Embarking on a career with the CIA after a period of militaryservice and college education, E. Prescott Engle already had chosena career path when his uncle, an attorney who owned an insurancecompany, asked Engle to join the firm and save it from sinking.Instead of working with the CIA, which would have requiredtraveling and time away from family, Engle decided working forEngle Paxson & Hawthorne Insurance Services LLC (EP&H),Leesburg, Va., was a better opportunity.

Little did he know he was walking into a minefield.

“The first problem we had was that some of the staff were notsales-oriented, and did not want to be,” Engle, CEO and soleprincipal, said.

Over a period of 10 years, Engle almost replaced the entirestaff with a team of sales- and service-focused persons. Threeemployees resisted, two of whom were in the business for some timeand were not thrilled to have an inexperienced,right-out-of-college boss changing their routines.

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“The first thing I needed to do was learn the insurancebusiness,” Engle said. “I knew nothing and carriers were leavingdue to low production and high loss ratios.”

Engle began learning the industry by cold calling to learn hiscompany and products, along with handing out business cards to anybusiness he could sell insurance to such as retailers, HVACcompanies and manufacturers. “It was very difficult,” he said. “ButI learned a lot of lessons from that passionate persistence.” Aftera television advertisement in the mid-1990s, EP&H began toreceive a profit and business.

EP&H has been serving the Washington, D.C., area for 103years, opening (as Paxson & Hawthorne) in 1908 by W.E. Paxsonand his son-in-law Del Hawthorne. Paxson retired in 1974, leavingthe business to Hawthorne, who then sold the company to Engle'suncle and former partner in 1980. When Engle first started,EP&H generated less than $750,000 in premium, and sold 100percent personal lines business.

Today, EP&H is predominantly a commerciallines business (70 percent commercial, 30 percent personal) andgenerates around $ 10 million in premium. Commercial lines businesspromised faster growth and potential with larger commissions,premiums and allowed the opportunity for the agency to branch outand be more versatile.

The firm targets construction consulting and generalcontractors, commercial property, shopping centers, condominiumassociations, technology companies and HVAC, and representsHarleysville, Loudoun Mutual, Ohio Casualty, CNA, The Hartford andProgressive.

After the market went from soft to hard in the late '90s,EP&H developed a strong specialty in safety and risk managementservices, working closely with clients to develop and implementtheir safety programs. The company has an attorney to conductcontract reviews, along with financial and legal consultants.

“Incentives always accomplish more than punishment,” Engle said,“but if you get the senior leadership and management involved inleading the company in risk management, then you have a companythat will perform very well. That keeps your clients' premiums downin a very competitive market.”

To stay competitive, EP&H hires smart and hardworkingemployees. Currently staffed with 10 full time—including Engle'stwo daughters—and two part timers, EP&H encourages employees toattain designations and to be socially and grammatically correctwhen contacting clients.

A telemarketer supplies the company with leads to keep producersupdated on current events in certain industry niches—medical,technology and contractors. The agency also performs internalresearch, examining industry data collected from trade publicationsand other media sources to best take advantage of market trends andforecast future trends and leads.

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“I don't follow insurance trends and related industries and amnot always on top of the newest practices,” said Michael Ward,president, Ward Data Services, and EP&H client. “I don't havethe time to follow who is the best carrier for this or that type ofinsurance. But I don't have to. EP&H does this for me.”

EP&H is proactive with clients. The agency is focused onreturning phone calls or starting conversations with its customers.“You have to return phone calls,” Engle said. “It might not alwaysbe a pleasant conversation, but you owe it to your client to returntheir phone call and tell them the truth, whether you want to ornot.”

For example, Engle became concerned when accident rates for aninsured, TMG Construction Corp., began increasing. Examining theaccount, Engle noticed a trend and requested a meeting with thesenior management. “I predicted what was going to happen with theirworkers' compensation policy and coverage if they did not becomeproactive with safety and get their accident rate under control,”he said.

The three scenarios could have happened: Thecurrent carrier would retain the business with a small increase incoverage; EP&H would put the insured in a risk retentionprogram, causing the company to pay more; or no carrier wouldaccept the company's workers' comp coverage and EP&H would haveto place its coverage in the residual market, resulting in not onlythe rates being increased but it would be issued the assigned riskadjustment premium, and that could equal to its debit experiencemodification rating.

“They took immediate action, and began to change their safetyculture,” Engle said. “This workers' comp carrier did not want torenew; we had to place in the residual market for a year, but Iwent to one of my other carriers and explained the situation withthem (at that time they had 2 years of very good loss ratios undertheir belts). That particular change saved them $100,000 in premiumin just that year. They were very grateful, and have done nothingbut perform well. We co-sponsored their educational forum at atrade show, The American Institute of Constructors, and thepresident of the company talked about the company and how we helpedhis company.”

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EP&H also provides growth bonuses to top-performingproduction, service and retention staffers. The agency is also aproud sponsor of Loudon Interfaith Relief, a local food bank,donating more than a thousand pounds of food last year, toemphasize its role in the community.

“One of the proudest moments in my career was last year when[EP&H] was designated a Best Practices Agency and recognized asthe No.1 firm in the country for our revenue group,” he said.

Although EP&H has encountered a few bumps in the road, theagency is not going away anytime soon. Engle successfullyintroduced a 5-year plan in 2007, with goals including a buyout ofEngle's partner and use his capital to expand personnel; the goalhas been achieved. EP&H has also increased service andprofessional staff, and has posted positive growth each yearthrough the recession.

The company has moved to a larger, more high-tech office, whichincludes a technology classroom and conference room to trainclients onsite in safety. It uses TAM Online and has been paperlessfor the past 3 years, increasing the business's efficiency.EP&H has even started a Facebook page to promote business.

EP&H is focused on growing its benefits business, but hasheld back due to the uncertainty surrounding the nationalhealthcare law. If the economy turned, EP&H would takeadvantage of vertical growth with current clients, and asignificant increase in premium.

To accomplish its future goals and potential, Engle understandsthat the agency and its staff have to withstand a tough currentmarket. Engle keeps a list given to him by a respected militaryleader called Murphy's Laws of Combat. The line Engle drills intohis staff is, “The important things are always simple; the simplethings are always hard. And it's the simple things we need to payattention to.”

“From where we were to where we are now, I am very grateful,”Engle said. “It hasn't been easy, but nothing worth working forever is.”