How PointeNorth is competing with PE-driven M&A

Personal fairness has remodeled the mergers & acquisitions (M&A) surroundings amongst insurance coverage companies and brokerages, with one company proprietor saying the variety of personal equity-backed rivals shopping for up companies has “quadrupled” over the previous decade.

“I feel the customer may be somewhat completely different now,” mentioned PointeNorth Insurance coverage Group CEO, principal, and president Invoice Skeeles (pictured).

“The banks bought out of shopping for retail insurance coverage companies a number of years in the past, and whereas the publicly traded brokers are nonetheless very lively, there’s a variety of continued exercise with a few of the greater personal equity-funded offers.

“We had about 10 rivals that had been personal fairness funded 10 years in the past. A yr in the past, it was in all probability about 40, so it had quadrupled in 10 years.”

The impression of personal fairness on impartial companies

PointeNorth, one of many largest regionally owned and operated impartial insurance coverage companies within the Southeast, is seeking to broaden its transportation insurance coverage operations additional via partnerships this yr.

“There’s hundreds of insurance coverage companies in the USA that function independently, and the worth on these is a lot better than it was 20 years in the past,” he mentioned.

Pushed by the surge in personal fairness, patrons snapped up wholesome middle-sized companies, Skeeles mentioned. The exercise led to many company homeowners rethinking their succession plans.

“Many of those company homeowners thought they had been going to perpetuate internally and promote to different folks within the company or to relations,” he mentioned. “However then they realized the worth of their company.”

To face out within the purchaser’s market, PointeNorth positioned itself with a hybrid acquisition mannequin that Skeeles mentioned made it a gorgeous choice for knowledgeable producers in search of further assist and expertise whereas nonetheless wanting to keep up their independence.  

“We are able to let [owners] understand the worth of their company whereas, on the identical time, cross on some fairness to the folks they initially wished to perpetuate [their agency] to internally,” he mentioned.

“Not most of the huge companies as we speak present fairness to producers, particularly a few of the youthful folks of their companies, which makes us somewhat bit distinctive.”

Increasing within the middle-market business house

PointeNorth, one of many largest regionally owned and operated impartial insurance coverage companies within the Southeast, is seeking to broaden its transportation insurance coverage operations additional via partnerships in 2024.

The group has grown to fifteen areas all through Georgia, Alabama, and South Carolina and was shaped via the partnership of excellent companies all through the Southeast. It focuses most of its enterprise on middle-market business strains.

Skeeles instructed Insurance coverage Enterprise that the group is eyeing an workplace in japanese Tennessee to assist continued development within the area.

“Our company is about 73% retail insurance coverage, which means your normal commercialized center market business strains of a small quantity of private strains insurance coverage, a small quantity of advantages, after which just below 20% of our revenues are in trucking,” he mentioned.

“We could get into the North Florida or southeast Tennessee somewhat bit sooner or later, however proper now, there’s loads for us to do in Georgia and Alabama.”

PointeNorth just lately bolstered its newly consolidated transportation program by buying Georgia-based Cooper Insurance coverage & Associates in August 2023.

Cooper Insurance coverage, which gives legal responsibility, bodily harm, cargo, employees’ compensation, and normal legal responsibility protection for the transportation business, is the most recent addition to PointeNorth’s portfolio of round 50 companies over 20 years. The company serves accounts in Alabama, Georgia, Florida, Tennessee, North Carolina, and South Carolina. 

“That is in all probability our best yr in a very long time, so far as the variety of acquisitions,” Skeeles mentioned following the deal.

PointeNorth’s mixture of area people contact with big-broker sources makes it a major draw to impartial companies, based on Skeeles.

“We’ve grown to be a agency that has all of the sources of a giant company or dealer however nonetheless operates within the communities like native impartial insurance coverage companies,” he mentioned. “We nonetheless have the flavour of a neighborhood agency that I feel attracts the those who need to be part of us.”

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