Brown & Brown Acquires Arrowhead General Insurance Agency

Brown & Brown Inc. announced Dec. 16 it had acquired Arrowhead General Insurance Agency Inc. for $395 million, a deal expected to increase the company's annual revenues and staff size by about 10%.

Arrowhead, a program manager that provides property/casualty insurance products, was purchased from Spectrum Equity Investors, JMI Equity and a management equity-holder group.

Arrowhead, together with its subsidiary, American Claims Management, Inc., a third-party claims administrator, and its other subsidiaries, are expected to have net revenues of approximately $105 million this year, according to figures provided by the company.

Arrowhead and ACM will continue to operate in their current locations in the greater San Diego, Calif. area. Alexander Anthony Insurance LLC, another Arrowhead subsidiary, will continue to operate in Salt Lake City, Utah.

"This transaction brings many exciting opportunities to Brown & Brown. We believe Arrowhead has built a strong management team and an organization that enjoys an excellent reputation within the industry," J. Powell Brown, president and chief executive officer of Brown & Brown, said in a statement. "The addition of Arrowhead to our programs division should significantly expand the breadth and depth of our insurance carrier relationships and the products and services we can offer our distribution partners."

As part of this transaction, Chris Walker, CEO of Arrowhead, will become a regional executive vice president of Brown & Brown, Inc. and will continue to serve as Arrowhead's CEO.

With 2010 revenues of $973.49 million, Brown & Brown ranked as the ninth-largest global insurance broker, according to Best's Review.

Earlier this year, Brown & Brown, Inc. settled a lawsuit with five former employees who launched a new company, Assured Agencies LLC. The settlement included an undisclosed amount of money and the five former employees -- Jim W. Henderson, Thomas E. Riley, Eric A. Anderson, Stanley K. Kinnett II and Paul A. Vredenburg -- have agreed to not recruit or hire any more Brown & Brown employees for 18 months (Best's News Service, July 25, 2011).

(By Jeff Jeffrey, Washington Correspondent: [email protected])