515 N Flagler Dr Ste P300, West Palm Beach FL 33401-4326
For personal assistance, call
Get Started

Insurance Agency Loans: How to Get the Funds Your Agency Needs


If you run an insurance agency and you need fresh capital to operate or grow your business, it’s important to understand what options you have when it comes to insurance agency loans.

Below, you’ll learn what types of loans and other funding products are available for insurance agencies as well as information about how funds from these loans are typically used. We’ll also let you know why it’s difficult to access insurance agency loans from big banks.

Most traditional banks don’t offer insurance agency loans. But it’s not because of credit or financials as much as it is due to the SIC Code they’re associated with.

Many insurance brokers and agents work with us to get business loans because they have been turned down by banks and want to know what other options are available.

Once you’ve gotten the inside scoop on insurance agency loans, we encourage you to set up a free consultation with us to talk about these practical business loans and other Fintech funding products available to you.

At Excel Capital, we help business owners achieve their business goals by making it easy for them to get the cash that they need without the hurdles and red tape associated with traditional bank instruments and loans.

What are insurance agency loans?

An insurance agency loan is a business loan which may be used to operate and/or expand an insurance related business.

Whether its an agency or a brokerage, working capital is needed to operate insurance agencies as they often have cash flow problems due to the way they receive payments. In most cases, every thirty days rather than day in and day out like most businesses.

Between monthly payments, you need sufficient cash flow if you hope to meet your financial obligations.

Most insurance agencies with cash flow problems struggle for a few different reasons:

  • The agency is over-leveraged
  • The agency is over-invested
  • Unpaid “withholding” taxes
  • Over-leveraged agency owners
  • Or a failure to budget

Establishing proper cash flow is essential to the profitability and longevity of your insurance business. And an insurance agency loan will help you to optimize your cash flow and realize your business goals.

What are borrowed funds used for?

When you access an insurance agency loan, you’ll be able to use the funds for working capital, hybrid equity and debt financing (mezzanine financing), agency perpetuation plans, and agency acquisitions.

Suffice it to say, there’s a lot you can do with funds from this type of loan.

Some examples include:

  • Paying vendors
  • Marketing
  • Buying equipment
  • Hiring new agents
  • And virtually anything else you can think of

With the right cash flow in place, you’ll have the freedom to handle current expenses as well as implement growth plans which offer long-term benefits.

Why traditional lenders won’t help

Your insurance agency may be rock-solid, but you’ll still get turned down for a business loan from a bank. Why? Because insurance agencies are considered “high-risk” by traditional lenders.

Companies are considered high-risk based on various conditions. One is that they operate in industries with “high-risk” designations, insurance being one such industry, and the other is that the threat of financial failure is present.

When a company has a high-risk designation, it severely limits funding options. If a bank does decide to grant your business a loan, you can bet the terms and conditions will be harsh.

Banks examine certain thresholds for accounts receivable (AR) portfolios and look at hard assets to see if sufficient collateral is available.

Banks want enough collateral to negate or minimize the risk. So, they often decide to deny loans because their loan officers aren’t comfortable with the risk level.

If you’re running a smaller insurance agency and looking for opportunities to grow, you may not have enough financial weight in the finance world to get the affordable loan that you need from a big bank.

However, nowadays, you have options. That’s because an insurance agency can get the business loans they need from alternative lenders.

Apply for an insurance agency loan today

At Excel Capital Management, our team of alternative lending experts understand the insurance business and why it’s unique.

We know why you need cash flow and why insurance agencies have trouble getting loans from big banks.

We also know that bank models for analyzing credit ratings and other performance factors before approving or denying loans are out of date.

That’s why we offer secured and unsecured loan options that fit the needs of modern insurance agencies like yours, no matter the size of your business, and even if your agency has a poor business credit rating or even no credit history at all (9002 credit).

To find out more and see what your agency can be approved for, click here to complete our short, 3-minute application.