Buying An Existing Health Book Questions

[jiminfla]

I am considering buying an existing health book. There is no office, no employees, just the book.
I sold P&C for 10 years, but not health.
I am currently P&C, life, and health licensed. I am not currently selling any insurance.
I know the policies are with many major carriers.
What should I look for?
What should I be concerned about?
What is your general opinion about buying an existing book?

 

[CHUMPS FROM OXFORD]

I would hold off until you know what the new renewal compensation will be. You'll know more in a few months and in about 3 1/2 years you'll know a little more.

 

[taterpeeler]

A book of health biz... NOW? U gotta be out of your mind.... want mine... 550 clients, make offer

 

[DS4]

What is your general opinion about buying an existing book?

I would use the uncertainty of renewal commission levels as leverage against the seller. The seller knows that future commissions will decrease. Just not how much.
The seller has built up relationship with these clients over many years. You are a new face.
In your state, how easy is it for a group/individual to change agents?
What is the composition of the block? Ind vs Group?
I have purchased two large blocks of individual business here in California. I paid a premium for both of these blocks because both blocks were with Blue Cross of California, and, BC of Ca does not honor agent of record requests. I only had to worry about retention, not other agents raiding the clients.

 

[jiminfla]

Thanks for the input everyone.
I actually tend to think that renewal commissions will go up and first year will come down when everything pans out. That is what got me interested in the book to start with.

Apparently someone else thought it was a good deal too. It went on the market on Friday and is already under contract. They were asking 1X commission on the book.