22nd Annual Rough Notes Marketing
Agency of the Year candidates

One of the agencies featured in a Rough Notes cover story during 2010 will be chosen Marketing Agency of the Year. The agency principals of the winning firm will be presented with the award at a dinner held in their honor this spring.

The winner will be selected by votes of the previous 21 years' Rough Notes cover agents (from the years 1989-2009).

The nominees for this year's award are described on the following pages. The winning agency will be announced in the February issue of Rough Notes, and a full story on the winner will appear in a future issue..

February

Paul T. Murphy Insurance Agency, Inc.
Malden, Massachusetts

The Beatles classic "I Get By with a Little Help from My Friends" could be the theme song of the Paul T. Murphy Insurance Agency. Based in a suburb of Boston, the agency spent the first 20 years of its existence operating under the rigid regulation imposed on personal auto insurance by the government of Massachusetts.

In 2008, when auto insurance reform brought competition back into the market, agency owner Paul Murphy was grateful to accept help from his friends as he retooled his agency to meet the challenges of a vastly altered personal auto market.

One such friend was a fellow member of the Strategic Independent Agents Alliance (SIAA), a New Jersey agent who had been through the turmoil that for decades had plagued the personal auto market in that state. Following the guidance of this seasoned veteran, Murphy and his staff decided to launch an Internet marketing initiative to attract new personal lines customers.

With help from another friend, Paul connected with Astonish Results, whose digital marketing system is designed to help agencies build business via the Internet.

At first Paul was thrilled by the volume of leads generated by his agency's new Web presence, but he and his staff quickly became overwhelmed by the flood of quote requests. A brainstorming session led to the creation of a new plan that focuses on selling multiple policies to each prospect. "It may sound counterintuitive," he says, "but Internet marketing works best if you use it to develop long-term relationships with clients."

	"I went into Internet marketing to defend my book of personal lines business. Contrary to what many feared, our retention rate has actually increased." —Paul T. Murphy
On the cover: Paul T. Murphy, Owner (center), is joined by (from left) Eric Dyer, Life and Health Agent; and Greg Porziella, Agent/Producer		Team Murphy and the storefront of Paul T. Murphy Insurance Agency in historic Malden, a suburb of Boston.

March

Wright & Percy
Baton Rouge, Louisiana

With a history of independence that dates back to its founding in 1882, Wright & Percy Insurance might seem an unlikely candidate for acquisition by a bank. Since 2003, however, the agency has been achieving strong growth as a division of BancorpSouth Insurance Services, Inc.

Kerry Drake, president and chief executive officer of Wright & Percy (W&P), says the acquisition not only is allowing the agency to pursue strategic investments in technology and human capital but also provides the opportunity to network with the other agencies in the Bancorp South insurance division.

Kerry is especially gratified by the support W&P has received from fellow subsidiary Ramsey, Krug, Farrell & Lensing (RKF&L) of Little Rock, Arkansas, as W&P makes the transition to a dynamic new sales culture. Kerry says that RKF&L principal Ron Lensing visits Wright & Percy on a regular basis in order to help them transition to a sales culture. (RKF&L was the Rough Notes Marketing Agency of the Month in May 1999, and Ron serves on the Rough Notes Editorial Advisory Board.)

In addition to its headquarters in Baton Rouge, Wright & Percy has offices in Lake Charles, Shreveport, Alexandria, and Hammond. Of its total revenue of approximately $23 million, almost one-third is generated by the agency's rapidly growing employee benefits division. On the property/casualty side, 60% of revenue is commercial lines, with the balance coming from personal lines.

In Kerry's view, the BancorpSouth acquisition is driving positive change in every aspect of Wright & Percy's operation. "The bank is not telling us what to do," he remarks, "but there is pressure for us to grow. It really has made a difference."

	?"We recognized the need to develop areas of specialty where we had sufficient premium volume to justify that approach. We anticipate that this will increase efficiency and give us a leg up on our competition." —Kerry Drake
?On the cover: Thomas Sandahl (left), President Emeritus; and Kerry Drake, President/CEO		Wright & Percy's upper management team poses with some of the awards the agency has won for its service to the community.

April

Van Gilder Insurance Corporation
Denver, Colorado

Van Gilder entered its second century with a Renaissance that duplicated the original Renaissance in that it produced dramatic changes and achievements, but also an unsettling environment where beliefs and practices were scrutinized.

A year after the agency's 100th anniversary, in May 2006, Michael Van Gilder took over the CEO position from his father, Dell Van Gilder Jr. Under Dell's leadership, the agency saw sales volume grow from $500,000 in 1963 to $250 million by the turn of the century.

"We have set out to transform the agency to one with a number of specialty orientations," Michael says. The agency initially identified eight areas where it had revenues in excess of $1.5 million and a team in place, including six commercial P-C areas: construction, aviation, executive liability, professional liability, oil and gas, and private equity. This year, senior housing was added as a specialty and "others are percolating," Michael says.

Today, Van Gilder has reached its initial goal of becoming one of the top three risk consultancies in their marketplace in every one of its specialty areas. "But our ultimate goal is to become the dominant player," Michael says, "where potential clients in that niche come to us because we have become recognized as the risk management experts in that specialty. And we've already achieved that status in a couple of business units."

With more than $40 million in revenue, Van Gilder has become one of the largest independent insurance agencies in the country, employing more than 200 people in its Denver headquarters and a branch office in Dallas.

	?"Our ultimate goal is to become the dominant player in each of our specialties where potential clients in that niche come to us because we have become recognized as the risk management experts in that specialty." —Michael Van Gilder
?On the cover: The senior management team		The producers and associate producers gather in the bullpen.

May

UNICO Group
Lincoln, Nebraska

Bob Reynoldson, UNICO's CFO, points out, "When you're in a state with only 1.7 million people, you have to be both a generalist and opportunistic." The firm's opportunism has included the development over the last five years of a division that provides workers comp and companion products to more than 450 rural phone companies throughout the U.S. It has developed its own management system for workers comp, which has helped its clients lower their open claims reserves by $7 million over the past four years.

The agency's strong workers comp expertise dates back to the '90s when it put together a comp program for Nebraska hospitals, using a rent-a-captive and strong risk management to save the hospitals more than $2 million. It has provided an endorsed workers comp program to the Nebraska New Car and Truck Dealers Association for more than 20 years, and it provides workers comp solutions to Nebraska Trucking Association members. It also has partnerships and endorsements for other coverages with the Nebraska Council of School Administrators and the Nebraska Independent Community Bankers.

UNICO has an ESOP in place, which owns 40% of the agency, and it prides itself on its young producers, backing them with a strong mentoring program. The 62-person, $8.5 million-revenue firm has a business mix of 65% commercial, 20% personal and 15% employee benefits. "A lot of our time is spent listening, ..." says Bob. "It allows us to provide solutions that our customers and companies need, not the solutions we think they need."

	?"By constantly monitoring the accuracy of comp claims reserves and working with our company partners, we have achieved an average experience mod reduction of 19 points for our clients." —Bob Reynoldson
?UNICO executives on the cover		UNICO's young agent team at work.

June

Daly Merritt, Inc.
Wyandotte, Michigan

Whether it's an agency social that includes family members or giving employees gas cards when prices topped $4 a gallon or providing up-to-date technology and training, Daly Merritt, Inc., demonstrates a "culture of caring."

With 32 employees responsible for some $5 million in revenue, Daly Merritt is owned by four Daly brothers, with additional family members also working there. With a mix of 70% commercial, 8% personal and 22% life/benefits, the agency has zeroed in on several keys to success.

About 12 years ago, the agency started working with MarshBerry, which advised the firm to focus more on profitability. Toward that end, small accounts were assigned to service centers.

"We also realized that we needed to better focus our personal lines growth. One of the hallmarks of our agency is the excellent service we provide to clients. So it made sense for us to focus on the high net worth clients who would appreciate the focus on service," says Martin F. Daly, CIC, CPCU. The result was the creation of the Select Services Division.

Until about five years ago, no funds were budgeted for technology. If an enhancement or upgrade was needed, money had to be found from other areas. Now, 4% of revenue is set aside for technology every year. In addition, the agency established the position of vice president of technology and operations, to be an inside resource for employees.

Going paperless has resulted in at least a 50% reduction in paper, and cancelling the agency's off-site storage has saved $2,000 a month.

Daly Merritt has continued to be profitable, even during a soft pricing period and economic downturn. "We were still able to increase revenues in 2009, and we're on par to do so again this year," Marty states.

	?"Our people also are key differentiators in helping us retain current clients and land new accounts. They are always ready to assist clients with any problem, even if it does not involve insurance." —John L. Daly, JD, LIC
Executives of Daly Merritt, Inc., on the cover		Melissa Armatis, Vice President of Technology and Agency Operations, leads the quarterly technology training session.

July

Brady, Chapman, Holland & Associates
Houston, Texas

Called one of the best places to work in Houston, Brady, Chapman, Holland & Associates, Inc. (BCH) fosters "a positive environment that keeps perpetuating itself and growing exponentially," says Jeff Brady, president/CEO. A wellness program includes subsidizing employees who want to join Weight Watchers, helping employees who want to stop smoking and allowing for flex time and work-at-home scheduling.

The team of 75 is responsible for about $13.5 million in revenue and focuses on its strengths, especially in construction and construction-related firms, which comprises about 35% of the agency's business. Other niches are habitational/association risks and manufacturing/distribution.

About 10 years ago, the agency realized it wasn't good at growing personal lines, so a new agency was formed to handle personal lines business—Focus Insurance and Financial Services—which BCH jointly owns with a friendly competitor.

Producers are called "consultants" because they provide "a consultative approach to risk management that includes insurance as only a part of the solution for our clients," explains Tim Brady, who founded the agency in 1983 and serves as chairman. Pairing new consultants with seasoned consultants has been a successful training method. Consultants look for ways to cross-sell, Tim continues, because "the easiest new business to get is business from an already committed client. That's what cross-selling is all about and that is where referrals come from."

	?"We are passionate about developing, retaining and nurturing relationships… with each other, with our clients, with our companies, and with our community." —Jeff Brady
On the cover: Jeffrey L. Brady, President/CEO (left) and Timothy J. Brady, Chairman		?Three generations of Bradys are part of the BCH Team. From left are two representatives of the second generation: Tim's daughter Jan Clark, Vice President and Controller, and Tim's son Jeff Brady; Tim represents the founding generation; and his grandson and Jeff's son, Timothy J. Brady, ARM, CRIS, CLCS, is a Risk Consultant.

August

Johnson, Kendall & Johnson, Inc.
Newtown, Pennsylvania

"It's all about the culture and the team," proclaims Bruce R. White, CPCU, executive vice president of Johnson, Kendall & Johnson, Inc. When Bruce and then-fellow producer John Wright, CPCU, purchased the agency in 1994, they refocused the operation "away from selling insurance and toward risk mitigation," Bruce explains. What resulted is a boutique operation whose niche isn't a specific line of business. The niche is risk mitigation.

Johnson, Kendall & Johnson staffed up by bringing safety engineers on board to help clients improve their risk profiles. The agency also developed staff who could help clients with contract reviews or perform due diligence for a proposed acquisition or a new division. "We became an all-purpose tool that the client could use to solve any risk-related problem," Bruce says.

Given the unique nature of the agency, Bruce and John decided to develop their own "homegrown production talent." They turned to an outside specialist to help them with their recruiting and mentoring program. The approach includes establishing relationships with local colleges, screening applicants, and presenting top talent to the agency.

Once a new producer is hired, he or she is then put through the JKJ Mentoring Program, a five-year process that includes a team selling approach. The success of the program is evidenced by the fact that one of its alums, Doug Friel, who was recruited in 1997, is now a partner in the agency.
"We emphasize our culture of entrepreneurship," Bruce says. "People who produce are invited to become owners."

	?"Our hiring and mentoring process really differentiates us. When we hire, we hire for life." —Bruce R. White, CPCU
?Executives of Johnson, Kendall & Johnson on the cover		The production team

September

SouthGroup Insurance Services
Ridgeland, Mississippi

While any agency merger can seem like a monumental undertaking, SouthGroup's task of merging 12 agencies representing seven ownership groups in 2002 provides a clinic in overcoming organizational challenges. All the merging firms were the largest in their respective communities, and internally they were about evenly split in using two major agency management systems. SouthGroup's results since the merger indicate they have overcome the major challenges: a total growth of 65%, to reach revenues of $13.2 million, the addition of three other agencies to the fold, and a total of 18 branch offices operating today.

In transitioning to the combined entity, SouthGroup has relied on strong centralized accounting oversight, hiring an MBA/CPA to set up a new system for the combined entity. It also selected a single management system vendor, adding one branch a month to the new system for the first year. SouthGroup also formed its own technology company to handle document management.

Sales management in its multiple offices is coordinated with the help of quarterly sales meetings and bi-monthly Web-based conference calls. It also has a "Producer Academy" designed primarily to provide sales training for new producers, utilizing a role-play system based on techniques developed by the firm's eight top producers. To manage its service team, the agency holds bi-monthly Web-based meetings for commercial lines and personal lines CSRs. SouthGroup's revenue is divided between property/casualty (89%) and employee benefits (11%). Personal lines premiums are approximately $25 million and commercial lines are $75 million.

	?"We see our job as trusted advisors, helping our customers identify, evaluate, and manage their risks, not as purveyors of insurance." —Ronnie P. Tubertini
The executives of SouthGroup Insurance Services on the cover		SouthGroup Insurance Services executives (from left): Warner Wells, CPCU, Chairman of the Board; Ned Mitchell, CPCU, Director; and Ronald P. Tubertini, President/CEO.

October

United Insurance
Falmouth, Maine

There's a lot to be learned from agencies with long histories, but that's not to say they aren't still learning themselves. United Insurance is comprised of a number of agencies that have a history which dates back to the 1800s. In its current form, United Insurance came into being in 1976 when two agency owners decided they could generate more revenue together than the total they would achieve apart. This decision was prompted by a long-term strategy for growth and perpetuation.

Growth has occurred both organically and through acquisitions. United has 125 employees in 15 locations in Maine as well as a small office in New Hampshire.

Producers and managers are offered stock bonuses on a discounted basis, based on production. "Internal perpetuation is a significant part of our success," according to Chris Condon, CEO.

With the increasing influence of the Internet on consumers' buying decisions, Chris says, "We realized we had to make some changes to deal with the new competitive landscape." So they brought in a marketing company to help with developing a marketing strategy for the Internet, a statewide advertising campaign, and a new Web site.

He says using search engine optimization will help the agency extend its reach to other parts of the state, a necessity given the agency's customer count: 22,000 personal lines clients and 4,000 commercial lines clients. "We have been relatively successful at saturating our marketing territories," Chris notes. "A Web site has to be dynamic and grow with the market it serves."

	?"Our goal is to remain independent on into the future, and the perpetuation plan is set up to make certain that happens." —Chris Condon
?Executives of United Insurance on the cover		Daniel Howland, Chief Information Officer, is charged with running the technology that keeps all 16 offices on the same page.

November

Logan Lavelle Hunt Insurance & Wealth Management, LLC
Louisville, Kentucky

"We've always had a laser approach to our market niches, getting intimately involved in their associations," says Stan Logan, executive vice president in charge of sales management. As a result, the agency has "endorsements from 27 different trade associations," including the National Home Builders Association, where Stan is a director. (One of the agency's most important niches is construction.)

"There's a big commitment involved in partnering with these associations," Jim Lavelle, secretary/treasurer, adds. "We attend and participate at all their meetings. We have to be active and responsive to their needs, especially today when their members have been experiencing difficulties."

As part of that effort, the agency realized it needed to offer employee benefits and financial products. "We had to provide the associations with new products that would help them attract new members," Stan notes. One result of this was the purchase of a benefits agency, Winston & Co., in 2006. In 2007, the agency began offering financial products, and it entered the mortgage brokerage field in 2009.

"These ventures have paid off," Jim points out. "We've already received endorsements from some of the associations for these new product offerings. And it's important for us to see that because we were concerned when we added the financial side about the negative impact of compliance issues. It has definitely limited what we can do in our marketing and advertising, but it's been worth it."

Today, the agency has total revenues of about $7.5 million, with 55% coming from commercial property/casualty, 25% from benefits, 5% from financial products and 15% from personal lines. There are 42 employees in Louisville and six in the New Albany, Indiana, office.

	"Our model of service 'above and beyond,' particularly with our association partners, has been great at helping us keep our clients." —Jim Lavelle
Agency principals on the cover		Stan Logan (right) meets with client John J. Miranda, a partner with Pinnacle Properties.

December

Swimmer Insurance Agency
Charlotte, North Carolina

Swimmer Insurance Agency has remained true to the independent agency philosophy of always doing the right thing for the companies it represents and the clients it serves. "Our job is to create a solid and respectful relationship with our companies and then loan that relationship to our clients. That's what we have to be experts at. Our clients respect us for that," says David Swimmer, CIC, president.

Comprised of 72% commercial lines/28% personal lines, Swimmer Insurance is proud of its record of high retention—of both clients and employees. Most employees have been with the agency at least 10 years, some 20 or 30, according to David. "We've really parlayed our experience into a sales and marketing asset," he says. "We've buckled down and focus on one client or prospect at a time. Then we move on to the next one. It's a very disciplined approach. Nothing dramatic, but simply building on what we do best."

The agency joined the Keystone Insurance Group to gain access to additional insurance companies. "The force of the volume of Keystone behind us has helped us gain markets and grow in new areas," David says.

The agency was founded in 1953 by David's father, Harry Swimmer. Since then, Swimmer Insurance has grown deep roots in the community, by being risk management advisors as well as doing charitable work. The Swimmer Family Foundation provides funds to a number of charities, including the Misty Meadows Mitey Riders, which enables handicapped and disabled children to engage in therapeutic horseback riding.

	?"The way we do personal lines is contrary to conventional wisdom where a lot of agents just write it and turn the service over to the companies. We provide superior service and expertise." —Craig Katzman, CIC
?On the cover: From left, David Swimmer, CIC, President; and Craig Katzman, CIC, Executive Vice President		Some of the people involved in creating "a solid and respectful relationship" with companies and clients (standing from left): David Boling, AIC, CWCA, Senior Vice President; Matt Frazier, CIC, AU, Account Executive; Craig Katzman; and David Swimmer. Seated from left are: Brian Meltsner, CIC, Vice President; Melanie Stowe, Account Executive; and Christa McMillan.