Why JLT Specialty’s acquisition of Belgian broker Belgibo offers a good deal – in every way – to both companies.
In August, the acquisition of Belgian specialty broker Belgibo by JLT Group was the culmination of a lot of hard work by Pierre Derom, its CEO – both in building up the company into a market-leading specialty broker and in persuading Rory MacLeay, Managing Director of JLT’s International Network, of the benefits of closer ties between the two companies.
“I would meet Rory every year and ask him ‘What more could we do together?’ Rory would say to me: ‘Let’s wait and see.’ In September 2013, Belgibo became a JLT affiliate and we’ve worked increasingly closely since then, with us joining the JLT family in August.”
The two businesses’ similar expertise and culture were a key part of the deal’s attractiveness, says Paul Knowles, JLT Specialty’s CEO.
“Specialty broking requires a deep knowledge of our clients’ industries. Over the past few years, JLT has invested in some of the brightest and best people to help us realise our ambition of becoming the world’s leading specialty broker.
“Belgibo has done the same, becoming a regional market leader in several niches, such as brown water marine, aviation and credit & political risks. Its skills mirror ours beautifully.”
JLT and Belgibo’s shared one vision
Belgibo’s approach in an increasingly ‘one-size-fits-all’ market is that the client comes first – just like JLT.
Its starting point is to listen to a client’s problems and find the right insurance package for its needs, explains Pierre Derom.
“We have invested in very talented people and we want to put their knowledge and experience to work in finding the right solutions for our clients.”
Its strategy has led to Belgibo’s business increasing rapidly. “Clients really appreciate our approach in a time of increasing commoditisation,” Derom says.
JLT is keen to find out more about the secret of its Belgian acquisition’s success.
“Within a decade, Belgibo has transformed from being a marine broker to a major player in the country’s specialty insurance market.
“There is plenty we can learn from Pierre and his team about how it’s grown,” says Knowles.
JLT certainly doesn’t want to mess with Belgibo’s winning formula.
“They’re the experts in their particular markets, so we’ll help them to grow.
“They will get the benefit of our support, knowledge, expertise and leverage, and will be able to plug into our international network.
“But we won’t try to dictate how they operate by imposing a business model. That’s not the way we work.”
New challenger in insurance market
The deal has sparked a good amount of expectation in the local insurance market, says Derom.
“Whereas our former parent was a shipping company, we now have a parent that is an expert in our field. That means we can tap into its wealth of information and experience to benefit our existing and potential clients.
“I know companies based in the Benelux countries are excited by this move, as it creates a new insurance broking option for them in the region.
“They’re interested in having a new kid on the block, with fresh ideas and a different perspective.
“Belgibo’s trading partners are already calling to find out more. Our insurers are very keen to hear what our expansion plans are for the next couple of years and what part they might play in them.”
Its existing clients are excited about the possibilities arising out of the acquisition, Derom adds.
“We have worked closely with JLT over the past five years, and have developed Belgibo using the JLT model.
“Many of our clients already understand the benefits to them of us becoming part of JLT, such as having access to Echelon [JLT’s specialist claims consultancy], which could provide crucial help to them if they have a complex claim.”
Acquiring Belgibo will help JLT to serve its clients across the European Union and in the European Economic Area countries once the UK has left the EU.
“It means we’re well positioned for any eventuality regarding Brexit, to help our clients continue to benefit from access to the London market as well as all other global markets,” says Knowles.
The Benelux insurance market is likely to benefit from the decision by Lloyd’s of London and a host of international insurers, including AIG, Amlin and QBE, to set up new companies in these countries to write business from 2019, adds Derom.
Derom’s first priority is to integrate Belgibo into the JLT group as quickly as possible.
“I want it completed within six months ideally, so we can help JLT to develop its business in the Benelux region and further across Europe.”
Belgibo is one of Belgium’s leading specialist brokers in marine, cargo, aviation, credit and political risks, employee benefits, logistics and construction.
Over the next 12 to 18 months it will also offer jewellery, fine art and specie and financial lines, with more expansion into other lines certain to happen in the future.
“Being part of the JLT Group opens up a world of new possibilities for us,” says Derom. “We’re already looking at potentially making new acquisitions, hiring new people and entering new niches.”
For more information contact Pierre Derom, CEO of JLT Belgibo on email@example.com.