NU Online News Service, June 16, 1:02 p.m. EST
Outgoing Liberty Mutual Group chief executive Edmund "Ted" Kelly says his continued role as chairman will not include stepping on David H. Long's toes.
"My involvement will be defined by his desires," Kelly says in an interview with NU Online News Service. "He's running the company."
Long is Liberty Mutual's incoming chief executive officer. The insurer announced Kelly's retirement as CEO, a position he has held since 1998. Kelly began with the company in 1992 as president and chief operating officer.
Long was elected president about a year ago.
"The numbers speak for themselves," Kelly says of the progress and growth Liberty Mutual has made during his tenure as CEO, but he says he is most proud of the management team Liberty Mutual has assembled that will now lead the Boston-based insurer. Long is among that group.
"I'm more and more pleased every day, watching him," Kelly says of Long. Of the transition, he adds, "You look at where the world is going. He will see things differently. But he understands the business."
A look at Liberty Mutual since Kelly was appointed CEO reveals tremendous growth. Total assets at the end of 1998 were $26.25 billion. At the end of 2010 they stood at $63.14 billion. Net premiums written after 1998 were $6.52 billion compared to $21.48 billion at the end of 2010. Policyholder surplus grew to more than $16 billion at 2010 year-end from just more than $7 billion at the same time in 1998.
Under Kelly's leadership Liberty Mutual bought Safeco in a move that gave the insurer a presence on the West Coast. The company also embarked on a plan to spread its global footprint, expanding to places like Latin America, Ireland, and China.
Globalization was an "inexorable trend," Kelly says. "We had a choice to go global or try to remain a successful regional insurer," he adds. There were doubters, but Kelly says there were likely doubters when Liberty Mutual decided to go into New Jersey, for instance.
The landscape of companies that decided to remain steadfast regionals is scattered with failure, he says. "Lots are gone," adds Kelly, who has warned North America-only companies will eventually become irrelevant.
Though "all good strategies are written in retrospect," Kelly says the company's status as a mutual allowed it to "take a longer-term view" of some moves that Kelly admits would have been difficult to convince investors to get behind.
Yet Kelly believes Liberty Mutual's employees had much more to do with the company's success.
"We made sure the rank and file participated in the success. They deserve it," says Kelly, who adds that hundreds of millions of dollars in bonuses have been doled out to non-management employees.
Travel and family time are included in the soon-to-be-retired executive's plans. So is music, he says. Kelly is to become the chair of the Boston Symphony Orchestra board.
"It's something I'm really excited about," he says. "I've always been interested in music."
The Boston press has hailed Kelly for his leadership in civic circles. As a leader of Liberty Mutual, Kelly has encouraged involvement in the community—something that appears to be reflected in the company's "Responsibility" ad campaign.
"You can't have success if everything around you is falling apart," Kelly explains.
Asked if there was anything he wishes he could have done during his time as CEO, Kelly relays a story of childhood in Ireland.
"We'd climb the hills and we'd get to the top, tired," he tells. "Then there was another ridge. There's always another ridge. No. I have no regrets."
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