Home > News > featured news > HGGC opens up on PCF Insurance acquisition

HGGC opens up on PCF Insurance acquisition

HGGC, PCF | May 18, 2020

HGGC recently completed its acquisition of PCF Insurance, a full-service insurance brokerage based in Woodland Hills, California.
Acquisitions have been at the heart of PCF’s growth over the past two years. Since 2018, the retail brokerage has executed an aggressive M&A strategy.
In addition to facilitating inorganic growth via M&A, HGGC will also support PCF in building out its platform, investing in new technology.

HGGC, a middle market private equity firm, recently completed its acquisition of PCF Insurance, a full-service insurance brokerage based in Woodland Hills, California.

Founded in 1987, PCF is a growing retail insurance brokerage with a diverse offering of commercial lines, personal lines, and employee benefits products. It currently has over 400 employees across the US and serves more than 40,000 customers. Following the deal, PCF’s current management, employee owners, and existing investor BHMS Investments have retained minority stakes in the business.

New owner HGGC is no stranger to the insurance services world. Two of its key insurance services portfolio companies include US-based Integrity Marketing Group and UK-based Davies Group. Since HGGC’s investment into Integrity in July 2016, the firm has grown to be among the leading distributors of senior life and health products in the US, placing $2.5 billion in premiums and recording 8x earnings growth. It’s a similar success story with Davies Group. The UK-based provider of tech-enabled insurance services has completed 17 acquisitions and quintupled revenues in three years with HGGC backing.

We believe the key to success in the insurance services space is strong leadership and smart M&A. We’re excited to build on our successful track record with Davies and Integrity, When we got to know PCF as a business, and we got to know Peter Foy [PCF founder, CEO and chairman] and the team, two things were very clear. One is that PCF was thriving in a market that we really like. The retail brokerage market is attractive because there’s highly recurring revenue, high retention of that revenue, nice earnings characteristics, stable and steady cash flows, and opportunities to grow both organically and inorganically.

- John Block, Partner at HGGC.

“PCF demonstrates those qualities. Peter Foy has done a fantastic job both managing organic growth and also leading 18 acquisitions over the past two years. He partners with BHMS Investments to meaningfully scale the business and build out what is now a national platform. So, they have a strong business today, a nice financial profile, a diversified platform nationally, a nice mix of commercial lines, personal lines and employee benefits, and a good mix of carrier partners. Those things combined make PCF a really strong platform to work with, and we think there’s a big opportunity to continue to invest in the team, continue to build out the corporate infrastructure, and continue to focus on organic and inorganic growth.”

Acquisitions have been at the heart of PCF’s growth over the past two years. Since 2018, the retail brokerage has executed an aggressive M&A strategy by completing 18 add-ons and expanding outside of California into New York, Illinois, Nevada, Colorado, Arizona, Kansas, Kentucky, and Florida. Moving forwards, HGGC wants to position the business to be able to acquire 10 to 20 businesses every year, according to Block. He said that with the pipeline of opportunities in the marketplace, and the increasing footprint and presence of PCF, the brokerage will be “well positioned to achieve that goal”.

The prospect of further growth proved “exciting” for Foy. Commenting on the deal, the brokerage founder and CEO said: “We’re excited to partner with HGGC and leverage their experience and support during this next phase. I’m confident that, together, we will be able to continue to execute our strategy and accelerate our growth in this attractive market.”

In addition to facilitating inorganic growth via M&A, HGGC will also support PCF in building out its platform, investing in new technology, and continuing to grow organically by leveraging its strong producer base and blue-chip carrier relationships. Block explained: “We absolutely intend to invest in the platform, meaning we will build out the infrastructure of the business and invest in new technology, systems and processes to help optimize the business and continue to allow it to scale.

We see that across all of our business portfolios – the utilization of technology internally to help these businesses scale efficiently and effectively – and that will absolutely be the case at PCF. In addition to that, we will be looking at opportunities to help our agencies and help our businesses, PCF included, utilize technology better. We are big believers in giving our teams external-facing technology over time and enabling them to use the latest and greatest tools at their disposal in order to be as effective and productive as they can be.

- John Block, Partner at HGGC.

About HGGC

HGGC is a leading global private equity firm with over $4.3 billion in cumulative capital commitments and oversees portfolio companies that employ more than 65,000 employees globally. Over its history, HGGC has completed platform investments, add-on acquisitions, recapitalizations and liquidity events with an aggregate transaction value of over $25 billion.

About PCF Insurance

Founded as Peter C. Foy & Associates in 1987, PCF is a leading insurance brokerage firm dedicated to providing complete risk management solutions. PCF has a diverse offering of commercial lines, personal lines, and employee benefits products, with more than 40,000 customers across the country.

Spotlight

More featured news

Spotlight

Related News

Core Insurance, Insurance Technology

Higginbotham Joins Forces with Houston's Iscential

PR Newswire | August 21, 2023

The team from Houston's Iscential, a premier independent insurance agency, risk management and financial services firm, has joined forces with Fort Worth's Higginbotham, the largest independent insurance, financial and HR services firm headquartered in Texas and one of the top firms in the country. This strategic move allows access to enhanced services for Iscential clients and adds a second Houston team to the Higginbotham roster. As Higginbotham celebrates its 75th anniversary this year, Chairman and CEO Rusty Reid continues looking toward the next milestone. Reid champions strategic growth for the company by bringing aboard agencies and teams that enjoy strong reputations in their local markets and share the same energy, culture, values, and commitment to service as Higginbotham. "Iscential fits perfectly into our national network of firms," Reid declared. "I could not be more pleased to bring them into the fold. They are a firm with impressive growth and an incredible reputation for client service. Our partnership with Iscential will allow both of us to better provide enhanced services to our clients for years to come." Warren Barhorst, CEO of Iscential, also looked to the future as he searched for a company that could bring long-term organizational continuity to the business he founded 30 years ago. But his search was complicated by what he found in the marketplace. "There were a lot of agencies to choose from," said Barhorst. "But when we started taking a closer look, we realized that so many companies are driven by stock price rather than customer and employee care, and they're not run by insurance people. "Then we looked at Higginbotham," Barhorst continued. "Not only do they have the long-term, proven performance we needed, but they also have the right culture. They're employee-owned. They're sales-driven and customer-focused. And best of all — they're run by insurance people. With Higginbotham, we found a partner that values what we've built, values our culture and associates, and wants more than a financial transaction." Barhorst noted that he was particularly excited to now be able to offer Higginbotham's wide array of services to Iscential clients: "When we looked at the Higginbotham services, there was no question — they've done what we were trying to do on a smaller scale, and they've done it right." Reid elaborated, "At Higginbotham, we've strategically and diligently built the in-house services for risk management, benefit plan administration, HR services, and more, and we're looking forward to offering these solutions to Iscential clients." "Despite the obvious benefits, the decision to team up with Higginbotham was surprisingly emotional," Barhorst concluded. "Higginbotham kept telling us it'll be business as usual, and they were right. Except they're enabling me to refocus on the parts of the business I love most. If you're a baker and you like to bake, you want to make cookies. You don't want to sit at your desk alone doing paperwork. Today, I got to make the insurance version of cookies: I got to be back with clients all day long." Dowling Hales acted as exclusive financial advisor to the sellers in this transaction. About Iscential Iscential is an independent insurance agency, risk management and financial services firm dedicated to helping individuals, families and businesses protect their most valuable assets. One of the largest writers of Nationwide property and casualty insurance in the country, Iscential was founded in 1993 by current CEO Warren Barhorst and his wife. With roots planted in Houston, Iscential has grown to encompass over 140 associates and is licensed in over 38 states. Visit iscential.com for more information. About Higginbotham Employee owned and customer inspired, Higginbotham is a single source solution for insurance, financial and HR services. The firm was established in 1948 and ranks by revenue as the nation's 21st largest independent insurance firm. Serving thousands of businesses and individuals through locations coast-to-coast, Higginbotham's approach to finding insurance, employee benefit and risk management solutions is more individual and less institutional. By understanding customer priorities, eliminating inefficiencies and committing to transparency, Higginbotham is a place that leads with values so value leads. Visit higginbotham.com for more information.

Core Insurance, Risk Management

Web Connectivity Limited Partners with Insurity to Further Expand its Sure Underwriting Solution to the London Market

Business Wire | August 16, 2023

Insurity, a leading provider of cloud-based software for insurance carriers, brokers, and MGAs, today announced that it has partnered with Web Connectivity Limited (WCL), a Zywave company, a provider of ACORD standards-based solutions for the commercial insurance industry. This partnership will empower carriers, brokers, and syndicates to leverage Insurity's Sure Underwriting platform while expanding access to tools related to London Market insurance operations by adding a London Market messaging function. WCL aims to make it easier for insurance organisations to exchange critical information and simplify workflows to improve accuracy, accelerate business, and reduce risks. As a longtime ACORD Messaging Gateway provider to the London Market, WCL allows organisations to streamline processes by automating the electronic transfer of data and documents between brokers and insurers and central services to improve client service, increase process efficiency, and decrease cost. Insurity is the largest provider of cloud-based insurance software solutions, with over 400 of its 500 customers deployed successfully in the cloud. Sure Underwriting recently became available for insurance organisations in the London Market. The cloud-native solution enables insurers to gain 50% faster risk assessment with real-time insights to increase underwriting accuracy and efficiency. "Our partnership with Insurity allows us to offer a variety of interconnected solutions through collaborations and integrations," said James Willison, Managing Director at Web Connectivity Limited. "By delivering solutions like Insurity's Sure Underwriting to our clients, we can speed up implementations and help our clients achieve significant operational efficiencies." "Through this partnership, Insurity customers can take advantage of WCL's integrated products, including rapid deployment of ACORD standard-based London Market messaging," said Sylvester Mathis, Chief Insurance Officer at Insurity. "This partnership marks a significant milestone for the London insurance market and solidifies our commitment to providing cutting-edge software for London Market carriers, MGAs, and brokers to capitalise on new opportunities quickly." About Insurity Insurity is a leading provider of cloud-based software for insurance carriers, brokers, and MGAs. Insurity is trusted by 22 of the top 25 P&C carriers and 7 of the top 10 MGAs in the US and has over 400 cloud-based deployments. Through its best-in-class digital platform and with unrivaled industry experience and the industry's most robust analytics offerings, Insurity is uniquely positioned to deliver exceptional value, empowering customers to focus on their core businesses, optimize their operations, and provide superior policyholder experiences. Insurity is a portfolio company of GI Partners and TA Associates. For more information, visit www.insurity.com. About Web Connectivity Limited, a Zywave Company WCL is a wholly owned subsidiary of Zywave, Inc. Zywave leads the insurance tech industry, fueling business growth for its partners with cloud-based sales management, client delivery, content and analytics solutions. Offering a technology platform embedded with robust data and the most comprehensive content portfolio available, we empower smarter business decisions throughout the entire customer lifecycle. More than 6,000 carriers, HCM service providers, agencies and brokerages worldwide—including all of the top 100 U.S. insurance firms—use Zywave solutions to enhance client services, achieve business growth and promote greater health, wellness and safety. For more information about Web Connectivity Limited, visit www.webconnectivityltd.com

Core Insurance, Life Insurance

Fortegra Specialty Insurance and Rockwood Programs Partner to Offer Liability Insurance

PRnewswire | July 12, 2023

Fortegra Specialty Insurance Company ("FSIC"), a subsidiary of The Fortegra Group, Inc. ("Fortegra") and Rockwood Programs, Inc. ("Rockwood") today announced the development of management and professional liability insurance products customized to address the unique liability exposures faced by financial institutions. Mortgage bankers/brokers, auto lenders, asset-based lenders, community development funds, and similar entities are also eligible for coverage. The comprehensive solution is being offered under the Bankers Defender brand name. "The dynamic nature of our nation's economy can have an adverse impact on the banking industry," said William Hess, Vice President of Rockwood's Financial Institution Division. "Even firms with sound portfolio risk management protocols can be caught off-guard by changing governmental regulations or seemingly unrelated socio-political events. The resulting scrutiny brought by the various state and federal regulatory agencies can make it difficult for the banks to secure vital insurance." Bankers Defender coverage offers liability limits of up to $5,000,000 on all lines except Employment Practices ($2,000,000 maximum), and financial institution crime bonds are also available. Management and professional liability products include Directors & Officers, Errors & Omissions, Employment Practices, and Lender Liability, among others. "Through Bankers Defender, we proactively examine exposure areas and offer policyholders additional support alongside their insurance policies, including risk mitigation practices to avoid losses, claim advocacy, and legal assistance through Wilson Elser, an internationally recognized law firm with a reputation for providing an advocacy defense for its clients," said Glenn W. Clark, CPCU, President of Rockwood Programs. With this strategic approach, policyholders are getting the expertise of three entities with decades of experience in this particular class." Cooper Wallach, Vice President of Specialty Products and Programs at Fortegra, said: "In all our partnerships, we seek to pair innovation with expertise. The combination of experienced underwriters, advocacy defense, dedicated claims response team, and loss prevention tactics, will position our policyholders for long-term success." About Fortegra For more than 45 years, Fortegra, via its subsidiaries, has underwritten risk management solutions that help people and businesses succeed in the face of uncertainty. As a global specialty insurer, we offer a diverse set of admitted and non-admitted insurance products and warranty solutions. Fortegra's A.M. Best Financial Strength Rating of A- (Excellent) is a result of our strict underwriting standards, consistent profitability, and high cash flows. For more information, please visit: https://www.fortegra.com. About Rockwood Programs, Inc. Rockwood Program Administrators is a full service Managing General Agency licensed in all 50 states. Its wholesale brokerage division, Rockwood Specialty, assists retail agents in finding markets for unique or hard-to-place management liability risks. Its Rockwood Insurance Solutions division provides innovative thinking and counsel to insurance entities seeking to grow and expand their business operations. Since 1996, the company has been committed to protecting its partners. For more information about our offerings, please visit: www.rockwoodinsurance.com.