Local presence, global reach
Serving banks is a key element in the growth of New York's Lee Agency
By Elisabeth Boone, CPCU
In the tightly knit community of New York's Chinatown, business and personal relationships are based on traditional principles of trust, respect, and integrity. From newly arrived immigrants to families whose ancestors arrived in New York in the 1800s, Chinatown's residents share a cultural bond that transcends differences in age, education, and social status.
Located in lower Manhattan, Chinatown is home to numerous businesses whose employees speak one or more of the common Chinese dialects—Mandarin, Cantonese, Toisanese, Shanghainese. These businesses play a vital role in building bridges between the Chinese and American cultures.
Exemplifying this commitment to outreach is Harold L. Lee & Sons, Inc. Insurance Services, a fixture in Chinatown's historic Pell Street since 1888 and now in its fourth generation of family ownership (see "Connecting Cultures, Building Business" in the August 2002 issue of Rough Notes). Every employee of the agency is a Chinese American who speaks or reads at least one dialect, and the agency's brochures are printed in Chinese, English, and Chinese/English.
Under the leadership of Sandra K. Lee, chairperson and chief executive officer, and Stephen Boon Jr., president, Lee Insurance is a full-service, all-lines agency that writes business nationwide and provides risk management services to its commercial clients. In addition to its Chinatown headquarters, the agency has offices in Los Angeles and the San Francisco Bay area. Through a partnership with a United Agencies affiliate in Pasadena, Lee Insurance offers a complete portfolio of employee benefits products and services.
Diversity in action
Long active in efforts to achieve diversity in civic affairs and in the insurance business, Lee and Boon have held leadership positions in numerous organizations and have been honored for their contributions.
Lee chaired the IIABA's Diversity Task Force from 2008 to 2010 and serves on the Small Business Fairness Board and National Advisory Council. In 2003, she was named by Crain's as one of the 100 Most Powerful Minority Business Leaders in New York. That same year, Lee Insurance was honored as Travelers' Agent of the Year—Emerging Markets; and in 2010, Travelers named Sandra Lee as one of its top 20 Personal Insurance Agents of the Year.
Stephen Boon was a founder and a recent past president of the Chinese American Insurance Association, and during his tenure he initiated a scholarship fund for young Chinese American insurance professionals with St. John's University/The College of Insurance. He has served on insurers' producer councils and made presentations to senior management on multicultural and emerging markets.
"In addition to being active in the Big 'I' Diversity Task Force, we participate in our carriers' diversity councils and emerging market councils," Lee says. "This gives us the opportunity to help our carriers understand the unique demographics of new populations of Asian immigrants."
Reaching out to banks
A strong and growing niche market for Lee Insurance is banks and financial institutions. Sandra Lee's grandfather, Harold Lee, was the first Chinese employee of Manufacturers Bank, and in the 1920s he started a foreign exchange business at the Pell Street office of the Tai Lung (Great Prosperity) Company that was founded by his father, Lee Kee Lo.
As noted in the 2002 article, Asian banks are being established here at a rapid pace to serve the needs of a growing immigrant population that includes newcomers from China, Hong Kong, Taiwan, and Singapore. With its deep roots and strong ties to the Chinese-American community, Lee Insurance is ideally positioned to help these financial institutions obtain insurance and bonds while at the same time acquainting insurers with the desirable characteristics of Chinese banks.
"We began to focus on financial institutions in the 1990s when Chinese banks were starting to establish operations in the United States," says Stephen Boon. "As newcomers, they did not have any resources to place insurance for them. They looked in the Yellow Pages and found the names of the larger brokers. Those brokers placed insurance for the new banks but did not provide the same kinds of services they offered to their larger accounts.
"Around that time, the Chinese banks joined forces and formed the New York Chinese-American Bankers Association," Boon continues. "We became associate members because we thought it would be a good opportunity to network with the Chinese banking community. Once we became acquainted with the executives of the member banks, we were able to discuss their insurance needs. They found out that we had the same markets as the larger brokers, and they gave us the opportunity to develop programs for them," Boon explains. "We were also able to provide these banks more personalized service than they had been accustomed to receiving. As newcomers, they had many questions, and we could give them answers and speak with them in their own dialect."
Adds Lee: "The banks' employees were more comfortable speaking in their native tongue as we explained credit requirements, bonds, and the kinds of insurance that U.S. banks must carry, like executive liability, directors and officers, and employment practices liability. These coverages are not common in Asia, and we were able to educate bank employees about the details of the policies and the importance of obtaining coverage from A rated carriers," Lee says. "We also talked about the issues that are of concern to regulators. In addition, the agency conducted seminars for bank employees on subjects like certificates of insurance, additional insureds, and mortgage requirements."
Thanks to these outreach efforts, Lee says, "We were able to win the trust of the banks' executives, and today we insure the U.S. operations of some of the largest Chinese, Taiwanese, and Hong Kong banks, as well as many community banks."
Adds Boon: "Much of our success is because of the added value we bring to the table. We encourage our bank clients to tell us about their needs and concerns so we can tailor coverages to their requirements. We also help them with exposure analysis and risk control, which are unfamiliar concepts to many Asian banks."
Lee Insurance offers a comprehensive financial institutions package with property and liability protection. In addition to a bankers blanket bond, the package provides directors and officers liability; executive protection; errors and omissions professional liability; employment practices liability; e-commerce and Internet liability; investment banking, mergers and acquisitions, and settlements liability; kidnap and ransom coverage; travel accident coverage; and workers compensation programs with dividends. The package can be customized to meet the needs of community banks and middle market financial institutions that specialize in securities, investments, asset management, e-commerce, and Internet banking.
Differences in cultural norms and business practices can be a barrier to American underwriters' understanding of how Chinese banks operate, Lee points out. "We're able to enlighten our underwriters and to explain the attributes of our bank clients that make them desirable risks for a carrier," she says.
As noted earlier, relationships based on trust are a hallmark of Chinese culture and business. When the financial meltdown hit in the fall of 2008, Lee comments, "Our Chinese bank clients were less affected than the money-center banks because they know their customers so well and are familiar with the loans they make. They felt some of the fallout from the Fannie Mae collapse, but they didn't experience the same crisis conditions as the banks that made high volumes of loans and applied less stringent standards to prospective borrowers."
Benefits are big business
A rapidly expanding niche for Lee Insurance is employee benefits and ancillary products.
"We had offered benefits products for many years," Lee says, "and this segment of our business grew to the point where we created a separate division for it." As noted earlier, the agency partners with a United Agencies affiliate, Hing & Associates, to offer a full array of employee benefits products to financial institutions and other commercial clients.
Products include group health, dental and vision, life, disability, key person, travel accident, pension and 401(k) plans, flexible spending accounts and health savings accounts, long-term care, and catastrophic health.
"Business owners today are thirsty for knowledge about the health care reform law," Lee says. "The U.S. employee benefits market is especially challenging for new immigrants who come from a country where health care is provided by the government. They may not understand the need for an individual or small business to obtain its own health insurance. We consult with our smaller and middle market clients to help them understand the impact and implications of health care reform for their business," she continues. "We also help them explore alternatives to traditional group health plans like self-funding and alternative risk options, and we explain the advantages of using health savings accounts and flexible spending accounts."
In addition, Lee remarks, "We're working with Baby Boomers approaching age 65 to help them understand Medicare, Medicare supplements, and long-term care. That's becoming quite an attractive profit center for us."
Lee Insurance represents leading carriers for life, health, long-term care, and employee benefits. Lee notes that United Healthcare, which recently acquired Oxford Health Plans, is very active in the Asian market in New York. "Last year we were named one of the top 10 Chinese brokers for United Healthcare because we've written so many small and mid-sized groups with them," Lee says. "In addition to our product knowledge, we have an advantage because we're able to educate prospects in their own dialect."
When Sandra Lee, and Stephen Boon's great-grandfather, Lee Kee Lo, came to New York in 1888 and opened the Tai Lung (Great Prosperity) Company in the heart of Chinatown, he built his business on ancient Chinese values of trust, integrity, and loyalty. Much has changed since Lee opened his office at 31 Pell Street, but if he walked into the office today he would be proud to see his descendants applying the same cherished principles as they serve the Chinese American community of the 21st century.