The U.S. insurance agency mergers and acquisitions (M&A) market remains brisk. 188 deals were announced during the third quarter of 2025 alone and 520 during the first nine months. Ten buyers have been involved in more than half the deals this year. All other potential buyers are competing with them. If your agency is interested in acquiring another one, how can you best position yourself?
Look for agencies the way you look for insurance prospects. Gary Hines of Hines Ball Advisory Group says every agency of any size is being prospected daily. Buyers must network and find ways to stand out from all that competition.
Bring more to the table than cash. Of course, sellers want buyers who can pay the purchase price, but that is not all. Chris Hughes, managing director of M&A Services, Inc., says they want assurances that the buyer can follow through. A track record of prior acquisitions is helpful. Mike Mensch, CEO of Agency Brokerage Consultants, says fit with the seller’s carriers, culture, compensation plans, and technology are important. If the buyer uses the same agency management system the seller uses, has some carriers in common, and has a similar compensation plan to the seller’s, the seller might foresee an easier transition for everyone.
Hines suggests giving the seller confidence that their staff and clients will be taken care of. “Nobody wants to see their producers lose any income value,” he says. “They’ve had sometimes decade-long relationships with (their) clients” and care about how the new owner will treat them.
Know your financial numbers. If you haven’t been tracking your revenue, expenses, and cash flow monthly, now is the time to start. Sam Patterson, CEO of Springtree Group, says that buyers who understand what their financial results are saying are in a stronger position to make a deal. “This is a mathematical business,” he says. “It’s all about the numbers.” He has seen deals fall apart because the buyer was unprepared. Hughes agrees – the ability to demonstrate financial strength assures sellers that the buyer can make the deal.
Build lender relationships. If possible, getting pre-approval from a lender can impress sellers, Mensch says. However, that option might not be available. Patterson says the lender underwrites both buyer and seller and the seller is unknown at the pre-approval stage. Still, forming a relationship with a lender experienced in making agency acquisition loans can only help. “There’s a lot of background that they do into you and your agency, see what kind of operator you are, what are your finances, what is your history, so on and so forth,” Hines says. “You can nail that conversation out of the gate right away.”
Learn as much as you can about the seller. “You have to be conscious that the target that you’re facing is in similar lines that you are in,” Patterson says, “because your whole organization spins around satisfying customers that have certain types of products.” Learn about their carrier relationships and whether they will continue under new ownership. Knowing that the carriers are on board will enhance the profitability of the book of business you’re purchasing. The seller’s growth and profitability history tells you what to reasonably expect after the purchase. Hughes also encourages buyers to work with experts to get an accurate estimate of the selling agency’s value so they don’t overpay.
Treat the seller like a future partner. Hines recommends keeping the conversation two-way so that it’s not all about the big changes the buyer intends to make. Too much talk of change may make the seller worry about the fates of staff and clients.
Be consistent. Any offers you make should be written in stone. “Changing any material terms of the deal is a complete turn off,” Hughes says.
Mensch recommends working with an experienced brokerage firm like his or his competitors to help buyers through the process, especially if it is their first acquisition. In the end, sellers have choices about who they will give the keys to the office. Buyers who take care in their approach will increase their chances of success.
