Hub International Limited has entered the reinsurance brokerage market through the acquisition of THB Intermediaries, Inc., which was formed in Los Angeles more than 20 years ago. Terms of the cash and common stock agreement were not disclosed.
THB, which has annual revenue of approximately $6 million, is one of a small number of facultative reinsurance brokers in the U.S. Facultative reinsurance brokers work with insurance companies to place portions of the insurers’ risks with reinsurance underwriters.
As the reinsurance market is fundamentally different from the retail and wholesale brokerage businesses at Hub International, THB will operate as a “specialty hub,” according to the companies.
Hub International’s acquisition strategy focuses primarily on regional hubs that serve as the base for further expansion within a region. The company classifies a business unit as a specialty hub when the unit addresses a unique market segment, rather than serving as a regional expansion platform.
“The acquisition of THB expands our total service range and reach in the insurance brokerage business and is an important extension of our acquisition strategy,” said Martin P. Hughes, Hub International chairman and chief executive officer. “The reinsurance brokerage business has consolidated dramatically in recent years, and THB was one of the few attractive reinsurance brokers remaining.”
THB operates with 32 employees out of four offices in New York, Los Angeles, Chicago and Dallas. The company president, Richard Di Clemente, will continue to lead as president of the new hub.
THB shareholders received restricted common shares in Hub International as a portion of the acquisition payment.
Hub International is headquartered in Chicago.
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