The latest agency deal by BB&T Insurance Services Inc. in Raleigh, N.C., fits its strategy of strengthening the banking company’s employee benefits and property/casualty businesses and bolsters a business whose revenue has risen 78% this year.
The unit of BB&T Corp. said this week that it had agreed to buy Langan Insurance Benefits and Financial Services, a Louisville, Ky., agency that would be the North Carolina company’s fourth acquisition in Kentucky in 21 months.
Wade Reece, the president of BB&T Insurance, said Langan has “a nice blend of employee benefits and a p/c emphasis within the agency.” “It is a good solid agency with solid management,” he added, and the agency’s principals have agreed to remain with the operation.
BB&T Insurance is the sixth-largest agency in the United States, with about $650 million of insurance revenue to date this year, or 78% more than in all of 2003, he said. It had $365 million of revenue in 2003.
In Kentucky, BB&T Insurance made one other purchase this year, Mr. Reece said, “and we’re not saying we wouldn’t make more.” Kentucky, as well as Florida and Tennessee, remain attractive regions for BB&T Insurance, he said, noting, “We have been a pretty active acquirer in the past 10 to 15 years.”
The BB&T agency bought Old Colony Insurance Services of Louisville and Cromwell Insurance Agency of Lexington, Ky., in March 2003. This June, it bought Lexington-based Employee Benefit Services of Kentucky.
The main motivation is to buy in parts of the parent’s footprint where the insurance unit lacks extensive operations. Another advantage, Mr. Reece said, of agency deals in the footprint is the cross-selling opportunities that give BB&T a chance to sell more products per customer.
About 60% of BB&T-Cromwell’s growth and 15% to 20% of BB&T-Old Colony’s growth have come from bank referrals, Clinton Glasscock, a BB&T-Old Colony vice president, told Business First of Louisville. He is to lead sales management for the combined Old Colony-Langan agency.
Across BB&T Insurance’s 10-state footprint, about 60% of new business comes from the bank, Mr. Glasscock said.
The insurance unit is setting a sales goal of $6 million for Langan, a standard goal for new BB&T agencies of its size, said Mr. Reece. Langan has 40 employees, and BB&T-Old Colony has 60, Business First reported.
The bank subsidiary has 80 locations and has generated $5.5 billion of premium volume this year so far.
Langan’s principal owners, Bill Roby Sr. and Tom Barrett, are to take executive roles in the combined Old Colony-Langan operation. Officials at Langan Insurance did not return calls seeking comment by press time.
In March, BB&T announced plans to buy Iler Wall & Shonter Insurance Inc. of St. Petersburg, Fla. The deal was to give it its second Florida agency. The announcement came three months after BB&T Corp. said it would buy Republic Bancshares Inc. of St. Petersburg for $436 million.
BB&T Insurance operates agencies in North Carolina, Virginia, Georgia, South Carolina, Maryland, West Virginia, Tennessee, Florida, Kentucky, and Alabama.
