Insurance and reinsurance broking group Aon feels great about its now completed acquisition of middle-market property and casualty (P&C) broker NFP, with Chief Executive Officer (CEO), Greg Case, describing it as “a tour de force revenue opportunity.”
After announcing the completion of its $13.4 billion takeover of NFP and a strong set of first quarter 2024 results, Aon executives discussed the deal during its recently held earnings call.
“We just feel great about this combination,” said Case. “This is the $31 billion North American market in which we’re vastly underweight. We have an opportunity because of ABS to really go after that market in a way that’s not just making us more sizable, but we think better.”
Aon expects to benefit from a lot of opportunities via its combination with NFP and sees real value in the operating model built around the principle of independent and connected, a notion which Eric Andersen, Aon’s President, expanded on.
“First, just to touch on the independent and connected piece, which is such a critical part of how both the NFP team and the Aon team have been approaching this. The independent piece is really to respect and celebrate the way NFP approaches its clients locally, and how the teams service those clients. So, really focusing in to make sure that those teams know that what they were doing before is what they’re going to continue to do,” said Andersen.
“The connected part is really about two pieces,” he continued. “There’s an efficiency play with our ABS platform around tech and ops and areas where we can get some cost synergies. But also, more importantly, I think it’s how we connect around product and capability, how we can bring our thought leadership, how we can bring structured portfolio solutions and product capability and get it to those teams in a way that their clients can digest it.”
“So, I think how we connect is really about content, and it’s a little bit about the cost synergies, but it’s really a revenue play for us as we look at the middle market,” he added.
Amplifying Andersen’s point, Case described the deal as a “tour de force revenue opportunity.”
“That has been the focus since the jump and that’s what we’ve seen for the last few months. And it’s both ways, incredible capability,” said Case.
During the call, Case also highlighted some of the opportunities this acquisition brings to its different business segments.
“In commercial risks, complimentary specialist resources and expertise from both organisations will enhance what we bring to clients. Delivering Aon’s analytics and decision support tools so the NFP salesforce allows for a real differentiation on top of their highly integrated sales approach,” said Case.
Adding: “Further, we can introduce and reinforce NFP’s offerings with access to our programmes and facilities like Aon Client Treaty, and also in commercial risks, we can leverage our global Aon network for clients who require a seamless global service, to enhance an already strong NFP value proposition.
“In wealth solutions, we see great opportunity to bring our capabilities around pension risk transfer to NFP clients, as well as to continue to build on our investment offerings together, ensuring all clients have access to retirement options that best support their people.”
“And in health solutions, our businesses are highly complementary with new opportunities in the health value chain where we don’t operate today,” added Case.
