Wachovia Corp. has reached an agreement to buy the DavisBaldwin Inc. insurance agency in a deal reported to be in the works in the Aug. 24 American Banker.
DavisBaldwin, Florida's largest privately held insurance broker, specializes in general liability, workers' compensation, directors/officers insurance and employment practices liability insurance. It is based in Tamp and also has an office in Orlando.
"This gives us a premier entree into the commercial property and casualty business," said David Holton, president of Wachovia Insurance Services, of Winston-Salem, N.C.
DavisBaldwin manages $300 million of premiums a year, 90% of them for commercial insurance, said Charles Davis Jr., chairman and chief executive officer. Mr. Davis would become a consultant to Wachovia Insurance Services.
"Our average commercial client has anywhere from $10 million to $2 billion in revenues, with a large concentration of that coming from the higher end of that range," Mr. Davis said.
Financial terms of the deal were not disclosed. It is expected to close in the fourth quarter.
DavisBaldwin would be Wachovia's second insurance agency buy. Its first was in September 1999, when it bought the North Carolina shop Barry, Evans, Josephs & Snipes.
Barry Evans manages more than $3 billion of life insurance coverage and also does work in wealth transfer and executive benefits. It has kept its name under Wachovia.
Buying a commercial insurance agency can be "a smart move," says Carmen Effron, president of the C.F. Effron Co. consulting firm in Westport, Conn.
"The more a bank has to offer to its commercial clients, the better off it's going to be," she says.
Ken Kehrer, president of Kenneth Kehrer Associates in Princeton, N.J., agrees.
"Unlike with a life insurance agency, a commercial insurance agency has detailed expertise that is hard to find," he says.
Wachovia Corp. has about 700 bank branches in Florida, Georgia, North Carolina, South Carolina, and Virginia.