Summer is officially here and that means the release of the Second Quarter Allstate Agency Value Index is on the horizon. This AAVI highlights recent price trends, a spark in large agency sale transactions, and why agency size matters when it comes to selling a book of business.
AAVI Preview
The average price multiple for Allstate agencies relative to commission income increased for each size category compared to the first quarter of 2016. The size category where the average paid multiple increased the most was the $3M+ earned premium agency transactions. This was due to the second quarter seeing the largest number of agencies with over $5M in earned premium sold since the second quarter of 2010.
These large agency acquisitions also showed a number of existing agency owners utilizing their current agency equity to leverage a strong purchasing power position in sales negotiation. Of these acquisitions, over forty percent of agencies with over $5M in earned premium showed an astonishing average paid multiple of 3.38x.
Be sure to check out the article which is set to be released within the next week.
Allstate History- Did You Know?
In 2004, Allstate became the official Home and Auto Insurance sponsor for USA Basketball and its Athens-bound 2004 US men's and women's basketball teams. The very next year in 2005, Allstate was ranked as the second most admired company in the Property & Casualty industry by Fortune magazine.
Recent Deal Highlight
Outside buyer in MSpurchased a $3.79M earned premium Allstate agency. The loan from PPCLOAN covered 94% of the purchase and the remaining 6% was held by the seller.
Customer Testimonial
Chris Burke- Lynchburg, VA
"I have been dealing with PPCLOAN for over 10 years. They have, in every instance, performed at the highest professional level. Whether for my own acquisition loans, lending to family, or providing funding for agents I have referred to them, I have encountered the absolute best service, communication & execution. There is a reason they have provided funding for more Allstate transactions than any other company- and that, quite simply, is that they are the best."
