Keeping the customer satisfied is easier said than done in a soft market, but not if the client buys into a comprehensive loss control plan to keep the cost of risk under control, according to Roger Bouchard Insurance, which earned itself an Honorable Mention as one of the trio of winners in this year's National Underwriter Commercial Insurance Agency of the Year award program.

The Clearwater, Fla., agency–which handles some $334 million in commercial insurance premium volume through 35 producers and 211 total employees–keeps its accounts on board and grows its business organically by putting risk management and customer service front and center.

“By utilizing a consultative approach to risk management, we stay out of the competitive bid arena and focus on clients who see value in our resources,” according to Tim Bouchard, the agency's chief operating officer. “Our sales philosophy is easy–show value in our capabilities and services rather than sell on price.”

The soft market, with insurance prices falling, has not changed Bouchard's bedrock risk management approach. “Our sales process is the same for all market conditions,” he said. “We understand the variations in pricing and how they affect our clients, yet we do not let that influence our risk management platform.”

Indeed, Bouchard has an “agency risk manager” in place to keep everyone's eye on the ball. “Working within our marketing department, the agency risk manager reviews new endorsements and changes to existing policy forms to identify important coverage differences that our staff and insureds need to know about,” said Mr. Bouchard, in his award essay. “These subtle changes can have substantial coverage impact that can be overlooked if price were the only measurement.”

There is follow-through on the back end of the process if a loss occurs, he noted.

“Working with our claims adjusters, the agency risk manager also reviews all reservation-of-right letters or denials on behalf of our insureds,” he said. “We are often able to direct the carrier's adjuster to the appropriate section of the policies, endorsements or correspondence that provides coverage for our insured.”

The agency also has a number of trademarked systems in-house to help the firm practice what it preaches in terms of comprehensive risk management, loss control and safety.

Through its “ClearTrac” risk identification system, for example, the agency “reviews policy wording, safety processes and claims data, and then compares the client's current program with their actual needs,” Mr. Bouchard noted in his essay. “Complementing this process are the tools to statistically analyze their claims for trending and forecasting. This allows us to map a strategy to improve their risk profile, which differentiates us in a price-driven marketplace.”

Another proprietary process called “Compro”–short for Comprehensive Professional services–”combines technology with the expertise of our own loss control coordinators, claims adjusters and statistical analysts. We augment, direct and oversee the resources of our carriers to provide solutions to client problems,” Mr. Bouchard explained.

“Since we are independent, our insureds know we are their advocate in these areas and can bridge any gaps or relationship challenges between them and their carrier,” he added.

This relentless focus on proactive risk management produces long-term, bottom-line savings by reducing premiums, curtailing losses, getting claims paid promptly and lowering the client's overall cost of risk, according to Mr. Bouchard.

“Our sales material highlights specific data on cases where we have reduced cost by aggressive claims management, correcting experience modifications and implementing successful safety programs,” he said–adding that the firm, on average, “can document direct premium savings to our insured of over $1 million annually.”

Bouchard isn't shy about sharing its success stories with prospects. Indeed, by providing specific references from other clients, “our prospects can talk directly to someone who can verify the services and benefits they have received,” Mr. Bouchard said. “Showing actual results rather than talking intangibles illustrates the value of our services.”

Mr. Bouchard said that “establishing a brand identity” based on risk management services, not policy peddling on price alone, “allows you to bundle your services and offer them as a product,” adding that such “differentiation in the marketplace is important to keep your customers from thinking you are selling a commodity.”

“It is your customer being able to identify with your product that differentiates you, and that makes your customer look at you differently than at another agent,” he said.

Despite the softening market, the Bouchard agency has grown aggressively, going from 60 employees to 211 in about four years, and from one location to four over the same period.

A key turning point for the agency came when it was reacquired by members of its founding family when its bank parent was acquired by another banking institution that was not interested in insurance. The bank owner's emphasis had been on growth through acquisition, but that all changed under the renewed family ownership.

“During a five-year period of bank ownership, we grew through acquisitions to serve the bank's 'footprint,'” noted Mr. Bouchard in his essay.

However, in 2004, when the management team reacquired the agency, “we decided to grow organically rather than by acquisition, because we wanted to concentrate on reducing the debt, and because we found it more profitable to produce growth internally rather than running out and buying agencies,” he said.

“You end up through acquisition picking up business you didn't want to write, as well as business you do want to sustain,” he added. “When you develop business organically, you eliminate the acquisition of business you aren't interested in.”

To keep growing, Mr. Bouchard said the agency initiated a comprehensive recruitment and training program in 2005. During the first four years of the program, he noted, the agency hired 24 producers, whose sales now exceed $17 million in new premiums. The move also allowed the agency to reduce the average age of its sales force from 45 to 40.

The agency's two-year, “Producers-In-Training” (or PIT) program is designed to teach insurance and risk management concepts, as well as sales techniques to new producers. “Our first goal is to make sure we measure the PIT's ability to sell,” Mr. Bouchard noted in his essay. “The first six months of the program consists of classroom training, broken down into sales techniques, time management and technical insurance aspects.”

He said each PIT is assigned a senior producer to act as mentor and to participate on new business appointments. “This helps to guide the PIT through any surprises that arise during the appointment,” he said.

In addition, the agency's annual “Bouchard University” training seminar “reinforces our regular technical, time management and sales training for all producers,” he noted. “This venue allows valuable interaction between our diverse sales professionals and creates a more competitive, yet supportive environment.”

This is not merely an academic exercise, as by the end of the day-and-a-half program, each producer has “specific and detailed business plans,” with all progress reported back to their assigned teams.

“The groups self-police and challenge each other to do better in the areas identified for improvement,” said Mr. Bouchard, who noted that since “most of our mentors are owners of the agency, they have a vested interest in helping the new producers.”

He said the agency's training program was so successful, “we caught the attention of a local college, which has asked us to help them develop a four-year insurance/risk management curriculum to educate potential candidates for the program.”

One key to the agency's success, according to Mr. Bouchard, is combining innovation with flexibility, so that neither the agency nor its clients are cornered by the state of the insurance market.

For example, with the workers' compensation market in Florida in turmoil in the late 1990s, Bouchard established an agency captive program to write smaller accounts being abandoned by traditional carriers. These accounts were “provided with services that most small employers never receive, and the resulting lowering of their claim and insurance costs benefited us both. This was a true win-win scenario,” Mr. Bouchard noted in his award essay.

This alternative market experience prompted Bouchard to develop another specialty workers' comp captive program for a selected group of temporary staffing agency accounts.

“In the temporary staffing business, we had the underwriting discipline to choose the right clients”–those with a solid loss history–”and those clients were being ignored by the insurance industry,” according to Mr. Bouchard, who said temporary staffing is a much aligned industry among some insurers–unfairly so, he argued.

“What we have been able to do is convince the insurance companies that our risk management approach improves the loss control processes of those staffing firms,” he said.

Mr. Bouchard also has positioned the agency to capitalize on the rapid growth in the health care sector–which, he said, is a “fairly recession-proof, a fairly level business.”

Another specialty area is agricultural–a major industry in Florida, especially citrus.He said the agency imported expertise in that area through an acquisition in 2003.

“There are special coverages and specialty markets, and you have to have relationships with the farmers and ranchers,” he said. “They are rugged individualists, where personal relationships are critical to sustaining the business.”

He added that “because Florida is such a big market, even if the economy shrinks, the agricultural economy is so large there is still business for us to add.”

It is even more important during bad economic times to add clients, because your existing accounts may be shrinking, or go out of business altogether, he said. To keep key clients on board, the agency launched a “Jeopardy Committee.”

“We found that when we looked at business we lost in the last few years, an underlying issue that wasn't being addressed was the main reason,” said Mr. Bouchard. “So we created the Jeopardy Committee as a means of bubbling up issues with clients that would get to the ownership group, so we could become involved in getting solutions for those accounts and keep them as clients.”

As part of the process, a top agency executive is assigned to work with the agent and the client as a team. The Jeopardy Committee is critical, according to Mr. Bouchard, because “we believe a renewal piece of business is more valuable to us than a new piece of business of the same dollar amount,” due to the acquisition costs that go into acquiring a new account.

More importantly, Mr. Bouchard said, “we never want to lose a client, yet we don't want to have dissatisfied clients. We want to understand why our client has concerns and resolve those issues.”

Special Reports /

Bouchard Keeps The Customer Satisfied By Staying Out Of The Price-Quote Trap

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