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...rce And Agency Value: Separating Goodwill
DIVORCE AND AGENCY VALUE: SEPARATING GOODWILL by Roy Phillips In m...lusive value: personal professional goodwill. Roy L. Phillips, CIC, CPIA, ...

Goodwill Value In An Insurance Agency
If you think 'Goodwill Value' has something to do with the ...ific and unusual circumstances, all goodwill in an agency is enterprise goodwill that can be transferred in a sale...

... historical growth, and profitability would lead one to believe. For instance, loss ratio problems with a carrier could imperil growth and profit that would otherwise be expected from an agency's historical performance. Conversely, the addition of new, young, aggressive producers would increase the potential value based on data before the new staff members came on board. Risk factors that refine the value of the soft assets and goodwill of an agency are a prime example of the special knowledge needed for evaluating agencies. Although many other industries provide standardized value methods, insurance agencies vary so widely that only professionals have the expertise to evaluate them. TANGIBLE NET WORTH Most agencies have limited net worth outside of the value of the "soft" assets of its book of business (future earnings stream) . However, if stock ... the past 20 years for a merger, acquisition, divestiture, or stock or book valuation has sought a simplified measure that they could use to generalize the value of their own agency or others. Most have heard that agencies were being sold for one time, two times or some other multiple of commissions, revenues, earnings, or some other gauge of income, gross or net. Unfortunately, industry averages and benchmarks can measure value only if most businesses in the industry are relatively similar — and insurance agencies just don't meet this test. A SIMPLE (AND ALL TOO FREQUENT) EXAMPLE Two insurance agencies within a few miles of each other both have $1 million in revenue. Each sought a valuation from Agency Consulting Group, and each asked if the multiple of one to one and one-half ...

...n intangible, but real, value in goodwill. Conversely, a sick agency with plu...r a departing producer who enjoys a goodwill relationship with his or her acco...

... to turning lookers into buyers. 3. CONCERNS OVER HEALTH AND SAFETY ARE GROWING. In every area of their lives, from their homes to their jobs to the products and services they buy, Americans are looking to enhance their health and safety. And for brokers and agents willing to take a little effort, this trend holds out important opportunities. Providing homeowners with health and safety information helps build goodwill and increase renewals. Going a step further, agents can offer personalized home safety analyses. On the business side, clients need to be made aware of growing concerns over issues such as workplace ergonomics and air quality. More than ever before, agents must promote their risk-management expertise. 4. AMERICA IS BECOMING MORE MODERATE. In almost every activity you can think of, Americans increasingly follow the ... ? 3. Why did you choose this rating? Submit This Anonymously Submit Cancel Contact Us contact_phone Click to call Unfollow First name: Last name: Email: Are you sure you want to deactivate your CompleteMarkets Company Profile Deactivate Cancel Loading.. About Us Services Jobs PR Newsletters Employees Articles Blog Photos Group Connections Reviews Member Content Member Content - Content Package Categories Popular Recent All Back 10 Market Trends The Insurance Industry Must Not Ignore 3/13/2014 12:00:00 AM by CompleteMarkets Editor , Kimberly Paterson This content has not been rated yet. Do your sales pitches still resonate with your market? The American psyche is rapidly changing and new, evolving attitudes toward work, leisure, spending money, and pursuing the good life are having enormous impact on the way insurance is bought and sold ...

... to turning lookers into buyers. 3. CONCERNS OVER HEALTH AND SAFETY ARE GROWING. In every area of their lives, from their homes to their jobs to the products and services they buy, Americans are looking to enhance their health and safety. And for brokers and agents willing to take a little effort, this trend holds out important opportunities. Providing homeowners with health and safety information helps build goodwill and increase renewals. Going a step further, agents can offer personalized home safety analyses. On the business side, clients need to be made aware of growing concerns over issues such as workplace ergonomics and air quality. More than ever before, agents must promote their risk-management expertise. 4. AMERICA IS BECOMING MORE MODERATE. In almost every activity you can think of, Americans increasingly follow the ... ? 3. Why did you choose this rating? Submit This Anonymously Submit Cancel Contact Us contact_phone Click to call Unfollow First name: Last name: Email: Are you sure you want to deactivate your CompleteMarkets Company Profile Deactivate Cancel Loading.. About Us Services Jobs PR Newsletters Employees Articles Blog Photos Group Connections Reviews Member Content Member Content - Content Package Categories Popular Recent All Back 10 Market Trends The Insurance Industry Must Not Ignore 3/13/2014 12:00:00 AM by CompleteMarkets Editor , Kimberly Paterson This content has not been rated yet. Do your sales pitches still resonate with your market? The American psyche is rapidly changing and new, evolving attitudes toward work, leisure, spending money, and pursuing the good life are having enormous impact on the way insurance is bought and sold ...

... to turning lookers into buyers. 3. CONCERNS OVER HEALTH AND SAFETY ARE GROWING. In every area of their lives, from their homes to their jobs to the products and services they buy, Americans are looking to enhance their health and safety. And for brokers and agents willing to take a little effort, this trend holds out important opportunities. Providing homeowners with health and safety information helps build goodwill and increase renewals. Going a step further, agents can offer personalized home safety analyses. On the business side, clients need to be made aware of growing concerns over issues such as workplace ergonomics and air quality. More than ever before, agents must promote their risk-management expertise. 4. AMERICA IS BECOMING MORE MODERATE. In almost every activity you can think of, Americans increasingly follow the ... ? 3. Why did you choose this rating? Submit This Anonymously Submit Cancel Contact Us contact_phone Click to call Unfollow First name: Last name: Email: Are you sure you want to deactivate your CompleteMarkets Company Profile Deactivate Cancel Loading.. About Us Services Jobs PR Newsletters Employees Articles Blog Photos Group Connections Reviews Member Content Member Content - Content Package Categories Popular Recent All Back 10 Market Trends The Insurance Industry Must Not Ignore 3/13/2014 12:00:00 AM by CompleteMarkets Editor , Kimberly Paterson This content has not been rated yet. Do your sales pitches still resonate with your market? The American psyche is rapidly changing and new, evolving attitudes toward work, leisure, spending money, and pursuing the good life are having enormous impact on the way insurance is bought and sold ...

... Connections Reviews IMMS Library Immerse yourself in our stacks. Take some time and browse through our library. We have thousands of articles, checklists, tip sheets, sales letters, and more! Communications Marketing Customer Service Planning Finance/Accounting Risk Management Human Resources Selling Legal and E&O Technology Life/Financial Services Glossaries Management Resources & Links Categories Popular Recent All Back Divorce And Agency Value: Separating Goodwill 4/30/2013 10:44:36 PM by CompleteMarkets Editor , Roy Phillips This content has not been rated yet. DIVORCE AND AGENCY VALUE: SEPARATING GOODWILL by Roy Phillips In my agency valuation work with agents and their spouses in divorce cases over the past 15 years, the issue of professional goodwill has often arisen. When a couple divorces, they seek to divide their community ... join? Need insurance for you, your business or your family? Get quality appointments - Save yourself a whole lot of time & money when you use our directory of carriers, wholesalers and service providers. Negotiate lucrative contracts with carriers and wholesalers. Net result. More revenue for your agency! Clients & Prospects will research you, your co-workers and your agency here. The most comprehensive online insurance industry reference library for - Personal Lines Professionals Commercial Lines Professionals Life/Health & Benefits Professionals Online newsletters and content that you can use for your clients and social media efforts. Ability to attach leads and clients to your specific market searches, with e-mail alerts for all the market, articles, blogs and people searches you make. And much more! All Articles by CompleteMarkets Editor Monetization type: None ...

...the value of the soft assets and goodwill of an agency are a prime example of ...ible net worth of the agency to its goodwill value. Tangible net worth should ...

... sell insurance as a commodity. Agents who don't sell insurance as a commodity are incredibly successful. They have revenues per person often 50% greater than their peers, their E&O exposure is significantly less, and their customers are much better served. FACULTY RESPONSE I'm an expert witness on a case that will make case law if we're successful. Our claim is that there's little if any Personal Goodwill (vs. Business Goodwill) in an insurance agency because, while the sale of insurance is certainly based in the experience, expertise, sales ability, and personality of the producer, its maintenance is primarily that of a commodity product. As long as the agency treats the account well, and the product and the price are competitive in the industry, the accounts will stay. If the ... aren't treated well, or if the product or price competitiveness deteriorates sufficiently, the account will tend to leave if solicited by an agent with better products and prices (and the promise of excellent service after the sale) . FACULTY RESPONSE I couldn't really disagree with the premise that insurance is a commodity. However, one claim can make a believer out of almost anyone. There's no doubt that Personal Lines in almost all categories is a commodity. You can't drive a car without insurance. You can't have a mortgage without insurance. Does it matter where it comes from? Not usually. In my consulting experience during the past 20 years, most agents believe they sell and retain clients with customer service. This couldn't be further from the truth. Some agencies can't keep a client through the first ...