With No Soft Market In Sight, Eagan Insurance Adapts To Prosper

With an agency located just seven miles outside of New Orleans, there is little sign of a soft insurance market, with the lingering impact of Hurricane Katrina and now the double-whammy of the BP oil spill in the Gulf.

Yet Eagan has managed not only to survive, but to prosper, holding its own with commercial lines premiums of $48.3 million–just slightly lower than the two years prior.

Eagan Insurance President Marc F. Eagan said the family has a long history in the community dating back to 1854 when the Eagans began a funeral business. Over the years, the funeral business would involve the sale of insurance–until 1954, when the independent insurance agency was established.

However, it was not until somewhere in the late 1970s or early 1980s that the business "started on its upward tract," recalled Mr. Eagan, and began hiring "the very best people we could get." With much of the credit going to his father, Maurice, along with his four brothers, the agency looked forward with a strong commitment to technology, Marc Eagan noted.

"We were ahead of the curve," he said. "That helped us to keep ahead and attract the best people. We got a better reputation because of the people in our firm, and that started growing the firm."

It wasn't until the 1990s that the family sold the funeral business and Maurice Eagan bought the insurance agency out from his brothers.

He said the agency soon "took off" because there was now a "dedicated group" devoted to the success of the firm.

Being a part of the New Orleans community for so long also helped.

"It is personal, and New Orleans is unique in that respect," noted Mr. Eagan when it comes to doing business. "We are more family-oriented, a big village where everyone knows everyone. If you are not from New Orleans, then you have a hard time breaking into the business."

However, being a long-time member of the community is not a guarantee for growth or success. Over the years, the agency has dealt with the challenges of growth by developing programs that keep it on an upward trajectory.

"We are a company that is moving forward and not backward," noted Laura S. Oser, commercial lines manager. She observed that the major differentiator for Eagan Insurance is that it has an excellent and strong reputation.

"Most people know we are very visible in the community," said Ms. Oser, noting that the firm ensures that visibility by being available to comment on risk topics in the news and doing a lot of community and insurance events.

Eagan Insurance developed a distinctive slogan back in the 1970s: "Family to family, business to business," explained Mr. Eagan. It typifies how the company reaches out to its customers, first establishing a personal relationship through personal lines coverage, then reaching out for their commercial line business.

The focus has always been on professionalism and rounding out accounts, according to Ms. Oser, nothing that this also offers a strategic advantage by making it more difficult for the competition to take business away from the firm.

The agency also promotes itself with a full-time graphic designer and an in-house print and media department. Eagan produces its own television and radio commercials, direct mail campaigns, newsletters and brochures.

While recognizing the need to effectively promote itself, the agency has not forgotten that promotion alone will not drive retentions or organic growth. Toward that end, new business comes from client referrals, growth and diversification.

On the retention side, Eagan maintains strong interpersonal relationships with its clients, "virtually" assuring them that the person who serviced them the previous year will be the "go-to person" in the years to come, the agency noted in its award essay.

Eagan added that while technology allows for extensive electronic contact, producers maintain regular one-on-one contact with clients.

The agency of close to 70 employees is large enough to handle any size account but still keep that personal, family touch, according to Ms. Oser.

Cross-selling and account integration is an important factor for Eagan's overall growth.

For example, to integrate group benefits with property and casualty placements, Eagan relies on its p&c producers to bring new business into the benefits area. It also relies on referrals from existing clients.

Free seminars are offered to existing and prospective clients, while professionals are always available to answer client's questions.

Another touch point is Eagan's in-house premium finance service. Ms. Oser explained that it functions just like any other finance service, with the same payment options others offer. The difference is that it provides clients with a familiar point of business and also allows for flexibility clients would not find elsewhere.

Unlike the rest of the country, Eagan is not suffering from a soft commercial insurance market thanks to Hurricane Katrina and the more recent oil spill in the Gulf of Mexico. Property, marine and energy, and workers' compensation have all been affected by these events, the agency noted.

One problem this poses, according to Mr. Eagan, is that many markets have retreated from the region. Where 70 percent of accounts were in the standard market five years ago, the figure has now dropped to 30 percent–especially on property accounts.

"We have seen very little easing; price-wise none, maybe a little on the deductible," he said.

One answer to the capacity crunch helping many agencies in the region is a wholesale unit that Eagan developed back in the mid-1990s named Antea. The business was set up at the suggestion of Aetna when it was still in the p&c business, recalled Mr. Eagan. Today, it helps 120 retail independent agencies throughout the state, allowing new agencies to establish themselves and providing a market to agencies that would otherwise be non-competitive with some standard market competitors, according to Mr. Eagan.

Focusing on the future, the firm said it strives to develop young and talented producers for perpetuation purposes. The goal, the firm said, is to try to bring in a new producer every 18 months, which is the approximate time it takes a producer to validate or come off scholarship.

So far this year, Eagan has brought in four new producers, who Ms. Oser said are hungry to develop a book of business and can offset producers who have mature books of business.

The new producer program included an intern from Louisiana State University, who became so excited about the industry while in the program that he obtained his insurance license and is expected to begin working for the firm in May of next year, noted Ms. Oser.

Despite the personal touch that Eagan prides itself on, without technology the firm would probably be having trouble growing today.

"We are not just that little guy anymore," said Donna Clement, office manager and information director for Eagan.

Over the past five years the agency has grown from around 40 to close to 70 employees, and with a satellite office in LaPosse, La., the firm has updated its agency management software, going from Vertafore AfW to Vertafore 360.

"We can grow as big as anyone wants, but you need a strong foundation," noted Ms. Clement.

Part of that foundation has been a program to update equipment every couple of years, which was especially important during the upgrade to Vertafore 360.

Because of its continuing investment in technology, the firm needed to replace only a few laptops that were not compatible with the new software. Since the agency did not have to spend much to update its hardware, Eagan was in a position to invest more heavily in the training of its employees on the new system, according to Ms. Clement.

The need for up-to-date technology was underscored when Hurricane Katrina hit and the firm experienced some 9,000 claims. Mr. Eagan said because phone service was out, the agency received 900 text messages that were forwarded to producers to process claims.

The agency was able to set up claims management anywhere and create a task force of 12 dedicated to processing claims.

Today, in addition to Vertafore 360, employees have dual monitors, scanners, desktop faxing and additional color printers. There is continuous refresher training on Microsoft Office software.

In addition, Eagan has a detailed catastrophe plan in place that includes turning the company's website into a claims-oriented center with direct reporting information and claims forms. Phones can be re-routed to an offsite emergency system.

The next technology challenge Eagan faces is on its website, transforming it to take advantage of the emerging social media age. There will also be a "big push" for front-end scanning of documents.

"We want to take advantage of what makes sense and makes someone's job easier and lessens the opportunity for error," explains Ms. Clement. "Anything that makes good business sense, we take a good hard look at."