Book Ownership
What makes one book worth 1x and another 2.5x commissions is important to understand. Do your due diligence and ask the questions listed below to ensure you maximize your net worth.
Why owning your own book is critical
Remember, you are building an asset … and book ownership happens to be a key factor in the ultimate valuation (or sales price) you can achieve for your agency. When selling, it is important to remember the buyer will require standard due diligence before making a competitive offer. The buyers typically assess 3 critical components of an agency (along with plenty of smaller things)
Policy Ownership Rights
Who truly has control of the client’s data and information? This is an important factor if ever exploring a purchase. If you have your own agency sub-code with an insurance company, this will help you more easily show production reports over 3-5 year timeframes and protect your client’s information from being seen by others’ eyes.
Commission Deposits
The age-old adage still exists … follow the money. If the commissions are going directly to the agency, that control is known and thus helps embolden the potential buyer.
Client Files
Agency information for clients should be stored digitally, preferably on the cloud to maximize valuation. If you don’t have actual ownership/control as sole admin over your agency management system, that may limit your potential valuation.
What's Next?
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More About Book Ownership
Book Ownership
Due Diligence Questions
| Be sure to understand the full value of your hard work and how to maximize your retirement plan | Other Networks | With VIAA |
|---|---|---|
| Will I have sub-codes unique to my agency on which only my agency has authority to write business? | ||
| Will I have access to commission and production reports through the insurance company login so I can monitor my production, loss ratio, and commission? | ||
| No one other than me and my contracted employees will be able to view my clients and their information. | ||
| Does the contract state that I can continue working with any and all insurance companies provided that we part ways? | ||
| If we part ways, does the contract state that you will sign a letter releasing my sub-code and send it to the insurance company? |
