Agency Partnerships: The Breakthrough Force in Distribution

September 20, 2021 by

Agency partnerships and networks continue to grow in strength and numbers as independent agencies, large and small, look to these groups for greater market access, valuable services and the sharing of ideas that can take their agencies to the next level of growth.

For eight years Insurance Journal has recognized the nation’s largest agency partnerships and networks in its annual Top 20 ranking. This year, the Top 20 Agency Partnerships showed considerable growth in both total property/casualty revenue and property/casualty premium. The Top 20 grew by more than $1 billion in total P/C revenue in 2020 and by nearly $8 billion in total P/C premium (see page 22 for the 2021 Top 20 Agency Partnerships list). That growth has continued into 2021, according to the handful of agency partnerships interviewed for this report.

Agency partnerships and networks are not new. Some have existed for decades. Yet in recent years these partnerships have grown into diverse organizations equipped with valuable services and product offerings.

Breaking Barriers

Agency partnerships were not always as popular, according to Meredith Rominger, executive director of Georgia Agency Partners Inc., based in Statesboro, Georgia.

“Maybe even five to eight years ago, you still had carriers that hadn’t really bought into aggregation,” she said. “You certainly had agents that didn’t really understand it.”

That discussion has changed. Today, Rominger says more than 90% of the agencies she encounters are part of a network or are seeking a network to fit their needs.

“Now when we’re talking to potential new members …. we’re not talking to the guy who is not with a group; we’re talking to somebody who’s [already] with a group but who’s looking for something different.”

According to research by the Insurance Networks Alliance (INA), there are more than 170 property/casualty focused networks in the U.S. today. Founded in 2018, INA is an association that helps promote insurance networks to independent agents. More than 30 networks, including many on Insurance Journal’s Top 20 Agency Partnerships ranking, are members of INA.

Steve Pearson, president of ISU Insurance Agency Network based in Charleston, South Carolina, a founding member of INA, says that recent INA research shows nearly 60% of independent agencies and agency employees are engaged with agency networks although the size and scope of those networks vary considerably.

“Some of these organizations might operate more like a cluster, where one agency principal runs it one year, and then the next year someone else runs it,” he said. Those kinds of groups operate differently than a larger network, such as ISU, which requires a network membership and a larger commitment to the group. For example, ISU requires that each prospective agency member generate at least $1 million in property/casualty business to join. ISU adds on average about 20 new members per year and currently has about 225 members.

But other large partnerships, such SIAA, which ranks number one on Insurance Journal’s Top 20 list, is large in both total revenue and total number of members.

SIAA has more than 8,000 members today and has new agency members joining each year from the captive and direct agency channels, according to Jeff Holmes, chief operating officer, SIAA. While SIAA also caters to larger agencies, its focus on helping captive and direct agents on their transition into independent agency channel is a draw for many smaller agencies.

SIAA’s services to newcomers to the independent agency channel include its Agency Foundation Program, which, according to Holmes, is a step-by-step mentoring and consultative program that “really helps captive or direct agencies make that journey to the independent world.”

New Partnerships

The youngest agency partnership group to join IJ’s Top 20 list is the MarshBerry Connect Platform, which launched in April 2019. The group ranks number three on the list with about 15 member agencies posting $626,586,272 in total P/C revenue for 2020.

According to David Soforenko, executive vice president at MarshBerry, the biggest differentiator for the members of the Connect Platform is not their size, but their ability to grow organically.

“They have an extremely robust organic growth mechanism, which is what insurance carriers are finding to be the hardest thing to find when they appoint agents,” he said. They might be growing but that growth could be acquisitions-related, he said. MarshBerry’s agencies are actively engaging with new clients to grow the business, according to Soforenko, who revealed that its members show a 14.1% new business growth rate. “Our members probably outperform the national average by at least double,” Soforenko said.

Marsh Berry Connect Platform agency members have always had a relationship with the MarshBerry consulting organization. They previously worked with its peer-to-peer exchange program, he said.

“We would go through their agency’s financial data and in a small noncompetitive group to talk about strategy,” he said. “But when those agencies opted into the Platform, they were asking us to help them execute on that strategy, not just report out on it.”

A lot has changed in the past 10 years for agency partnerships and networks, according to Georgia Agency Partners’ Rominger. Ten years ago, aggregation was the primary driver to join a group. “It was something that agencies were doing to get an advantage, to get ahead, and up their competitor,” she said.

Today, most agencies are already aggregating, Rominger said. “You’re either with a national [firm], or you’re either getting bought by a national firm, or you’re aggregating as an independent agency with a group,” she said.

Carriers have finally recognized that networks are here to stay. “The future of aggregation is here,” Rominger believes.

MarshBerry’s Soforenko agrees. “The future for agency partnerships is actually in a real transition point right now,” he said. “Some of the best performers in aggregation are now part of another organization that they’ve decided to sell, and I think we’re seeing some of the insurance carriers getting concerned about the quality of the results that they’re getting from that.”

If the only offering an agency partnership can provide is carrier alignment, or market access, that’s not enough, he said. Agencies and their agency partnership and/or networks must remain relevant in today’s changing insurance market.

“If a broker wants to remain relevant or an insurance aggregator wants to remain relevant to the marketplace and to their carrier partners, then they need to provide predictable, healthy, profitable growth to an insurance carrier,” Soforenko said. “And when they fail to do that, regardless of their size, then their relevance drops significantly.” It’s all about maintaining relevance in the marketplace.


Agency partnerships continue to grow, but not without challenges. Tighter insurance markets, continued merger and acquisition activity throughout the independent agency channel, and the ongoing COVID-19 pandemic are a few hurdles that agency networks and their members face today.

“Networks and agency partners are facing rapid changes and challenges,” said Tiffany Bertolini, president of Pacific Interstate Insurance Brokers (PIIB) based in El Dorado, California. PIIB is comprised of 240 affiliate partners and 45 carriers across nine states.

Agencies face many obstacles they cannot control. As a California-based network, wildfires and the property market are two difficult challenges PIIB member agencies face, Bertolini said. “As carriers evaluate their exposures and issue millions in non-renewals, our agencies have to allocate all of their resources to remarket that business,” she noted.

Another hurdle: private equity and M&As. “We will lose 20 agencies to outside sales this year,” Bertolini said, calling it another challenge agencies can’t control.

“We stay focused on what we can control,” she said. “We listen to our agency partners to learn how to best serve their agencies best in this new world.”

But even with the challenges, most agencies have performed well through the pandemic of 2020 and 2021. Many reported having their “best year ever” for results for 2020 and first half 2021, according to ISU’s Pearson.

Independent insurance agents and brokers grew overall by 7.1% in the second quarter 2021, surpassing the 6.9% organic growth reported eight years ago in the second quarter of 2013, according to Reagan Consulting’s Growth & Profitability Survey (GPS). The quarter saw the highest organic growth rate in the 13-year history of the survey.

In general, COVID-19 had little financial impact to ISU members aside from a few specialty niche agencies, Pearson said. He said there was New York-based restaurant-focused new venture agency that shut its doors due to COVID, as well as another well-established agency exclusively writing youth sports, which lost 90% of revenue due to COVID shutdown of youth sports. But overall, most agencies have excelled despite the pandemic.

For Combined Agents of America (CAA), an Austin, Texas-based agency partnership, having a diverse agency network helped moderate the highs and lows in business that came from the pandemic, according to AJ Lovitt, CEO.

“Over the last 10 years, we have diversified into seven other states outside of Texas and that geographic distribution really helped,” he said. While larger metro area businesses were hit hard during the beginning of the pandemic, the network’s more rural agency members stayed on path, he said.

“Quite frankly, for us on a pure organic growth basis, we were up over 8% last year. We were very pleased with that.” A focus on cross-selling existing accounts helped keep revenue up for CAA members, he added.

While some larger agency partnerships have lost a few members due to consolidation, others have captured thousands of new agents moving from the captive agency channel.

High Point, North Carolina-based Smart Choice added more than 1,000 new agent members in 2020.

Smart Choice President Andrew Caldwell attributes that growth to a new focus on commercial lines agencies. “About seven years ago, we were primarily a personal lines organization, focusing on small agencies,” he said. “Today, we have a heavy focus on commercial lines and larger agencies.” Of the new agencies coming into the Smart Choice program, about 40% are converts from the captive agency world, he added, many from Nationwide, Farmers and Allstate.

SIAA, too, is accelerating its growth by catering to the captive-turned-independent market. “Roughly about 70% of the members that we sign each year are from the captive/direct world,” Holmes said. SIAA signed 527 independent agents in 2020, an increase of 14.8% over 2019 and reports that the group is on track to sign more than 500 new member agencies for the second consecutive year.

Private Equity

Private equity is playing a growing role in the agency partnership space. While some groups welcome the funding, others have taken a hard stance against it with their members.

In March 2021, Odyssey Investment Partners joined with management of SIAA to acquire the company. SIAA says its model and operations remain unchanged under the new ownership plan. At that time, Matt Masiello, CEO, said the transaction “sets the stage to take our business to the next level” and provides resources to “move forward more decisively” in mergers and acquisitions, technology and investing in “other growth initiatives.”

The Odyssey investment will help SIAA to not only perpetuate the company from a formerly family-owned business, but also allow for continued investment in technology for the network and its members, Holmes added. “That investment will help SIAA and our members achieve greater things as the years come up.”

Renaissance Alliance Insurance Services, number 10 on Insurance Journal’s Top 20 Agency Partnerships ranking in 2021, received financial backing from private equity investors in 2018 with a $30 million investment from Long Arc Capital. Since then, the company has entered new markets, enhanced the services it provides to its members, and built a new integrated technology platform.

But not all agencies or agency partnerships are keen on outside investments.

Pearson said that ISU made the decision a couple of years ago not to allow agencies in its membership with private equity owners. If a current member is purchased by private equity, they would no longer be eligible to continue as a member, he said.

“We thought about our members and considered how they consider their tribe to be fellow independent insurance agencies, and their competition to be the national brokerage firms and the private equity-backed firms,” Pearson said. “We realized that we should align ourselves with our membership’s beliefs, so we made the tough decision to terminate some very happy customers because of their corporate structure.”

CAA also doesn’t allow PE-owned agencies in. “Our deal is we want to have local people in the group who are responsible for the success of the agency,” said CAA’s Lovitt. “We don’t want to have something that’s owned by a bank or by private equity where every two years the ownership group is changing … those people have no skin in the game locally,” he said. He added that a few members have been purchased by banks and allowed to stay, but nothing that is private equity owned.

“Part of the reason is our organization is two-pronged: it’s financial and fraternal. You can’t have one without the other, but typically, when you have the private equity group involved, it tends to be almost a 100% financial. It’s all about ROI. Those are very important things to us and our members to be successful, but it’s not the thing that always drives the decision points.”

Lovitt says that while CAA might not be the network for every agency, there is another that is. “I think there’s an aggregator for everybody,” Lovitt said. “But I think the ones that are going to be long-term and successful players, are the ones who bring more resources and opportunities to the table versus just market access and combining a premium.”