Goosehead Insurance, Inc Stock

Goosehead Insurance, Inc. operates as an independent insurance agency that distributes personal lines policies throughout the United States.

Strategy

The key elements of the company’s strategy are to continue to expand recruiting in corporate sales; national penetration of the franchisees; continue to develop innovative ways to drive productivity; maximize its effectiveness in managing renewal business; and continue to invest in technology to drive efficiencies in all areas of its business.

Franchise Agreements

Franchise sales operates under a franchising model and each franchise is governed by a Franchise Agreement. The Franchise Agreements for all existing franchises are substantially similar. Each Franchise Agreement contains one ten-year term with either two optional five-year renewal terms or two optional ten-year renewal terms. Franchisees are required to pay an Initial Franchise Fee that varies depending on the state in which the franchise will be located.

Seasonality

The majority of the company’s new accounts are sourced by referral sources tied to home closing transactions. The company experiences seasonality and revenue related to the sale of insurance policies throughout the course of a calendar year (year ended December 31, 2023) that is tied to the seasonality of new home sales. Revenue from home insurance leads is higher from April to August and lower from October through January.

Intellectual property

The company has registered Goosehead, Goosehead Insurance, and its logo as trademarks in the U.S., Mexico, the United Kingdom, the European Union, and Canada. The company also has filed other trademark applications in the U.S. and will pursue additional trademark registrations and other intellectual property protection. The company is the registered holder of a variety of domain names that include Goosehead and similar variations.

Service Centers

Both corporate sales and franchise sales are supported by the company’s client service centers. The company’s service centers are staffed by fully licensed property and casualty service agents, who provide fulfillment and quality control services for newly issued insurance policies, accounting services and ongoing support services for clients. Ongoing support services for clients include handling client inquiries, facilitating the claims process with Carriers, accepting premium payments and processing policy changes, and renewals. The company’s service agents are also focused on selling additional insurance coverages to clients which account for additional New Business Revenue. The company’s four separate service centers provide it with the ability to cover the U.S. time zones more broadly, and the ability to better manage business continuity risks.

Regulations

In order to include its consolidated financial statements in the franchise disclosure document (FDD), the company is required to guarantee Goosehead Insurance Agency, LLC’s obligations to its Franchisees.

History

Goosehead Insurance, Inc. was founded in 2003. The company was incorporated in 2017.