For Web surfers Jim Bolton (left) and Bill Bolton, the Internet has been a welcome new way to deliver insurance.
"We're having quite a lot of success dealing with larger and larger accounts," says Bill Bolton, chairman and chief executive officer of Bolton & Co., South Pasadena, California. "We've hung in there under the national houses as another choice and it's been successful. We can provide a higher degree of service because we don't have heavy home office expenses. Our whole thrust is value-added. With our direct international capabilities, we are truly a viable alternative to insuring through the nationals."
Bolton & Co. started its quest to become a competitor with the national brokers in the late '60s when Jim Bolton and then Bill Bolton joined their father, Dorance, at the agency. The agency was established by Dorance in 1931 during the depths of the Depression. Jim doubled the number of producers at the agency when he joined in 1964 after working two years for the Pacific Fire Rating Bureau. His brother Bill left the security of a claims management position at Industrial Indemnity to join the agency in 1967.
"The volume was about $300,000 at that time," Bill remembers. "Today, our volume is around $115 million."
Jim says, "The growth started after Bill and I bought the company in 1974. We were the only sales people until then and it turned out that we were pretty good at it. It just clicked for us. But we needed additional producers to grow. And that's really been the reason for our success. We hired good producers, a lot of them from direct writers. We also made a few small acquisitions, but internal growth was really the crux of our success."
A good sales team, however, is only part of the story. Once the business is in the agency, service becomes critical. It is what sets the agency apart from its competition.
The first step in providing excellent service is knowing the product. "That's one of our real strengths," Jim points out, adding that all the people in the agency are knowledgeable about the insurance product. "Education has been huge. All of our CSRs have the CIC designation, and we have continual mandatory educational programs beyond those required by state licensing. Whenever a client calls the agency, he or she will be talking with somebody who understands insurance. We demand professionalism here."
On the cutting edge
Another key to providing excellent service to clients is to be ahead of the curve. Bolton & Co. tries to look for new ways to do things. "Back in the '80s," Bill says, "we were looking around for a different way to market workers compensation. We put together a client-owned captive, letting smaller companies do something that larger companies were doing. The captive operated for about seven years. When it shut down because the market changed, everyone who participated got a return of profit. But this idea was a leading edge idea that worked for everyone involved."
--Bill Bolton
To manage that captive and others to follow, Bolton hired Rob Davidson, J.D., MBA, who, in addition to his expertise at captive management, "became a good salesman," Jim says. "Rob became very interested in the Internet and in using that as a new way to provide insurance products and services. He also recognized that the whole automation explosion represented a new market and an improved way of doing business. Not only that, the Internet could save thousands of dollars in overhead costs per year."
Bill continues, "We talked to a lot of companies and finally reached an agreement with Atlantic Mutual to put together a program for high-tech companies to be solicited, sold and serviced over the Internet. I'm glad we waited because they became a terrific partner for us." This new product called InsurePoint includes specially designed coverages for computer viruses, errors and omissions, property and casualty and so on. Companies can get information on the product, complete an application, receive a quote, be issued a policy and pay for the policy all within two days, all via the Internet. The program is available in 15 states and will be in 33 states by the end of the year.
The company also has online applications for its California Association of Independent Schools (CAIS) program.
"We were the third agency in the United States to have a Web page (www.boltonco.com) and the first property/casualty agency in the world," Bill says proudly. "We see the Internet as a big part of the future. In a little over a year we've issued 300 commercial policies via the Internet with almost all functions being done entirely over the Internet."
Robert L. Davidson, J.D., executive vice president, directs Bolton & Co.'s pioneering system for delivering insurance over the Internet.
And Rob's interest has led him to become one of the leaders on Internet usage and e-commerce in the insurance business. He's become a featured speaker on this subject throughout the United States. "Rob's become a guru," Bill says. "We are probably three years ahead of the entire insurance industry in using the Internet as a total sales/service vehicle. That's cutting edge!"
Not surprising, once you know that Bill was an insurance major at Berkeley in the early '60s and graduated with a degree in risk management and business, is the fact that Bolton & Co. has a dedicated risk management department. That department works with business clients to evaluate, design and implement a plan for managing potential loss exposures. "We conduct a thorough review of a client's existing insurance program," Bill says. "By addressing all areas of risk and treatment of risk, we have involved the client's entire company in risk analysis." This service is free to clients and available on a fee for service basis to others.
The agency also has a dedicated claims unit for tracking and monitoring workers compensation claims. "Since 1967 we have had in-house loss control adjusters who analyze all the loss runs produced by our claims tracking software," Jim says. "They educate clients suggesting how losses can be reduced, and they watch the reserves and claims handling." The software keeps track of the claim from date of filing to closing.
The agency also is very active in the life and health field, offering group medical, life insurance and 401(k) programs. This represents a significant amount of revenue. "And as a natural extension of that field, recently we opened up a human resource consulting service in conjunction with a local law firm," Bill says. The consulting includes a new software program developed by Bolton & Co. called HR ManagerTM. HR Manager is a unique, form-based human resource management system that guides employers through each action (hiring, termination, family medical leave and so on) to ensure both legal compliance and employer consistency.
The agency has a perpetuation plan that involves moving ownership to younger employees. "We've already sold about 25% of the agency to younger people," Bill says. "These people are terrific. They can run the agency. Consequently, we have a very young management team that is reflected in our entrepreneurial and cutting edge way of approaching insurance. We have a great combination of age and youth which makes a good management style. We hire good people, tell them what we want and then get out of their way. And to help us hire well, we use the services of an industrial psychologist which has been worth every penny spent many times over."
As a member of Assurex International, Bolton & Co. is well able to handle the needs of the largest multinational company as well as smaller companies venturing into the global marketplace.
Bolton & Co. already has received a great deal of recognition for its professionalism and focus on value-added service. It was the Insurance Broker and Agents Association of the West Agency of the Year in 1996. And Bill was recognized by his peers by being named the recipient of The Ramsden/Sullivan Award for the Outstanding Insurance Man. To this, we add Rough Notes Marketing Agency of the Month. *
The author
Dennis Pillsbury has more than 20 years' experience in insurance journalism, both as an editor and freelance writer.
©COPYRIGHT: The Rough Notes Magazine, 1999