Brown & Brown, Inc.’s BRO unit Brown & Brown Programs (CA), Inc. recently agreed to acquire the assets of Special Risk Insurance Managers, Ltd. The acquisition, following the fulfillment of certain conditions, is expected to be completed on Jan 1, 2020.
Special Risk, in operation since 1991, is an incorporated Managing General Agent (MGA), specializing in providing innovative insurance products and programs that meet the needs of specialty insurance product market in Canada. As an MGA, Special Risk Insurance Managers has entered into contracts with a number of the world's largest insurers. The company provides quotes, issues policies and manages claims. It also provides products that best suit client needs and at best prices. Special Risk offers a complete selection of insurance coverage for all aspects of diverse activities.
The addition of Special Risk will strengthen the presence of the acquirer in the insurance brokerage market in Canada.
As far as Special Risk is concerned, the combination will provide it with major insurer opportunities, enhanced Lloyd’s relationships and innovative products for retail brokers.
Brown & Brown maintains a disciplined focus on acquiring companies that are strategic fits. The Zacks Rank #3 (Hold) insurer closed 18 transactions through the third quarter of 2019 with annualized revenues of $86 million. Mergers and acquisitions are central to its growth strategy, demonstrated by the more than 500 agency acquisitions so far. It remains focused on making investments to drive organic growth and margin expansion.
Recently, there have been a number of acquisitions in the insurance industry, given the significant capital available. Arthur J. Gallagher & Co. AJG acquired New South Wales-based Blueleaf Consulting Pty Ltd.
Shares of Brown & Brown have gained 38.7% year to date, outperforming the industry’s increase of 34.9%. The company’s efforts to ramp up growth and its solid capital position should continue to drive shares higher.
Stocks to Consider
Some better-ranked stocks in the same space include Kemper Corporation KMPR and EverQuote, Inc. EVER, each carrying a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Kemper provides property and casualty, and life and health insurance to individuals and businesses in the United States. The company beat the Zacks Consensus Estimate in the trailing four quarters, the average beat being 16.40%.
EverQuote enables consumers to shop for auto, home, and life insurance quotes. It serves carriers, agents, financial advisors, and indirect distributors and aggregators. The company surpassed the Zacks Consensus Estimate in the trailing four quarters, the average beat being 84.25%.
Today's Best Stocks from Zacks
Would you like to see the updated picks from our best market-beating strategies? From 2017 through Q3 2019, while the S&P 500 gained +39.6%, five of our strategies returned +51.8%, +57.5%, +96.9%, +119.0%, and even +158.9%.
This outperformance has not just been a recent phenomenon. From 2000 – Q3 2019, while the S&P averaged +5.6% per year, our top strategies averaged up to +54.1% per year.
See their latest picks free >>
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
EverQuote, Inc. (EVER) : Free Stock Analysis Report
Brown & Brown, Inc. (BRO) : Free Stock Analysis Report
Arthur J. Gallagher & Co. (AJG) : Free Stock Analysis Report
Kemper Corporation (KMPR) : Free Stock Analysis Report
To read this article on Zacks.com click here.