Posted on 22 Jul 10
Last month Dallas-based Insential, a national full-service wholesale broker, announced its acquisition of Source One Benefits, a Chicago-based wholesale general agent of some of the nation’s largest providers of ancillary group benefits. Retail agency partners of Insential get immediate access to Source One’s ancillary group benefits products, helping to round out the coverage offerings for their clients, and providing an expanded portfolio of products to generate new business. We spoke with Darwin Lucas, president/COO of Insential and Terry Byrne, former owner/president of Source One, about the acquisition.
“Source One is a unique business that began in Chicago 12 years ago,” said Darwin. “It focuses on nothing but the ancillary benefits that agents offer their commercial clients. This includes vision care, dental, long-term and short-term disability, and life insurance that’s part of nearly every company’s corporate benefit plan. Typically the ancillary coverages are add-ons, an after-the-fact throw-in to the health and medical coverages provided.
“Source One makes the ancillary benefits a primary focus and because of the volume written, we have contracts with major carriers around the country. This allows us to provide agents and their customers the advantage of getting the best rates, expanded coverage, and maximum revenue potential for the agency. These products offer tremendous cross-selling opportunities to our existing P/C retail partners," according to Darwin.
Source One was founded by Terry Byrne. After serving as director of sales for a dental insurance company, he saw that many general agencies were not offering dental coverage as part of the medical package. He saw a void and created Source One to fill that void. “The goal was to bring multiple dental products to the brokerage community, and become a one-stop shop for brokers to get four or five dental quotes,” said Terry. “In doing this, we were able to compete for the best rate. This resulted in generating $20 million worth of dental business. We decided to expand our ancillary product line to include vision, life, and disability. As result, our premium volume increased and the rates we were able to negotiate for our brokers improved again. We also get more compensation for our brokers due to our volume, and we’re guaranteeing new business to the insurance companies. This gives us the opportunity to get brokers better commission rates and we’re not impacted by any year-end bonus.”
Terry was looking to expand his business nationally and found a partner in Insential. “I was looking for a partner that was national in scope and had the ability to grow our business. Insential was the perfect fit in all respects. I recognized the synergies with Insential immediately. We had the Chicago market cornered, and wanted to bring our products to the next level, in a national program. We’re building on the success we’ve had in Chicago.”
There are three key advantages you get with Source One products:
1. Multiple quotes from several carriers. This allows you to easily shop several markets with one application/census--than just receiving one quote through the carrier writing the medical coverage for you.
2. The ability to offer better coverages based on the volume we write, and the relationships we enjoy with our underwriters.
3. The same revenue you would normally receive from the carrier, and sometimes more with no effort because we do all the work.
4. No impact on your bonus plan, despite using Source One to access the carrier.
“You’re getting multiple quotes, and potentially better coverage at the same or higher revenue when coming through us,” said Darwin. “It’s truly a win-win for all parties involved.”
"Source One brings a great opportunity for cross-selling opportunities for retail brokers who don’t currently write ancillary benefit coverages," explained Darwin. “It’s a great way to round out the accounts, cross-market, and create more of a relationship with clients. Any retail agent that writes benefits should look to this division as an opportunity to help them generate more revenue while transferring some of the labor involved in placing these coverages for their clients.”
Adding Source One to Insential’s products and services fits well with Insential’s overall vision to create a partnership with its agency clients. “If we can assist in the placement of property and casualty insurance and ancillary group benefits products, we’ll further solidify our agency partnerships,” said Darwin.
“Insential has great relationships on the P &C side and Source One is a bridge for agents to begin selling benefits to their clients, and add to their revenue and profitability,” said Terry.
To find out more about Source One Benefits, contact Terry Byrne at 312.454.6008, or via email at