The next generation at B-H-C is represented by (l to r) Shannon Schmidly, Marty Clark and Scott Clark.
By Dennis Pillsbury
There are very few people left in the insurance industry who aren't wondering when or if the current soft market will ever end. It has lasted nearly a decade and has had a dramatic impact on the way business is conducted. And Brown-Hiller-Clark & Associates (B-H-C), Fort Smith, Arkansas, is no exception.
"It's certainly made us change the way we operate," notes Sam Hiller, president. "We're geared to bringing in more business and that puts more emphasis on the sales side. We've also become a much more cost-effective operation. Automation, which really was viewed as an expense for a long time, finally is showing some benefit. It's really helped us keep the cost of doing business down and that's key in today's environment."
He continues that budgeting now is done "without contingencies and with the assumption that we will lose around 20% on current business due to pricing. It means we have to run like hell just to stay even. The emphasis is on retaining business, developing new business, and rounding out accounts a little better."
While this certainly represents a change in emphasis, an awful lot of what B-H-C has done since its inception in 1915 remains very much the same. The agency continues to focus on service to clients and on being a good citizen in the community, living up to its motto that the agency provides "The Difference that makes a Difference." "Good service means better retention and a good reputation in the community and these translate into easier access to potential customers," Sam points out.
The agency traces its roots to the founding of the W.A. Booker Insurance Agency in Fort Smith in 1915. Mr. Booker was joined by P.G. Brown in 1933, and the agency name became Booker-Brown Agency. In 1950, F.M. Hiller became a partner and the firm became known as Brown-Hiller, Inc. Sam Hiller, F.M.'s son, joined the agency in 1963 and was named a full partner in 1973. He currently serves as president and treasurer of the agency.
In 1972, Larry Clark, CIC, joined the agency after having served as assistant manager of the Fort Smith Chamber of Commerce. He became a full partner in 1973 and the agency's name was changed to Brown-Hiller-Clark & Associates. Today, Clark is executive vice president and secretary. Tom Cooley, who is a partner and vice president, joined B-H-C in 1983 when McConnell-Cooley Agency merged with B-H-C. In 1976, F.M. Hiller retired. P.G. Brown stepped down as president to serve as agency consultant in 1979, and Gaylon Brown, Jr. retired in 1988.
Today, the agency operates in both Arkansas and Oklahoma and boasts property/casualty premium volume of nearly $14 million, with 84% commercial and 16% personal lines. There are 29 employees in its three operations--the main office in Fort Smith and B-H-C of Oklahoma in Sallisaw, Oklahoma, both of which write P/C business; and B-H-C Life & Group Specialists, Inc., also in Fort Smith.
The next generation at B-H-C is represented by (l to r) Shannon Schmidly, Marty Clark and Scott Clark.
The next generation
The 1990s saw the addition of three young producers who represent the perpetuation plan for B-H-C. Scott R. Clark, CIC, joined the agency in 1990 as vice president of marketing. Marty C. Clark, AAI, joined in 1993 as vice president of marketing; and Shannon C. Schmidly joined in October of 1996.
"We've brought these young guys into the agency by design," Sam points out. "Our primary goal is to turn it over to them in an organized method. We go with them on larger cases and try to support them in their sales efforts. Right now, they are aggressively picking up new business, while Larry, Tom and I handle the management. The three of us are in our 50s so we're able to slowly introduce them to the management side of the business. For example, I bring them with me to meetings of the Midwest Agents Group where they have a chance to meet with other producers and discuss sales and management issues.
"Inside the agency, we're pretty much letting them run the sales effort. They meet every Monday with people from the life and group operation to discuss their game plan for the week. They're all well known in the community as is our agency and that gets them in a lot of doors. They're extremely busy. With their help, we've broadened our scope. We'd pretty much been a contractor agency--contractors were our market for years. Today, we're writing other good, well-managed businesses in addition to contractors."
Sam continues that the fact that B-H-C has an organized perpetuation plan in place has "helped us tremendously in developing insurance company markets. Insurance companies have been knocking on our doors because they know we have a plan."
"Insurance companies have been knocking on our doors because they know we have a plan"
--Sam Hiller, President of B-H-C
"The difference"
While sales provide the fuel to run the agency, service is the lubricant that keeps the agency operating effectively. The "Difference that makes a Difference" cements the long-term relationship that B-H-C establishes with every one of its clients and its insurance companies.
That "difference" was dramatically brought into play in April of last year when the area was hit by a tornado that did estimated damage of more than $500 million. "We had 163 claims to the tune of around $12.5 million," Sam says, adding that the final tally isn't known since three claims still are open because reconstruction has not yet been completed.
"Our insurance companies were terrific. They worked with us to settle these claims as quickly as possible. We didn't lose one client. We actually picked up new clients because we settled so quickly and word got around."
Of course, the "difference" isn't displayed only during a catastrophe. B-H-C provides value-added service on a daily basis. "One of the things we do on larger accounts is a regular analysis of their workers compensation program using Smart-Comp," Sam explains. "This service generates a number of loss trending reports that really help us show each of our insureds just what goes into determining the pricing. We've found that by educating our clients in this way, it's really helped to establish a stronger relationship. It's also helped us market the business to our insurers."
Another example of the way that B-H-C makes certain that someone is always available to customers is by having a backup for each agent. "That's pretty standard on larger accounts. That serves to give the customer more confidence and has helped in our retention, which runs in the high 90s."
Automation also is a key to quick service. "We've got Applied Systems' WinTAM, and we're using it for almost everything with the exception of scanning. It's all Windows-based and our computers are networked so each person in the agency has access to client information and can help them immediately when they call."
B-H-C doesn't rely solely on shoe leather to reach clients. They have a TV advertising program that "has been well worthwhile," Sam notes. "We spent around $31,000 last year and got co-op for around $12,000 of that. The TV package we purchased tagged big sports events like Razorback football and even included local time during the Super Bowl. We also run on the news. We know it's worked because clients and potential clients have mentioned seeing the ads, especially when we showed up on the Super Bowl. We also have done a little bit of radio."
He adds that the advertising agency also has helped with brochures and presentations. "They keep all our information in their computer and can produce a color brochure and a customized presentation really quickly so we can have a sophisticated looking package when approaching larger clients."
B-H-C epitomizes what has been a common thread with all the successful independent agencies we've spoken to--an emphasis on value-added service and long-term relationships with clients. This "Difference that makes a Difference" is the reason we recognize B-H-C as our Agency of the Month. *
©COPYRIGHT: The Rough Notes Magazine, 1997