Answers to Questions:
The merger of TF and HRH

Thousands of clients and employees of Thilman Filippini and Hilb Rogal & Hobbs awoke Wednesday morning to good news. As of July 6, the two companies have combined to form one of the largest insurance brokerages and risk management consulting firms in the United States and the world.

This is a move that benefits everyone – beginning with clients and prospective clients, and continuing to staff professionals of both firms at all levels.

Nonetheless, we know that in a transaction this large, with so many people and offices involved, questions may arise. We've tried to anticipate some of these questions:

Is this a merger or an acquisition?

The difference is largely semantic. In legal and financial terms, HRH has signed a "definitive agreement" to purchase substantially all the assets of Thilman Filippini. But for all practical purposes, this is a mutually-agreed merger of two successful companies. In recent years, both firms have enjoyed growth rates among the highest in the industry.

Combined, the new organization has annual revenues approaching $700 million.

Who is HRH?

Hilb Rogal & Hobbs (HRH) is the nation's eighth largest insurance brokerage and risk management consulting firm … and the 10th largest worldwide. The company is based in Richmond, Virginia, and maintains 125 offices around the country with a staff of approximately 3,500.

HRH also staffs a London office as a European service-base for clients operating on the Continent and worldwide.

Will TF keep its identity?

Yes. Thilman Filippini will operate from its Chicago headquarters as before – with no reduction in expenses and no changes in management. This merger provides TF a capital infusion to expand our capabilities on a nationwide scale:  in other words, to do more of what we do best.

What about staff cuts?

There will be no staff cuts. On the contrary, the merger enables to TF to make even greater investments internally and expand our Chicago-based operation. TF and HRH both are keenly aware that the primary "assets" of our two companies are the people in our employ.

Why this merger … and why now?

For both sides, the strategic benefits were overwhelmingly attractive.

TF had been seeking a partner to bolster its national activities; HRH wanted a greater Chicago presence. Both firms therefore bring exponential value to the new relationship. It is a rare instance of one-plus-one equaling three.

By joining forces with HRH, we will accelerate our entry into attractive new markets, add impetus to our specialty-lines expertise and competitively deepen our risk management and employee benefits service capabilities.

Equally important, our two companies found an ideal symmetry of value-sets and shared client-service philosophy. Ironically, both TF and HRH were formed around the same time, in the early 1980s, and pioneered similar Managed Risk-approaches to cost-effective property casualty programs and employee benefits plan design.

With this merger, TF instantly becomes one of the Top 5 brokerages in Chicago – the acknowledged "capital" of risk management in America. We'll also become the largest office in HRH's extensive national operations.

What about other HRH acquisitions in this market?

By definition, every merger is a unique combination of corporate cultures. Earlier transactions between HRH and other firms are so different from our situation, there's very little basis for comparison.

For one thing, TF's structure is non-bureaucratic but closely-managed. And this structure will remain completely intact. HRH sought out TF because of how we manage our company. Also, we emphasize a team approach to client service, similar to HRH's. This means there's only one "book of business" at TF … belonging to all of us.

Be assured this merger represents the best interests of all TF clients and employees, not a select few.

Will our practice areas stay the same?

Yes. One of the qualities in TF that HRH found most compelling is our well- established and respected expertise in specialized exposures. Our deep experience in such industries as construction, energy, real estate, cast metals and foundries ,seniors housing and professional sports brings a new dimension to HRH. We intend to aggressively expand our work in these areas.

Will our day-to-day operations be compatible?

Yes. Remarkably so.

It's common for two merging companies to say nice things about each other, for the record. But in this case the admiration is genuine and deep. TF and HRH are cut from the same client-oriented cloth. Both firms have similar corporate histories. And our goals are identical: sustained growth through superior programs and service … as well as continued personal growth for our staff professionals.

Consider this:  In their corporate statements, HRH often refers to a "zeal" for client service, a determination to "out-think and out-service" competing firms. Here at TF, we've used the same language, almost word for word, in describing our own approach to client service. It's clear that our two staffs share a camaraderie and a passion for finding innovative solutions.

What happens next?

On a day-to-day basis, you'll notice no immediate change. But in the coming weeks, management-employee teams will get acquainted and sort through the details. Together we will make the most of this tremendous opportunity – that's a promise.

Talk with your supervisor or representative. If you have specific questions, just ask. We'll keep you posted every step of the way.

And congratulations! You are part of the most dynamic insurance brokerage in Chicago.