In our experience, owners of insurance firms usually answer that they wish to make a nice living while taking care of family members, partners, employees and clients. Typically, their belief is that they must remain independent to do this effectively. Principals fear that selling or merging their business will negatively alter their lifestyle, diminish their control and ultimately erode their ability to achieve these goals. Of course, it certainly might but, it doesn’t have to -if - the seller chooses the right buyer / partner.
Not selling or merging is its own compromise and failing to change can also put those original goals at risk. By deferring doing anything about the strategic long-term future of the business, principals(s) are likely foregoing a great deal of money. Let’s forget for a moment about the principal(s) passing up what might be the biggest payday of their life. They are also passing up opportunities that might significantly increase the value and future success of their business which would benefit all. Selling or merging with the right partner could offer capital for growth that could be used to hire new talent, acquire other agencies, invest in technology, etc. It would likely increase the resources, markets and scale of the combined firm. Consider that the income, career opportunities and outcomes for the very people that the principal(s) seek to serve may actually be enhanced by their selling or merging the business.
It is a choice to do nothing, maintain the status-quo and/or attempt to perpetuate internally. It should be recognized that these choices come with significant risks too. Selling the business internally often results in the lowest sale price and longest payout period for the principal(s) to get their money. Internal buyers don’t usually bring increased resources to the firm. Good producer salespeople (or employee) buyers frequently don’t succeed as manager / leaders. What if internal buyers cannot take the organization as far as an external buyer might have? What if they fail? The potential consequences of not entertaining the idea of selling or merging may present an even greater risk to the future of those the principals care about, including themselves.