Skip Knauff at the Charlotte Motor Speedway. The agency conducts
educational seminars for clients and prospects at the Speedway Club.
In 1969, Bill Knauff founded Knauff Insurance, Inc., in Charlotte, North Carolina. He started the agency after working nearly nine years as an agent with a direct writing company. Bill really liked that company's strong emphasis on claims control and loss prevention but found that representing only one company limited his ability to consistently provide the best product to his clients. He briefly joined an independent agency but found that their emphasis was almost solely on sales. To achieve the level of service he believed an agency should provide, Bill realized that the best way to do this was to follow the old adage--"If you want something done right, then you've got to do it yourself." So he started his own agency.
His son, Skip, joined the agency about 15 years ago when he realized that it offered the kind of job that best suited his own personality. When Skip graduated from college, he went to work for a computer sales company and "really learned the corporate side of sales. I enjoyed building the relationships, but then it was over once a sale was made. I realized that what I wanted was the renewal relationship. I wanted more of a consultant role rather than a sales role." After a year with the computer sales company, Skip applied to work at Knauff Insurance and "my Dad gave me the job."
Skip's philosophy jibed well with his father's. They both believed in providing a high level of service to clients as the way to best achieve long-term growth and maintain client loyalty.
As Skip explains: "We don't sell our insurance. We educate and help our insureds buy the protection and service that they want." In order to best accomplish this, Knauff Insurance focuses on three niche areas--manufacturers, distributors and contractors. The agency is licensed in 28 states.
Seminar marketing
"If you educate them, they will come," Skip quips as he discusses the education seminars the agency has been providing for the past three years. Education seminars are one of the innovations Skip has added to the agency's arsenal of marketing tools.
The seminars have ranged in size from groups as small as 40 people up to an audience of 160 people. "The topic is what drives the numbers," Skip notes, pointing out that the smaller session dealt with the narrowly focused topic of surety bonds, while the seminars on employment legal practice and on group health both drew large audiences.
The education seminars must focus on topics that are of interest to the audience. "You've got to have the best speakers that can capture the audience's interest and entertain them. You want them to leave the seminar with two or three jewels of knowledge they can implement immediately."
The location of the seminar and the day it is held also are very important considerations. "You need a place that is accessible and provides a pleasant ambience." Originally, Knauff Insurance held its seminars at hotels and even experimented with a presentation at a cinema. But, for the last two years, the agency has used the Charlotte Motor Speedway Club. "They have banquet facilities to handle different sized groups and offer an interesting environment for attendees." Turning to the day and time, Skip points out, for example, that Tuesdays and Thursdays are bid days for contractors, so they would not be good days for a seminar directed toward contracting businesses. "Wednesdays have usually worked out best for seminars for everyone."
The seminars are provided free of charge to insureds and prospects and include a buffet lunch. "It's one way to say we appreciate you to our insureds. It also emphasizes that our goal is to educate and help them succeed."
"Many of our commercial clients have asked for help with employee benefits. --Skip Knauff, president
Making life easier for the insured
"One of our key goals is to make our insured's life easier. Educating them about various issues that could have an impact on their business is one way in which we do this," Skip explains. But that is only one way the agency helps to take some of life's burdens off the shoulders of its clients.
"We really do operate as the risk manager for each of our insureds," Skip says. "We get to know their operations inside and out so we can help them reach their next level. Their concerns become our concerns, regardless of what is involved. They may have turnover problems or concerns about educating their sales force. We'll help them whether it involves financial security and protection or not. If we don't have the expertise, we'll refer the problem to others who can help."
"We help our clients become better at what they do," explains Jack Ellis, vice president of finance. "This philosophy is based on an 'external focus,' with our success resting on our ability to discover and meet our client's or prospect's objectives. Many times these objectives are not insurance-related. We try to meet this objective with the many resources available. We strongly feel that applying an external focus to all functions, not just sales, gives the greatest of all possible returns."
One of the keys is that "we listen to our insureds," says Skip. "Our producers are expected to have on-site involvement. We walk through the shop with our clients and help them identify areas where they can reduce losses. We learn their corporate philosophy concerning insurance, loss control and safety. Using that information, we sit down with each of our clients to map out a road to success."
One way that Knauff helps clients save money immediately is by checking every client's experience mod using SmartComp. "About 10 years ago, we found the error rate ran about 25%. Today, it's around 30%. Automation has actually increased the error rate," Skip says. "By promulgating the experience mod internally, we have the weapons to go to the bureau on our client's behalf and get their mod corrected.
"Our automatic bid bond service is just one example of the services we offer here at Knauff," says Brad Corkwell, surety bond manager. "Our contractors do not have to remember to request their bid bonds. We subscribe to several of the area publications. Our staff is committed to identifying each of our contractors shown as prospective bidder. We gather the pertinent information normally needed to obtain approval from the surety companies. At that time we prepare the bid bond and mail it directly to our client. This allows their estimators more time to devote to the project in question."
It's show time!
In the insurance business, claims payments are the pay-off, and nobody wants them. Nobody wants to have a loss--not the insurance company nor the insured. This makes for an interesting dynamic that, perhaps, explains in part why insurance companies are not all that well liked. As far as most insureds are concerned, the payment of insurance premiums is an unpleasant necessity.
Well, Knauff Insurance look at claims as show time.
"We do everything possible to help our clients not have a claim," Skip says. "But if they do, we want to make certain that its handled quickly and fairly." Knauff Insurance asks every client to report the claim to them, not to the insurance company's "800" number. "We have a dedicated claim department that includes three licensed adjusters. The department is there to make certain that every claim is handled quickly. Every study has shown that early intervention is the key to successful claims resolution and we adhere to that by getting together with the insured as soon as the claim occurs. We go out to their place of business or home immediately with cameras and recorders to document the claim.
"We understand that it is not our role to adjust," Skip continues. "We have adjusters on staff because they know the process and can act as a conduit of communication between the insured and the insurance companies. It's rare that companies make mistakes with claims, but people do need to be reminded to keep moving so claims are settled quickly and equitably."
Bill Knauff III (seated), who founded Knauff Insurance in 1969, is joined by Jack Ellis, Jr. (left), vice president of finance, and Bradley D. Corkwell, vice president/bond manager.
Expanding to meet client needs
Knauff Insurance started out as a provider of property/casualty insurance and services. "Today, however, most of our insureds look to us as a single source for all risk transfer," Skip notes. "Contractors expect us to provide surety coverage. Everyone wants help with their individual insurance. Many of our commercial clients have asked for help with employee benefits. We listened to their concerns and now have a large and growing employee benefits and group health department. We also have a bonding and surety department." Employee benefits has become such an important part of the agency that the last three hires were for sales and support of that department.
Today, Knauff employs 23 people, eight of whom are producers. It is licensed in 28 states so that it has the flexibility to go after the best clients wherever they are located. "Charlotte is our home town, but we enjoy going to neighboring areas to find those clients who want to focus on becoming more successful," says Skip. "We look for the above average account that wants a long-term relationship. In fact, we ask each new account for a three-year commitment. Most appreciate the fact that we intend this to be a continuing relationship. And we earn our stripes each year.
"We do a six-month review that includes an internal audit of the insured's payrolls and sales. This gives the insured a forecast of its final audit so proper budgeting or adjustments can be made. We also advise them about where the market is headed. Then we return 90 to 120 days prior to renewal to develop a renewal plan of action. Some ask that we shop. Most want to stay with their current carriers unless there is a significant savings. We listen and we act."
"One of the things that makes Knauff unique is the special care and attention we give our customers," says Alan Wise, vice president of production. "This thought permeates everything we do at Knauff--from how we compensate producers on renewals to providing educational seminars for customers and prospects."
"We believe in relationships," he continues. "Our producers work with their customers in a variety of roles, from employee benefits to property and casualty coverages. This allows our people to understand the unique needs of their customer and spend time with each one. Our goal is to do more business with fewer customers and grow our business in that way."
Thanks to its focus on client needs, Knauff Insurance has grown by an average of 14% to 21% a year. Even with today's soft market, the agency continues to grow at a rate of 8.5%. And it enjoys a retention rate of better than 98%. It well deserves recognition as Marketing Agency of the Month. *
©COPYRIGHT: The Rough Notes Magazine, 1998