In July, BrokerLink acquired the brokerages McTague Insurance, DPM Insurance Group, and Crowsnest Insurance Agencies, expanding its presence in the provinces of New Brunswick, Ontario, and Alberta.
Earlier this month, BrokerLink unveiled another triple acquisition move, picking up J.W. Davis Insurance Brokers and Kuhn & Associates Insurance and Financial Services in Ontario, and Current Maritime Insurance in Nova Scotia.
Read more: BrokerLink scores hat-trick of acquisitions
So, why does it seem like the pandemic did little to slow down the M&A activity of brokers? And what is BrokerLink’s secret and approach to growth?
Read more: BrokerLink reveals hat-trick of acquisitions
To find answers to these burning questions and more, Insurance Business Canada interviewed Joe D’Annunzio, president of BrokerLink. For D’Annunzio, technology plays a key role in mergers and acquisitions, and that only became more apparent during the pandemic.
BrokerLink is one of the largest property and casualty insurance brokerages in Canada, with more than 3,000 employees, 200 locations and close to $3 billion in direct written premium.
We’re committed to being a strong investor in the communities we serve, and we pride ourselves on maintaining a local presence by employing people who live and work in our communities across Alberta, Ontario, New Brunswick, Nova Scotia, Newfoundland and Labrador.
We offer our customers a true omni-channel experience by supporting them the way they choose, digitally, by telephone or in person at our local branches. We work with multiple insurance companies to provide customers with competitively priced insurance solutions that are tailored for their specific home, auto, business needs and more.
BrokerLink is a national brokerage with deep roots in the local communities we serve across Canada, so our customers get the best of both worlds: local brokers who know their community and can offer personalized insurance service and advice, combined with the power and resources of a multi- billion dollar brokerage. Our brokers have access to expertise across the organization and best practices are shared from Alberta to Atlantic, in all lines of business and operations. We are a top five commercial brokerage in Canada and we leverage that scale through national programs and expertise to assist both our clients and to support our employees.
Providing superior service to customers is increasingly complex, and we are able to commit to the large investments in technology and the new roles and resources they require. Access to new technology is one of the advantages we offer to acquired brokerages, as it can be expensive for them to continuously invest in the technology that’s needed to compete in today’s ever-changing marketplace.
We are also committed to the growth and development of our employees, and offer a wide range of career paths within our organization, to attract and retain the industry’s most talented.
Corporate Social Responsibility is important at BrokerLink, and our employees across the country are active in community engagement. In addition, BrokerLink strives to be an industry leader when it comes to diversity, equity and inclusion (DEI) and initiates educational and celebratory activities to promote an inclusive workplace and society.
We look for a mix of things, with a focus on people and culture, location and unique business offerings (special programs, unique digital options, etc.) as the main factors.
People really are at the heart of everything we do, so we look for brokerages that share similar values and culture, which include delivering exceptional customer service and being an integral part of the local community. A brokerage’s employees are an important component of an acquisition because we believe that welcoming new employees with diverse insurance experience – personal, commercial, specialized – is a key benefit, and this is an area that differentiates our model. In fact, our more than 3,000 employees nationally, includes a strong percentage from acquisitions because we retain over 90% of the employees we acquire!
Our employees live and work in the communities they serve, so they are insurance experts when it comes to understanding customer needs. The brokerages we acquire share values similar to ours, so the new team members are usually active in community engagement, which they are encouraged to continue as part of BrokerLink.
Location is the next key factor. Our goal is to keep expanding our footprint by investing in the provinces in which we operate: Alberta, Ontario, New Brunswick, Nova Scotia, Newfoundland and Labrador. As demographics change and people have more choice in deciding where to live due to an increase in remote work capabilities, many smaller communities are growing and so are the insurance business opportunities
And finally, we look at unique business offerings. We are always looking for ways to grow and expand our personal and commercial lines portfolios with specialized and/or unique programs or enhance our existing offerings by adding segment experts in industries like farming, manufacturing or trucking for instance. Unique technology offerings or digital know-how is also something we look for, to improve the experience for our customers and employees.
Insurance broker M&A activity appears to be accelerating. Did M&A activity slow during COVID? If so, do you see it now hitting pre-COVID levels?
We didn’t see a slow down in activity during the pandemic, as transactions are generally worked on a minimum of 6 to 12 months in advance, so the disruptions experienced during the early stages of the pandemic consisted mainly of a few delays on closings and some slight disruption to logistics. 2021 and 2022 were both record setting years for M&A at BrokerLink, and we continue to see a sustained level of interest from brokers across the country looking at options for succession.
M&A continued to accelerate faster during the pandemic with technology playing a larger role and allowing for more frequent meetings via video conferencing technologies like Teams and Zoom, which may have traditionally required additional time for travel. Individual brokers growing comfortable with these new technology platforms has allowed for easier scheduling and more frequent meetings, driving the acceleration of M&A even faster.
Also of note are the changes in brokers’ perspectives about retirement and future plans as we’ve moved through the pandemic. A good number of brokers have spent some time reflecting on what’s most important to them at this juncture in their lives and they’ve made a conscious decision to sell, allowing more time for family, travel and other personal pursuits. Not surprising, as one ponders what’s most important to them in life.
Insurance is a people business, and we believe that building and strengthening relationships between brokers and customers is critical. At BrokerLink, we pride ourselves on providing personalized service, which includes offering customers a true omni-channel experience by supporting them in the way they choose, whether it’s a phone call, visiting the branch directly, or digitally, through various types of communication tools, email, text, online quoters , etc.
A brokerage’s dedication to its employees is another valuable contributor to a strong value proposition. In addition to financial rewards, benefits and work-life balance, BrokerLink believes in equipping its employees with skills for success by promoting and supporting growth and development initiatives.
What advice do you offer to brokerage owners considering their future?
Michael Stack, our Vice President of Acquisitions and I are always willing to have discussions with broker principals who are considering future options for their brokerage – it’s a personal and difficult decision to make, but we offer a strategic succession option for Canadian brokerages that share our values.
Setting the numbers aside, we’d suggest that brokers simply ask themselves a series of questions to ensure a fit with the potential acquirer, some of which include:
As mentioned previously insurance is about people. If the answer to all of the above questions is yes, it would appear that the broker has found a sound succession option.
