Insurance agencies in Illinois are most commonly valued at 1.5x to 2.5x annual commission revenue or 2x to 4x SDE. Independent agencies with diversified books across personal lines, commercial lines, and life/health trade at the higher end of the range. Captive agents (State Farm, Allstate, Farmers) face different transfer requirements specific to their carrier.
Book of Business Retention
The central valuation question for any insurance agency is: what percentage of the book will stay after the owner leaves? Agencies with long-tenured, multi-policy clients and strong service staff have high retention. Agencies where the owner personally handles most renewals and client relationships face steeper post-sale attrition risk that buyers price in.
Carrier Relationships and Appointments
Independent agencies with access to multiple carriers provide more flexibility for clients and buyers. Carrier appointments are generally assignable but require carrier approval. Buyers may want to add new carrier appointments post-close — understanding current carrier mix and any volume commitments is important due diligence.
Illinois insurance agencies can be sold to individual agents, larger regional agencies doing strategic acquisitions, or private equity-backed agency platforms. Each buyer type has different price structures and post-sale expectations.