February

Charlton Manley
Lawrence, Kansas

Being a successful sales organization doesn’t necessarily mean your financial house is in order. That’s what the management team of Charlton Manley discovered in 1998 when the agency’s largest shareholder decided to retire and the buyout ensued.

The agency, which traces its roots back to 1861, had grown organically as well as through mergers and acquisitions. At the time of the buyout, they discovered that collections were a problem and recognized the need for a full-time COO and CFO as part of the agency’s five-year plan to improve its finances and operations. The new COO/CFO implemented a collection plan that didn’t alienate customers, according to CEO Gary Sollars, CPCU, AAI, CWCA. With its improved revenue position, the agency was able to retire the debt from the buyout in five years, rather than 10. The agency was debt free.

Then the agency set its sights on better sales management. So its next five-year plan focused on fully utilizing the agency’s sales talents, while at the same time bringing in new talent, which would fortify the agency’s perpetuation plan. Additionally, the plan called for a doubling of revenues, while boosting revenues from the benefits side of the organization. To achieve the desired results, the agency contracted with a local sales training consultant. The agency’s benefits operation uses value-added enhancements to gain a competitive advantage. Value-added services are important on the property/casualty side as well. Sollars notes that the agency offers a service called Work Comp Solutions that lets clients take back financial control of their WC programs.

On the cover: Executives of Charlton Manley

From left: John Pepperdine Jr., Director of Business Development, and Casey Petersen, Director of Marketing, discuss agency development strategies with Gary Abram, Sales Training Consultant.

“It makes more sense to learn from other people rather than make mistakes and learn from those the hard way.”

—Gary Sollars, CPCU, AAI, CWCA
Chief Executive Officer

March

York International Agency, Inc.
Yonkers, New York

Investing in people, fostering an entrepreneurial spirit, and working with passion—those are the key drivers of success for York International Agency, which from 1997 to 2006 built its revenue from $3 million to $8 million.

Created in 1985 by the merger of two established agencies, York International set its sights on growth and never looked back. The agency, whose specialty is real estate, created an in-house life, health, and benefits unit and aggressively pursues cross-selling opportunities. A professional liability unit, opened in 2003, writes a high volume of D&O through relationships with securities broker-dealers and also offers lawyers and miscellaneous E&O coverages. York International also sees personal lines as an important growth area and has set its sights on strengthening its presence in the high-value personal lines market

Another critical focus has been recruiting top-drawer employees: Of York International’s 32-member staff, 10 come from mega-brokers Aon, Marsh, and Willis, and several have strong backgrounds in national accounts. Although the agency’s bread and butter is middle market accounts, it’s achieving impressive results by developing expertise in large and multinational markets.

Because many of its mid-market clients don’t have an in-house risk management department, York International created a process called RADAR: Risk Assessment and Data Analysis Report. RADAR is the linchpin of the agency’s consultative approach to clients and prospects.

On the technology side, York International has invested heavily in its state-of-the-art agency management system and hired a former Applied Systems trainer to head up its IT and marketing effort.

For York International, the magic formula for success is simple: Work hard and have fun.

York International Agency, Inc., executives on the cover

York International Benefits executives discuss strategy.

“We have an incredibly high-level staff where teamwork is stressed and egos are left at the door.”

—Robert Kestenbaum
President

April

HFA Haywood and Fleming Associates
Gary, Indiana

When you’re the son of an insurance agent, following in your father’s footsteps is often the last thing on your list of career choices. That was certainly true for Roosevelt Haywood III, whose parents came to Gary, Indiana, from the South to work in the steel mills. Although Haywood’s father left the mills and became an insurance pioneer in the blue-collar town, working seven days a week to serve clients was not Roosevelt’s idea of a dream job.

After graduating from Indiana University in 1973 with a degree in business, Roosevelt joined the phone company—only to discover that he was an entrepreneur who wasn’t cut out for the corporate world. Six years later he began a brief stint in his father’s agency but found the situation even more confining than the phone company, with long hours and low pay.

Realizing that he was meant to be his own boss, in 1984 Roosevelt founded Haywood and Fleming Associates to sell life insurance for The Equitable. He quickly expanded into personal lines so he could meet the diverse insurance needs of the community he serves, and subsequently the agency moved into the small commercial arena via the excess-surplus market. Before he knew it, Roosevelt was working the same 24/7 schedule as his father—and loving it.

Roosevelt is unabashedly of the community, by the community, and for the community of Gary, with which he feels an unbreakable bond. Thanks to both community involvement and cultivating business relationships, the agency now handles such important accounts as the City of Gary, the Sanitary District, and the U.S. Steel Yard baseball stadium, among others.

On the cover: Haywood and Fleming Associates staff

Haywood and Fleming Associates insures the stadium for Gary’s Minor League Baseball Team, the Railcats.

“This community is what made us, and we will never abandon our roots here.”

—Roosevelt Haywood III
Principal

May

Hobson Insurance
Hobson, Montana

A rural town of 265 people may not sound like much of a market, but when Dale Longfellow founded Hobson Insurance in 1996, he believed the sky was the limit. And there’s a lot of sky in Hobson, Montana’s Big Sky country, where he and his family moved to lead a simpler life.

With a background in large commercial accounts and expertise in large national programs, Dale brought five of his national accounts to establish Hobson Insurance. He sold off the two largest accounts and kept the three most profitable groups—Sports, Inc., Worldwide Distributors, and Athletic Dealers of America. Since that time, Hobson Insurance has added seven additional buying groups to its national program business and now has written premiums of nearly $5 million.

Knowing your carriers and sending them business that fits their appetite is a key to success, according to Dale, as well as knowing the unique qualities of each buying group in order to match the group with the carrier.
To support the buying group and hear firsthand about any issues the businesses may be facing, someone at the agency attends every show. “Since each group has a show every six months, this means our acquisition costs are a little high, but our loss ratios are low, so it pays off,” Dale says.

Ninety percent of Hobson’s book is BOPs, with an average premium of around $6,000 to $7,000.

On the cover: The staff of Hobson Insurance

The national program business started with Sports, Inc., of which Don Pfau is chairman. Don and Dale are at Don’s first store, located in nearby Lewistown, Montana, which is also home to Sports, Inc.

“Each buying group has its own characteristic. It’s important to know the differences so we can match the group with the carrier.… Someone at the agency attends every show so that we get to hear firsthand about any issues the businesses may be facing and so we’re seen as supporting the group.”

—Dale Longfellow
Principal

June

Specialized Insurance Services, Inc.
Richmond, Virginia

Not many scratch agencies can achieve $6 million in premium in just four years. But if the agency’s leadership combines wisdom and experience with drive and enthusiasm, it can happen. And it did for Specialized Insurance Services, Inc., based in Richmond, Virginia.

Steve Love provides the wisdom and experience, drawing on more than 20 years in the insurance business. He began his insurance career with Nationwide in 1985 and established the Steve Love Insurance Agency, Inc., in Virginia Beach, Virginia, which he still operates today.

When the workers comp market dried up for Nationwide agents in Virginia, Steve set up Mid Atlantic Insurance Services, Inc., a workers comp brokerage. Now it sells all lines of commercial property/casualty insurance for all types of risks for more than 200 agencies in Virginia and 10 nearby states.

The drive and enthusiasm at Specialized Insurance Services begins with agency President Neal Gorman and is replicated by the agency staff. Steve serves as an overall guide and company coach for the agency, while still running his other companies.

Specialized Benefits Services, LLC, provides benefits coverage and consulting, as well as human resources consulting for agency clients.

Specialized Insurance Services offers its staff numerous perks: no “set-in-stone” vacation or sick time policies, ping-pong and air hockey tables, and a personal trainer who visits twice a week to conduct yoga classes.

All told, the four agencies write in excess of $40 million in premium and employ 30 people.

Principals of Specialized Insurance Services, Inc., on the cover

The conference room offers a pleasant, open or closed environment for meetings with clients and company reps.

“We do not have multiple layers of management. The atmosphere is open and laid back.”

—Neal Gorman
President

July

Slaton Insurance
West Palm Beach, Florida

A funny thing happened to Les Breedlove on his way to joining a major national direct writer—his sister introduced him to the owner of an independent agency in West Palm Beach, Florida, who was looking for an aggressive young producer to join his small family-owned firm.

When Breedlove discovered that there were only three people at George Slaton’s agency, he saw a tremendous opportunity and signed on as a commission-only producer. That first year, 1984, he made just $8,000 but had the satisfaction of knowing that by working hard to build a book of business, he had proved his worth to George Slaton.

In 1986 Breedlove became part of the agency’s top management, and in 1998 he purchased the firm, which now has a staff of 42 people and generates revenue of $7.5 million.

In the wake of market dislocations caused by Hurricane Andrew in 1992, Breedlove opened new offices throughout Florida to bring non-coastal business to his insurers. Soon he found himself on a treadmill, constantly trying to put out fires in the various offices. Realizing he was in trouble, Breedlove signed up for a session with agency management guru Roger Sitkins and discovered he was frantically writing business without even knowing whether it was profitable—and definitely without following a plan.

With advice from Sitkins, Breedlove created a plan. Today Slaton Insurance is a sales organization with six producers that stresses high-quality boutique service. Gone are the branch offices, the personal lines division, and an employment leasing firm. The agency dropped its number of accounts from 8,000 to 900 and is now running leaner, meaner, and—best of all—efficiently and profitably.

Principals of Slaton Insurance on the cover

Slaton employees review a presentation on one of the agency’s major value-added strengths, IntelliComp.

“The 30% of expenses that we used to spend on quoting now goes into providing meaningful services to our clients.”

—Les Breedlove
Owner and CEO

August

Hetrick & Associates Insurance
Marquette, Michigan

Operating in the sparsely populated Upper Peninsula of Michigan, this agency has tripled in size, to more than $3.1 million in revenues, since changing owners 10 years ago. With its well-diversified revenue stream (38% commercial; 36% personal; 26% benefits), one of the keys to growth has been cross-selling. To maximize this effort, the agency holds meetings throughout the year, involving as many of its 25 employees as possible. A monthly state-of-the-agency meeting measures progress and adjusts plans. An annual off-site meeting for goal setting includes all employees, during which time the office is closed. For producers, the agency holds quarterly “pipeline” retreats to evaluate its new business opportunities.

To increase the new business prospects in its pipeline, Hetrick & Associates established a business development center, which produces quarterly marketing campaigns. The coordinator for the center measures sales activities with an internally developed reporting system. The software for the system has proven useful enough to be marketed to other agencies. Another internally developed product, ProComp SystemsSM, is offered to the agency’s clients as a valued-added tool for driving down workers comp costs. By stressing its value-added services, “We focus on developing relationships to avoid the price game,” says Sales Manager Scott White. “The result is a consistently high retention rate in the 90s.” Agency personnel take seriously their commitment to education, with six CICs, 11 CISRs on staff, and a number of others working on CRM and CPCU.

On the cover: Principals of Hetrick & Associates

Vertical growth team leaders.

“Our revenue per employee has grown from $60,000 to $130,000 thanks to their [the employees’] efforts.”

—Scott M. White, CIC
Sales Manager

September

Cavignac & Associates
San Diego, California

Cavignac & Associates of San Diego, California, is a 14-year-old agency that focuses on improving every client’s risk profile in order to reduce the cost of risk. The firm concentrates on certain key industries—including design professionals, construction development and real property—learning everything about those industries and the risks they face.

One key to the agency’s success is founder Jeff Cavignac’s progressive attitude. Four years after starting the agency, he brought in Jim Schabarum and Scott Bedingfield to complement his expertise and round out the construction, design professional and development specialty. He also offered them ownership of the agency. Jeff remembers that “other agency owners said that I was crazy to give away stock, but the results speak for themselves.” As of September 2006, the agency has $65 million in premium and a 97%-98% retention rate.

Bringing in 15-year-insurance veteran Stuart Nakutin to work with clients in risk management, loss control and claims management has been a “huge value-added” service to clients, Jeff says. Besides working with clients to educate them and mitigate their risk potential, Stuart works with carriers to provide information to insureds. He also conducts in-house seminars on risk-related topics.

Another value-added is having a human resources expert on staff who conducts HR seminars for clients, many of whom have little or no HR support. And adding value internally is a six-month mentoring program for new producers.

Principals of Cavignac & Associates on the cover

Stuart Nakutin, a risk management, loss control, and claims management specialist, conducts in-house seminars for clients on such topics as contractual risk transfer and OSHA compliance standards.

“…There is no one in our marketing territory who can help clients reduce the cost of risk better than we can.”

— Jeff Cavignac
Founder and President

October

KCI Insurance Agency
Marlton, New Jersey

With fewer than 100 accounts, KCI Insurance Agency in Marlton, New Jersey, is “more leveraged than the average agency,” according to President Ron Cooperman. But with a tight concentration of accounts, the agency is able to develop a strong niche—transportation—and learn everything about the niche and its risk management needs. One of the agency’s goals is for each producer to have a maximum of 15 clients and a minimum of $500,000 in revenue. Powerful relationships exist between the agency staff, clients, and underwriters. As a result, revenues reached $6 million by October 2006.

Another essential element of KCI’s game plan is diversification. The agency lost its only market in 2003. With the loss of the market, KCI also lost six of its top 10 accounts. Although the primary coverages had been with that one market, KCI was involved in managing a workers comp self-insurance group, a risk retention group, and in placing the reinsurance for those entities through its reinsurance intermediary. By having the right people in place who had strong relationships with clients and potential clients, KCI soon had several major markets interested in writing its book of transportation business.

Most of KCI’s accounts represent more than $40,000 in commissions so losing an account impacts the bottom line. But because every account that the agency works on is sizable, Ron says KCI will land a new account to make up for it. “You can’t stop writing big accounts out of fear,” he says.

KCI Insurance Agency principals on the cover

KCI’s 15 talented employees work together as a team and have brought the agency revenues to $6 million, an astounding $400,000 per employee.

“In real estate, it’s location, location, location. In insurance, it’s relationships, relationships, relationships.”

—Ron Cooperman
President

November

Chas. Lunsford Sons & Associates
Roanoke, Virginia

This multi-generational firm operates under the name it bore when it was founded in 1870. And its headquarters location is within walking distance of where its original office stood in 1870. It has grown to write $70 million in premium, with 60 employees and additional offices in Blacksburg and Richmond, Virginia, and Raleigh, North Carolina. The agency began a new chapter in its history in 1995 when Charles I. Lunsford and Roy Bucher, Jr., the current president/chairman, repurchased the firm from Aon. They established an ESOP as part of the new ownership so that as Bucher says, “we would remain independent in the future.”

The book of business is predominantly commercial lines, with the balance in personal lines and benefits, but Bucher describes the firm as “basically a generalist, with businesses ranging from mom and pop establishments to the Norfolk Southern Railroad, which has 8,000 vehicles. However,” he points out, “it has built expertise in some niches, including health care and construction.” The agency also has grown recently in employee benefits and HR services, the latter provided at no additional cost to benefits clients.

The agency prides itself on treating employees well, and was named “The Best Place to Work” in 2006 by The Blue Ridge Business Journal. “If you treat the employees well, they treat the customers well,” says Bucher.

On the cover: Executives of Chas. Lunsford Sons & Associates

Roy Bucher with Pam Breeding, CPIW, Director of Marketing.

“Everyone here is aggressive and hungry for new business. My job is to work to keep that spirit alive.”

—Roy Bucher
Chairman

December

JMB Insurance
Chicago, Illinois

JMB Insurance transformed itself from an agency designed to service its parent’s real estate holdings to a client-centered multiline sales dynamo. The agency was formed in 1971 to provide risk management services to the assets owned by JMB Realty Corp., one of the largest commercial real estate owners in the country. Business literally walked in the front door.

But in 1986, change came when JMB Realty spun off the agency and also began selling some of its assets in reaction to a change in the real estate market. An agency that had prided itself on being able to design sophisticated property insurance programs that often involved a number of insurers and reinsurers had to morph into a sales organization. Lee Sacks, the agency’s founder, headed up the effort to recruit sales professionals who could parlay the agency’s enviable expertise into a competitive advantage as they sought new business.

And then change came again when Lee Sacks retired in 2003 and Steve Topel was hired to move the agency to the next level. Steve faced a host of challenges, including an antiquated automation system, a shortage of middle management structure and no marketing plan. On the plus side was a team of people ready for change and willing to take on any challenge thrown in their direction. “I kept sticking 20 pounds of stuff into a 10-pound bag,” Steve says. “There was change after change after change. Fortunately, we have a resilient team and they welcomed every challenge and became stronger for it.”

Today, the agency employs 104 people and has $25 million in revenue with more than half of its business coming from outside the property arena.

On the cover: The Executive Committee of JMB Insurance

The Hospitality and Real Estate teams at JMB still account for half of the agency’s revenue.

“One of the things you learn very quickly in this business is that you can’t stand still. If you try to stay even, you always lose ground. You need to constantly move forward.”

—Steven J. Topel
President and CEO