Truist
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It acquired wholesaler ARC Excess & Surplus, confirming an earlier report from this publication. -
Insurance Insider US spoke with the incoming CEO to discuss the future of TIH.
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The mid-market unit has been a home run but will now face the fresh test of integrating a $1.3bn revenue business.
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With the disposal, TIH would amass a robust war chest for a looming MGA consolidation arms race.
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Sources said that the business will be marketed off adjusted Ebitda of ~$500mn, including a title broking asset.
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The broker has seen an “outpouring of interest” from talent looking to join since the Truist exit.
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State National has been lined up to front for the vehicle, which would be a rare example of third-party capital in this space.
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The firm will no longer have to compete with one hand tied behind its back.
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The $15.5bn price tag equates to around 18x the company’s 2023 core Ebitda.
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The Insurance Insider US news team runs you through the earnings results for the day.
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The oversubscription may signal additional capacity waiting on the sidelines.
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The announcement confirms earlier reports from this publication.
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Sources said the deal was roughly three times over-subscribed as cat becomes hot.
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He will assume the role of office president in mid-2025.
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Sources said Stone Point and CD&R will each have stakes of around 35%.
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The firm will have more flexibility around talent compensation and M&A activity.
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TIH CEO John Howard said the deal positions TIH for continued growth.
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Work is underway to line up a supporting debt raise that could be ~$7bn.
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The executives were speaking after Truist reported Q4 organic growth of 7.3%, accelerating from 6.3% in Q3 and 5.6% in Q4 a year earlier.
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The bank’s representatives have started reaching out to other potential interested parties.
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He most recently served as the Truist-owned broker’s national director of P&C.
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The broking firm promoted Rachael Yelverton to director of strategic projects while Jeremy McCaslin was named chief innovation officer.
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Truist appointed Neil Kessler to lead the wholesale division as CEO, while Bill Goldstein will become CEO of the underwriting unit.
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The Inside P&C news team runs you through the earnings results for the day.
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The executive declined to comment on Truist Insurance sale reports but said the firm is constantly assessing all its options.
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Inside P&C has independently confirmed that the bank is working on a full sale of its insurance operation amid a challenging banking environment.
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The private equity house already owns 20% of Truist’s insurance business following a deal earlier this year.
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Inside P&C’s news team runs you through the key highlights of the week.
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In a recent report titled “TFC: Primed for activist”, Wells Fargo notes investor discontent and lists pressing issues to be addressed at Truist.
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The firm’s interim CEO Ami Barlev has argued that, with Vesttoo’s weekly expenses being $360,000, freezing assets above $1m would be “catastrophic for the company”.
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The Inside P&C news team runs you through the earnings results for the day.
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John Howard, CEO and chairman of Truist Insurance Holdings, noted that the response to its minority sale to Stone Point had been “very positive”.
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Organic growth fell 90 basis points from 5.6% in Q4 2022 due to carrier capacity constraints and slower growth in wholesale.
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The sale represents an aggregate value of $14.75bn and increases Truist's common equity Tier 1 ratio by approximately 30 basis points.
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Inside P&C’s news team runs you through the key highlights of the week.
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Management of the insurance broking business should seek to seize the opportunities of independence with both hands.
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The Truist Insurance Holdings CEO also said that the velocity of acquisitions would now increase.
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Management was speaking after the announcement that Stone Point finalized a deal with Truist to acquire a 20% stake in its insurance broking business at a valuation of $14.75bn.
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The ~$1bn Ebitda business is seeking a minority private equity buy-in to unlock value for its banking parent, and to create equity incentives for staff.
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Inside P&C’s news team runs you through the key highlights of the week.
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Stone Point and Clayton Dubilier & Rice are believed to be the two remaining contenders vying for a 20% stake in Truist Insurance.
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Organic growth fell 90 basis points from 6.5% in Q3 2022, but both underlying exposure and inflation continued to provide gains.
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Inside P&C’s news team runs you through the key highlights of the week.
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All claims in the case were dismissed with prejudice, barring the parties from bringing the dispute to another US court.
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The bank is running a process to seek a minority stake sale of its broking arm, and is in talks with Stone Point and CD&R.
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Inside P&C’s news team runs you through the key highlights of the week.
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Inside P&C’s morning summary of the key stories to get you up to speed fast.
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Sources have suggested bids at the top end were around 16x marketing Ebitda of just over $1bn.
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Although 2022 was on balance, a good year, macro-economic issues such as a slowing economy, falling employment, and loss cost reversion could create an overhang for 2023.
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Inside P&C’s morning summary of the key stories to get you up to speed fast.
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Inside P&C’s news team runs you through the key highlights of the week.
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As the super-cycle slows and the economic landscape becomes more uncertain, brokers will face pressure, though a cooling labor market may aid margins.
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Inside P&C’s morning summary of the key stories to get you up to speed fast.
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Margins contracted as performance-based incentives and T&E costs increased.
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Prior to joining CRC, Gulati spent 10 years at AmTrust in various underwriting management and business development roles.
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With the deal, CRC expects to increase its annual premium to $31.5bn from $23.5bn and grow its staff to over 5,100 employees across North America.
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While brokers continue to report positive earnings, the possibility of a downturn shouldn’t be discounted.
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The bank-owned broker reported positive earnings despite economic conditions, but results may vary for other brokers.
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Adjusted Ebitda margins narrowed by 200bps, as an uptick in T&E costs took its toll.
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The parties did not disclose whether any money changed hands to settle the legal proceedings.
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Inside P&C’s morning summary of the key stories to get you up to speed fast.
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Truist Insurance Holdings said prior-year market tailwinds including rising rates, exposure growth and tightening labor markets, remained in Q1.
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The Truist Insurance Holdings-owned broker also gave new roles to six executives across its practice areas.
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The broker closed on the acquisition of KV, a national title insurance agency, announced in early February.
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After calling 2021 its best year ever, Truist Insurance is purchasing private equity backed title insurer with nationwide operations.
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Truist’s chief insurance officer John Howard said favorable market conditions position the unit for an even better year in 2022.
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Ebitda margins were flat YoY at 27.3% but expanded by 250bps for the whole of 2021, while organic revenue grew by 11% over the same period.
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AIG joins Aon, Zurich in industry apprenticeship program that aims to draw in young talent, improve diversity efforts.
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Alliant’s motion to dismiss McGriff’s counterclaim in the case follows an order that judge Moore filed setting the case for a two-week trial commencing on August 29 next year in Miami.
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The executives will report to Renee Keen, McGriff’s PL and small business CEO.
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The wholesaler also said the ultimate size of industry claims from Winter Storm Uri and Hurricane Ida were less relevant than shock unmodeled loss components.
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The executive argued that his prior role at McGriff is hugely different from his new position at Alliant.
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The organic revenue number beat CEO Kelly King’s projections from this past summer, when he said the company expected high-single-digit third-quarter growth.
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Current group CEO Kelly King will become executive chairman and president William Rogers prepares to take chief executive role.
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Henson joined the team at Truist through the merger and had a long career in multiple senior roles at BB&T.
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The broker provided an optimistic growth outlook as pricing momentum slows.
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The company posted monumental Q2 growth of 15%, in what Kelly called "fundamentally the best quarter I have seen in this business in my career"
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New business was up by 25% in the quarter and Ebitda margins expanded by 380 bps.
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Inside P&C revealed last month that Constellation had been put up for sale by its private equity owners RedBird Capital, in a process run by Evercore.
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The broker touted new business growth of 12.8%, improved cross-selling and stable rates at 7% from Q4.
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Truist open to M&A opportunities in the coming year.
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The intermediary said that rate increases were “comparable or slightly up” versus prior periods in Q1.
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The broker’s 5% organic growth was flattish versus Q3 but management’s tone pointed to more bullishness on the operating environment and the economy.
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Standard carriers are pushing risk to the wholesale market, said banking and insurance head Henson.
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Net profits grew 67% over the quarter to $99mn, as brokerage unit expanded margins by 390 bps.
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Inside P&C’s research team examines some of the areas that will be closely watched during the results season.
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Truist Insurance Holdings is on an expansion drive, following the merger between BB&T and SunTrust.
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Paul Cicerchia, Jamie Sharpe, David Beckley and Jonathan Nigro join the Truist-owned broker.
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The private equity house exits the Texan MGA after five years.
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Yesterday, Truist Insurance provided its traditional first look at likely trends in the insurance broking sector.
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New business was up 8.4% due to an uptick in submissions into the E&S market.
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The wholesale broker will continue to be overseen by Laura Beckmann, AmRisc’s president and COO.
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Truist Insurance reported its Q2 results providing the first view on broker earnings season, and more broadly, a read on P&C market dynamics.
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Banking and insurance chief Christopher Henson flags the rise as the broking group reports a 9.5-point slowdown in year-on-year organic growth.
