UCFC Adds Insurance to Array of Financial Services

YOUNGSTOWN, Ohio – Further evidence that United Community Financial Corp. has fully recovered and returned to growth mode came Monday when the holding company for Home Savings and Loan Co. announced it will acquire the James & Sons Insurance Agency.

The purchase, expected to close in the first quarter, is the first step toward the creation of The Home Savings Insurance Group, UCFC said.

The president and CEO of UCFC and Home Savings, Gary M. Small, was in the office of James & Sons President Tom Costello Monday where they detailed how the customers of both would benefit.

Costello joined James & Sons, 4444 Market St., 35 years ago.

Small and Costello first met about 1½ years ago while watching a YSU football game in the Home Savings loge at Stambaugh Stadium, they recalled, and hit it off.

The father of the James brothers, Bill and Gib, founded the agency in 1921, and while the brothers still come to the office every day, Costello has been running the agency since they stepped back 17 years ago. Costello, not that far from retirement himself, passed on buying the agency. So the brothers looked elsewhere for a purchaser.

UCFC is buying the firm with 16 employees — all licensed to sell insurance and all of whom will remain — for “a combination of stock and cash,” Small said. The acquisition, which needs no regulatory approval, should be completed before March 31.

While James & Sons will constitute The Home Savings Insurance Group, the agency will retain its name.

Last year, James & Sons enjoyed revenues of $8.8 million, Costello reported, and he looks forward to joining Home Savings and providing homeowners’ insurance to consumers who get their mortgages at the bank and auto insurance to those who finance their cars and trucks.

Home Savings’ growing commercial lending department – it serves 5,000 companies, Small said — will offer greater entry to sell insurance to small businesses that borrow from the bank and use its treasury management services, Costello said.

More than 55,000 households have at least one relationship with Home Savings, a demand deposit account, credit card, mortgage or auto loan, according to Small.

“Eventually,” Small said, “you will see James & Sons signage in our branch system” of 31 full-service offices in Ohio and western Pennsylvania.

Insurance regulators allow agencies to offer discounts on bundled policies, that is, lower prices for a package of disparate coverage – for example, homeowners and car insurance.

Regulators do not, however, allow insurance agencies to offer such a discount on a homeowners’ policy or auto insurance policy if a customer finances his residence or car or truck through a bank holding company that owns an agency.

“That’s considered a rebate,” Costello explained, “and is illegal.”

Pictured: Tom Costello and Gary Small.

Copyright 2022 The Business Journal, Youngstown, Ohio.