HomeCom Signs Merger Agreement With Financial Institutions Marketer
"By combining our online offering, InsureRate, with their face to face platform insurance offering, we have an integrated offering that will change the way insurance is sold," Sax says. "Our vision is to assist financial institutions in building electronic channels to their customers." Sax's firm believed that most banks would be disappointed with the transaction volume of insurance products sold today exclusively through their Websites. "Considering the most successful Internet banking programs have less than 10 percent of their customers online, it would be unrealistic to expect a bank to penetrate a satisfactory number of customers over the Internet alone," he says. "We believe the Internet is an important and rapidly growing channel but we also must integrate it with the way most financial products and particularly insurance is sold today."
The agreement is subject to certain conditions, including regulatory and other approvals, as well as approval by HomeCom's shareholders. The two companies will begin working together and expect final closing of the transaction to be completed in approximately 60 to 90 days. FIMI shareholders will receive 1,252,174 shares of HomeCom stock for 100 percent of the outstanding stock of FIMI.
Simultaneous with the closing, Tim Higham will assume the dual responsibilities of vice president of Insurance Services and president of InsureRate. Higham will be responsible for the day to day technical operations, architecture, and design of the platform. Dr. Jerome Corsi will assume the role of chairman of InsureRate and will lead the sales and new business development effort. The whole InsureRate offering will be integrated under FIMI during the coming months with InsureRate representing the electronic arm of FIMI.
"This merger adds significant value to our shareholders," said Higham. "It is a known fact that banks, credit unions, brokerage houses and other financial institutions want to sell insurance to add revenues. FIMI has successfully, and profitably, been providing this capability in a paper based environment for over ten years and their reputation is first class. We developed InsureRate after banks asked us for a web-based offering that matched the success of the FIMI delivery mechanism. InsureRate, quite simply, blends the proven success of FIMI with a wide reaching, low cost insurance offering for any financial institution wanting to add value to their customers and add profit to their bottom line."