The FINANCIAL -- Wells Fargo & Company announced on June 27 it has entered into an agreement with USI Insurance Services to sell Wells Fargo Insurance Services USA (WFIS) , which includes its Insurance Brokerage and Consulting, Employee Benefits and Property & Casualty national practices, along with Safehold Special Risk, Small Business Insurance, Student Insurance, Individual Health and Private Risk Management Insurance business lines.
Terms of the transaction, which is expected to close in the fourth quarter, were not disclosed, according to Wells Fargo.
“The sale of the commercial insurance business reinforces Wells Fargo’s focus on core banking products and services that best meet the needs of our customers and support strong financial returns for shareholders,” said Perry Pelos, head of Wells Fargo Wholesale Banking. “By joining USI, an industry leader, the extremely talented team of WFIS insurance professionals will be able to continue to provide customers with products and services that best meet their insurance and risk management needs.”
WFIS provides small business, middle market, large corporate and high net worth clients with property and casualty, professional risk, employee benefits, private risk solutions and targeted insurance programs to specialized industries.
USI is headquartered in New York and is one of the largest privately held insurance brokerage firms in the U.S., with more than 4,400 associates in over 140 offices. In 2014, USI acquired more than 40 smaller brokerage offices from Wells Fargo Insurance.
“I’m confident USI is an excellent fit for our clients and our team members, and I’m excited about the opportunities we will have by bringing together our exceptionally strong and experienced teams,” said Tim Prichard, head of Wells Fargo Insurance. “As we move through the sale and transition process, our clients will continue to receive excellent service and support.”
In conjunction with the sale of the commercial brokerage business, the Personal Insurance business will report into Consumer Lending to ensure it is well positioned to continue to serve retail customers. Wells Fargo’s Personal Insurance business provides customers with access to personal insurance products, such as auto, home, umbrella and renters insurance.
“Personal Insurance offers important protection for our customers' homes and vehicles and gives them peace of mind,” said Franklin Codel, head of Wells Fargo Consumer Lending. “We look forward to welcoming the Personal Insurance team and extending the valuable financial services capabilities they provide today to consumers.”
Wells Fargo Securities, the company’s investment banking arm, served as exclusive financial advisor to Wells Fargo & Company in connection with the transaction. Financial details related to the transaction, including the sale’s expected gain to Wells Fargo, were not disclosed. WFIS’s annual operating results are not material to Wells Fargo. Completion of the transaction is subject to regulatory approvals and is anticipated to close in the fourth quarter.