Private investment firm Gallatin Point Capital and insurer, American Family Insurance Group, have successfully closed a new partnership whereby funds managed by Gallatin Point will acquire a majority stake in the attorney-in-fact for Trusted Resource Underwriters Exchange (TRUE).
TRUE is a reciprocal insurer established by American Family in 2020 to serve homeowners in storm-prone regions of Florida, and other parts of the country.
Gallatin Point will be investing over $1.25 billion into TRUE, and American Family will remain a minority owner and continue providing distribution and client services such as claims handling and call centre support.
The funds will be utilised by TRUE to provide underwriting capacity in Florida at a crucial time and to strategically expand its footprint nationally. TRUE will also utilize the partnership distribution model both through new and existing partnerships.
Matthew Botein, Co-Founder and Managing Partner, Gallatin Point, commented, “We are excited to be part of TRUE’s journey as it enters a new phase of growth, and we believe that our investment aligns perfectly with TRUE’s long-term vision and Gallatin Point’s commitment to the insurance sector. The regulatory changes in Florida present a unique opportunity for us to contribute to the stability of the market and provide crucial support to homeowners in the region.
“With TRUE’s leadership team, combined with the strength of American Family’s industry expertise and our capital investment, we are confident in the prospect of TRUE supporting homeowners as a fully national insurance company over time.”
The transaction closed on December 31st, 2023, with post-transaction transitions expected to be seamless for current TRUE customers and employees.
Howden Tiger Capital Markets & Advisory served as financial advisor and Kirkland & Ellis LLP served as legal counsel to Gallatin Point. Willkie Farr and Gallagher LLP served as legal counsel to American Family.
Gallatin Point has put together a team of insurance industry veterans, including Fabian Fondriest, former American Family Direct President, and former Chairman and Chief Executive Officer of Homesite Insurance, to serve as TRUE’s Executive Chairman, and Tony Scavongelli, former Head of Partnerships at American Family, as TRUE’s incoming Chief Executive Officer.
Scavongelli added, “I am honoured to lead TRUE in this exciting phase of growth. The support from Gallatin Point and their investors is a testament to the confidence in our collective vision and capabilities. We are focused on delivering reliable protection to homeowners and expanding our footprint nationally.”
Michael Lorion, President of American Family Direct and Homesite, concluded, “This partnership reflects American Family’s commitment to providing high-quality insurance options for homeowners nationwide. The ongoing relationship between American Family and TRUE will enable us to serve more customers in catastrophe-exposed regions.”
