The Knight Insurance Group team
Amid growth, employee-owned
agency works to keep the heart and soul of who they are
By Dave Willis, CPIA
Photography by Tim Meyers
When Knight Insurance Group Board Chairman Ken Knight gets bored on the weekend, he rides the elevator down to his office and does a little work. He can do this because, four years ago, he bought the building next to the agency’s downtown Toledo, Ohio, office and moved there from his childhood home of 60-plus years. He and his wife live on the third and fourth floors of the building.
Ken grew up in the agency, which traces its roots to 1859. “In high school, I started working at the office and have been there ever since,” he says. He and his brother bought their dad’s ownership in the late 1970s. “My brother was exactly opposite of me; he was the fun-loving personality who liked to deal with clients. I was a detailed person who liked to get the work done,” Ken says. “We were a great combination.”
After losing his brother to cancer in the 1990s, Ken successfully ran the agency for a time but then felt the tug to find another partner. He did just that by merging his firm with Crockett Miller, an agency whose principal, Luann Canham, “was the best influence in my life,” Ken recalls. “She taught me how to look at things completely differently—to focus on the positive, on what people did right. It was eye opening, and it turned my life around.”
Agency of choice
Today, the agency’s 50 employees serve thousands of customers, located primarily in Ohio, Michigan, and Indiana. Its mission is to be the agency of choice for its various stakeholders. “Stakeholders have been an important part of our value proposition,” says Diane Keil-Hipp, chief operations officer. In the early 2000s, the agency identified five stakeholder groups: clients, employees, the community, carriers, and owners.
“We try for every decision we make to be good for all of our stakeholders,” explains Diane, who has been with the agency for 41 years—since she was in high school. “For instance, a decision we make can’t hurt a carrier even though it benefits a client.”
Agency of choice plays out through the agency Partner-Carrier program. Each year, the agency designates five insurers as partner carriers. “These are companies that don’t just call us a partner, but really treat us like one,” explains agency CEO Bud Bonner, who was brought on in 2017 to, among other things, help the agency build a strong sales/growth engine. “We’re part of each other’s planning process; we collaborate on our mutual capabilities.” Those five carriers get a first look at opportunities because they’re partner carriers.
“Most [ESOPs] are based on salary … . We incorporated longevity, so the receptionist with 30 years’ service can get almost as much as a top producer, because she’s been here so long.”
—Ken Knight
Chairman of the Board
The agency maintains with these carriers what Bud calls a “three-level relationship: with the frontline folks—the underwriters or field underwriters—with middle management, and with senior management.
“So, if someone on the front line gets promoted or leaves and we don’t have a relationship with the replacement, we lose traction,” Bud explains. “We want to be able to go to the next level at the carrier and say, ‘Hey, last year we wrote a million dollars with you and this year, it’s only $30,000. We need help.’ And we can go all the way up to senior management; that’s critical in being a partner carrier.”
There’s something else in it for carriers besides first look. Well, for one carrier each year, anyway. “At year-end, our employee-owners vote for carrier of the year,” Bud explains. “We travel to the winner’s headquarters and deliver a trophy. Insurance company executives are excited to win. In one case, without naming carriers, a winning CEO picked up the phone and called a long-time buddy from another company to let him know they won.”
Customer and community focus
For customers, a differentiator feeding the “agency of choice” mission is the agency’s proactive review process. “You retain clients when you pay attention to them, provide them good advice, and deliver accurate and timely service,” Diane explains.
“The first thing that we look for in hiring is whether someone’s a fit for our culture. If they are and they have the capabilities, we’re interested.”
—Bud Bonner
Chief Executive Officer
As part of the review process, staff members meet with clients to “uncover changes in their life or business—something that may necessitate a change in their insurance. Maybe they forgot to tell us something and it’s our opportunity to find it before a claim happens,” she notes. They conduct 1,000-plus such reviews annually.
Employee-owners benefit from this, too. “For about 25 years we’ve had a bonus program called gainsharing,” Diane notes. “It bonuses our service team from pooled funds shared from the gain the agency earns from high retention.
“Another differentiator that seems small, but is big to clients, is a live receptionist to answer every call, directing them to someone right here in the office,” Diane adds.
As part of its community engagement, the agency has what it calls a “team and family committee” that’s been around for years. “Each year, they designate one charity to focus all fund-raising efforts and carrier grants we apply for,” Diane explains. “Our receptionist chairs the committee and they determine everything we do.”
Employees take ownership
In 2022, the number of stakeholder groups shrank from five to four, as a perpetuation move combined “employees” and “owners.” Diane describes the move—creating an employee stock ownership plan, or ESOP—as being “most impactful” in terms of changing agency trajectory.
Ken recalls factors that precipitated the move. “Ten years ago, our major competitor in town—a really good, long-time agency, exactly like us, very loyal to employees, loyal to the community—decided to sell to private equity,” he explains. “The owner was probably the same age as me, in his late 60s, and they were probably double our size—with 110 employees. Today, the acquiring company employs 25 here.
“That shocked the living heck out of me,” Ken adds. And it got him thinking about his own team. “These people who built our agency are loyal to us and it wouldn’t be fair to take that away from them.” So they toyed with different perpetuation options, including some that would get them more money, but that wasn’t necessarily what they wanted. They wanted to be fair to everybody.
This led to the creation of the ESOP. Diane says, “The ESOP solved the problem of protecting our employees, protecting the community, and keeping our name on the door.” It rewards the employees who built the company and those employees now feel more involved in decision-making. “They ask questions now, like when we need to hire another person, ‘What role do we really need filled?’ They’re more cognizant,” she notes.
According to Ken, the agency structured the ESOP differently from many. “Most share allocations are based on salary, so someone who makes 1% of total agency salary gets 1% of the stock. We incorporated longevity, so the receptionist with 30 years’ service can get almost as much as a top producer, because she’s been here so long.”
The agency has had several employees join because of the ESOP. “And we’ve had some leave and then come back, realizing the ESOP’s a really good option,” Diane says. “In 20 years, we could have employees with million-dollar funds.”
The ESOP also feeds into client and prospect preferences. “People want to buy local,” Diane explains. “They want to deal with a company who has a commitment to the community, and we’re doing that in spades.”
Importance of culture
Another key to the agency’s success is agency culture. Knight Insurance Group’s culture is built around the notion that values drive behaviors, and behaviors drive outcomes.
“Our agency has a big, hairy audacious goal: to be one of the top 100 agencies in the country,” Bud explains. “But as we pursue that goal, it’s important that we keep our soul. So, we want to be a top-100 agency that people envy and admire.”
Addressing culture starts with hiring. “The first thing that we look for in hiring is whether someone’s a fit for our culture,” Bud explains. “If they are and they have the capabilities, we’re interested.” Bud says agency culture was part of what drew him to the firm in 2017.
“We strive to make every decision good for all our stakeholders. For instance, a decision can’t hurt a carrier even though it benefits a client.”
—Diane Keil-Hipp
Chief Operations Officer
The Commercial Lines Sales team. From left: Evan Rosplohowski, Risk Consultant; Matt Werner, Business Insurance Consultant; Risk Consultants Tom Regan and Phil Bowles; Greg Corbitt; Risk Consultants Del Vath and Rick Diegel; Travis Spitnale, Risk and Surety Consultant; Stephanie Ehman, Risk Consultant.
To ensure consistency around the topic, the agency maintains an official culture statement. “The statement addresses the three tiers of our culture—values, behaviors and outcomes, or VBO as we call it,” Diane says. “These values are enduring relationships, exceptional standards, and relentless focus.
“From those values, we have behaviors—that’s where the rubber meets the road,” she adds. “All employees are expected to, for instance, earn trust in every interaction, treat people with the Golden-Platinum Rule, seek opportunity in every challenge, always be creative, and build themselves as a person.”
From those behaviors, Diane explains, “we expect to receive outcomes: that we will grow and thrive in a fun environment. And the word ‘fun’ is there intentionally. We don’t want it to be a slog. Second, that we delight our stakeholders—not just our clients, but all our stakeholders, and then third, that we are the best at what we do. Those are our three outcomes.
“So we live and breathe our VBO,” Diane says. Performance reviews are centered around it. The agency gives out awards for each of the values. And they’re displayed prominently in the office and integrated into everything the agency does.
Culture is valued by employees, as Bud points out. “We participate in the annual top workplace program. Eight of the last nine years we’ve won top workplace, and the only way to win is from employee votes.” The only year the agency didn’t win was when COVID hit—and they didn’t participate.
Meeting the future
As the agency looks ahead, it has a plan. “Our future growth strategy is two pronged: organic sales growth, which we’ve been honing since Bud joined us,” Diane explains, noting that the agency had its best year ever last year in terms of new sales and EBITDA.
The Administrative team. From left: John Gage; Michelle Bowe, Information Specialist; Lauren Roe, Digital Media Specialist; Brenda Robinson, Director of First Impressions; Tom Daniels, Director of Talent Management.
The Commercial Lines team. From left: Anna McCann, Account Manager; Holly Reif, Team Leader; Natalie Messenger, Account Analyst; Cystal Gleason, Assistant Account Manager; Nicole Bowles, Event Coordinator and Marketing Assistant; Julian Urbina, Account Analyst; Wendy Harris, Account Manager; Ross Villella, Account Analyst; Mitchell Fink, Risk Consultant; Michele Merritt, Commercial Marketing Leader; Michelle Roberts, Account Manager; Hannah Zapiecki, Marketing Assistant; Michelle Willard, Director of Employee Benefits.
The Personal Lines team. Seated from left: Account Managers Monica Romstadt and Dorian Harmon; Marlene Levengood, Team Leader; Paula Korecky, Account Manager. Standing from left: NaJiya Whitman, New Business Administrator; Tracy Barber, Senior Account Manager; Michelle Crosley, Account Manager; Heather Gaisie, Retention Specialist.
“There’s a term we got from our consultant, MarshBerry, called PPOG, which stands for predictable, profitable, organic growth,” Ken adds. “You can’t just have growth without having it be profitable and predictable.”
“And the second area is mergers with like-minded agencies” Diane says. “There’s a lot of private equity money out there, but our proposition is different. We’re saying, join with us and your employees can become owners. If that legacy is important to you, we should be talking.”
Left: Joe Marck, Director of Development of IBC Properties, an agency client, points out an architectural drawing of Burt’s Theater from the late 1800s.
Right: Joe Marck; IBC Properties President and CEO Gary Marck; and Ken Knight stand in the former Burt’s Theater building, located a few blocks from the Knight office. Once the home of a bar, the building inspired the opening line from the Kenny Rogers song “Lucille.”
La Posada Family Emergency Shelter, part of Knight Insurance Group Charity of the Year Catholic Charities, provides temporary housing in the Toledo area. Diane Keil-Hipp (right) visits with Rodney Schuster, Executive Director of Catholic Charities Diocese of Toledo and Michelle Wojnowski, Program Coordinator of La Posada Family Emergency Shelter.
According to Ken, target agencies likely will be in the Ohio/Michigan/Indiana area. “That’s not to say we wouldn’t open a strong branch outside of these states, but right now that’s where we’re focusing. Being in the Midwest protects the insurance carriers against severe natural disasters.
“When asked about retiring, Ken—who boasts proudly of his beautiful wife and three children, three grandchildren, and one on the way—says, “Why? We have such great people. And I’m having so much fun right now. This is exactly what I want to do every day—be with these great people and deal with the relationships with the carriers and the clients.
“I do exactly what I want to do,” he adds, “and I have people like Diane and Bud who do all the stuff I hate to do. It’s a perfect combination. I’ll tell anybody, find good partners and you’re going to be happy for the rest of your life.”
And we’ll tell Ken and the rest of crew at Knight Insurance Group that we at Rough Notes magazine are happy to recognize your 165-plus years of success and share your compelling story with others in the independent insurance agency arena.
