Hub acquires wholesale specialist

In a move paralleling Equisure Financial Network’s 1997 acquisition of wholesale broker South Western Group, broker network The Hub Group has purchased KMS Insurance. Terms and the value of the transaction were not released.

Rick Gulliver, president of Hub, says the acquisition was a strategic investment for the public broker group. “We made the deal on the basis that KMS can provide some centralized services for hard to place accounts. Not only for us but for other brokers in the market place as well.” Still, the deal has raised eyebrows among small brokers who were similarly surprised with the Equi sure/South Western transaction. Says one observer “I do business with wholesalers because my book is hard to place with insurers who do not prioritize my business. Why would a wholesaler owned by a network make my business a priority when they have a bunch of clients within their own group?” Gulliver responds to this concern by insisting the wholesale operation will continue to run independently and at an arm’s length from the regular brokerage business.

Hub also recently announced its acquisition of Chicago, Illinois-based broker Mack & Parker, which brings annual p&c premiums of $80 million into the network. Gulliver says the borders of the business are expanding. “Our strategy is to be international so the U.S market will become a big part of our future plans. We don’t believe the world is going to maintain its borders, with technology businesses no longer operate within a company, you’ve got to operate globally.” More U.S. acquisitions could be forthcoming, he adds.