- March 28, 2024
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When Tampa-based USAmeriBank was presented with a $4.5 million cash offer to sell the insurance brokerage firm it bought 10 months earlier, it was easily persuaded. The quick sale wasn't due to lack of performance — Connelly, Carlisle, Fields & Nichols (CCF&N) was growing quickly — but rather the insurance firm and the bank saw it as an opportunity to expand services for the firm. The deal meant CCF&N would benefit from its acquirer's larger brand, Hub International, but would still be able to maintain a strong relationship with USAmeribank and its clients.
John Connelly, president of CCF&N, says executives of the bank and the agency quickly concluded “in order to pace the growth that (the firm has) been growing at, we need access to more tools.” Connelly says USAmeriBank's deal with Hub International is good for his firm's clients, good for the bank's clients, and an all-around “tremendous business opportunity.” It's a bold statement coming from Connelly, a USAmeriBank shareholder and one of the bank's original organizers.
Connelly's agency, which was made up of 90 employees, has folded into Chicago-based Hub International, one of the world's 10 largest insurance brokerage firms, touting more than 6,000 employees. CCF&N works with clients to match them with homeowners' insurance, flood insurance, and car insurance, in addition to providing businesses with commercial coverages.
Working with Hub, a small insurance brokerage can attract more insurance agency partners and more talent, Connelly says. CCF&N previously sold coverage from 22 insurance companies. With Hub's 365 locations, the firm now has access to products from more than 80 insurance companies, which allows CCF&N to provide a wider variety of options to its clients. In addition, the firm now has access to an in-house team of risk attorneys, Affordable Care Act experts, and a loss-control team.
With the acquisition, Connelly was asked to lead Hub Florida, taking on its existing offices in Boynton Beach, Fort Lauderdale, Venice, and Sarasota, in addition to his current offices in Clearwater and Tampa. Hub wanted to expand its operations in Florida because the state is the third-largest insurance market in the country. It's also one of the most difficult for out-of-state brokers to understand, Connelly says, due to wind coverage, flood insurance and special regulations for independent groups with fewer than 50 employees.
Connelly points to other Hub success stories as evidence that the acquisition will only help his firm grow. For example, over the last eight years, Hub has grown nine times larger in Boston.
During the next three years, Connelly expects the Florida division to triple in size, through acquisitions and organic growth. He says Hub is also a leader in buying firms, having completed more than 300 acquisitions. Connelly says Hub makes a good fit as a parent company because, “For the vast majority of those acquisitions, people don't want to give up management, but they want more capabilities, more tools.”
Connelly, who's been working in the insurance industry since 1977, says he's received several calls from groups in smaller cities looking for a way to join Hub International. He's also started to reach out to his contacts, to see if they have interest in the joining the group, hoping to announce a Florida acquisition by the end of the year.
“The state of Florida is a big state, so I have a lot of territory to cover,” Connelly says. He plans to enter Florida's other four major markets, Jacksonville, Orlando, Miami and Naples, in the near future.
Meanwhile CCF&N is already bringing value to Hub International, Connelly says. Hub's Boston office recently reached out for assistance on insurance regulations for Florida manufactured housing communities. Connelly's agency represents more than 330 such communities in Florida, and was able to get the branch in touch with an experienced law firm, accounting firm, banker, and four insurance agencies. His firm also represents more than 600 churches in Florida, another niche area that the Hub offices can tap into, Connelly says.
Despite being a big chain, Hub came in saying “there's no new employee manuals, no changing. But, if there's anything we can do, provide insurance contacts or access to tools, you let us know. It's your business,” Connelly recounts.
Connelly says the firm has no plans for layoffs, and thus far, the firm is on target to continue to grow 10% to 15% this year. “We've experienced rapid growth over the last eight years, and I expect that to continue,” Connelly says.