How do you place a value on a sub standard insurance agency?

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PostPosted: Wed Dec 21, 2011 3:04 am   Post subject: How do you place a value on a sub standard insurance agency?  

How do you value a sub standard agency? Is there a formula? If it grosses about 175-200k consistantly, is the asking price of 250k out of reach on a sub standard business?

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PostPosted: Wed Dec 21, 2011 8:51 am   Post subject:   

What do you mean by sub standard? If it grosses 175-200k a year consistently, how is that sub standard. I would buy it for 250k in a heartbeat. Basically I would make my money back after 1.5 years.



I may have misunderstood your question though.



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PostPosted: Thu Dec 22, 2011 5:12 pm   Post subject:   

Sub standard agency is not define as a category beyond the limit of 250k, i think your doubt is not clear in post, provide more information.



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PostPosted: Fri Dec 23, 2011 2:18 pm   Post subject:   

Substandard agency? Do you mean they specialize in insuring substandard risks?



Or do you mean they should be grossing $500,000-$750,000?



If that's the case, the agency is not substandard, it's the agency owner who is. $250,000 would be a bargain price.



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PostPosted: Fri Dec 23, 2011 5:29 pm   Post subject:   

Normal price for an agency specializing in sub standard auto insurance is close to 1X an annual commission. If the persistency is over 80% and the growth is good 250 is realistic



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PostPosted: Fri Dec 23, 2011 5:29 pm   Post subject:   

Normal price for an agency specializing in sub standard auto insurance is close to 1X an annual commission. If the persistency is over 80% and the growth is good 250 is realistic



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