MARKETING AGENCY OF THE MONTH
24/7 service and educated employees spark
this New Jersey agency's growth
By Dennis H. Pillsbury
Commerce Insurance Services executives (from left) Edward P. Kiessling, President and Chief Operating Officer, and George E. Norcross, III, Chairman and Chief Executive Officer. The agency is based in Cherry Hill, New Jersey.
"We set out to redefine the insurance brokerage system," says George E. Norcross, III, chairman and chief executive officer of Commerce Insurance Services, Cherry Hill, New Jersey. George goes on to point out that the agency's parent, Commerce Bank, had, in many ways, redefined banking. It is a bank that is open seven days a week from 7 a.m. to 7 p.m. In much the same way, Commerce Insurance Services offers 24/7 service where a client actually talks to a live person. The agency's branches are closed only three days a year--Easter, Thanksgiving and Christmas--but "you can still talk to a real person on those days," he says.
George continues: "And the person with whom a client is speaking is not just someone hired to answer the phone. He or she will be a well-trained insurance professional whose job is to help the client. We've spent millions of dollars training our people," he adds proudly. "Commerce Bank has an extensive training facility called Commerce University that we emulated in the agency. We brought in one of the senior training people from the bank to head up the effort."
Edward P. Kiessling, president and chief operating officer, adds: "We developed a formalized apprentice program under which we train people for six to 18 months. We train them in the technical side of insurance and get them licensed. We believe that what ultimately distinguishes an agency from its competition is the quality of its people, and we want to have the smartest people and the best-trained people," Ed says. "We focus on developing people who can explain the insurance product to customers and potential customers and can help them with claims or any other situation that arises. We have five full-time people who do nothing but training. We also provide a producer training program for individuals who are headed in that direction." Between 25 and 30 Commerce Insurance employees earn the Certified Insurance Service Representative (CISR) designation annually. The National Alliance for Insurance Education & Research, which developed the CISR program, hosts a separate awards ceremony at the agency's University headquarters.
George points out: "Our greatest resource is our people and we go after the best. We recruit kids out of college. Temple University is one institution where we recruit regularly.
Commerce Insurance has invested millions of dollars to train employees through its Commerce University, which includes a six- to 18-month apprentice program.
"We're actually recruiting lawyers right out of law school. In our claims department, we're looking for people who will be advocates for our clients. Who better than a lawyer? It's a perfect fit. This is a business that has a lot of legal needs. We can offer a person right out of law school an attractive career opportunity. We also recruit people from other industries and teach them insurance. We especially look for individuals who are working in our niche market specialty areas--health care, life science, public entity, school boards, and construction."
Ed says: "Our goal is to become the employer of choice for individuals looking for a career in the insurance industry. The brochures we distribute about our training programs include information on career pathing and emphasize that we offer a career that is nearly limitless in opportunity for the right person."
Commerce Insurance Services was started in late 1996 with the acquisition of two agencies by Commerce Bank. Two additional agencies were added in the same year. All told, there have been 16 acquisitions, primarily aimed at enhancing expertise and market penetration in the niche areas or to gain a foothold in a new geographic area. The goal of the agency is to expand into the areas covered by its parent's footprint. Thus far, the bank has branches from the New York metropolitan area down through Wilmington, Delaware, and is opening up in northern Virginia.
Commerce University Training Instructor Kathleen Haller, CISR, discusses a course with John Kulikowski, Commerce Insurance Vice President and Dean of School of Insurance.
However, "the true reflection of our success is our organic growth," George notes. "We have averaged organic growth of 15% a year and actually exceeded that last year."
Today, Commerce Insurance Services employs more than 500 employees and is the 24th largest broker in the country with annual premium volume exceeding $800 million. It serves more than 125,000 clients in 25 states and is licensed in all 50 states.
Client focus
As mentioned above, Commerce Insurance Services views itself as an advocate for its clients. Advocacy is especially important following a claim. "We believe it is our responsibility to procure an appropriate and fair settlement for our clients," George says. "For every claim, regardless of size, we assign an individual claims person to oversee that claim. That individual works on behalf of our client with the insurance company."
A 360 Leadership class under the supervision of Cathi Riddleman of Novations (an outside vendor that Commerce University utilizes).
Ed points out: "Individual claims people oversee personal lines claims as well as commercial lines claims. Personal lines is a very important sector for us. It accounts for 18% of our total revenues. In fact, we're the largest writer of private passenger auto in New Jersey."
The agency has five divisions: personal lines; core commercial (the middle market with premiums ranging from $10,000 to $300,000) accounts for 23% of revenues; Main Street business accounts for 4%; major commercial accounts for 10%; and benefits provides 22%. The balance comes from other services, including loss control.
"We're very much a matrix organization," Ed explains. "Our first step was to achieve economy of scale. Then we developed our specialty areas by taking our people with a particular interest in a specialty and working to grow that or by bringing in people from outside. We also acquired agencies that had specialties in which we already had a presence or in which we wanted to become a market. We then leveraged the expertise of our own people by bringing them together in our home office. Initially, they operated on their own, but as their efforts brought us to a certain level of market share, we realized that we could make even greater inroads by bringing them together to share ideas and take better advantage of cross-selling opportunities. This has really helped our growth. We've been able to take property/casualty clients and add group employee benefits and vice versa."
Ed continues: "This has involved a cultural change for people who were used to doing things on their own. However, our goal was to leverage what really are scarce resources. When these people start to see their incomes rising and see their peers succeed as well, it helps overcome the initial challenge."
Advanced technology allows the agency's call center to provide personalized 24/7 service.
Technology has been a key component in Commerce Insurance Service's ability to provide seamless service to clients. "Our claim service has been 24/7 since 1996," George points out. "In order to accomplish that, we had to have a system where every person in the claims area had instant access to policy information. We chose to use AMS Sagitta as our agency management system but have modified it extensively to fit our needs. We have our own CIO and he built our customer service system on top of the AMS Sagitta." The agency also provides clients the capability to enroll for benefits online in addition to accessing to their benefits account information.
Company relations
An agency's company relationships and its client relationships are phenomena in which the oft-competing and distant interests of both parties must be correlated to the satisfaction of each. To use a physics analogy, it's like the strange phenomenon of quantum entanglement in which spatially distant particles have correlated properties. In the world of quantum particles this "entanglement" proves to be quite explicable mathematically, but remains counterintuitive. The same is true with company and client relationships. On the surface, meeting the needs of both parties appears counterintuitive. However, the conflict disappears once both parties understand their ultimate best interest, which is for claims to be paid quickly and correctly, thereby avoiding the consequences of having a disgruntled policyholder--one of which is to seek redress via the legal system.
"Our proactive approach to claims handling has produced profitable results for our carriers," Ed says. "We have excellent relationships with our companies. Our largest relationship is with a subsidiary of St. Paul Travelers and the loss ratio is excellent. For some claims, we have the authority to write a check to settle the claim. In other instances, we'll work with our insurance company partners to get an advance emergency payment if the client needs help recovering from a crisis."
Signs on every wall and in every office throughout Commerce Insurance Services remind employees that giving "WOW!" service is the agency's goal. Every year, Commerce Bancorp and affiliate companies--like Commerce Insurance--celebrate employees' commitment and service at the "WOW! Awards," which is "part rock concert, part Vegas show, part awards ceremony and part revival." With 6,000 employees in attendance, this year's ceremonies were held in Atlantic City, New Jersey, and included live musical and dance performances as well as surprise appearances by celebrities Donald Trump and Julia Louis-Dreyfus.
George continues, "Our carriers understand and appreciate our emphasis on quick, fair settlement of claims. The lower loss ratios we provide are, in part, a result of our responsive claims handling."
He concludes, "We're very fortunate that the chairman of the bank has allowed the agency to be run by insurance professionals and instilled a respect for entrepreneurship. It has allowed us to not only attract the best people, but to keep them as well. In addition to competitive salaries and benefits, we reward every extraordinary performer with stock options, from receptionists to high-performing producers. It's the difference between owning your own home and renting. The ownership matters and 73% of the employees are stakeholders. They want Commerce to be their employer for the long term and there's a lot to be said for that. You really can't have an agency that never sleeps unless you have people who really care, and that's what we have."
The agency's strong customer advocacy combined with an emphasis on continuing education at all levels certainly makes Commerce Insurance Services a well-deserving recipient of our Marketing Agency of the Month recognition. *