An insurance brokerage in Australia is typically valued at 5 to 9 times adjusted EBITDA for a mid-sized operation, or 1.0 to 1.5 times annual gross commission income (GCI) for a smaller book. The key variables are renewal retention, the spread of your carrier relationships, and whether the business genuinely runs without you — each of which can shift that multiple materially in either direction.
If you’ve been building a broking practice for ten or fifteen years, you’re operating in a sector that Australian buyers find genuinely attractive. Steadfast Group, AUB Group, and PSC Insurance have spent the past decade systematically rolling up smaller practices. Private equity found the sector, liked the recurring revenue profile, and has been building platforms ever since. The strategic logic is straightforward: insurance commissions renew, clients are sticky, and a well-run book generates predictable cash flow year after year.
The buyer pool exists. What determines your price is the quality of what you’ve built.
How Insurance Brokerages Are Valued in Australia
There are two frameworks in common use, and which one applies depends on the size and structure of your business.
EBITDA multiple is the standard approach for any brokerage that has genuine overhead — employed staff, office costs, technology, a brand that isn’t purely the principal’s personal reputation. Buyers calculate your adjusted EBITDA and apply a multiple based on size, quality, and competitive tension in the sale process. In Australia, mid-market insurance brokerages have been trading at 5 to 9 times adjusted EBITDA over the past few years, with the best-run practices in the $2M–$5M GCI range achieving the high end of that range from strategic acquirers.
Revenue multiple is more relevant for smaller, sole-operator practices where separating business profit from owner income is genuinely difficult. Here, buyers look at annual gross commission income and apply a factor of 1.0 to 1.5 times. A practice writing $1.5M in annual commissions might sell for $1.5M to $2.25M on this basis — though that number gets adjusted downward if key person risk or carrier concentration looks problematic.
Rule of thumb: under $500K annual GCI, expect a revenue multiple. Above $1M GCI with employed staff, expect an EBITDA multiple and a more competitive sale process.
The distinction matters because it changes the ceiling. A sole-operator practice has a hard limit on what a buyer will pay because they’re taking on concentration risk and uncertainty around client retention. A structured business with employed account managers and diversified referral sources can attract multiple bidders and genuinely competitive pricing.
The Quality of Your Book Matters More Than Its Size
Two practices with identical gross commission income can attract very different valuations depending on what’s underneath the numbers. This surprises a lot of brokers who’ve been focused on growing the top line without thinking about what makes that revenue defensible.
Renewal retention rate is the single most important metric a buyer looks at. Insurance commissions are inherently recurring — most clients renew each year — but they don’t all renew with you. A retention rate above 85% is acceptable; above 90% signals a genuinely loyal client base and commands a premium. Anything below 80% raises questions about service quality, pricing competitiveness, and how much of the book a new owner will actually inherit twelve months after settlement.
Carrier concentration is the next variable. If 60% or more of your gross written premium is placed with a single insurer, a buyer sees a single point of failure — an insurer that could change commission rates, withdraw products, or decide not to renew your binding authority. Buyers apply a discount for that exposure. A diversified placement spread across six or more quality carriers is worth more than the same GCI concentrated through one relationship, even if the underlying numbers look the same.
Revenue mix matters too. Renewals are worth more than new business, and new business is worth more than one-off project or fee-for-service income. A brokerage where 80% of GCI comes from renewing policies has predictable, bankable cash flow. One where a meaningful chunk of last year’s revenue came from a single large placement is harder to value because the buyer can’t be sure it repeats.
Key Person Risk: The Discount Nobody Talks About Enough
An insurance brokerage changed hands in Western Australia last year that illustrates this clearly. On paper, everything looked solid: $2.8M in annual GCI, 88% renewal retention, a well-spread book across commercial lines, liability, and motor fleet. The principal had a figure in mind and reasonable grounds to expect it.
Due diligence uncovered something he hadn’t properly quantified: he personally managed relationships with clients representing around 65% of GCI. Not because the business wasn’t staffed — it had account managers, a service team, a compliance officer — but because the principal had never deliberately handed over relationship ownership. When clients renewed, they called him. When there was a claims issue, they called him. The business ran on his reputation, not on its systems.
The final sale price came in roughly 25% below his original expectation. That gap came almost entirely from the buyer’s assessment of key person risk — the probability that clients follow the principal out the door rather than staying with the new owner.
Reducing key person dependency before you sell isn’t complicated, but it takes time (which is why starting 18 to 24 months before you intend to exit is the right move). Introduce account managers into client relationships deliberately. Make sure renewal conversations happen between your staff and the client, not just you. Document which clients are genuinely sticky to the business versus sticky to you personally. That process also makes the sale due diligence much less fraught.
Adjusted EBITDA: What Gets Added Back
For brokerages valued on an EBITDA multiple, the starting point is your reported EBITDA from the P&L. That almost always needs adjusting before a buyer applies their multiple, and the adjustments can be material.
Common EBITDA add-backs for insurance brokerages include:
- Owner salary above market rate — if you’re paying yourself $450K but a replacement CEO or principal would cost $180K, the $270K difference is added back to normalise earnings
- Owner superannuation — the portion above what an equivalent employee would receive
- Personal vehicle costs — vehicles owned or leased by the business for personal use
- One-off professional fees — legal or consulting costs related to a specific non-recurring project
- Excess related-party rent — if the business pays you above-market rent for premises you own
The result is your adjusted EBITDA — the number a buyer uses to apply the multiple. A brokerage with $400K reported EBITDA might have $600K of adjusted EBITDA once add-backs are properly documented and presented. That $200K difference, multiplied by 7, represents $1.4M in additional valuation. Getting your numbers right before you go to market is not administrative housekeeping — it’s directly worth money.
Who’s Buying Insurance Brokerages in Australia Right Now
The consolidators are the most active buyers. Steadfast Group (ASX: SDF) and AUB Group (ASX: AUB) are well-known in the broking community and have both grown significantly through acquisition over the past decade. PSC Insurance Group is another active consolidator, particularly in commercial lines and specialist risks.
These buyers pay full multiples because they’re acquiring earnings streams to bolt onto their existing operations — and they have real synergy benefits from placing client policies through their own wholesale and underwriting facilities. But they have specific criteria: management depth, clean systems, and a book they can migrate to their platforms without losing significant clients. If you’ve been running on spreadsheets and handshake processes, a consolidator will either walk away or price in a meaningful transition discount.
Smaller acquirers — individual brokers or regional groups buying a book to add scale — are more flexible on structure but typically pay lower multiples. Private equity platforms targeting the sector tend to focus on practices with $3M+ GCI and want management remaining post-transaction.
ASIC Licensing: The Detail That Catches People Out
Unlike most business sales, an insurance brokerage transaction involves a regulated entity — specifically, an Australian Financial Services Licence (AFSL) issued by ASIC. The business doesn’t simply transfer; the buyer needs either to hold their own AFSL or for the acquisition to be structured so the licensed entity continues operating while control changes hands.
This shapes deal structure choices meaningfully. Acquirers generally prefer a share sale so the AFSL and carrier agreements transfer cleanly with the entity. Buyers who don’t already hold an AFSL often require a transition period — six to twelve months operating under the seller’s licence while their own application is processed — which affects settlement timing and, sometimes, deferred payment structure.
Get legal advice early. A solicitor with financial services M&A experience is worth the cost — this isn’t a standard small-business conveyancing job.
What to Do Before You Sell
If you’re thinking about selling in the next two to three years, the actions that move the needle most are:
- Improve renewal retention — systematise your renewal process so it doesn’t depend on the principal personally reaching out
- Document carrier relationships — binding authorities and broker agreements should be in the business’s name, not yours personally
- Reduce client concentration — if any single client or group represents more than 15% of GCI, that’s a risk a buyer will price in
- Build management depth — even one capable account manager who can run day-to-day operations changes the key person risk profile materially
- Clean up three years of financials — properly documented add-backs supported by evidence make due diligence faster and reduce buyer uncertainty
If you want a sense of where your brokerage sits on the valuation spectrum right now, get in touch for a no-obligation conversation, or run some initial numbers through the valuation calculator.
The Australian insurance broking market is actively consolidating, and quality practices are in genuine demand. The brokers who achieve the best outcomes are almost always the ones who spent 18 months before going to market making their business look the way they’d always intended it to look.