What is the typical multiple for sale of Medicare Book of Business?

Nov 19, 2018

  1. joe92275
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    joe92275 Super Genius

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    Most offers for vested renewals (med supp/LTC/FE) depend on your persistency, product commission schedule, and age of client. Althoughits possible to get more..typically at most 2x (if the policies are newer) with a holdback typically equal to 20%. If the policies are older don’t expect more than a 1 - 1.25 multiple

    Medicare Advantage is non vested renewals. They have no tangible resale value unless they are assigned to an agency and you sell the agency to someone that can be licensed appointed and certified by the carriers Why? Because a carrier will only pay the renewal to a licensed, appointed, and certified agent (if not assigned although an agent I’m charge must be selected). Very strict rules.

    I’m not sure you will find anyone that has sold Medicare Advantage renewals.

    Your situation is unique and you should be compensated at least 2-3 years because of their error. I would push hard, get your money and then reach out to your clients and try to become AOR with them etc,

    I would be happy to help you negotiate a better deal with your former IMO and answer any additional questions you may have.
     
  2. somarco
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    somarco That Medicare Expert Guy

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    Selling agent can take as much cash as they want, but unless the existing carriers recognize AOR to new agent the new agent is screwed. Alternative is to rewrite the block with new carriers.
     
    somarco, Nov 20, 2018
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  3. joe92275
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    joe92275 Super Genius

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    this is the most sensable advice...fight for as much as you can get and then try to get those clients back. The new OEP from 1/1 to 3/31 is a big window of time if you cant get to everyone by 12/7
     
  4. axeman462
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    axeman462 Guru

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    I understand OEP used to exist years ago, and is coming back. Was it a busy time of year back then? Like AEP busy? or was it more like the MADP?
     
  5. joe92275
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    joe92275 Super Genius

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    If it was before 2011/2012 I was not doing MA. I do know you are not allowed to specifically market for OEP business, however I am sure Facebook is going to be flooded with advertisements.
     
  6. Daniel Gallagher
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    Daniel Gallagher Expert

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    I purchased a book last year for 1.5x. Depending on the types of policies, age, and carrier, I think 1.5-2x is fair. Maybe more if retention is high. I would be interested depending on the state and what is involved.
     
  7. Packerland
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    Packerland Super Genius

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    I have purchased 4 MAPD Book of Business's from agents .. paid anywhere from 2.1X. to 3X for those BOB ..
     
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