Today's Viewpoint: A MarshBerry Publication

Preserving Your Legacy With Internal Perpetuation

While internal perpetuation planning creates a roadmap for an owner’s departure and succession of the business, there are other benefits that can fuel exceptional growth and value for the firm.

When retirement comes, many insurance brokerage owners seek to preserve the legacy of the essential work they’ve done. After all, their work has benefited clients, employees, and their community. To continue that positive impact, it’s common to perpetuate internally. If family members are a part of the business, then there is even more incentive to keep the legacy going for future generations.  

There may also be strategic reasons to keep ownership with internal stakeholders. If an owner believes that existing employees and/or family members possess the necessary skills and knowledge of the business to continue operating on the same path, an internal perpetuation plan could be a viable solution for succession.  

Start your planning now  

Having a plan to transfer equity ownership has never been more important – nor can the planning begin early enough. Studies show that agencies tend to experience their highest value when the owner is in their 50s.1 A firm’s value begins to decline after the owner reaches the age of 60 and decreases even further when they reach their 70s. 

Reinvest in people and identify potential owners 

Equity succession planning can be accomplished in a few different ways, including identifying a good capital partner for debt or equity, or broadening ownership over time to key stakeholders. But without question, the most important ingredient is the people. To maintain the right people, a firm must be committed to continuously reinvesting in the staff. This includes identifying potential stakeholders, developing their skills, and communicating the plan for succession. Recruiting should also be done with strategic purpose, tailored to replace existing talent that may move up (or out), and for maintaining key relationships long before a transfer of ownership takes place.  

What to consider in your perpetuation plan  

Rather than focusing solely on perpetuation, a more comprehensive approach involves considering how and for whom you want to preserve and grow your business’s value. This perspective acknowledges that your objectives may change as your agency grows, your family situation evolves, and as you age. Here are things you may want to consider:  

  • Terms vs. price: When creating an internal perpetuation plan, the terms are often more critical than the price itself. Key considerations include establishing a fair valuation, determining payment amounts and time periods, and defining limitations and obligations imposed on new owners, who may be family members but will also become debtors.  
  • Alignment with your will: Your perpetuation plan should align seamlessly with your will, ensuring that your wishes are clearly stated and legally enforceable.  
  • Succession planning: A well-rounded perpetuation plan should also encompass a succession plan. A succession plan will ensure that critical roles within your organization are covered as other people assume greater leadership or ownership roles.  

How to identify a successor 

Within a perpetuation plan, succession planning is a key component. Organizational succession prepares key leaders for future roles, but it must be carefully thought out and clearly communicated. When identifying a successor consider these questions:  

  • Are there family members already involved in the business? Could this change over time?  
  • Are there senior leaders in the organization who are candidates for succeeding into ownership? What is your level of personal relationship with these people?  
  • Does each key player really want to be in the business? Are they capable of running it?  
  • What level of additional training, mentorship or education is required before the successor is ready?  
  • How are you preparing them and what steps can you take now to ensure their success?  
  • Have they been informed of the succession plan and included in the perpetuation planning process?  
  • Are they willing to personally invest their own money to buy ownership in the business? 

Why internal perpetuation planning can fuel growth and value  

When existing employees are supported through professional development programs, promoted within the organization, or are given ownership opportunities – they are more motivated. Motivated employees are more productive, more innovative, and stay with a company longer. Most top performers agree that they will stay with a company only when given strong professional development programs and opportunities.  

Advanced and thorough planning, clear communication, and comprehensive succession planning can ensure a seamless transition of power. Couple that with reinvesting in staff, designing a comprehensive approach and choosing the right successor and you will uncover growth, value, business continuity, and stability for all parties involved. When the next generation of talent takes over, your legacy will not only be protected, it will thrive.  

Is FirstChoice, a MarshBerry Company, right for you?  

We meet our agencies where they are from infancy to perpetuation or final sale. Quality networks like FirstChoice can help maximize revenue, provide technology solutions, and assist with education, strategic planning and firm valuation. 

Contact Diane Wagner
If you have questions about Today's ViewPoint, or would like to learn more about how MarshBerry can help your firm determine its path forward, please email or call Diane Wagner, Vice President, Education & Strategic Planning , at 704.831.8715.


MarshBerry continues to be the #1 sell side advisor in the industry (as ranked by S&P Global). If you’re considering selling your firm, we are the best choice to help you through the complicated process. If you don’t hire MarshBerry, hire a reputable advisor that can help you navigate one of the most important business decisions you will ever make. You will be much better off having an advisor in your corner that knows the industry than trying to do this on your own.