Fairfield County”™s largest independent insurance agency will be independent no more, after Norwalk-based Pierson & Smith announced its sale to First Niagara Financial Group Inc.
In mid-April, First Niagara completed the acquisition of New Haven-based New Alliance Bank, giving First Niagara a beachhead in New England backed by some $30 billion in assets.
The company did not immediately state what it paid for Pierson & Smith.
“The additional lending and support we will provide all segments of the market will provide real economic stimulus and growth to the region and as in our other markets,” said John Koelmel, CEO of First Niagara, in a prepared statement. “Our New England leadership team will be empowered to not only make credit available to local consumers and businesses, but to also provide exceptional service and good corporate citizenship.”
First Niagara has long extended those services to include insurance; in 2010, its risk-management division had $51.6 million in revenue, up 5 percent from the year before, much of it in the form of commissions and fees from some $590 million in premiums it placed with carriers.
The Buffalo, N.Y.-based bank”™s products and services include commercial and personal insurance; surety bonds; life, disability and long-term care coverage. It also consults on risk management issues, including self-insurance plans; claims investigation and adjusting services; retirement benefits; and third party administration of self-insured workers”™ compensation plans.
First Niagara also provides industry-specific insurance programs related to long-term care, moving and storage, ice rinks, and municipalities.
“This transaction provides Pierson & Smith”™s clients with the broad and deep resources of First Niagara, while ensuring that they continue to receive the direct and personal attention from our professional staff with whom they have built strong relationships over the years,” said Bruce Rogers, president of Pierson & Smith, who is staying with the company. “At the same time, we look forward to expanding our risk management and employee benefit brokerage and consulting expertise to First Niagara”™s growing base of banking customers in the state.”
The Pierson & Smith deal mirrors First Niagara”™s entry to the Pennsylvania market, where it acquired bank branches from National City and Harleysville Bank, then purchased Pennsylvania insurance agency businesses in short order.
First Niagara did not immediately indicate whether it is scouting additional insurance agency acquisitions in Connecticut.
Recognizing the increasingly blurred boundaries between banking and insurance, New York Gov. Andrew Cuomo is proposing to combine his state”™s regulatory departments that oversee the two industries.
Pierson & Smith was founded in 1946 in Stamford, relocating to Norwalk in 2001 and in 2004 merging with Darien-based TLA Insurance Inc.; today it is the second largest local agency after giant Marsh Inc. according to data agencies self-report to the Fairfield County Business Journal.
With Pierson & Smith”™s sale, Bridgeport-based Merit Insurance now tops the Fairfield County Business Journal”™s list of independent insurance agencies with three-dozen employees; but hardly holding a dominant position, with several other local agencies employing a similar number of brokers.
In its own insurance outlook, New York City-based Marsh forecast a continued soft insurance market in 2011 helping to keep property and casualty insurance premiums low ”“ although that prediction was made before disasters like the Japan earthquake and tsunami, and the freak spate of tornadoes that leveled towns in North Carolina and other states.
