Brown & Brown's Unit to Fortify Wholesale Brokerage Services

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Hull & Company, LLC, a subsidiary of Brown & Brown, Inc.BRO , has entered into an agreement wherein it purchased all the assets of Izzo Insurance Services. The buyout will enable Brown & Brown to boost its workers' compensation insurance profile and cater to its clients' demands efficiently and effectively.

Izzo Insurance was founded by the sole shareholder Karen Izzo in 1980 and it operates as a wholesale brokerage. The company focuses on offering workers' compensation insurance coverage options to its retail broker partners. Izzo Insurance remains committed toward ensuring that each of its clients receives top-notch services and products at the most economic value. Moreover, the acquired company makes sure that there is substantial improvement in revenues and profits for its customers, thereby leading to long-term growth for both its clients and employees.

Izzo Insurance boasts annual revenues of about $2 million and post completion of the buyout, the firm will continue to do business from its present location under the leadership of Karen Izzo. When it comes to its operations, Izzo Insurance will function as a new stand-alone location in the acquirer's Wholesale Brokerage division with Tony Strianese at the helm.

Izzo Insurance has made a name for itself in the workers' compensation insurance solutions space on the back of its experience and customer-centric approach. This in turn, has helped it create a long-standing relationship with its retail agent partners and carrier.

The buyout will add an impetus to Izzo Insurance's already strong workers' compensation profile with Brown & Brown expected to benefit from its expertise, work culture, commitment toward markets and goodwill. The high-quality service offered by the acquired company along with its exclusive security guard specialty program will add value to Brown & Brown's service portfolio.

The latest consolidation will not only solidify the buyer's brokerage operations but also lend a vital support to ramping up its inorganic growth profile and boosting its margin expansion. Moreover, the company is anticipated to gain traction from this takeover in terms of reinforcing its product and service offerings.

The above-mentioned inorganic ploys braced the company to fuel growth and broaden its scope of operations. Also, these strategic endeavors braced Brown & Brown to increase its commissions and fees, which in turn, contributed to revenue growth. In fact, the company projects its 2018 revenues to range between $17.5 million and $21 million while for 2019, the metric is expected to be in the $210-$220 million band.

Shares of this Zacks Rank #2 (Buy) insurance broker have gained 7.3% in a year's time, outperforming its industry 's increase of 5.8%. We expect the company's sustained operational performance, higher commissions and fees plus a solid capital position to push the stock higher in the near term.

Insurers on Integration Spree

Taking the insurance industry's all-time high available capital into account, there has been a significant number of acquisitions in the space of late. In December 2018, Arthur J. Gallagher & Co. AJG announced the acquisition of Pointer Insurance Agency that is likely to improve its employee benefits consulting and brokerage operations. Also, property and casualty (P&C) insurer Arch Capital Group Ltd. ACGL recently completed its previously announced buyout of McNeil & Co. that will help serve its clients' needs more effectively and offer better growth opportunities to its team. In November, Marsh & McLennan Companies, Inc.'s MMC arm Mercer purchased Summit Strategies Group.

You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here .

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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