How to Value an Insurance Book of Business: A Comprehensive Guide

Direct answer: Independent insurance agencies are valued as a multiple of annual commission revenue. Most quality agencies under $5 million in revenue trade between 1.5x and 2.5x commission revenue, with well-managed agencies at the upper end of that range, roughly 1.75x to 2.5x. A book of business sold on its own prices lower, typically 1.0x to 1.5x annual commissions, because the buyer gets the clients without the staff, processes, or carrier relationships. Where your agency lands comes down to five factors: revenue size, client retention, growth rate, personal and commercial mix, and how much of the book sits with standard carriers.

How Are Insurance Agencies Valued?

Buyers of independent agencies price the book, not the org chart. The core method is simple: annual commission revenue times a multiple. The multiple stretches or compresses based on how durable that revenue looks to someone who has to keep it after you hand it over.

You may have read that agencies sell on EBITDA multiples. That is true for large agencies, and mostly noise for everyone else. In an agency where the owner’s own compensation is a big share of profit, EBITDA becomes whatever the owner decides to pay herself. Buyers know this, so for independent agencies under roughly $5 million in revenue, the revenue multiple is the dominant method. They price revenue quality: how much commission comes in, how reliably it renews, and how the book is composed. That is the frame this guide uses, because it is the frame a buyer will use on your book.

Insurance Agency Valuation Multiples at a Glance

What is being sold	Valuation basis	Typical range 2026
Whole independent agency (under $5M revenue)	Multiple of annual commission revenue	1.5x to 2.5x, with well-managed agencies at 1.75x to 2.5x
Book of business only	Multiple of annual commissions	1.0x to 1.5x
Personal lines agency	Multiple of revenue	1.2x to 2.0x
Commercial lines agency	Multiple of revenue	1.5x to 2.5x or higher
Larger agency ($5M+ revenue, institutional buyers)	Multiple of adjusted EBITDA	Commonly 5x to 10x depending on mix and performance

The Five Factors that Price an Independent Agency

1. Commission revenue: size sets the floor

Revenue is the base every multiple gets applied to. Larger books also attract more buyer types, carry less concentration risk, and support staff and processes that survive a transition, which is why published guidance puts commercial and larger agencies at the upper end of the ranges above. A $250K book and a $750K book do not just differ by size. They tend to trade in different markets, in front of different buyers.

For context on where you sit, here is what the independent agencies exploring their options actually look like. Across roughly 1,600 owners who ran the Renegade Agency Value Calculator between September 2024 and September 2026, the median agency reported $400,000 in annual commission revenue, with the middle half falling between $150,000 and $910,000. Most agencies in this market are smaller than the deals that make industry headlines.

From our research: figures are medians drawn from approximately 1,600 completed submissions to the Renegade Agency Value Calculator, September 2024 to September 2026, after excluding incomplete and implausible entries. All inputs are self-reported by agency owners and are not independently verified. These figures describe the agencies who used our calculator. They are not transaction data and do not represent completed sale prices.

2. Client retention: the lever you control most

Retention is the closest thing valuation has to a single master variable. The average independent agency retains about 84% of its clients each year, while the highest-retention agencies run at 95%, according to Liberty Mutual’s 2026 Independent Agency Growth Study of nearly 1,200 agency principals and staff. That eleven-point spread is the difference between a book a buyer trusts and a book a buyer discounts.

Owners exploring a valuation tend to run ahead of that industry average. In our own submissions, the median self-reported retention rate is 90%, with the middle half between 80% and 92%. If you are below 84%, you are behind both the industry and the group actively getting valued.

A book renewing at 90% or better tells a buyer the revenue will still be there in three years. Below the 84% average, every other number gets discounted, because the buyer is pricing a leaking bucket. If you are 12 to 24 months from any transition, retention is where improvement pays the fastest.

3. Sales growth: proof the book has a pulse

Buyers separate a book that grows from a book that coasts. Three years of steady new-business growth signals that revenue survives an ownership change, that referral sources are alive, and that the book is not quietly aging out. Flat is survivable. Declining growth stacks a discount on top of whatever retention already says.

For reference, the median owner running a valuation reports 15% average sales growth over the prior three years, with the middle half between 7% and 30%.

4. Personal and commercial mix: composition shapes the buyer pool

Personal lines books are simpler to service and transfer, and most independent books lean personal. Commercial business earns more per client, retains longer, and widens the set of buyers willing to pay up. Published guidance prices the difference directly: personal lines agencies typically trade at 1.2x to 2.0x revenue, while commercial lines agencies trade at 1.5x to 2.5x or higher. A book with a meaningful commercial share, even 20 to 30 percent, reads as more durable revenue than a pure personal book of the same size.

Most independent books are personal-heavy. The median agency in our submissions reports 70% personal lines, with the middle half between 40% and 90%.

5. Standard carrier share: where the book is placed

A book concentrated with standard carriers renews predictably and moves cleanly to a new owner. A heavy non-standard share means volatile renewals, thinner margins, and carriers a buyer may not have access to. Two books with identical revenue can price meaningfully apart on placement quality alone. The median owner running a valuation reports 85% of the book placed with standard carriers.

A Worked Example

The following is an illustration of how the five factors interact, not a valuation of any real agency.

Take an agency with $300,000 in annual commission revenue, 88% retention, 12% average growth over three years, a 75% personal lines book, and most policies placed with standard carriers.

Size puts it in the heart of the independent market. Retention four points above the industry average and healthy growth push it into the upper half of the published range. The personal-heavy mix holds it back from the top. Placement quality supports it. Applying the general benchmarks above, a profile like this would sit somewhere around 1.8x to 2.3x commission revenue, roughly $540,000 to $690,000, before a buyer examines the specifics.

Move one factor and the number moves with it. Lift retention to 92% and the same book sits closer to the top of the range. Let it slip to 80% and the discount costs more than a year of growth earns. Any real agency needs a real valuation. This is arithmetic on published ranges, not an offer or an appraisal.

When Does EBITDA Matter?

EBITDA multiples take over when agencies get large enough for institutional buyers, generally above roughly $5 million in commission revenue with real profit after market-rate owner compensation. At that scale, private equity platforms and large strategics pay on normalized earnings, and multiples commonly run from the mid single digits to around 10x depending on book mix and performance, with the strongest performers trading higher still.

The line is not perfectly sharp. A smaller agency with unusually strong profitability after paying its owner a market wage can attract earnings-based offers too. But for most independent agencies, EBITDA is a distraction from the five factors above.

Is an Agency Worth More Sold Whole or as a Book of Business?

Whole, in nearly every case. A book-only sale transfers the client list and nothing else, which is why published ranges put it at 1.0x to 1.5x commissions. A whole-agency sale carries the staff, the processes, and the carrier relationships along with the book, and typically prices meaningfully higher. Sell the book alone when the agency around it has no transferable value, or when you want a partial exit rather than a full one.

What Do You Need to Value an Insurance Agency?

A serious valuation runs on five documents, and they map to the five factors above.

• Commission statements for the trailing 12 months, by carrier, to establish revenue.
• A retention report from your AMS showing policy or account retention over the past two to three years.
• New business production for the past three years, to show the growth trend.
• A book composition report splitting personal and commercial lines revenue.
• A carrier production summary showing how revenue distributes across standard and non-standard markets.

If any of these take more than a day to pull, that is a finding in itself. Buyers pay more for agencies whose numbers are a report away, and they discount agencies whose numbers live in the owner’s head.

How Often Should You Value Your Agency?

Once a year, and at every trigger event: an unsolicited offer, a carrier appetite change that hits your book, a producer departure, or the first serious thought about succession. Most owners run a valuation for the first time when a buyer forces the question, which is the worst time to learn the number. An annual check tells you which factor to work on, what a growth year actually earned you, and whether the next unsolicited offer deserves a reply or a delete.

Once you know your number, the next question is how to move it. We cover the five levers that raise book value, and how long each one takes, in our guide to increasing the value of your insurance book before selling.

A sale is not the only reason to know your number. Some owners want the value of what they built working for them while they keep running the agency under their own name. Renegade’s back office support program exists for exactly that owner: you hand off the servicing work, keep your clients and your name, and stay in the business. The starting point is the same either way. Know your number.

 

How to Get Your Number

You now know the five inputs that price an independent agency. The Renegade Agency Value Calculator turns them into an estimate in minutes: enter your commission revenue, retention, growth, lines mix, and standard book share, and it returns an estimated value range for your agency. It is free, it takes a few minutes, and we do not share what you enter with other agencies, carriers, or anyone in your market.

The estimate is a starting point, not an appraisal. If you are inside a year of an actual transaction, pair it with a formal valuation from a professional who has closed agency deals. The estimate tells you the neighborhood. The formal valuation gets you the street and house number.

One thing you should know about who is telling you this. Renegade buys agencies and books of business, and we also support owners who want to stay independent. That makes us an interested party, not a neutral appraiser. Everything on this page is sourced to published industry guidance so you can check it yourself, and we would rather you walk into any conversation, including one with us, knowing your number than not knowing it. If you want a fully independent opinion, hire a valuation professional with no stake in the outcome.