Liberty Mutual, Wausau
Liberty Mutual Group, which sells insurance both direct and through independent agents, is discontinuing direct distribution to mid-sized businesses and now plans to distribute its commercial property/casualty insurance products in the middle market exclusively through independent agents and brokers.
Liberty Mutual defines the middle market as businesses with total account premium ranging from a low of about $150,000 up to about $1.5 million. Liberty Mutual has written about $2.5 billion in this segment.
The insurer is selling off the renewals on these direct middle market accounts to several large brokers: Arthur J. Gallagher & Co., Hub International and USI Holdings Corp.
It is also creating a new unit, Liberty Mutual Middle Market, which will accept and serve middle market business only from agents and brokers going forward. Products available will remain workers’ compensation, general liability, commercial automobile, property, crime and umbrella for mid-sized companies.
As part of the move, the company is retiring the Wausau brand, which has been part of its middle market operation.
The moves recognize that about 95 percent of middle market business insurance is sold by independent agents and brokers, not through direct distribution. The company acknowledged that by limiting itself to direct distribution in the middle market, it was missing out on opportunities to grow.
Illinois-based broker Arthur J. Gallagher & Co. is acquiring renewal rights for the middle market business in the Midwest and Southeast. Gallagher is also acquiring renewals and hiring the national producer group from Wausau Signature Agency. The agreement includes an initial payment of $44 million and additional payments based on revenues. The maximum amount of additional payments is $120 million.
Chicago-based brokerage Hub is getting the renewals in Arizona, Arkansas, California, Colorado, Hawaii, Kansas, Louisiana, Nebraska, Oklahoma, Utah and Texas. Terms were not disclosed.
USI Holdings Corp., based in Briarcliff Manor, New York, is the third buyer. It is grabbing the renewal rights in the Northeast region.
West Virginia Mutual
West Virginia Mutual Insurance Co. has paid off the $24 million surplus loan it received from the state plus interest, according to Insurance Commissioner Jane L. Cline.
The state loaned the money to the physician-owned carrier in June 2004, a time when West Virginia physicians faced difficulty obtaining medical liability insurance at affordable rates.
WVMIC is the only non-profit, member-owned medical liability insurer in West Virginia.
Bankers Insurance, HVWM Group
Bankers Insurance, LLC has acquired the Hutton Vincent Williamson McLean Insurance Group (HVWM) based in Asheville, N.C. HVWM was formed through the merger in 2000 of McLean Insurance, Schley and Williamson Insurance and Hutton-Vincent Insurance, three long-standing Asheville agencies. The owners of the three merged agencies will retain an active role.
This purchase marks the twelfth acquisition by Bankers Insurance since 1999 and the first outside of Virginia, where it is one of the largest agencies with sales of $175 million.
South Carolina Blues
South Carolina BlueCross and BlueShield has opened its first retail insurance store in the state in Mount Pleasant. The store offers health insurance policies for both adults and children. It will be staffed by both BlueCross workers and independent insurance agents and will be open weekdays and Saturdays. BlueCross, headquartered in Columbia, said it is opening the store to allow people to get face-to-face help when shopping for health insurance.
Catlin US
The Bermuda-based Catlin Group Limited has added casualty facultative reinsurance to its portfolio of products underwritten by Catlin US. Scott Beall, director of casualty facultative reinsurance, will direct unit, which is expected to begin underwriting operations from Catlin US’s Atlanta headquarters during the second quarter of 2009. Beall recently joined Catlin after six years with Markel Corp. He has 27 years of insurance industry experience.
Topics USA Virginia West Virginia
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