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Reply to Looking to Sell My Medicare Book of Business!!     
Old 03-29-2012, 06:45 PM   #21
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Looking to Sell My Medicare Book of Business!! Re: Looking to Sell My Medicare Book of Business!!
Originally Posted by Medigap View Post
I believe Access Capital quit buying Medicare business
I think I just got an email from them today and it said something about med Supp biz.
I was looking into selling my book a few years ago and if I remember right, it was Oaktree Financial or something like that and it was 2.5x's on med Supp business.

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Old 03-29-2012, 06:50 PM   #22
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Looking to Sell My Medicare Book of Business!! Re: Looking to Sell My Medicare Book of Business!!
I remember when I first got into the business. The General Agent sold the agency for a multiple of commission to be paid out over a number of years. The new owner simply rolled the business, took the new 1st yr commission and paid basically nothing.

I would cut a deal where the new company either allowed me to maintain my relationships and contracts or paid me for the business.

By going captive, you are taking a huge risk that you will succeed with the new carrier and that they won't decide to do something else. You are walking from a valuable asset with no money. If you don't currently own the business, that needs to change. Owning the business is the reason to be independent.
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Old 03-29-2012, 06:59 PM   #23
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Looking to Sell My Medicare Book of Business!! Re: Looking to Sell My Medicare Book of Business!!
Are you going to sell medicare with the new company.
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Old 03-29-2012, 07:11 PM   #24
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Looking to Sell My Medicare Book of Business!! Re: Looking to Sell My Medicare Book of Business!!
Originally Posted by senior-advisor-indiana View Post
if I remember right, it was Oaktree Financial or something like that and it was 2.5x's on med Supp business.
I wonder how that is paid out...? Doubtful that it is a lump sum, and if so, not w/o recourse. What if they pay 2.5 on Joe Smith and ole Joe croaks one month later...? They aren't going to be out that lump sum of cash.

The value of the book would also depend on the avg age of the clients in the book. If they avg age was 68 vs avg age of 78; see the diff. One book is going to have a longer stream of income for sure.

I don't know for sure but I would think that something like this might sell more like an accting firm, dependent somewhat on retention (and mortality), which has to do with future income stream. So I would find it hard to believe a 2.5 x flat out pymt of total comm's... I'm sure there are some caveats on the details... and in the end those caveats = deductions from the price. But I'm just letting my financial brain run wild here, so I'll now try to lasso it back into where it belongs.

Hoping Philly man gets a BIG number, whatever it is.

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Old 03-29-2012, 07:48 PM   #25
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Looking to Sell My Medicare Book of Business!! Re: Looking to Sell My Medicare Book of Business!!
Sounds like Phillyguy assigned his commission to the FMO, looks like Phillyguy is at the mercy of the FMO.I would think if the FMO were human they could "unasign" this poor soul.They could get there over ride sent from the company & Philly could be paid direct from companies.
He still would be paid his vested renewals even if he is no longer contracted! If this new partner is requiring you to walk away from a vested renewal check,this better be a very sweet deal for you brother! If I am out to left field with this please someone correct me!
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Old 03-29-2012, 08:30 PM   #26
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Looking to Sell My Medicare Book of Business!! Re: Looking to Sell My Medicare Book of Business!!
Whats your vesting schedule? if you had been paid directly from the carrier you would, with most carriers be 100% vested in your renewals.

If you do not have a vesting schedule from your current FMO you might be about to learn a very expensive lesson.

The only thing you have to sell is the income stream, which may or may not be yours. The good will and clients have almost no value above the cost of a lead.

The only chance you have of this working is to be honest with your FMO.

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Old 04-11-2012, 03:16 PM   #27
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Looking to Sell My Medicare Book of Business!! Re: Looking to Sell My Medicare Book of Business!!
Just an FYI - I called Access Capital today to see if they are buying Med Supp again. They told me they are looking at buying some Med Supp blocks - they mentioned UHC, Great American, & United American. They told me they are trying to stay away from Companies that have announced big rate increases lately (they didn't say who, but I assume they were talking about MOO, Family Life, UCT, etc.) Also told me they are focusing on product lines like cancer, Critical Illness, Accident + Life Insurance.
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Old 04-16-2012, 10:19 AM   #28
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Looking to Sell My Medicare Book of Business!! Re: Looking to Sell My Medicare Book of Business!!
I never understand why people sell a block of individual business for 2-3 x annual revenue especially when there is little service work attached. You could do nothing and simply let business fall off the book and earn more than you receive by selling.
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Old 04-17-2012, 09:08 AM   #29
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Looking to Sell My Medicare Book of Business!! Re: Looking to Sell My Medicare Book of Business!! Phillyinsuranceguy17 is the thread starter for: Looking to Sell My Medicare Book of Business!!

Thanks to everyone who responded. After checking my agreements and contracts, we verified that I own the business generated and I actually got lucky because the person who bought my book agreed to keep the book with our FMO so it was a nice transition. We did very well and again I thank everyone for their responses.
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Old 04-17-2012, 01:28 PM   #30
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Looking to Sell My Medicare Book of Business!! Re: Looking to Sell My Medicare Book of Business!!
Originally Posted by junkman View Post
I never understand why people sell a block of individual business for 2-3 x annual revenue especially when there is little service work attached. You could do nothing and simply let business fall off the book and earn more than you receive by selling.
It's the same reason people "borrow" money - they need money for something now. Certainly you wouldn't sell renewals if you don't need the money - but if you need capital (and we all know banks probably won't lend us money with commissions as collateral) selling some of your renewal commissions isn't necessarily a bad idea.
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