Independent agents often ask bank lending officers three questions:
- What's going to happen to interest rates?
- What price could I get if I sell my agency?
- Are valuations for independent agencies now at their peak? (The implied question behind this is: Should I sell my agency soon because prices are high?)
When bankers hear these questions, they answer with the caveat that they don't have a crystal ball. Besides, as bankers, it's not their business to predict the movements of interest rates or make independent valuations.
But bankers do spend a lot of time talking with insurance agency owners and producers, working up close on independent agency perpetuation and merger & acquisition transactions, and observing the economic signs. At InsurBanc, which provides credit exclusively to the independent agent channel, lenders have a vested interest in having an ongoing dialogue with agents/brokers.
On the following pages, are observations about the three common questions that bank lending officers receive:
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