Reliance Global Pivots, Sells Assets to Fund AI-Powered InsurTech Push

LAKEWOOD, NJ – December 29, 2025 – Reliance Global Group, Inc. (NASDAQ: RELI) announced today the completion of a strategic sale of two non-core insurance agencies, a move designed to aggressively reshape its financial structure and sharpen its focus on its technology-driven future. The InsurTech firm finalized the divestiture of its Michigan-based subsidiaries, Employee Benefits Solutions, LLC and U.S. Benefits Alliance, LLC (EBS), for $1.05 million in cash.

The transaction is a cornerstone of what the company calls a "balance sheet rationalization program." According to the announcement, 50% of the net proceeds will be used to pay down outstanding debt, while the remainder will be funneled directly into its core InsurTech platforms, RELI Exchange and 5minuteinsure.com. This divestiture marks a decisive pivot, shedding traditional "brick and mortar" assets to fuel its ambitions in the competitive artificial intelligence and cloud technology space.

A Strategic Financial Overhaul

The sale of the EBS business unit is more than a simple portfolio adjustment; it is a critical component of a broader and aggressive deleveraging strategy executed throughout 2025. This single transaction, combined with prior efforts, has enabled Reliance to reduce its long-term debt by approximately $6 million—a reduction of more than 50% over the past year.

Company executives project that this substantial debt reduction will slash annual principal, interest, and service fee payments by over $1.8 million, freeing up significant capital. "Combined with the debt reduction from this transaction... the Company anticipates greater scaling and an enhancement in our competitive position," stated Joel Markovits, the company's CFO, in the official press release.

This financial maneuver comes at a crucial time. Prior to the sale, recent financial reports indicated the company was facing challenges, with an InvestingPro analysis noting it was "quickly burning through cash." As of the last quarter, total debt stood at $7.06 million against a market capitalization of just $4.8 million. The infusion of cash and reduction of debt service obligations are designed to directly address these pressures.

Adding to the urgency is a recent notice from Nasdaq, received on December 12, 2025, indicating that the company's stock no longer meets the $1 minimum bid price requirement. With a 180-day compliance window to regain its footing, this strategic divestiture and subsequent balance sheet fortification appear to be a calculated response aimed at restoring investor confidence and securing its position on the exchange.

Shedding Legacy Assets to Fuel Tech Ambitions

The assets sold—Employee Benefits Solutions and U.S. Benefits Alliance—were acquired in 2019 and provided traditional employee benefits and health insurance services. While the company described EBS as a "reliable asset," it was ultimately deemed non-core to its long-term vision.

In the years following the acquisition, Reliance had already integrated strategic elements and intellectual property from these businesses into its primary B2B platform, RELI Exchange. The sale announced today involves only the remaining, non-strategic components of those operations. This surgical approach allowed the company to retain value while divesting the operational overhead of the traditional agency model.

"Successfully completing this transaction is an important step in our overall strategy to focus capital and efforts toward the areas that the Company has identified to potentially produce the best return on investment," said Ezra Beyman, CEO of Reliance Global Group.

Those high-return areas are unequivocally its technology platforms:
* RELI Exchange: A business-to-business (B2B) InsurTech platform that equips independent insurance agencies with a suite of AI-powered tools. It aims to level the playing field, allowing smaller agencies to compete with national giants by improving efficiency and reducing back-office costs. The platform recently expanded its Commercial Quote & Bind solution after a successful beta launch.
* 5minuteinsure.com: A direct-to-consumer (B2C) platform that uses AI and data mining to deliver rapid, competitive quotes for auto, home, and life insurance, catering to the modern consumer's demand for speed and convenience.

By reinvesting the proceeds from the EBS sale into these two platforms, Reliance is placing a firm bet that its future growth lies not in traditional brokerage but in scalable, technology-forward solutions.

Navigating a Competitive InsurTech Landscape

Reliance's strategic pivot aligns squarely with dominant trends sweeping the insurance industry. The global InsurTech market, valued at nearly $10 billion in 2023, is projected to explode to over $96 billion by 2032, driven by a compound annual growth rate of approximately 35%. Key drivers of this growth are the very technologies Reliance is banking on: artificial intelligence, cloud computing, and hyper-automation.

Industry reports from firms like Forrester indicate that while many insurers are still grappling with how to best leverage AI, it is the undisputed engine of tech spending and transformation in the sector. From AI-driven underwriting and real-time quoting to automated claims processing, technology is reshaping every facet of the insurance value chain.

However, this opportunity comes with intense competition. Reliance is not only competing with legacy insurance giants undergoing massive digital transformations but also with a host of agile and well-funded InsurTech darlings. B2C players like Lemonade and Next Insurance have already captured significant market share with their user-friendly interfaces and AI-powered models. In the B2B space, platforms like Bold Penguin and Boost Insurance offer sophisticated "insurance-as-a-service" infrastructure.

By shedding non-core assets and deleveraging its balance sheet, Reliance is attempting to become a leaner, more agile competitor. The move frees up both capital and management focus, allowing the company to concentrate its resources on innovating and scaling RELI Exchange and 5minuteinsure.com. The success of this strategy will ultimately depend on its ability to execute in this crowded market, differentiate its offerings, and demonstrate a clear path to profitability that can reignite investor interest and lift its standing on the public market.

The sale of its Michigan agencies is therefore not an ending, but a calculated new beginning, representing a firm commitment to a future defined by algorithms and cloud infrastructure rather than traditional brick and mortar.