The company perfected the new model: use of financial might to build massive scale in order to consolidate and perfect back-office distribution. With a near-relentless acquisition appetite, Integrity boasts a network of about 500,000 agents and advisors who serve more than 11 million clients annually. 

Integrity’s rocket-ship growth has the industry buzzing. Five years ago, the company acquired Neishloss & Fleming, a Pittsburgh-based company that distributes Medicare Advantage and Medicare supplement insurance plans. Its agent network numbered 120,000 then, according to an Integrity news release. 

Integrity is not the only marketing company reaching for scale. Although the companies deny being motivated by competition, Simplicity Group and AmeriLife Group are also growing dramatically via acquisition activity.

The Big Three’s relentless growth is altering the distribution landscape, said Sheryl Moore, president and CEO of Moore Market Intelligence and Wink Inc. Small to midsized IMOs and FMOs are being gobbled up so quickly, it is forcing many to reconsider their plan, she said. 

“It is hard to compete against an Integrity, Simplicity or AmeriLife in terms of sales, and therefore annuity commission payouts,” she said. “For this reason, I’ve seen friends talking to these firms when they previously wouldn’t have considered selling so soon. It just seems like for those who had planned to retire in five to seven years, I am seeing more of them entertain discussions with these three firms than I would have anticipated.”

The Benefits of Scale

Certainly, not all agencies selling out to the super-IMOs are doing so reluctantly. In fact, many are eager to receive interest and offers from the big players. To understand why, one needs to look at what it means to be an Integrity “partner,” as Adams calls them. 

In an era of increasing regulatory obligations and segmented marketing audiences, combined with shrinking profit margins, agencies can use the help with back-office functions. 

Integrity touts streamlined administrative functions through centralized areas, such as people and culture, technology and innovation, finance, legal and compliance, and “world-class” advertising and marketing. In addition, Integrity offers partners access to proprietary technology through its omnichannel insurtech platform. 

“These comprehensive insurance and financial services offerings include valuable agent resources, such as product development, quoting and enrollment systems and customer relationship management software,” Integrity said on its website. 

For a smaller agency like Richman Insurance Agency, a Dallas, Texas-based IMO that joined Integrity in August, that kind of backstop can reduce or eliminate a lot of potential headaches. “This partnership with Integrity is pure opportunity,” said Rob Richman, president of the agency, “to do things you never thought you’d be able to do on your own. And to do it with a big team of resources.” 

Adams balks at the perception of Integrity as a voracious acquirer of agencies. He mentions the May 2022 acquisition of Ritter Insurance Marketing, a midsize IMO specializing in Medicare Supplement and Medicare Advantage plans and based in Harrisburg, Pa.

Not in the Plan

Integrity made its first acquisition in 2013, and to hear Adams tell it, the deal came about almost by accident. 

“We never thought about acquiring a business,” he said. “It was never part of our plan. But an insurance company came to us, a really large insurance company, and said, ‘Hey, we’ve got an older distributor that doesn’t have a succession plan. Would you acquire them?’” 

That was quickly followed by another, similar offer, Adams recalled, and it quickly became clear that there was a vacuum in the distribution chain that needed to be filled. 

In 2016, Integrity took a giant step forward with a capital infusion from private equity firm HGGC, the shop co-founded by NFL Hall of Fame quarterback Steve Young. Young now serves as the managing director of Integrity.

A Public Future?

In 2021, Integrity received a second infusion of private equity capital, this time from Silver Lake. A leading technology investor, Silver Lake took a minority stake and a board seat with its $1.2 billion investment. 

The Silver Lake investment was earmarked for Integrity technology platforms. 

“Insurance and wealth services are crucial components of the health care and financial markets — industries ripe for transformative innovation,” said Egon Durban, co-CEO of Silver Lake. 

But the mounting investment from private equity has many in the industry wondering if Integrity is destined to go public at some point. 

Integrity became an employee-owned business in 2019 with the formation of the employee ownership plan, and at that time paid out a retroactive cash distribution of $50 million to Integrity’s 750 employees. Adams said there are no plans to shake up the company’s structure.

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