Agency Valuation Calculator
Estimate what your insurance agency is worth using revenue and EBITDA multiples.
Agency Valuation Calculator
Estimate an insurance agency's value using the two methods buyers rely on: a revenue multiple and an EBITDA multiple.
More carrier diversification nudges the valuation toward the higher end of each range.
Estimated valuation range
$2,700,000 – $3,200,000
Midpoint $2,950,000 · EBITDA $250,000
| Method | Multiple | Valuation |
|---|---|---|
| Revenue multiple | 3.20x | $3,200,000 |
| EBITDA multiple | 10.8x | $2,700,000 |
Key drivers: a 90% retention rate place this agency at 80% of each multiple range. Higher retention and broader carrier access push valuations toward the top of the range; concentration and churn pull them down.
This is an estimate for planning purposes only and does not constitute a formal valuation or financial advice. Consult a licensed M&A advisor before any transaction.
FAQs
- How is an insurance agency valued?
- Most independent agencies are valued two ways: a multiple of annual revenue (typically 2.0x to 3.5x) and a multiple of EBITDA (typically 6x to 12x). Buyers compare both and weigh factors like retention, carrier diversification, and book composition.
- What is a typical revenue multiple for an insurance agency?
- Independent property and casualty agencies commonly trade at about 2.0x to 3.5x of annual commission revenue. Agencies with high retention, recurring commercial lines, and diversified carrier access sit at the upper end.
- Why does retention rate affect my agency's value?
- Retention measures how much of your book renews each year. A high retention rate makes future revenue more predictable, which lowers a buyer's risk and justifies a higher multiple. Low retention signals churn and pulls the valuation down.
- Should I use revenue or book of business?
- Use whichever you know best. Revenue (your commission income) feeds the model directly. If you only track premium written, enter your book of business and average commission rate and the calculator converts it to revenue for you.
- Is this estimate a formal valuation?
- No. This is a planning estimate based on industry-standard multiples. A formal valuation accounts for book composition, contingent income, deal structure, and other factors. Consult a licensed M&A advisor before any transaction.
Related Terms
Loss Ratio
The portion of premium paid out in claims: incurred losses divided by earned premium. A core measure of how a book of business is performing.
Combined Ratio
A carrier profitability metric: incurred losses plus expenses divided by earned premium. Below 100% means underwriting profit; above means a loss.
Underwriting Profit
The profit generated from insurance operations alone, calculated as earned premium minus incurred losses and expenses, before investment income.