First Niagara, Hatch Leonard Naples
First Niagara Risk Management Inc., the wholly-owned insurance subsidiary of First Niagara Bank and its parent First Niagara Financial Group in New York Inc. is acquiring Hatch Leonard Naples Inc. the largest insurance agency in Rochester and among the top agencies in Buffalo and Syracuse. The acquisition is expected to close July 31, 2005.
Similar to First Niagara, Hatch Leonard Naples specializes in commercial insurance, surety bonds, workers’ compensation, employee benefits and personal insurance. The combined agency will operate under the direction of current Hatch Leonard Naples’ chief executive officer, Gerard Wenzke. First Niagara Risk Management CEO John Hoffman will become the chairman of the board of directors.
Hatch Leonard Naples offices are located in Rochester, Buffalo, Syracuse, Albany and Plattsburgh. The agency’s revenue in 2004 exceeded $17 million. First Niagara Risk Management’s annual revenue exceeds $22 million.
Middlesex Insurance Company, a member of the Sentry Insurance group, has informed Massachusetts Division of Insurance that it will stop offering private passenger auto insurance in the state after this year. The company said it decided to exit the market after recent attempts to reform the state’s residual market, Commonwealth Auto Reinsurers, were thwarted by a court ruling.
The company will continue to write other personal lines, including homeowners and boat insurance, along with commercial lines.
“The prospects for significant reform either by regulatory or legislative means are now uncertain, at best. The current situation has left Sentry no choice but to begin the process of withdrawal from the personal auto insurance market in Massachusetts,” Thomas Donnelly, vice president, stated.
The company writes about 22,000 vehicles in the state, or less than 1 percent of the market. It does not use independent agents but writes direct.
Commerce Bancorp, BK Insurance Brokers
Commerce Insurance Services, a wholly-owned subsidiary of Commerce Bancorp Inc., has entered into an agreement to acquire BK International Insurance Brokers Ltd., headquartered in Greenwich, Conn. The acquisition will complement Commerce Bank’s expansion into Connecticut, where it will open its first two stores in Norwalk and Fairfield in late July 2005. Commerce plans to open 25 stores in Fairfield County as part of its overall metro New York growth strategy. In all, the Commerce network includes 326 stores serving, metro Philadelphia, metro New York and metro Washington, D.C.
BKIIB provides commercial insurance and has an expertise in insuring educational institutions. BKIIB has created an international network of insurance brokers.
BKIIB’s Chairman and Chief Operating Officer David E. Kimball Jr. and President and Chief Executive Officer John F. Betz will lead CIS’ growth in the metro New York market. Shelley M. Levine, Frank Lyon and Lee Pierce, the other members of BKIIB’s executive management team, will join them.
With the addition of BKIIB, Commerce Insurance, headquartered in Cherry Hill, N.J., operates a network of 15 offices generating $1 billion in annual premium. In recent years, CIS also has expanded its focus to include developing specialty insurance practices to serve education, life science and biotechnology research, public entities, construction, professional liability, surety, and risk control services.
MetLife , Travelers Life
Just one day after Connecticut officials approved the deal, MetLife completed the acquisition of Citigroup’s Travelers Life & Annuity and substantially all of Citigroup’s international insurance businesses for $11.8 billion.
Citigroup received approximately $1 billion in MetLife common stock and $10.8 billion in cash, subject to post-closing adjustment. The sale will result in a third quarter gain of approximately $2 billion after tax for Citigroup.
“This transaction significantly increases our size and scale in our core insurance and annuity products and expands our presence in the retirement and savings and international markets,” said Robert H. Benmosche, chairman and chief executive officer of MetLife.
MetLife products will be available through certain Citigroup distribution channels, including Smith Barney, Citibank branches, and Primerica in the U.S., as well as a number of international businesses.
“The distribution agreements with Citigroup, complementing our existing channels, provide us with one of the broadest distribution networks in the industry. Altogether, the transaction solidifies our leadership position in the industry and provides a platform for growth beginning with modest earnings accretion in the second half of 2005,” Benmosche added.
Berkshire Hathaway, GE Medical
Omaha, Neb.-based Berkshire Hathaway and Kansas City, Mo.-based General Electric announced that GE Insurance Solutions’ sale of Medical Protective Corporation to Columbia Insurance, a unit of Berkshire Hathaway, became effective last week. The sale price was $825 million.
With more than $700 million in annual premium and $2 billion in statutory assets, Medical Protective is a national leader in primary medical professional liability coverage and risk solutions for primary healthcare providers. Medical Protective products are distributed through a nationwide network of employee market managers and appointed agents.