Simplicity Financial Marketing’s acquisition will help InsurMark push deeper into the fee-based advisory world.
“This transaction is about executing on our plan,” said InsurMark founder Steve Kerns, in a news release. “Simplicity sought us out based on our 35-year history, our leadership, our vision and our re-engineered operational leadership.”
Two years ago, Houston-based InsurMark recast itself to serve fee-based advisors after decades of targeting primarily commission-based insurance agents.
Since then, regulatory changes have led to the realignment of distributors in the life and annuity sector, forcing independent marketing organizations (IMO) to differentiate themselves or merge with larger competitors and benefit from economies of scale.
InsurMark, which built its business helping independent agents sell fixed indexed annuities, opted to differentiate itself and focus on fee-based advisors as an “advisor development organization,” or ADO.
In doing so, InsurMark became an attractive target to an acquirer.
No layoffs or major reorganizations are planned and InsurMark will retain the brand and continue to operate as a stand-alone company out of Houston, the company said. Simplicity, based in Hartford, will “let us, be us,” Kerns said.
Many advisors in their late 50s or even early 60s are hundreds are looking to secure succession plans and exit strategies. InsurMark can help them with that.
With the backing of Simplicity, InsurMark will have access to more capital and will be able to pursue growth opportunities.
“As of today, we gain the vision, expertise and experience of Steve and his leadership team,” said Bill Malloy, CEO of Simplicity, in a news release.
“We are simply better together,” Malloy said. “InsurMark’s strategic initiative will shape our future in many ways.”
In addition to Kerns, InsurMark executives Jay Vinson and Jeff Maxey will serve as principals of Simplicity.
Kerns, Vinson and Maxey “will be instrumental in helping expand the Simplicity business,” said Malloy.
InsurMark is Simplicity’s ninth purchase. Simplicity, based in Hartford, was rebranded last year from Futurity First Financial Corporation, one of the nation’s largest IMOs.
There are about 350 IMOs in the country and some market experts see the number of IMOs shrinking by 30 percent to 50 percent in the coming years.
InsuranceNewsNet Senior Writer Cyril Tuohy has covered the financial services industry for more than 15 years. Cyril may be reached at email@example.com.
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