The main M&A story of 2020 was more of a global than a national story, but it attracted more readers in each geographic location than any other. Since it was first announced in March, the proposed merger between Aon and Willis has remained the main merger and non-merger insurance story throughout the year. But there were other proposed and completed transactions that caught the attention of Insurance Journal's South Central audience. Here are the M&A reports of most interest to readers of the South Central region in 2020:
Aon is going to buy Willis Towers Watson
Global insurance brokers Aon and Willis Towers Watson announced in March that they had agreed to merge in an all-equity transaction with an implied combined share value of approximately $ 80 billion. Upon completion of the combination, Aon's existing shareholders will own approximately 63% and existing Willis Towers Watson shareholders will own approximately 37% of the combined company on a fully diluted basis. According to S&P, Aon plans to partner with Willis in an all-stock transaction worth approximately $ 30 billion, exchanging Willis stock for Aon stock. The combined company will be named Aon. Combined, the companies have more than $ 20 billion in revenue. Aon reported $ 11 billion in revenues with $ 2.2 billion net income for 2019, compared to $ 9 billion in revenues and $ 1.4 billion net income for Willis Towers Watson. Aon will maintain its headquarters in London, United Kingdom. The parent company is incorporated in Ireland. The combined company will have 95,000 employees worldwide, with what it said will be a "significant presence" in Chicago, New York and Singapore. John Haley will assume the role of Executive Chairman with a focus on growth and innovation strategy. The combined company will be led by Greg Case and Aon Chief Financial Officer Christa Davies. The board of directors will consist of proportional members of the current directors of Aon and Willis Towers Watson. In December, Aon confirmed that the European Commission has begun a review of the proposed merger. Aon said the review is a common next step "for a transaction of this size and complexity" and said it is on track to close the deal in the first half of 2021.
In a first, State Farm to acquire Texas non-standard auto insurance company GAINSCO
State Farm Mutual Automobile Insurance Co. acquires a non-standard Dallas auto insurer, GAINSCO, in a $ 400 million cash transaction in September. It is the first time in State Farm's 98-year history that it has acquired an insurance company. GAINSCO specializes in minimum limits on personal car coverage and actively distributes its non-standard personal car products through independent retail agents in Arizona, Florida, Georgia, New Mexico, Oklahoma, South Carolina, Tennessee, Texas, Utah, Virginia, Ohio and Alabama. Its insurance business is conducted through its subsidiary, MGA Insurance Company Inc., a Texas corporation.
Truist on track for 5 acquisitions to boost wholesale insurance business
In December, Truist Insurance Holdings, based in Charlotte, N.C., reported that it will complete five insurance acquisitions in the fourth quarter, adding more than $ 100 million in combined annual revenue to the wholesale division. The most recent of these transactions was the acquisition of Wellington Risk Holdings Inc., an insurtech operating as a managing general agent in the authorized residential real estate markets, with a strong presence in Texas. Wellington has developed a virtual marketplace offering with an easy-to-use agent portal for real estate insurance placement. The insurance company, a subsidiary of Truist Financial Corp., has already completed three transactions: W. Brown & Associates Property & Casualty, an Irvine, California-based surplus lines and MGA broker; Specialty Risk Associates, a Shreveport, Louisiana-based surplus lines and MGA broker; and Program Insurance Management of Sarasota, a Sarasota, Florida-based managing general underwriter with specialty programs for industrial chemicals manufacturers and distributors. In addition to Wellington, Truist was expected to close a transaction by the end of 2020 with Fidelis Group Holdings, a Covington, Louisiana-based provider of specialty insurance products for the marine and cargo industries. Truist Insurance Holdings, formerly BB&T Insurance Holdings, operates more than 250 offices through its subsidiaries: McGriff (consisting of McGriff Insurance Services and McGriff, Seibels & Williams); CRC Insurance services; Crump life insurance services; AmRisc; and its Premium Finance companies (AFCO Credit Corp., Prime Rate Premium Finance Corp. and CAFO).
Get insured Florida insurance through Lighthouse Property Insurance Corp..
Lighthouse Property Insurance Corp. said in March that it would acquire its sister company, Prepared Insurance Co., from Prepared Holdings Group. Lighthouse is a Louisiana-based property / casualty insurer that writes in Louisiana, Texas, North Carolina and South Carolina. Prepared is a Florida-based airline authorized to write in Florida and Louisiana. Lighthouse will acquire the Prepared portfolio and write directly in Florida through Prepared Managers, a licensed Florida general agent. Lighthouse will also take over all Prepared assets and liabilities. The resulting carrier, including the wholly owned subsidiary Lighthouse Excalibur Insurance Co. (Lighthouse Excalibur), which Lighthouse acquired in May 2019, will have a legal surplus of more than $ 45 million and will cover approximately 175,000 homes in the Southeast. Lighthouse Excalibur has a legal surplus of $ 11.5 million at the end of 2019. The gross written premium for the combined business will exceed $ 275 million. Lighthouse began writing homeowners policies in Louisiana in 2008. It has since expanded over the past 12 years. Based in Tampa, Prepared Insurance was licensed to do business in Florida in 2009 and offered homeowners insurance products including flood, condo, tenant, and residential fire policies. It had 32,018 policies in effect and $ 63.5 million in total premium as of the third quarter of 2019.
Woodlands Insurance obtains homeowner renewal rights from Gulfstream in Texas
The Woodlands Insurance Co. (TWICO) entered into an extension rights agreement with Gulfstream Property & Casualty Insurance Co. in April. in Florida to acquire Gulfstream & # 39; s Texas homeowners business. The transaction resulted in the transfer of approximately $ 4 million in current gross written premium to TWICO. TWICO has begun to offer renewal terms for policies that must be renewed on or after June 1, 2020. TWICO is a wholly owned subsidiary of TWFG Holding Co., which includes TWFG Insurance Services, TWFG General Agency and TWFG Premium Finance. Gulfstream, a Sarasota, Florida insurance company founded in 2004, provides homeowner insurance and related services in Alabama, Florida, Louisiana, South Carolina, and Texas.
Paragon Completes Acquisition of Trident Public Risk Solutions from Argo
Paragon Insurance Holdings, a national general agency, said in May that it had closed the purchase of Trident Public Risk Solutions from Bermuda-based Argo Group. Trident provides insurance and risk management for public sector entities such as counties, municipalities, schools, special districts, and long-distance government agencies. It operates through a distribution network of national brokers and local agencies. It has offices in San Antonio, Texas and Springfield, Massachusetts. Paragon is headquartered in Avon, Conn., And writes more than 20 insurance programs, including those for arborists, skiing facilities, pest control, lumber, precision manufacturing, and wineries. Paragon said the transaction positions it as one of the largest providers of commercial insurance coverage for public entities in the US.
Brown & Brown acquires assets from Texas All Risk
Last January, Brown & Brown Inc., headquartered in Florida, through its subsidiary Hull & Co. Acquired virtually all assets of Texas All Risk of Dallas, a general manager in Texas, Louisiana and Oklahoma. The transaction includes the acquisition of assets from the All Risk companies: All Risk General Agency Inc .; Select General Office; TARGA Investment Company; TARGA Premium Finance Company Inc .; and Texas All Risk General Agency Inc. (collectively Texas All Risk). The Texas All Risk team will continue to operate from the Dallas location as a new office within Brown & Brown's Wholesale Brokerage segment.
BRP Group's BKS partners acquire Houston's Insgroup
BRP Group Inc.'s subsidiary, Baldwin Krystyn Sherman Partners, agreed in November to acquire all of the outstanding equity interests of Insgroup Inc., a Houston, Texas-based provider of commercial property / casualty insurance, employee benefits, private risk services and suretyship until – market companies and individuals. With annual sales of approximately $ 38.5 million, Insgroup represents the largest new partnership in BRP Group history. Insgroup President and Chief Executive Officer Brian Kapiloff will serve as regional president within the BRP Group operating group. BRP Group has 160 colleagues in offices in Houston, Dallas, Addison and Austin.
Arkansas' Southern Pioneer P / C Insurance Acquired by Biglari
A.M. Best said in March that the Financial Strength Rating of B ++ (Good) and the Long-Term Issuer Credit Rating (Long-Term ICR) of "bbb" of Southern Pioneer Property and Casualty Insurance Co., of Jonesboro, Ark. , Continued to exist. unchanged after the acquisition by Biglari Holdings Inc. Biglari has acquired Southern Pioneer, an insurance company offering commercial real estate, homeowners, residential and other coverage in the Southern states. Southern Pioneer will continue to operate under its existing structure as a subsidiary of Biglari. with the management team and all legal entities intact. Southern Pioneer was founded in 1981 in Trumann, Ark .; it moved to Jonesboro in 2007. Originally, the company focused on providing credit-related coverage for banks and furniture retailers. In 1992, it began writing licensed bonds and garage liability insurance for Arkansas non-franchise auto dealers. The geographic area for that product area now includes Tennessee, Missouri, Alabama and Texas. In 2003, it began offering home ownership and homeowners coverage in Tennessee and expanded this product to Arkansas in 2012.
Norman-Spencer Agency acquires assets from Intercorp, BNK Insurance Services
Norman-Spencer Agency, a Dayton, Ohio-based program manager and wholesale brokerage company, acquired the business assets of Intercorp Inc. in May. and BNK Insurance Services. Intercorp is headquartered in Ephrata, Pennsylvania, and BNK Insurance Services is headquartered in Dallas, Texas. Intercorp manages national insurance programs and operates as a wholesale broker in the field of professional and environmental liability. Under the direction of owner Elaine Matternas, as a division of Norman-Spencer, the company will continue to manage professional indemnity insurance programs for appraisal firms and appraisal management firms. BNK Insurance Services is a general agency specializing in professional liability insurance for niche industries including real estate agents, home inspectors and mortgage brokers. Norman-Spencer said the deal is an attempt to continue to grow and bolster its professional real estate programs.
XPT Specialty acquires Texas MGA, LP Risk
XPT Partners acquired Texas-based LP Risk Inc. in April. about, a general surplus lines agency and broker. LP Risk has offices in Houston, San Antonio and Dallas. XPT said it will expand its transportation expertise by partnering with LP Risk and its internal commercial vehicle programs and brokerage markets. The acquisition is XPT's sixth investment and was preceded by Western Security Surplus, WE Love & Associates, SVA Underwriting, Klein & Costa and Sierra Specialty.
Western Security Surplus acquires Houston Surplus Lines
In May, Western Security Surplus, part of the XPT Group, acquired Texas-based Houston Surplus Lines, a general-purpose redundant and redundant line agency founded in 1994 and managed by Barbara Partlow and Carol Gardner. WSS is headquartered in Plano, Texas, and its employees are also based in California. Since 1981. This acquisition is the seventh by XPT.
Hub acquires assets of Gus Bates Insurance & Investments in Texas
Chicago-based global insurance broker Hub International Ltd. acquired the assets of GBC Benefits Ltd., d / b / a Gus Bates Insurance & Investments, based in Fort Worth, Texas, in July. Gus Bates I&I offers retirement plans, employee benefits, property / casualty insurance and personal insurance. CEO Gus Bates and President Matt Morris joined Hub.
Insgroup acquires assets from Dallas Brokerage Harris F Underwood III
Houston, Texas-based insurance broker Insgroup Inc. acquired virtually all the assets of the Harris F Underwood III Inc. agency in February. acquired in Dallas. HFU has served the needs of commercial and residential customers in the DFW area for over 40 years under the leadership of Chris Hill, Co-Founder, and Cash Harbaugh, President. Insgroup said it would use HFU's office as a launch pad for growth in DFW in other verticals, including construction, manufacturing, transportation, financial / professional services and retail clients. The entire Underwood team joined Insgroup and will continue to operate at HFU's downtown Dallas location under the existing leadership of Harbaugh and Hill.
CRC Group acquires assets from Louisiana Continental Underwriters
CRC Group, a nationwide wholesale broker from Birmingham, Alabama, agreed in December to acquire the assets of Continental Underwriters. Headquartered in Covington, La. Continental offers insurance for primary maritime, marine surplus obligations, sea freight and inland navigation insurance. Led by CEO H. Elder Brown III and with 50 years of activity, Continental Underwriters has additional offices in New York, N.Y .; Houston; Chicago; Knoxville, Tenn .; and Seattle. Fidelis Marine Underwriters and Fidelis Claims Services will also be involved in the transaction. The Fidelis companies provide insurance, brokerage, claims management and loss control assistance. Continental will be part of CRC Group's Program Division.
Hilltop Holdings completes sale of National Lloyds to align financial situation
Hilltop Holdings Inc. of Dallas and Align Financial Holdings LLC (Align) completed in June the sale of Hilltop's wholly owned Texas subsidiary National Lloyds Corp. (National Lloyds), to Align. The transaction, which was first announced in January 2020, was closed upon receipt of required regulatory approvals and compliance with other customary closing conditions. Based in Dallas, National Lloyds is a specialty real estate insurer that primarily serves owners of lower value homes and mobile homes. The company depreciates premiums through two subsidiaries, National Lloyds Insurance Co. and American Summit Insurance Co. (Carriers), and also has wholly owned agencies and services, including Nalico General Agency (Agencies). As part of the National Lloyds purchase, Align simultaneously sold the Carriers to ReAlign Insurance Holdings LLC (ReAlign) in an all-cash transaction. National Lloyds Insurance Co. has since been renamed National Summit Insurance Co. The rebrand follows the completion of all regulatory approvals leading to the conversion of National Lloyds from a Texas Lloyds Plan company into a endowment insurance company.