By Len Strazewski

Employee benefits business is booming and agents and brokers that specialize in property/casualty insurance are fighting hard for a piece of the benefits action. But Digital Insurance Inc., in Atlanta, Georgia, which began in 2000 as employee benefits specialists, is more than fighting for its share.

The agency is riding a tidal wave of growth and continuing to evolve as the employee benefits business grows increasingly complex.
Digital began as a specialist in employee benefits for small and medium-sized employers, aiming to provide them with some of the same plan design and rating options available to larger employers, says President and Chief Executive Officer Adam Bruckman.

Bruckman, one of Digital's founders, has spent his entire 25-year career in the employee benefits industry, the past 15 years of which have been dedicated to leading Digital from a venture-backed startup to the largest national agency which is exclusively focused on employee benefits. The original strategy was to market insurance online to employers, but the tactic quickly changed to partnering with other agents, brokers and financial service firms to help them manage a small business customer base, he recalls.

Back then, as they are now, property/casualty insurance specialists were struggling to meet the growing needs of their clients and provide efficient, cost-effective service to small businesses. The new company invested in expertise and technology designed to deliver that service.

"Teams, technology and efficient agency management systems were what we brought to partnerships with agents and brokers that recognized a growing need for efficiency and expertise. Those were the roots of our business," he says.

Digital Insurance's EVP of Culture and Corporate Development Elizabeth Chrane, photographed just outside the company's Sky Lounge (an open-air break room for employees and visitors), is excited about the company's new corporate offices which includes an open concept with low-walled cubicles and huddle rooms for team meetings.

Digital established a revenue sharing model and provided support for primarily property/casualty insurance agencies that needed benefits resources to maintain their comprehensive books of business. With superior customer service and an efficient technology platform, the business flourished, he remembers. In the first seven years of operation, the agency book of business grew to 20,000 small businesses.
But in 2010, the passage of healthcare reform provided new avenues of opportunity, Bruckman says. Compliance became a pressing issue for all sizes of employers but larger firms, in particular, needed expert advice to manage their future benefit plans under the new law.
In 2011, the firm split into three divisions: Digital Benefit Advisors, a new brand for marketing consulting expertise; Digital Enterprise, which serves small and medium-sized businesses throughout the United States; and Digital Small Business Express which manages thousands of microgroups. The firm is now a division of Fidelity National Financial.

Business exploded. From 2010 to 2016, Digital grew from 150 to 710 employees in 30 offices, acquiring 25 smaller agencies around the country, giving the firm a national network for sales and service.

"For the past seven years, we have managed a 30% annual growth rate through both acquisitions and organic growth," Bruckman says. "We have made a lot of mergers and acquisitions, but our organic growth has been averaging 8% to 10%," a testimony to the firm's marketing and technical expertise.

Bruckman anticipates revenues will top $150 million by the end of this year and double in the next three years, reaching a $250 million milestone in 2018.

Digital now provides a full range of employee benefits products as well as strategic plan designs that comply with ACA regulations. Products include: group and individual medical insurance, as well as group dental and vision care, short- and long-term disability and a variety of voluntary benefit offerings.

Digital also provides special service centers such as the Customer Advocate Center, an advanced call center service operation, responding directly to employee and dependent questions about coverage terms, deductibles, and claims status; and the Wellness Management Center that provides health risk assessments and wellness management tools for plan participants.

Additional proprietary strategies include a new Human Capital Management solution for small and mid-size employers and risk management services for Professional Employment Organizations (PEOs), offered through the company's Compass Consulting division.

But Bruckman says expertise and the ability to meet the evolving needs of employers continue to be the company's strongest value proposition. Employers need technical expertise and sound business advice more than ever, he explains, even as healthcare reform winds down into business as usual.
"Employers have a whole new generation of employees with a different set of values that need to be considered. In addition to employee benefit plans that need to be designed to respond to those values, employers need guidance on human capital management and human resource information systems to maintain their efficiency," he says.

From left: Antoine Blackwood, Alexa Fuquay, Chasity Coverson, Jordan Zech and Elizabeth Chrane take advantage of the "Huddle Room."

Digital continues to expand its resources with new levels of expertise and technology, but also continues its acquisition growth path. In December, for example, Digital acquired Bean Hamilton Corporate Benefits in Little Rock, Arkansas.

"Joining Digital Benefit Advisors enhances our ability to effectively serve our clients in the complex, evolving world of health insurance," said Bean Hamilton President Fred Bean, CLU, at the announcement of the merger. "Our clients now have access to compliance experts to guide them, cutting edge technology to streamline plan administration, and human resource tools to support daily operations."
Mike Sullivan, executive vice president and chief growth officer for Digital, has more than 25 years of insurance industry experience. He began his career at MassMutual, then joined New York Life and later became a vice president at Aetna before teaming up with Bruckman in 2000.

Sullivan oversees Digital's strategic growth plan and ensures that the company maintains its technical value and culture as it grows. Employers are choosing more sophisticated strategies, he says, challenging their agents and brokers in new ways and calling for innovative plan design.

"I believe in private exchanges and I expect that employers will be moving toward defined contribution models for health benefits," Sullivan says. "That means that we must have the expertise and technology to manage those plans."

Digital will also need the personnel and the support for the future, which is integrated into its acquisition strategy.

"Over the years," Sullivan notes, "our industry has found itself doing more work for less money. In response, we have invested millions of dollars building an infrastructure that delivers efficiency and economy. But in the migration from an insurance outsourcing company to a retail broker, we have also come to understand the people side of the business as well as the technical side."

Insurance is a people business, many in the industry say, he notes. "Everyone says it, but we live it. And more than 15 years after we began, our best years are in front of us," Sullivan says.

Elizabeth Chrane, executive vice president of corporate culture and development, manages human resources, talent management and corporate communications in addition to directing the integration of merged agencies and their employees.

Before joining Digital in 2008, she spent 15 years in the financial services and healthcare industries with leadership roles at Opteum Financial Services, HomeBanc Mortgage and TLC Laser Eye Centers.

She was originally hired to lead marketing for the company, but quickly became engaged in the rapid growth of the firm, assisting in the onboarding of compatible employee benefits agencies with a strong focus on the organizations' values and corporate culture.

From left: Chuck Ristau, Chief Financial Officer, and Elizabeth Chrane, EVP Culture and Corporate Development, meet with Digital Insurance President and CEO Adam Bruckman.

"When I joined Digital, we had about 125 employees. Now we have more than 700 employees," she says. "I could see there was something unique about Digital and the culture it was developing. The culture was open and receptive to new ideas-and receptive to individuals who could contribute to the innovation we were building."

When the agency launched its new strategic organization, Chrane was given the challenge of building a department focused on fostering the company's culture and investing in its people, the organization's most important asset.

Today, she is deeply involved in the acquisition activity, helping to determine if a potential partner is the right for Digital Benefit Advisors' continued expansion. Chrane says the Digital leadership attempts to learn as much about the potential partners as possible, paying attention to the resources and services they can bring to clients, but also their business style.

"Our culture is the key to our competitive advantage," she says. "It is important that, as much as possible, we identify the right partners who can fit into our growth and evolution. It's not just whether they can bring profit to the firm, but also can they provide other benefits to the business and the culture."

Site visits are important as the Digital leadership explores whether their proposed merger will fit into the agency's up-tempo growth-oriented style.

"It's not one size fits all," Chrane says. Digital doesn't just seek to acquire a book of business, but rather partner with individuals who contribute to an evolving collection of services and expertise. "The real question is: 'Do they have the DNA to fit with our business style and mission?' "

What's in the DNA? Employee buy-in to the company mission, passion for the industry, and the ability to communicate successfully with colleagues and clients. Those are three key reasons for Digital's success, she says.

The author
Len Strazewski is a Chicago-based writer, editor and educator specializing in marketing, management and technology topics. In addition to contributing to Rough Notes, he has written on insurance for Business Insurance, Risk & Insurance, the Chicago Tribune and Human Resource Executive, among other publications.