With many leaders of brokerages not too far from retirement age, plans for what will happen to their business when they decide to leave should be front and centre. But most people will have little to no experience in how to go about the process.
“There are about 3,000 brokers in the UK, and a lot of the principals of those brokers are [aged] 55 plus,” Aviva’s chief distribution officer, Phil Bayles, told Insurance Business. “So, at some point they’re going to want to retire or cash in their investment, and most people only do that once in their lives, so they haven’t got any experience of selling a business.”
Many will have spent their lives building up a business and a book of contacts that they are proud of, and will want to ensure that it stays in safe hands. But with third parties around who may have a vested interest – such as venture capitalists and private equity firms – it can be hard to know where to turn, Bayles explained, which is why Aviva is offering independent advice on succession planning.
“We have a whole raft of experts, people that have sold their businesses before who know the pitfalls, and know the advice that was beneficial to them,” he said. “We can provide those experts to give completely impartial advice so that those brokers who haven’t been through the process before aren’t at the mercy of lots of people with ‘hot’ money.”
The service, which Bayles said has been “inundated” so far, means that brokers have a better chance of getting what they want out of the succession process.
“Part of the win for us is that the more success they have in passing those businesses down, the more successful and vibrant a broking community there is,” he said. “We like the fact that the market supports independents as well as big groups – we don’t want everyone to be swallowed up into a big group, we think independent brokers play a really vital role in their local communities.”
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