No 'evidence our competitors are paying attention to culture'

No ‘evidence our competitors are paying attention to culture’ – Acera COO | Insurance Business Canada

Mergers & Acquisitions

No ‘evidence our competitors are paying attention to culture’ – Acera COO

“It’s really just us and BFL that are left as Canadians”

Mergers & Acquisitions

By
David Saric

Acera Insurance chief operating officer Bruce Rabik has taken aim at US private equity-backed competitors who claim to be looking for cultural fits rather than a revenue and premium boost.

“Let’s be very blunt on that point – most of our competitors are American, controlled by investors in Chicago and elsewhere, and their private equity model is that they’re in a race to accumulate premium,” Rabik told Insurance Business. “I just don’t see any evidence that most of our competitors are paying any attention to culture whatsoever.”

The broking leader said he found it “surprising” that there has not been more discourse around American ownership in Canadian insurance, with many of the top 10 brokers in the country having American backing.

“It’s really just us and BFL that are left as Canadians,” Rabik said.

It was a deal that saw Toronto-based middle market investor Clairvest, said to focus on “owner-led” businesses, come on board with a minority stake that stands at 21%.

“For us, it’s about aggregating people, not premiums,” said Rabik.

Self-styled “fiercely independent, employee-controlled company” Acera continues to carefully consider cultural fit, according to the COO.

“We have to pay attention to our culture,” Rabik said. “Ownership is a long-term commitment, and we have to exercise utmost caution when making these deals because the longevity of the business and our retirement is based on that.”

“We have ambitions in Central Alberta, and this will definitely help us carve out a greater presence in the farming community,” Rabik said.

As for how Acera determined the firm would be a cultural winner for the brokerage business, the COO pointed to staff loyalty.

“When we met with Rushton Agencies, there were some very good questions from the staff about how we operate at Acera, and it was quite obvious they were very loyal to the firm and its past owners,” Rabik said.

Rushton Agencies has been in business for over 100 years in Stettler, Alberta, offering commercial, personal and farm insurance.

“I think Acera’s philosophies are aligned with ours,” Steve Babcock, Rushton president, told Insurance Business. “With their access to markets bringing more choice to Stettler, it’s going to be great.”

The acquisition process is set to be “incremental”, according to Babcock.

“It’s been business as usual, but we are excited to offer the Stettler region more opportunities and options in insurance while still being a reliable bedrock,” Babcock said.