Marketing Agency of the Month

Nine decades of relationships

Commitment to clients, personnel, and company partners leads to success

By Dennis H. Pillsbury

The quality people who account for Rigg Darlington’s success include (seated from left): Becky Kooken and Michelle Gordon; behind the chair (from left) are: Diane Lewis, Jim Johnson, Jan Berglund, Steve Arbegast and Rick Hartfield; and from the top of the staircase down are: Sue Reppert on the highest level; Tracy Hackenberg and Bob Rigg; Barb Brown and Karen Rigg; Iris Beaver and Lynn Bryson; and Jeff Darlington and Alan Haffler.

The Rigg Darlington Group, Exton, Pennsylvania, was formed in January 2001, but traces its roots and its business philosophy back to 1917. Both the Joseph A. Rigg Insurance Agency and the Darlington Insurance Agency were built on quality people with strong relationships with clients, each other, and the insurance companies they represented.

The agency’s mission statement sums it up in that one word: “Relationships.” It continues: “We believe the value and importance we attach to earning a relationship with our clients, our agency family and the companies we represent is the reason we have achieved and continue to maintain a position of prominence within the insurance industry.

“Through our enduring commitment to developing and maintaining professional, quality relationships we are able to provide a unique level of responsive, informed and caring service to our clients.”

President Robert Rigg, CPCU, CIC, CLU, explains, “We live by our mission statement. We’ve been building relationships through fairness and integrity, not only with clients, but also with fellow associates. Our culture supports those relationships. Everything is done with a client focus, with the goal of providing our clients with the ability to lower their cost of risk to make them more attractive to the insurance marketplace.”

Some members of the personal lines team.	Some members of the life and benefits team.	Some members of the commercial lines team.

Producer/Owner Jim Johnson, CIC, who has been in the business for 30 years and started with Rigg in 1999, points out that “whenever we talk to a new account, we emphasize the value-added. We find out their loss ratio and talk about ways we can help them control losses. We look for the win/win situation where we can help lower their costs and provide profitable business for our companies.”

Bob Rigg continues, “We developed a plethora of value-added services that we bring to clients. We truly practice aggressive risk transfer and risk management. We take a strong stance with experience mods. We try to project the mod in the future and watch the reserves very carefully, comparing them to what the companies are reporting. Fairly frequently, there can be misunderstandings and mistakes. We’ve actually contracted with a third party that evaluates the reserves. We provide this service to large accounts at no cost.

“Another value-added is claims service. We have a third-party vendor that provides 24/7 claims service where our clients can talk to a human being who will point them in the right direction.”

Producer/Owner Jeff Darlington, CLU, adds that the agency also seeks to differentiate itself in the employee benefits field. “Most brokers and agents have access to the same carriers in this field, so we provide services to the HR department that makes us different from the competition. We offer COBRA administration, work with a third party for flexible spending accounts, and also provide help with ADA and FMLA compliance issues.”

Bob continues, “We’re able to supply the right consultants at the right time. We have some great consultants that we can fall back on who are quite reasonable. For example, Pennsylvania has a workers comp problem. One of our consultants works with clients to include physical requirements with their job descriptions. The consultant will also tie everything into the employee handbook. The objective is to put the client in the best position in the event of a claim.”

These types of services are uncommon even for many large brokers. However, Rigg Darlington is not a mega broker. It has 20 employees in two offices and total revenues of about $3.4 million, but is able to compete with the large brokers.

The focus on relationships also extends to the carriers where “we have extremely strong relationships that are measured in decades,” Bob points out. “We have worked hard to develop those relationships by providing sufficient volume of the right type of business to each of our company partners.”

Celebrating victories

The fun squad is responsible for developing new ways for the agency to celebrate success.

Most important, however, is “our relationships with our associates. Everything that we accomplish is built from those relationships, and that spills over into the way our people treat our clients and our carriers,” Bob adds. “We’re open with everyone and we like to think that everyone feels we’re fair and upfront.

“For example,” he continues, “we recently found out we were about to receive a contingency check from one of our carriers. It was our largest single contingency ever. We started celebrating with all the associates in the agency because they all receive a portion of the contingency in their bonus plan. We share the income statement every month with our producers so everyone knows where we are,” Bob adds.

And that openness extends to clients. “We’ve explained our contingencies to most of our commercial clients,” Bob says. “They understand incentives. They have them in their business and appreciate that we have them in ours.”

Producer/Owner Steve Arbegast, CIC, who has been with the agency for 14 years and prior to that worked with a carrier, points out, “We’re big believers in celebrating, which has been a major boost to the relationships with our associates. We have regular agency-wide contests and solicit input from the associates as to what the reward should be. We may go out to dinner and a show or take a day trip to New York City and so on.

“We realized a few years ago that we were so focused on getting the ‘right people on the bus’ and operating efficiently that we weren’t stopping to celebrate our successes. Our people work hard and, thanks in part to our commitment to technology, handle an above-average workload, but we weren’t doing enough to show how much we appreciated the effort. We don’t want to ever forget to have fun and celebrate our triumphs, so we created a ‘fun squad’ that is responsible to find creative ways for all of our associates to have fun together.”

Bob adds, “Fortunately, we’ve already had a lot of reasons to have fun and celebrate our success. We brought in $128,000 in new commissions in the first three months and celebrated by getting together at a local sports hangout and watching one of the Final Four games.”

Ron Hohl of Lyons & Hohl, Inc., paving and site contractors, meets with commercial lines experts from Rigg Darlington. Lyons & Hohl was a client of Joseph A. Rigg Insurance Agency and has remained with the firm after the merger in 2001.

Steve affirms, “We’re living proof of the positive effect of enjoying work. Our associates all know we’re working toward a common goal—to help our clients succeed and, by doing so, to enjoy our own successes at fun celebrations.”

Bob points out that the celebrations also extend to their carriers and customers. “We instituted an Underwriter of the Month program and reward one of our company underwriters with a gift. We also have a client appreciation night to which the underwriters are invited. We might go to a Reading Phillies game or some other event where we can all relax and talk and get to know each other.”

Steve adds, “We’re also big on creating slogans. This year, it’s: ‘High fives in ’05,’ and so far there have been a lot of them.”

Bob notes that incentive pay also plays a key role in motivating employees. “We feel that incentive pay needs to be an increasingly larger proportion of pay. It amounted to around 20% of staff payroll last year. We’re trying to make that larger for all our associates. In addition, salaries are based on the volume on the desk and individual performance grades. We want everyone to feel accountable.

“We also have a staff semi-annual bonus pool that includes 11.5% of contingencies and 11.5% of interest income on accounts receivable (65% of the business is agency billed). Bonuses are achieved through a combination of individual and team goals and can be a significant amount. In addition, we have an old-fashioned profit sharing plan that we started in 1975 and we’ve never paid less than 7%; last year we paid 12%.”

Jeff points out that the agency is mindful of the dynamics of the agency when it brings in new associates. “We have a quality group of people and a culture that is built on celebrating hard work and excellent service to clients. Our success is due to our people. So when we bring in new associates, we have to be certain that they will fit in with our culture. We go through an extensive process that includes Omnia and Kolbe testing.”

Producer Steve Arbegast, CIC, meets with Account Executive Kathy Miller (left) and Senior Commercial Account Manager Barbara Brown, CIC, CISR.

“We also look for all our associates to be involved in education,” Jim Johnson continues. “Their continuing education is tied to their bonuses and their career advancement. Fifty percent of our associates have at least one designation and one-third have multiple designations. Two percent of our budget goes for education. As we said earlier, our reason for being in business is to help our clients reduce their risk and the only way we can be effective at this is by keeping up with what is happening in the industry.”

Getting there is half the fun

“We’re big believers in planning,” Steve points out, “and we involve all the associates in the process. We have been conducting an annual Management by Objectives (MBO) planning process since 1980.”

One part of the MBO process is the Start/Stop program, where the agency is divided in half, with one team assigned to develop ideas that “we, as an agency, need to start doing,” Steve explains. “The other team is assigned the task of developing a list of items that we need to stop doing. It provides us with valuable information and has been a healthy process for our organization.”

A key part of the MBO planning is that it is ongoing, Steve adds. “It doesn’t just sit on the shelf once it is completed. We develop action plans and assign team members and team leaders who are responsible for each plan. We also agree on a date for accomplishing the goals and a date to review the accomplished goal.” Progress is reviewed on a biweekly basis.

Steve says the MBO annual planning process “is definitely one of the most important keys to our success.”

Help from consultants

The Rigg Darlington partners (seated from left): Producer Jeffrey P. Darlington, CLU, and President Robert E. Rigg, CPCU, CIC, CLU; and (standing from left): Producer Alan J. Haffler, CLU, ChFP; Producer James A. Johnson, CIC; Producer Steven T. Arbegast, CIC; and Operations Manager Richard H. Hartfield, CIC.

“We haven’t accomplished this alone,” Bob admits. “We have built relationships with some of the most progressive consultants and agents’ associations in the country. And they have been very helpful and generous with their time and advice.

“We’ve worked with Roger Sitkins for over 20 years and are a charter member of the Sitkins 100 group, which formed in late 2000. Our involvement has helped us organize our sales effort, and the results speak for themselves—in the last four years, our sales have grown 150% with a closing ratio that is over 50%. It looks like our revenue growth this year will exceed 20%.

“We are also a charter member of Marsh Berry’s APPEX group and have worked with Larry Marsh for more than 20 years. Their PHP report (Perspective for High Performance) and the advice of the APPEX members have been critical in forming our culture and financial success. We are proud that we were the first agency to earn their Pinnacle award and even prouder that we were the first to repeat the award five years later. The peer support and pressure has been instrumental in our reaching revenue per employee of $167,000.”

Also key in achieving such a high revenue per employee is an automation system that has allowed employees to handle an increased volume of business. Operations Manager/Owner Richard H. Hartfield, CIC, says, “We continually review our technology to make certain we are able to effectively access and manage customer files. We don’t necessarily want to be on the cutting edge, but we do want to be efficient and effective. Our agency document management system is fully integrated with our AMS system.”

The agency business is built on relationships and Rigg Darlington has elevated this to an art form. It is for this and their obvious success that we recognize them as our Marketing Agency of the Month. *