Dee Perry, Susan E. Carroll, and Laurie P. Hutcherson (left to right) bought out the former agency owners and embarked upon the journey of running their own firm.
Five years ago, Laurie Hutcherson, Dee Perry and Susan Carroll faced an interesting challenge. At that time, they were managers at Forbes-Westar, Inc., an independent agency in Bellevue, Washington. The owners of the agency, who were involved in other things, had decided to take their equity out of the business. It was one of those "sink or swim" scenarios that usually scares the heck out of a person and often ends up as a defining moment.
And that was the case here. The owners offered to sell the agency to the three managers and they agreed. So, on December 17, 1993, Westar Insurance Managers, Inc., came into being, beginning operations on January 1, 1994. All 15 employees of Forbes-Westar remained with the new agency.
The first step was overcoming the "Catch 22" that faces many new agencies. State regulators won't give you a license until you have a company appointment, and companies won't give you an appointment until you're licensed.
Fortunately, Safeco, which knew the managers and the people at the agency, stepped in with an appointment and all the other companies with which the former agency had dealt were happy to continue the relationship. In fact, Laurie Hutcherson, executive vice president, says the companies "were delighted. Basically, we had been running the agency, and the company representatives knew us. They were glad that we now had an ownership stake in the operation."
Most of the clients had worked with the new owners in the past as well, so there was virtually no fallout in this area.
The agency had a book of aviation insureds, personal lines business and employee benefits. However, most of the commercial book had been sold prior to the change in ownership. "We only had a few BOP accounts, but we really wanted to build up that side of the business," Laurie says. To do that, Westar had the choice of either bringing in a commercial lines producer or developing someone who already was there.
"We opted for development from within," Laurie notes. "We really wanted this to be an agency where employees have a chance to grow, where we provide different opportunities to our people. Moving from personal lines to commercial lines represents one of those opportunities."
Erik Kuhn, who has been with the agency for 11 years, became the commercial lines producer. He and several other people were sent to the commercial lines school at Safeco. "We've slowly developed that business and have started getting into bigger accounts more recently," Laurie reports, noting that the agency wrote $126,000 in commercial lines premium in the month of June. "It's definitely moving in the right direction."
--Laurie Hutcherson
The philosophy
"Our philosophy is to go the extra mile for every one of our clients," Laurie points out. "We really try to pay attention to their needs and what is important to them. And that can vary widely. For some people, coverage concerns may be most important, for others it may be price. We identify their concerns before we make a presentation and then present based on their needs and desires. They really appreciate the work that we do in that regard. That's one reason why nearly all of our new business is the result of referrals.
"One of the keys to our success is that we never give up," she adds. "When a difficult risk comes to us, our attitude is that we are going to find a way to cover this and we do." This is especially important in the highly specialized field of aviation insurance where "we help our clients navigate a field known for its red flags and restrictions. Not only do our insureds have to contend with insurance company guidelines, they have to ensure they are in compliance with FAA and IRS rules. Working with any one of these bureaucracies can be challenging in itself, let alone coordinating all three."
The aviation division is run by Susan Carroll. She and her staff have more than 45 years of professional experience in this field and deal with all the major writers of this coverage, as well as surplus lines companies. The agency covers a wide range of aviation risks, including corporate jets, private business and pleasure aircraft, fixed-base operators, aircraft manufacturers, airports, hangars, helicopter operations, control towers, aviation workers compensation and aircraft brokerage firms. The book comprises more than $4 million in premium and is growing.
"Every day there is something new to contend with," Sue says. "Today's project is finding coverage for the Free Willy Keiko Foundation to transport Keiko in an Air Force C-17 from Newport, Oregon, to Iceland."
Dee Perry (center) is the agency president. Susan E. Carroll (left) and Laurie P. Hutcherson (right) are executive vice presidents.
Laurie continues that this effort to go the extra mile for clients means the agency does its utmost to "try to stay on top of the new wave. We have our own Web page (www.westarinsurance.com) and have links from several different companies that advertise insurance products on the Internet. We're evaluating the merits of insurance via the Internet. In addition, we're using the Internet for e-mail with clients." The agency will be listed in the Microsoft Yellow Pages that soon will be coming to a computer near you.
Automation is the key in handling some 5,000 personal lines accounts. "You have to be efficient to be successful in personal lines," Laurie says. In that regard, the agency recently switched to the Applied Systems agency management system from a mainframe system.
Accommodating all levels
"In the personal lines and commercial lines, we don't have any particular specialty. We try to accommodate all levels," Laurie notes, pointing out that the agency insures homes ranging in value from $100,000 to homes costing $10 million or $15 million. And in the commercial lines "we're happy with accounts producing $5,000 in premium. We're not actively soliciting the small BOP accounts, but we do write them."
Although Westar hasn't targeted specific industries, because of referrals, the agency is beginning to see growth in new accounts in a couple of areas. "We do a lot of business in computer and computer-related businesses," Laurie says, noting that many smaller computer businesses have opened up in the area due to the proximity to Microsoft. Another area that has grown is retail chains. "We're trying to focus on those areas and build up that business."
One of the advantages to dealing with smaller commercial accounts is that the soft market hasn't reached down to that level. Unlike other agencies that are facing rate cuts every year, Westar reports that premiums for their commercial clients have remained pretty stable.
Laurie admits that trying to grow a commercial lines book from scratch was difficult at the start, but "we're really happy with the outcome. It has opened up opportunities for our staff and they appreciate that. They know that we're looking for growth and stability for them. We've had very little turnover, and we still have good relationships with those who have left. This stability at the staff level allows us to better serve our clients. It's a real win-win situation all the way around."
"Going the extra mile" exemplifies what the best agencies around the country strive for. It is why agencies such as Westar have high retention rates and strong customer loyalty. One of their clients sums up the experience: "At Westar, they don't check to see if they can get me what I need, they just figure out how to get it done and go do it--and usually yesterday." *
©COPYRIGHT: The Rough Notes Magazine, 1998