Legal Guidance for Insurance Agency Transactions

For more than a decade, baby boomers who spent a career building their insurance agency have been taking greater advantage of the opportunity to monetize their investment by selling their agency.

While rising interest rates have had some cooling effect on deals, the market remains relatively brisk, the multiples remain high as compared to other industries, and selling an agency can provide a good opportunity to build wealth while continuing to work in a meaningful and lucrative way. Quality agencies looking to sell will still find high demand from perspective buyers. While there are a number of similarities between buying and selling an insurance agency and buying and selling other kinds of businesses, there are sufficient unique features in these transactions that should cause parties involved in insurance agency merger and acquisition activity to engage counsel that is specifically experienced in this arena. We often become involved in transactions with buyers and their counsel that we have worked with in the past. We find that this connection provides instant credibility which enhances the opportunity to close the transaction on time and on budget.

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Effective Non-Piracy Agreements

By Gary Miller and Matt Veech, BoyarMiller

Experience

BoyarMiller’s team of corporate lawyers has decades of experience helping agents and owners of insurance agencies build and maintain the value of their businesses, especially in times of transition (whether that means selling an agency developed over the years or buying an additional agency). 

Our senior deal team members have a long history in representing agencies in purchase and sale transactions. Recently, BoyarMiller’s insurance agency M&A lawyers have handled transactions as small as a single owner as the primary producer to agencies with multiple offices, ten or more shareholders and numerous producers. 

Our lawyers assist agencies
in structuring the deal terms negotiating the sale documents and addressing the distinctive considerations of selling an agency such as:

• Unique and significant earnouts and related post-closing payment opportunities
• Equity of the acquirer as a portion of the purchase price
• Non-piracy and non-competition elements, including insurance agent non-compete agreements
• Providing incentive to non-owner producers through bonus arrangements link to the sale transaction
• M&A referral bonuses

Relationships

We maintain excellent relationships with several top national investment bankers specializing in insurance agency acquisitions, and we work closely with the investment bankers and our clients to successfully complete the transaction. 

We recognize the need for speed (minimizing the period a selling agency is in transition) and for patiently explaining all aspects of the transaction to our clients. We recognize that many of our clients have never been through this process before and it may be among the most significant transactions of their careers. For over 30 years, representing insurance agencies in connection with their perpetuation, owner agreements, insurance agency mergers, and insurance agency purchases and sales has been an important part of our practice.

BoyarMiller is well positioned to handle the purchase or sale of an insurance agency in any of the fifty states (although our attorneys are licensed only in Texas). By partnering with your local counsel on any local law issues, BoyarMiller’s insurance agency representation reach applies across the United States.