Selling Your Book of Business: Retirement Planning for Medicare Agents
selling your book of business

Selling Your Book of Business: Retirement Planning for Medicare Agents

Everyone needs an exit plan. No matter how much you love working as a Medicare agent, you’ll want to retire eventually. If you’re thinking about retiring in the near future, start considering how much you could earn by selling your book of business.

Is This the Right Time to Retire?

For some, this seems like an inopportune time to retire. Inflation is high, and the Nationwide Retirement Institute says 40% of Americans are delaying their retirement as a result. However, most of those Americans are not business owners.

As an independent agent or agency owner, you own a book of business that has value, and because of that, you don’t have to base your retirement decisions on inflation alone. You have the freedom to listen to your heart and do what’s best for you and your family.

If you want to spend more time with the people and hobbies you love, or you’re tired of the daily grind and the challenge of keeping up with ever-evolving regulations, training and call recording requirements, here’s some insight on what’s involved with selling your book of business.

Selling Your Book of Business

The business you’ve worked so hard to build has value, and you can maximize that value with a strategic succession plan.

Selling your book of business when you retire is a logical solution that can be easier than selling an entire agency. The buyer will take over your clients and, in exchange, you’ll receive a percentage of the renewals. This can work out well for everyone: your clients will benefit from a smooth transition, the buyer will grow his or her own business, and you’ll receive money to help fund your retirement.

Alternatively, if you’re looking to scale back your business but you’re not quite ready for a full retirement, you can sell just a portion of your book. For example, if you sell both life insurance and Medicare products, you might decide to sell your Medicare book of business but keep your life insurance book for a few more years.

Understanding Book of Business Valuations

When you sell your book of business, you want to make sure you receive a fair deal. There are different methods available to determine the value of a book of business. These methods tend to vary by industry.

The value for Medicare books of business is typically based on annualized renewal commissions. The amount you receive could be one, two, or two and a half times your annualized renewal commissions – this will depend on factors including how much the buyer is willing to pay and the types of products in your book. Whether you receive a lump sum or installments will also impact the valuation.

Are You Thinking About Selling?

Western Asset Protection supports agents throughout their entire career.

We help agents grow their businesses with access to top markets, training, call recording and compliance tools throughout their working years.

We also purchase books of business and provide agents with a fair deal when they’re ready to retire.

If you already work with Western Asset Protection, you can feel confident that we will support your clients with the same high standards you’ve come to expect. If you don’t yet work with Western Asset Protection, learn more about our comprehensive agent support.

Either way, if you’re preparing to sell your book of business, reach out to us.