HomeServices of America is launching a national expansion of its insurance business with the acquisition of PCG Agencies, one of the largest independent personal insurance companies in the Midwest.
The deal comes after 15 years of "looking for the right business model," said Ron Peltier, chairman and CEO of HomeServices of America. Terms of the deal weren't disclosed.
"The acquisition of PCG aligns with our growth strategy of identifying market leading companies that share our vision of delivering an unparalleled customer experience throughout the home transaction process," Peltier said.
Last year, St. Paul-based PCG Agencies sold about $30 million worth of homeowners, auto and other kinds of property and casualty insurance. HomeServices, based in Minneapolis, is the second-largest real estate company in the country, a subsidiary of Berkshire Hathaway and parent company of Edina Realty.
HomeServices and PCG have been acquainted through local partnerships between HomeServices affiliates and boutique offices offering PCG products. The deal will help HomeServices expand those offerings nationwide.
Peltier said PCG may look to add staff to facilitate growth.
Through its operating companies, HomeServices is already one of the largest brokerage-owned settlement service providers in the U.S. The company offers its insurance services through "multiline" regional and national agencies that generated more than $115 million of premium volume in 2015.
Strategically, the deal resembles Peltier's efforts to bolster HomeServices' presence in the mortgage market. For years, HomeServices had a joint operating agreement with Wells Fargo that enabled the company to offer mortgages. During the summer of 2013, that agreement ended and HomeServices has since been building a stand-alone mortgage venture.
"This is really sort of an endgame decision that we are growing a national insurance agency," said Peltier, noting that the deal will enable him to consolidate all of his insurance business under a single entity.
St. Paul-based PCG was founded in 1982 and has undergone several transitions. The company was founded by Bruce Humphrey, who is now chief executive and will play an "integral role in the ongoing success of PCG as a member of the insurance senior management team," according to a statement.
Humphrey said joining the HomeServices network "provides us with a unique opportunity for growth and further positions us to deliver unparalleled products and services to our new and existing clients."
Jim Buchta • 612-673-7376
