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Succession Loans for Insurance Businesses

 

Specialized Lending for Insurance Agency Perpetuation

 For insurance agencies and specialty insurance businesses, a successful succession plan is vital to protecting your legacy, clients, and team. Whether you're making a well-deserved exit or funding next-gen buy-ins, Oak Street Funding provides the capital and expertise to make your internal succession smooth and successful—without leveraging your personal assets.

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Internal Perpetuation

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External Sale

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Succession Planning

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Succession and Perpetuation Financing

Since 2003, agencies and MGAs like yours have grown thanks to billions of dollars in financing from Oak Street Funding, a non-SBA, cash flow-based lender.

 

$30MM*

Lending Limit Per Borrower

50+ Years

Experience Across Our Experts

$2B+

In Insurance Financing

*Loans over $30MM require participating bank partner (per borrower)

 

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The Oak Street Funding Difference

  • INDUSTRY EXPERTISE
    We have a deep understanding of the insurance agency and MGA business models – including the value of recurring commissions and client relationships.

  • CASH-FLOW BASED SOLUTIONS
    Your agency’s recurring revenue secures the loan—leaving your personal assets unencumbered and your cash flow available to invest.

  • CUSTOM STRUCTURES
    Flexible terms up to 10 years and tailored payment schedules to meet your deal's unique timeline.

  • NON-SBA LENDER
    Larger potential loan amounts and a streamlined, faster process compared to government-backed options.
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Loan Specialists

Don't let financing be a barrier to your succession.
Take the next step today.

Please provide your contact information and a representative will reach out to you within 24 business hours. 

Frequently Asked Questions

What is the ideal timeline for starting my agency's perpetuation plan?

You should ideally begin planning 5-10 years before your expected exit date. This allows sufficient time for finding and developing a successor, getting an accurate valuation, training the new owner, and structuring the financing for a smooth, gradual transition.

 

How do specialty lenders finance an insurance agency buyout?

Specialty lenders (like Oak Street Funding) use a cash flow lending model. The loan amount is based on your agency's future recurring commission and fee revenue rather than on tangible assets like real estate or equipment. This approach recognizes the true value of the agency's client relationships and contracts.

Which providers specialize in succession financing for insurance agencies?

Specialized lenders like Oak Street Funding provide financing for:

  • Internal successions and perpetuations
  • Partner buy-ins or buyouts
In addition to successions, Oak Street Funding can finance acquisitions and working capital needs.
What loan terms can be expected?

Loan terms vary:

  • SBA 7(a) loans: Can have repayment terms of up to 10 years for working capital.
  • Conventional loans: Typically have similar terms, such as 5-10 years. At Oak Street Funding, we have terms up to 10 years.
What factors do lenders consider when evaluating an agency succession loan application?

Lenders typically assess several factors:

  • G2's Financial Health: Credit score, personal financial statements, assets, and liabilities.    
  • Successor's Experience: Relevant experience in the insurance industry or business management.    
  • Business Plan: A detailed plan for the agency’s operations, integration, and growth. 
  • Management Team: The experience and qualifications of the successor and any key staff who will be part of the organization after the succession.
  • Market Conditions: The economic environment and the specific market in which the agency or specialty business operates.
What are Oak Street Funding’s interest rates?

Interest rates depend on various factors, including the type of loan, the borrower's creditworthiness, and current market conditions.

  • SBA loans: Often have interest rates tied to the prime rate plus a spread .    
  • Conventional loans: Interest rates will vary based on the assessment of risk and market rates. Oak Street Funding rates are based on the U.S. Treasury plus a spread.
How long does the succession financing process take?

The timeline can vary significantly based on the complexity of the deal, the type of financing, and the responsiveness of all parties involved. It can take anywhere from a few weeks to several months for larger loans. It’s important to be prepared and have your financials in order before undertaking a succession strategy to expedite the process.