As we welcome 2021, we must consider the challenges that have affected the insurance sphere during 2020. Springtree Group remains prepared to assist insurance agency sellers and buyers alike despite any shifts in the landscape. We have listened carefully to our clients throughout the last year, and as a result, we are in a unique position to offer advice tailored to each agency in this unique time.

We recommend our clients employ the following strategies to prepare to sell or purchase an insurance agency in 2021.

Adapt to Succeed

Adapting to changing dynamics is always key, but especially so in this new year. Remote work remains the cornerstone for all independent agencies, so smooth interactions with professional, technologically-savvy interactions are a must.

As an example, when you are ready to sell your agency, make sure your agents have created robust home office setups. This will be a strong indicator to buyers that your agency has been quick to respond to the demands the pandemic. STG will then communicate your agency’s successful adaptations to our network of qualified, motivated buyers. This is an example, combined with our skilled negotiations, will ensure that your agency brings in a top-level offer that you have earned.

Keep an Eye on the Future

While this year has required most independent agency owners to focus narrowly on day-to-day operations, it is crucial that those of you who are planning to sell within the next year or two work toward your goal. Keep your books in order, streamline your operations, and continue to adapt.

While selling an agency normally takes 6 months on average, it is realistic to expect that the current adverse conditions will lengthen this period. However, STG’s skilled staff will simplify and shorten the complicated sales process as much as possible.

The benefits of choosing to work with the Springtree Group team cannot be overstated. We provide in-house financing for our buyers, ensuring that we can connect prime agencies with buyers who are prepared to place funded offers. Because failed financing is the number one reason deals fail, you will avoid months of frustration by listing your sale through our network, and you will not be charged for STG’s services.

Tax Implications to Consider in 2021

In simpler times, you may have been prepared to remit the full sum of your taxes due on your agency’s sale in one lump sum. This year, though, you might prefer to avoid paying your capital gains tax right after closing by accepting payments on your agency over a period of time, if you desire.

By scheduling payments over time, you can avoid a huge jump in your adjusted gross income in the first year. If you have the financial resources to exercise patience, you will keep a greater percentage of your agency’s sale price.

Furthermore, your agency may be accessible to more buyers thanks to this staggered payment schedule, which may help your business sell more rapidly.

The strategy for selling your insurance agency should be tailored to your specific situation. Contact Springtree Group’s specialists for assistance creating a plan that will optimize your odds of success, maximize your profits, and reduce the amount of personal effort you will be required to invest in the process. Again, our services are free to agency sellers.

Email us at service@springtreegroup.com, or contact us via our website for more information.