Alera Group has completed its 10th acquisition this year — making a grand total of more than 70 such transactions since its start in 2017.
The national insurance firm said Wednesday it acquired Shepler & Fear General Agency, a Roseville, California-based brokerage that specializes in large group, small group and self-funding plans. The terms of the deal were not disclosed.
“Their commitment to providing the best tools, resources and expertise to their brokers [and] collaborating to create an exceptional client experience is tightly aligned with Alera Group’s mission,” Alera Group CEO Alan Levitz says in a statement about the deal. The company says it plans to continue to acquire “high-quality, like-minded firms” moving forward.
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Alera Group has more than 1,600 employees and serves clients in the employee benefits, property and casualty, risk management and wealth management spaces.
This is the Deerfield, Illinois-based brokerage's second transaction in California this week. The company also acquired Shomer Insurance Agency, a Los Angeles-based firm that specializes in serving nursing homes, home health, and assisted and independent living facilities. This year alone, Alera Group acquired, among others, Phalanx Healthcare Solutions, TriSure Corporation and Dohrmann Insurance Agency.
David Fear, managing partner of SFGA, says the deal will play a “powerful” role in the company’s client services. “We continuously seek to create elevated client experiences for our brokers,” he says in a statement.
Insurance brokerage M&A continues to pick up speed, industry experts say. The number of acquisitions soared to its highest ever last year, topping off at 626, according to a report from Optis Partners. In the first quarter this year, there were 151 reported transactions, compared with 150 in the first quarter last year.
Tim Cunningham, managing director of Optis Partners, says there aren’t any signs of a slowdown this year. In the first quarter, Patriot Growth Insurance Services led with 18 acquisitions, followed by Acrisure (16), Hub (12), Gallagher (10) and Broadstreet Partners (10), Optis reports.
“I think we still see a lot of interest on the buy side, and there still seems to be a fairly strong inventory of potential sellers,” Cunningham says.
A report from Deloitte on insurance M&A finds that brokerages will likely continue to be interested in acquiring companies that diversify both their product portfolio and customer base. “Smaller, high-performing specialty businesses that provide bolt-on opportunities are likely to sell at a premium,” the consulting firm says.
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Firms have expressed similar sentiments. Mike Sullivan, co-founder and chief growth officer of OneDigital Health and Benefits, told EBA the company would continue to acquire local agencies in order to diversify its business. OneDigital completed the largest acquisition in company history in April.
“You have a relatively fragmented space, lots of smaller agencies that compete in local markets where more significant entities like us are trying to localize our business,” he says.
The acquisition of SGFA was effective May 1, and the firm will join Alera Group as part of California General Agency, Dickerson Insurance Services. All SFGA employees will continue operating out of the firm’s existing location under the name Dickerson Insurance Services, an Alera Group Company, the brokerage says.
