CHICAGO—A new middle-market insurance brokerage appears to be combining a potent mix of ingredients to fuel its success.

Announced last week and led by two former Brown & Brown Inc. executives, Lake Mary, Fla.-based Assured Agencies L.L.C. is backed by up to $250 million in capital from Chicago-based private equity firm GTCR L.L.C.

Jim Henderson, who retired in August as Brown & Brown's vice chairman and chief operating officer, is CEO of the new brokerage venture, while Tom Riley, who left Brown & Brown in January after most recently serving as a regional president and chief acquisition officer for the Daytona Beach, Fla.-based brokerage, is president and COO of Assured Agencies.

“I think it's pretty exciting, especially for those guys,” said Kevin Donoghue, managing director at Mystic Capital Advisors Group L.L.C. in New York. “They're good guys, talented guys and I would expect them to be successful.”

John W. Wicher, principal at John Wicher & Associates Inc. in San Francisco, said he sees two significant storylines in the startup announcement.

“One is the fact that they've been able to attract $250 million from some very sophisticated money people in Chicago,” Mr. Wicher said. “The fact that they've been able to attract capital from smart money indicates that there is a belief that there is still room for another middle-market broker.

“Two, you can't separate the fact that the two individuals who are leading this are two of the most experienced people in the business,” Mr. Wicher said.

“When I retired, I realized I wasn't ready to retire,” said Mr. Henderson. With Mr. Riley leaving Brown & Brown at the start of the year and Mr. Henderson's existing relationship with GTCR, “it came together really very quickly at a really very opportune time, I think, to acquire companies,” he said.

Assured Agencies will be built through acquisitions, looking to establish “geographic platforms across the country,” said Aaron Cohen, vp at Chicago-based GTCR. “We have a very long history of relationships in the industry because we've invested there before, so I wouldn't be surprised if we did several deals this year,” he said.

GTCR is no stranger to the insurance space, or to building a brokerage through acquisitions (see box).

“They're going to need a platform agency,” said Mr. Wicher in discussing Assured Agencies. “They're going to need to complete in the coming 12 months a couple of fairly significant deals.” But, he said, he thinks the new broker's leaders are capable of doing that.

Mr. Donoghue noted that Messrs. Henderson and Riley “were part of the inner circle at Brown & Brown, and that's how Brown & Brown got built: doing deals.”

“Between the two of them, their M&A experience is unbelievable,” Mr. Donoghue said. “They're pretty good at deploying capital.”

Meyer Shields, principal at Stifel, Nicolaus & Co. Inc. in Baltimore, said he expects the middle-market brokerage to feel very much like Brown & Brown, a fact that will pose certain challenges to Messrs. Henderson's and Riley's former employer.

“Brown & Brown's history was enormously and appropriately attributed to the culture that was created under Hyatt Brown,” Mr. Shields said. In their tenure at Brown & Brown, the two Assured Agencies leaders “have breathed that culture for a long time,” he said. “I think what we're likely to see is the re-creation of that kind of company.”

“Culture has always been one of the tools that Brown & Brown has used to attract like-minded agents,” Mr. Shields said. “They now have to compete with guys that know their secret sauce.”

Mr. Shields also said he thinks defections from Brown & Brown to the new broker are likely.

“I'd have to expect them,” he said. “There have to be people that worked for (Messrs. Henderson and Riley) a long time that have a lot of respect for them.” While they might respect their leaders at Brown & Brown, employees who are looking for an opportunity “to do something entrepreneurial” might see Assured Agencies offering a good fit, Mr. Shields said.

Brown & Brown could not be reached for comment.

But Mr. Henderson said Brown & Brown is “just one more player in a very big market. I think there are ample opportunities for us and I don't see this being disruptive to Brown or Hub (International Ltd.) or anyone else.”

Meanwhile, Mr. Shields said he likes the new broker's prospects.

“I think we're going to see rapid deployment of the capital they've got,” he said. “I would be shocked if we don't see something by the end of the year, probably by the end of June.”

One observer, though, offered a more guarded view.

Timothy J. Cunningham, principal at OPTIS Partners L.L.C. in Chicago, suggested there's a shortage of potential sellers in the current market, as many agencies choose to sit on the sidelines until valuations improve.

“I think they're certainly very experienced guys,” Mr. Cunningham said of Assured Agencies' leaders. “They've got a lot of deal experience behind them. They certainly have a premier private equity firm behind them.”

But, Mr. Cunningham added, “They're certainly going to have to use all their talents and possibly have some good luck to get some traction.”

GTCR's Mr. Cohen acknowledged there is competition for acquisition targets. “It's clearly a concern,” he said, but added that Assured Agencies will benefit from offering entrepreneurial owners of small brokerage offices expanded resources and access to markets while allowing them to “remain involved and remain meaningful to the overall organization.”

Mr. Wicher said the new broker's formation suggests a belief among those involved that the current phase of the insurance pricing cycle is nearing its end, with many agency owners realizing they'll need additional resources to succeed when markets harden.

“In a tight market...it is all the more important for small- to medium-sized brokers to have all the tools that come with being part of something larger,” Mr. Wicher said. “So I think it's an excellent time to position the way these guys are able to position themselves.”

Mr. Shields offered a similar view. “It's such an enormously fragmented market,” he said. “There's plenty of opportunity for acquisitions in the marketplace.”

“I'm relatively optimistic that rates are going to start working for rather than against brokers, probably by 2012,” Mr. Shields said. “This is good timing for all of the brokers and that would apply in this case as well.”