Jeff Cavignac said he “lucked into” aninsurance job right after earning his bachelor's degree from theUniversity of California at Los Angeles.

Like many young people, Cavignac had graduated “without a clueof what I wanted to do.” While his father was an insurance broker,it had never been automatically assumed he'd follow in his dad'sfootsteps.

After several job interviews outside the industry, he receivedhis first real employment offer from Industrial Indemnity in SanFrancisco, where he had applied for a casualty underwriter traineeposition.

“I figured I would learn the business in 6 months and thencoast,” he said. “What a surprise: After those 6 months, I was onlyjust beginning to learn the complexities of our business.”

Fast forward 32 years, and Cavignac, now president and principalof his own agency, is still learning the business. “I startedstudying when I got my first job—and I haven't stopped since. WhenI say I 'lucked into' this business, I mean it. I was lucky to findsuch an interesting business that offered such an upside. Therisk-management and insurance fields offer young people hugeopportunities.”

Cavignac is living proof of that statement. In the 20 yearssince he founded it, Cavignac & Assocs., this year's winner inthe Recruitment, Training & Perpetuation category, hassucceeded and grown by identifying and managing its customers' lossexposures with the goal of lowering their total cost of risk—andultimately, driving dollars to their bottom line.

Cavignac specializes in serving several sectors, among themconstruction, real estate and development, manufacturing, designand environmental professionals, lawyers, accountants and smalldesign firms.

The numbers say it all, with his firm showing steady growth inpremium volume even in today's challenging economy. Cavignac'ssuccess also is reflected in achieving recognition from IIABA as a“Best Practices” agency for the sixth consecutive year.

Building and Perpetuating an Agency

Cavignac's experience at Industrial Indemnity ended after 3years, when he joined his father's agency. Four years later, hisfather and his partner decided to sell the agency to a thirdparty—a move that didn't work out for the younger Cavignac.

“I resigned and started Cavignac & Assocs. as a one-manshow,” he recalled. “I really had no idea what I was getting into.The only way our company has achieved what it has is because I havebeen fortunate to surround myself with great people, from my threepartners to our entire staff. I couldn't be luckier.”

But luck only goes so far when an agency needs to survive andgrow: You need a plan, and you need young people in the pipeline,both for current success and for perpetuation down the road.

“We consider ourselves first and foremost a knowledgeorganization; and secondly, but no less importantly, a serviceorganization,” he said. “Without the knowledge, we will havenothing to service.”

Recognizing that insurance is predominantly a “graying”industry, Cavignac believes the best way for the industry toattract young talent is through “awareness and education,” he said.“We've been fortunate to find the right young people on aone-on-one basis; however, we do need to do a better job as anindustry. I'm not certain if you start this in high school, butcertainly there should be awareness at the college level.”

The agency's strategy focuses on recognizing talent andfollowing through with training and mentoring. “Recruiting is themost important non-insurance activity the agency engages in,”Cavignac said. “Identifying and hiring the right people asproducers provides the best outcome for our agency's financialgrowth, staff professional development and cultural integrity.”

Some steps the agency takes to find new talent includeadvertising an interest in meeting potential candidates year-roundon its website; participating in job fairs at the University of SanDiego and advertising open positions on the job board at San DiegoState University; and participating in an internship program withKing-Chavez High School, a charter school located in downtown SanDiego.

Because Cavignac & Assocs. is a smaller agency with about $1million in revenue per producer, producer recruitment, training andmentoring is critical.

The agency currently has nine brokers, two of whom are new andin their early 20s. Kelly Weaver interned with the agency when shewas in college at San Diego State University; she has now been withthe agency for 5 years and is in her second year of brokering.

Preston Cavignac, the other young broker, started in October2011 at age 23 after graduating with a degree in businessadministration from the University of Southern California'sMarshall School of Business. Helping to build on this experienceprior to joining his father's agency: an internship with theworld's largest global wholesale brokerage and reinsurance firm.

Training Regimen

Producer training gets special emphasis at the firm. Brokers aregiven a detailed 6-month training schedule that outlines all of theactivities they will be trained to handle; included in the trainingare educational events to enhance their insurance knowledge.

New employees also attend multiple-day company seminars andconferences focused on producer development; a week-long producertraining camp; and classes focusing on specific insurance issues.Further, they shadow the agency principals and more seniorproducers to observe and learn about their day-to-day tasks andspend time with account managers and learn about servicingclients.

All Cavignac & Assocs. producers, whether new or seasoned,meet monthly with the sales manager and president to review theirprogress related to year-to-date production; new relationshipsgenerated; status of preliminary risk-management meetings held;areas of growth needed, including mention of greatest failures andwhat was learned; and status of referrals.

Cavignac & Assocs. pays its producers a base salary duringtheir first two years of employment. They also earn 10 percentcommission on all new business they develop during that time.

In the third year of employment, they are expected to “validate”and are paid commission-only going forward. Cavignac does notdisclose its compensation structure, but it is discussed withclients when they ask, and commission information is provided uponrequest.

The agency's ownership is shared by four principals. “I amfortunate to have three great partners, all with different skillsets,” Cavignac said. Jim Schabarum (Surety and Construction),Scott Bedingfield (Real Estate and Development) and PatrickCasinelli (Benefits) all have contributed significantly to theagency's success. Every 3 years the agency balances its ownershipbased on an established formula and an agreed-upon agencyvaluation, a system which so far has worked well, Cavignacsaid.

Cavignac has developed a “Mack truck” replacement plan to befollowed if he is no longer able to lead the agency: If thepresident was hit by a Mack truck, there are other partners whohave been trained to step in and handle the activities he currentlymanages. All four principals carry key-man life insurance.

Additionally, “we have hired producers who we believe will belong-term members of the agency and have developed criteria toprovide the opportunity for them to become agency partners,” headded. “We will continue to use this model with each class of newproducers.”

This will ensure the perpetuation of the agency when partnersbegin their transition into retirement or part-time participation,Cavignac said.

“I started the agency by myself, but I knew that to expand Iwould need quality partners,” he said. “We have had lots ofinterest from others to acquire us, but our objective is toperpetuate internally.”