volume alone.
Most acquirers want to keep producers, since the book follows the relationships, and will often offer retention packages. The terms are negotiable and should be negotiated explicitly. Enforceable producer agreements before a sale both protect the buyer and materially raise your price.
Free · confidential · no obligation
Know your number before a buyer names it.
Get a free market range for your insurance agency in 60 seconds — anonymous, no email. Then open a free account and ask Vera, Sentinel’s AI, where you’d land in it and what would raise it.
Holding an offer already? Get a free offer read → · Prefer to talk? (888) 560-5852
General information only, researched and drafted with AI assistance — not legal, tax, financial or valuation advice. See our terms.