BB&T 2012 Annual Report Download - page 19

2012 Annual Report
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acquisition, we believe the best way to achieve needed retail scale
is through acquisition. For now, retail acquisition prices are
higher than what we are willing to invest, so we are moving ahead
on the commercial front, where organic growth is very effective.
Make no mistake, BB&T is committed to the Texas market for
the long-term, commercial for now and retail when acquisition
prices return to levels that meet BB&T’s criteria of optimizing
a long-term return to shareholders. Already, as Kay St. John
tells clients, BB&T stands for “The Best Bank in Texas.”
OUR DIVERSIFICATION IN INSURANCE
BB&T Insurance Services, the pacesetter for the highly
successful diversification of our revenue sources, dramatically
expanded its reach in 2012 with an acquisition that creates
the nation’s largest independent wholesale distributor of life
insurance and one of the largest providers of commercial
insurance brokerage and specialty programs.
The acquisition of the life and property and casualty insurance
divisions of Crump Group – which added $300 million to
Insurance Services’ $1 billion in annual revenue – is the
latest coup for a business that started humbly in 1922 and has
grown into the world’s eighth-largest insurance broker in total
revenue. BB&T Insurance offers our clients whatever protection
they need, ranging from business and personal insurance
to corporate risk management to employee benefit plans.
Already contributing 14% of BB&T’s total revenues, BB&T
Insurance is leading the way in another crucial arena: cross-
selling additional products and services to meet the broader needs
of our clients. While we have long offered property and casualty
insurance, the Crump acquisition achieved our long-standing
objective of moving into life insurance in a big way. For example,
now our relationship managers are offering the rich variety of life
insurance products that Crump brings to help our wealth clients
with their investment, tax planning and other needs.
Moreover, our added wholesale muscle allows BB&T to offer
our services to the hundreds of thousands of independent retail
insurance brokers, the dominant sales channel in insurance
today. Add to that the many banks and other financial
institutions that offer life insurance to their clients, but who turn
to Crump, and its relationships with more than 100 life insurers,
as their wholesaler because setting up their own comprehensive
life insurance platform is too complex or expensive.
BB&T Insurance’s growth into a national business with more
than 100 retail insurance agencies began the way most of our
relationships start – meeting our clients’ needs. In Wilson, N.C.,
where BB&T was founded, the city’s primary agency went out
of business, so the bank stepped in at the request of local business
owners. For the next 60-plus years, insurance remained mainly
on the sidelines. Then, in the mid 1980s, when BB&T started
more aggressively diversifying into non-interest fee businesses,
BB&T Insurance was ready. Between 1990 and today, a string of
acquisitions expanded our insurance revenues from $6 million
to $1.3 billion, including Crump.
Scores of combinations with other firms that share BB&T’s
commitment to client service – coupled with cutting-edge
products such as online flood and supplemental unemployment
insurance added in 2012 – have built a business that wins
accolades from clients and independent sources alike.
BB&T Insurance’s retail client retention rate averages 92%.
We consistently earn excellent client satisfaction awards for
large corporate and middle-market insurance brokerages from
Greenwich Associates. Business Insurance magazine has rated
us the most productive of the world’s top insurance brokers
for eight consecutive years.
Our consistent performance in client service and financial
performance is no surprise given the senior leadership team’s
average tenure of 20 years with BB&T, headed by Chairman
and CEO Wade Reece, a 35-year BB&T associate. With a 50-50
balance between retail and wholesale – retail led by BB&T
veteran David Pruett and wholesale by former Crump CEO
John Howard – and the support of our 6,400 associates, BB&T
Insurance is proud to offer comprehensive, hands-on service to
individuals and families, small business owners, Fortune 500
companies and nonprofits across the country.
Growing Insurance Commissions
BB&T Insurance offers our clients
whatever protection they need, ranging from
business and personal insurance to corporate
risk management to employee benefit plans.