RIABiz

AmeriLife just bought a $2.7-billion TAMP based on growing belief pre-packaged RIA services and commission-sold insurance can be sold out of the same briefcase

The Clearwater, Fla. insurance marketer bought Brookstone Capital Management with faith that insurance agents can moonlight as part-time RIAs

Brooke's Note: The idea of having a turnkey asset management program that turns non-wealth managers into wealth managers is not entirely new. The most famous is BAM Advisor Services which turns accountants into advisors and has about $15 billion of AUM to show for it. Brookstone is trying something similar with its TAMP aimed at insurance agents -- leveraging their trusted relationships with clients and their presumed comfort with talking to clients about money-related services. But now it'll have a more captive audience as it gets acquired by a firm with 140,000 agents on its roster. Is this a good or bad development for the RIA business? It might not be ideal having advisors wearing such varying hats. But it's also not ideal having a shortage of human advisors as 70,000 baby boomers retire daily. Innovative ways to stretch a labor supply assembling parts in new configurations may be one way to do that.

When AmeriLife CEO Scott Perry was trying to decide whether to build or buy a wealth services division, he opted for the latter. He purchased an outsourcer. Now all he has to do is train 140,000 insurance agents how to become RIAs.

The insurance marketer, last month, acquired a majority interest in Brookstone Capital Management LLC. The Wheaton, Ill. TAMP works with 400 insurance agents and provides wealth-management solutions in a box as well as compliance services.

"Rather than start from scratch, it made more sense to partner with Brookstone,” says Perry.

“Brookstone has years of experience in providing fee-based asset management services with a superior platform of investment models, along with credibility as one of the leading RIAs in the U.S."

In June, Perry lined up his ducks for the deal by refinancing and estimated $300 million in debt and building a $100 million cash and credit stash to put in play.

The combined organization will keep its two brand names. See: RIA TAMP, Brookstone, for insurance agents hits a quick $700 million AUM then opts for Orion software

The deal includes Brookstone's $2.3 billion in assets under management, according to Brookstone's ADV. (The company claims $2.7 billion.) AmeriLife, on its own, generates $3.5 billion in annual premium revenue from life, health and annuity insurance lines.

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