LAKEWOOD RANCH -- The third-largest insurance broker in the United States has purchased a Lakewood Ranch agency that serves more than 100,000 clients.
On May 27, Arthur J. Gallagher & Co. purchased MGA Insurance Group. MGA, an agency the specializes in insurance policies for independent contractors, sold for an undisclosed amount after nine months of negotiations between the two companies.
Lou Marinaccio, MGA's president, said the 25-year-old agency has been "an acquisition target" of six companies over the past three years. MGA ultimately accepted Gallagher's purchase offer in order to expand its access to international insurance carriers, he said. For its part, Gallagher acquires a company that sold and managed about $100 million in premiums in 2013.
Marinaccio and his wife, Ann Marie, founded the company in Chicago in 1989, then moved it to Lakewood Ranch 10 years later. MGA currently employs 44 people on its sales force and in a call center at its 36,000-square-foot office space at 8430 Enterprise Circle.
MGA is the latest of a string of purchases Gallagher has made over the past four years. According to the company's website, Gallagher purchased 142 companies between 2010 and 2013, including insurers GAB Robins North America, Heath Lambert and the Giles Insurance Group.
With the MGA purchase, Gallagher taps into the specialized independent contractor market. Marinaccio said MGA has built a network of about 15 carriers through which the agency can assemble health, life, professional liability, property and casualty policies for people who work on a contract basis. Under the Gallagher umbrella -- which provides insurance in more than 140
countries -- MGA will be able to sell and service insurance policies for people who move from country to country.
Keeping insurance coverage intact can be a challenge for ex-patriates, Marinaccio said.
"You leave London and are currently insured with ABC company, you come to the states, and there is no such thing," he said.
Marinaccio said it was no surprise that his company was eyed by several larger firms for a possible purchase. He said the state's low or nonexistent payroll and income taxes make it attractive.
"People want to buy Florida-based companies," he said.
Jeff Grady, president of the Tallahassee-based Florida Association of Insurance Agents, said the state is experiencing an "exceptional" rate of mergers and acquisitions of independent insurance agencies. Some sell as owners retire, while others are attractive to larger firms attracted by the state's high rate of population and economic growth.
Kevin Garvin, the head of Gallagher's North American affinity operations, confirmed that MGA will continue to operate under its current name and management. Marinaccio will remain president of the company, and current staff will be retained. Ann Marie Marinaccio, currently the company's chief financial officer, will retire from her position in the near future.
MGA has plans to hire more staff. Some additions will come from Itasca, Ill., where Gallagher is based. Business Insurance magazine ranks Gallagher as the third-largest insurance broker in the United States with revenues of over $1.9 billion in 2012. It was founded in 1927, and its shares are traded on the New York Stock Exchange.
Matt M. Johnson, Herald business reporter, can be reached at 941-745-7027, or on Twitter @MattAtBradenton.