How are insurance agencies valued?

Agencies are commonly valued as a multiple of adjusted EBITDA or of revenue, adjusted for quality factors such as retention, growth, profitability, revenue mix, carrier concentration and how dependent the business is on its owner.

What multiple do insurance agencies sell for?

It varies widely by size and quality. Industry data cited in 2026 put larger agencies with more than $1 million of EBITDA at about 11.8 times adjusted EBITDA in early 2025, while smaller agencies typically sell at lower multiples.

Does retention affect agency value?

Yes. Buyers are paying for future renewals, so higher retention generally supports a higher valuation.

Can I sell an insurance franchise agency?

Usually, subject to the franchise agreement. Transfer conditions, approvals and fees are described in Item 17 of the FDD and in the agreement itself.

What Makes an Insurance Agency Valuable? 8 Drivers Buyers Look At

Most agency owners think about value only when they start thinking about selling. The owners who get the best outcomes think about it from the first year, because the habits that make an agency valuable are the same habits that make it profitable and easier to run.

A busy acquisition market

Insurance distribution has been one of the most active mergers and acquisitions markets in the country. MarshBerry reported 649 announced U.S. insurance distribution deals in 2025 through November 30, with private-capital-backed buyers accounting for 72.6% of them. Trade reporting in August 2026, citing MarshBerry and OPTIS Partners data, put average multiples at about 11.8 times adjusted EBITDA for agencies with more than $1 million of EBITDA in the first half of 2025, and roughly 7 to 9 times for lower-middle-market agencies.

Those figures describe larger firms. Small agencies are usually valued at lower multiples, and individual valuations range widely. What moves a specific agency up or down that range is quality.

The 8 drivers

1. Retention

Buyers are paying for future renewals. A book that keeps a high share of its clients each year is worth more than one with the same revenue and more churn. Track retention by policy count and premium, every month.

2. Recurring revenue quality

Renewal commission from long-standing accounts is valued more than one-time or volatile income. Contingent commissions are typically discounted because they are not predictable.

3. Account rounding

Households and businesses with multiple policies stay longer. Policies per client is a simple metric buyers check.

4. Commercial and personal mix

Many buyers place extra value on commercial lines because of larger accounts and stronger relationships. A healthy personal lines book is still valuable, particularly when it is well rounded.

5. Carrier diversification

If one carrier represents most of your book, a single appetite change or contract termination can hurt you. Spreading business across several carriers reduces that risk. See why multi-carrier access matters.

6. Profitability

Multiples are often applied to adjusted EBITDA, so clean financials and controlled expenses translate directly into value. Separate personal and business expenses and keep books a buyer can verify.

7. Growth

Consistent organic growth tells a buyer the agency can keep producing after the transaction. Document where new business comes from.

8. Low owner dependence

If every client relationship runs through you, a buyer worries those clients will leave when you do. Licensed staff, documented processes and a CRM that holds the client history make the agency transferable.

Know what you can transfer

Value only exists if you can deliver it. The Insurance Information Institute notes that in the independent system the agent rather than the insurer owns access to renewals, but your specific rights depend on your carrier agreements and, if applicable, your network or franchise agreement. In a franchise, Item 17 of the FDD and the agreement explain renewal, termination and transfer. Read them before you build, not when you are ready to sell. Our FDD guide covers what to look for.

A value-building checklist for year one

Set up monthly reporting for retention, policies per client and revenue by carrier and line.
Run annual account reviews for every client.
Keep every client interaction in your CRM, not your head.
Document your processes for quoting, binding, service and renewals.
Keep business finances separate and reviewed by an accountant.

Insurance Warehouses franchisees operate with EZLynx, a centralized CRM and defined compliance standards from day one, which supports exactly these habits. Learn more about the model.

Valuation figures are from third-party industry sources for context only and do not predict the value of any particular agency.

This article is general information, not legal, tax or financial advice, and is not an offer to sell a franchise. A franchise offer is made only through a Franchise Disclosure Document and only in states where it may lawfully be offered. Figures referenced from our franchise materials are estimates and are not a guarantee of results.