There is good news for insurance agencies–interest rates are gradually increasing. As a result, there is once again "real" interest income on your bank statement!
Unlike commission income, interest income has no corresponding expense (payroll, benefits, selling), so 100 percent of the income goes directly to the bottom line.
At a conservative EBITDA (earnings before interest, taxes, depreciation and amortization) multiple of six, that means $1 of interest income equates to $6 of agency value–or, $1,000 of monthly interest income equates to $72,000 of agency value.
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