Agency Acquisition Checklist: Pre-Purchase to Post-Closing

Buy-side M&A | M&A in the Insurance Industry Agency Acquisition Checklist: Pre-Purchase to Post-Closing

Acquiring an insurance agency can be an excellent growth strategy, but it comes with risks. A comprehensive acquisition checklist is essential for conducting thorough due diligence and setting your purchase up for success.

This checklist covers key areas to evaluate before setting the purchase price, during pre-closing, and post-closing integration. Assessing the target agency in these areas helps ensure accurate financials, productive staff, satisfied customers, and operational efficiency after the acquisition. With proper preparation, an agency acquisition can significantly expand your book of business, capabilities, and profitability.

Before Setting the Purchase Price

Start by compiling policy expiration dates to quantify the value of the book of business being acquired. Identify key customers vital to retain during the transition, as well as any non-desirable accounts to potentially purge.

Plan a schedule for customer contacts and develop an advertising strategy to retain clients. Review canceled accounts and generate contact lists for targeted mail merge campaigns.

Next, assess current employment agreements for transferability and discuss new agreements with incoming staff. Detail the compensation, benefits, and incentive plans. Plan the former owner's transition period to ensure continuity.

Pre-Closing Activities

Leading up to closing, finalize the customer contact plan and advertising strategy. Update the receptionist's greeting to reflect the new agency name. Announce the acquisition to all employees and address any non-compete agreements with outgoing staff. Begin training on new systems and procedures.

Review the agency's errors and omissions claim history. Decide if tail coverage is needed and add new employees to the policy. Transfer necessary vendor licenses and assess needs for dual system operation in the short and long-term.

Establish carrier agreements and organize policy servicing and filing methods. Allocate books of business among the staff and conduct system and procedure audits. Ensure compliance with state requirements for non-renewal notifications.

Post-Closing Activities

After closing, consider getting a third-party asset valuation to determine facility and equipment needs. Handle lease assumptions, trade name purchases, and assignment of communication methods. Conduct a UCC-1 search for any liens.

Settle financial matters with the seller regarding returns, chargebacks, bonuses, etc. Establish new business checking accounts and implement a system to track acquisition finances and spending.


Careful planning and preparation is critical for a successful agency acquisition. As this checklist outlines, important steps should be taken before setting the price, during pre-closing, and after the deal closes.

While each stage requires attention to detail, a methodical approach ensures no step is overlooked. Rushing into an agency purchase can lead to missed items that create future problems.

Platforms like Cake provide valuable assistance with valuations, transition planning, and transaction management. By thoroughly planning and leveraging their expertise, agency owners can navigate the acquisition process while staying focused on serving customers.

The checklist provides a roadmap, and Cake provides the tools and insight to make your agency acquisition a success. With the wave of retiring agents driving increased M&A activity, growth-minded buyers who prepare now will be well-positioned to capitalize on opportunities.