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Ohio Casualty: Open for business New president focuses on "delivering value to our agents" By Dennis H. Pillsbury
“They have people in place from the CEO to the president to managers and underwriters who are looking to write business,” is the way Mike Kneflin, partner/producer at Kneflin-Dillhoff-Hils & Kruse Agency, Inc., Cincinnati, Ohio, describes Ohio Casualty Insurance Co. under the leadership of its new president and chief operating officer, Ralph S. (Mike) Michael III. “They still have some of the conservatism,” he continues, “but that’s good. I’d rather have that little increase instead of big price swings. We have a great relationship with the company across the board.” Mike Michael took over as president and chief operating officer, effective July 25, 2005. Prior to his appointment, he was executive vice president and manager of Private Asset Management at U.S. Bank, National Association. He also served on the Ohio Casualty board since April 2002, a position he resigned on July 25. He currently serves as a board member of Key Energy Services, Inc., Integrated Alarm Services Group, Inc., Cincinnati Bengal, Inc., and Xavier University (Ohio). “I saw this company from a wonderful seat as a board member and am very comfortable with the people,” Mike says. “During that time, we had an inward focus as the company repositioned its book and brought its combined ratio from 118.4 in 2000 to 96.9 for the quarter that ended September 30, 2005. And those numbers include both Katrina and Rita. “We have a very stable platform from which to grow,” he continues. “Now the fun is to really work hard at transforming this company into an outward-focused marketing company. “Over the past few years, we have exited those states where we weren’t relevant or had bad experience and left lines of business that were not working for us. All told, we took about $350 million in business off the books as we went through the transition. And even so, we managed to replace the lost business with business we wanted. That’s not bad in a pretty competitive market. But, now it’s time to communicate our risk appetite to our agents and really start growing.”
Dan Carmichael, president and CEO of the parent holding company, Ohio Casualty Corp., adds, “Mike brings a different focus on marketing financial services products. His experience in the banking world makes him very familiar with marketing that is based on having a depth of data about customers. That is not a normal thing for property/casualty companies. With his help, we are identifying areas where the best customers exist. These are not just SIC Code listings. We are really digging deeper. “We feel very good about what Mike brings,” Dan continues. “As we become a more marketing focused organization, we’ll benefit from his knowledge of ways to find more potential clients that mesh with our appetite. Then we need to provide that information to our customers—our agents—so they can broaden their reach within those areas.” Mike adds, “We have a very clear vision of our customer. When I served on the board, Dan took all of us to the Conference of Champions (a meeting of the company’s top agents). We split into subgroups. One agent said in my session, ‘Don’t forget, the insured wouldn’t even know that Ohio Casualty exists if we didn’t show Ohio Casualty to the insured.’ We know that. The agent is such an important gatekeeper and we are working very hard to demonstrate our continuing commitment to the agent.” Dan adds that Ohio Casualty has a service center for commercial lines that “continually maintains the brand name of the agent. We always identify the agency whenever we speak to a client.” With his tongue placed firmly in his cheek, Mike adds that he may have been “single handedly responsible for airline recuperation. I have been around the country meeting with various agent groups to find out what they want from us. I had 11 meetings with agent groups in four months. It’s been fascinating and very encouraging to hear the relevance of Ohio Casualty to the agents.” He also traveled to London “to visit our reinsurers. And I met with groups of our employees to discuss what it means to become a marketing company.” In addition to general commercial and personal lines business, the company is also committed to specialty business that includes umbrella and bonding. “We’re not afraid of commercial contractors,” Mike says. “We should be the market that agents seek out as best in class for small and medium-sized artisan contractors.” “We also would like to write more workers comp in the right states,” Dan adds. “There are some states and classes where comp makes sense.” However, he notes, there must be “minimum exposure from a terrorism point of view, and that’s important. There have been some cases, however, where we have had to pass.” “Our bond business has been excellent,” Mike points out, “and we’re looking to expand in that area because we have the core competency. We write a lot of surety and fidelity, principally for community banks. We’re also looking to expand into nonstandard bond areas.” “Additionally, we’re planning to expand our book of personal lines business,” Dan explains. “We’re very interested in growing that business. We’ve increased binding authority in homeowners and are actively seeking new business.” Doug Groves of The Capital City Insurance Agency, Inc., Austin, Texas, says of Ohio Casualty, “Things are really looking up for them. I had a meeting with Mike in November and told him that Ohio Casualty needed to start marketing. They’re not price sellers,” he adds, “so they need to provide value. We’ve been doing business with them for more than 20 years, but the new agents need to be talked to so they can find out just who Ohio Casualty is and what it has to offer. They’ve always treated us well. I’ve been through several presidents and CEOs since I’ve represented them and had excellent relationships with each one. They’ve been a good team player for us in a lot of different ways.” Dan Carmichael concludes, “Mike has been very well received. The agents know him as a person who will listen to their concerns and address them, as a person who will be a value-add to the Ohio Casualty organization and to the agents that represent us. The rating agencies also have been rewarding us. S&P and Fitch both moved us up and we’re optimistic that A.M. Best will act favorably. And we keep hitting all-time highs in the stock market, so that certainly makes our investors happy.” Mike adds, “This is going to be a very exciting and productive year for us. We have the data that will help move us forward. We still need to finish organizing it. But that process is well under way, and we should be seeing some strong growth in areas where we will continue to realize underwriting profits. This is the year that we’re putting our strategy to the acid test. And we’re convinced that the strong numbers we’ve shown thus far are sustainable into the foreseeable future.” * |
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