The most important lesson to be learned from the finalists is to focus not on the short-term cost of insurance but on the long-term cost of risk. While price inevitably fluctuates, the cost of risk can be controlled through persistent risk management and creative risk transfer--sometimes to alternative markets.

Principals of this year's winner--Haake Companies of Overland Park, Kan.--made a conscious decision to become the risk manager for their clients, and they've never looked back. When confronted with competitors threatening to take accounts with a better quote alone, they don't panic.

"Price is relative," says Steve Schill, Haake's chief operating officer. "If we're doing what we need to [from a risk management perspective], we can produce lower overall costs."

We were also gratified to learn that Haake felt reinforced about its transition to risk management after reading about the consultative approach taken by Scott Addis, principal of the Addis Group in King of Prussia, Pa.--the 2003 "NU Commercial Insurance Agency of the Year."

Indeed, a conference call with Mr. Addis "crystallized the whole thing. You could definitely see a difference," according to Mr. Schill, thus reinforcing our award program's goal--to put forth role models. Of course, Haake was already an industry leader after being named a "Best Practices Agency" by the Independent Insurance Agents & Brokers of America in 2004.

Our other two finalists are definitely worthy of "Honorable Mention." The Insurance Office of America in Longwood, Fla.--which also positions producers as risk managers--featured a unique agency ownership, management and compensation structure. Fullerton & Company in Portland, Ore., stressed producer autonomy--discarding the bureaucratic model and eliminating middle management to improve client service.

I invite you to learn more about these agencies by reading their profiles on pages 12 to 26. You can read more about their views on the challenges facing the industry in our Oct. 10 coverage of NU's "State of the Independent Agent Roundtable," which also features award winners from the past two years.

I want to thank the two judges who joined me to choose this year's winner from among the three finalists picked by NU's staff--Bobby Reagan, president and CEO of Reagan & Associates in Atlanta, who runs IIABA's "Best Practices" program and who helped set the award's entry requirements, and last year's winner, T. Gray McCaskill, president of Senn Dunn in Greensboro, N.C.

I also want to thank the IIABA, which once again graciously permitted NU to introduce this year's winner at the Opening General Session of its annual conference.

Last, but not least, I want to thank those agencies that took the time to examine their own operations and enter the award program. I hope you all learned something about what makes your agencies successful, and invite you and others who feel they have something unique to share to enter next year.

Sam Friedman

Editor-In-Chief

Infobox with Agency Award Logo:

Winner:

Haake Companies--Page 12

Honorable Mentions:

Insurance Office Of America--Page 19

Fullerton & Company--Page 25