Wells Fargo Doubles Down in Reno, Acquires Local Insurance Business

September 30th, 2011 by Trefis Team
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Wells Fargo (NYSE:WFC) announced the acquisition of Reno-based insurance brokerage and consulting firm ISU Stetson-Beemer Insurance earlier this week. [1] While Wells Fargo boasts of being the second-largest bank in the U.S. in terms of deposits held, this move is aimed at expanding the bank’s insurance services offering to help the bank compete effectively with other global financial institutions including Bank of America (NYSE:BAC), JPMorgan Chase (NYSE:JPM), and Citigroup (NYSE:C).

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We include Wells Fargo’s insurance revenues as a part of the Insurance & Others division in our analysis of the bank. We estimate that the insurance business contributes to just about 3% of our $32 price estimate for Wells Fargo – which we are reviewing in light of the weak global economic conditions.

Founded in 1923, Stetson-Beemer provides commercial and personal insurance services through a team of 50 agents. [2] Commercial insurance services provide insurance covers ranging from professional liability and workers compensation to group health and commercial auto insurance, whereas the personal insurance services provide cover for auto, home, recreational watercraft and vehicles, and individual health.

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While details of the deal completed on 1st September are not disclosed, the firm’s President, Richard Schield, will join Wells Fargo Insurance Services’ Reno office along with a team of about 24 employees.

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Notes:
  1. Wells Fargo’s insurance unit buys Reno firm, Bloomberg Businessweek, Sept 28 2011 [↩]
  2. ISU Stetson-Beemer Website [↩]