I met an agency consultant and asked how I could turn around my mostly personal lines, family-owned agency. I had bad loss ratios and knew if I did not do something about it, I would most likely lose a carrier or two and be forced to deal with the resulting fallout. He replied that there was no real way to correct the problem; rather, I should just keep putting as much on the books to try to outrun it. Wow, was he ever wrong!

It took me a few more sessions in the school of hard knocks before I discovered that there is a tried-and-true formula for success: good front-line underwriting. At that time, we almost never inspected the properties we insured–no photos, no cost estimators, no physical inspections. We felt we knew the area and did not need to perform those measures. We compiled the customer's information and believed whatever he told us. And if a company told us that the customer really wanted to work with us and re-underwrite the book, we considered that both an imposition and an insult. It did not take too many years for that process to catch up with us.

Related: Read October's Getting Personal column, "Safe passage."