There are 20 people working at Clark-Theders Insurance Agency, located in the Cincinnati suburb of West Chester, Ohio. Three of them are sales people and the rest are involved in making certain that the promises the agency makes to its customers are met or exceeded. And to take that one step further, the agency has its own Director of Customer Care—Mandy Frank, CISR—who serves as part of the management team. Her job is to look at everything the agency does or plans to do and determine whether it will benefit agency clients.
“The only way to get into trouble is not matching up with the promises made during the sale,” says President Jonathan Theders, CRA, CPIA, CHSP. “Mandy makes certain that our promises match what we do. She makes certain that we maintain our focus on exceeding client expectations.”
It is a key part of the agency’s goal to be remarkable—to turn that oft-quoted ditty by Gelett Burgess about the Purple Cow on its head and indeed rather “be than see one,” a la Seth Godin’s book which suggests that companies should strive to become a strangely colored bovine and stand out from the herd. In fact, the agency provides visual credence to its commitment—its kitchen is purple and one wall in the sales office is purple.
“You have to differentiate and distinguish yourself,” Jonathan declares. “That’s how we’ve grown from $4 million in premium when I joined the agency as its 11th employee in August of 1998 to $19 million this year.”
Clark-Theders came into existence in 1977 when Jonathan’s dad, Rick Theders, CIC, purchased the Jim Clark Agency from James W. Clark Sr., who established the firm in 1950. Rick was a field rep for Midwestern Indemnity calling on various agencies in the region. The Jim Clark Agency was one of his weekly stops. Rick knew the agency well and appreciated its sterling reputation in the community. In fact, that was the primary reason he decided to keep the Clark name and its heritage. It meshed perfectly with his goal to create an agency environment that provided quality insurance products and services to clients, while focusing on core values of honesty, integrity, care and professionalism.
And it probably came as no surprise that Jonathan was destined to be part of the agency. “From the time I was three years old, I wanted to work with my dad,” he relates fondly. “I remember carrying his briefcase around when it was almost bigger than I was.”
Preparing his way
But Jonathan did not just step into the agency unprepared. He carefully planned for success by first attending Eastern Kentucky University, where he majored in insurance and risk management and graduated with a Bachelor of Science degree in those disciplines.
Following graduation, he went to work for Cincinnati Insurance Company for two years in a program the company provides for individuals who are going into the family business. “I started out in underwriting. My territory was Iowa for the first year-and-a-half and then I did a stint in all the departments to learn what happened in every area of an insurance company.”
By the time he joined the firm, Jonathan was ready to rock and roll and he stepped right in as a producer. “We already had a great team of people capable of providing a high level of service,” he notes. “This gave me the freedom to get out and meet people and bring business into the agency.”
The epiphany—no more quoting
“We always had an emphasis on risk management that we provided to our clients and prospects. And as part of that, we would audit the current coverages of prospects to determine whether it was adequate and appropriate. I was meeting with a design/build contractor whose primary business was construction management and looked over their professional liability policy,” he remembers. “They had a $1 million limit with a $10,000 deductible. It had been placed by one of the largest agencies in the area. But there was one problem—it had an exclusion for all construction management services.
“The coverage was with a respected insurance company in the field, but somebody hadn’t done all their homework. They were simply quoting the business. I realized that we could have made the same mistake, although I like to think that we wouldn’t. But now, I can guarantee that we won’t, because we no longer quote business,” Jonathan points out proudly. “We audit the needs of every client and prospect and will not place their business unless they agree to go through this process. We don’t charge for our audit process. We feel it’s an investment into the relationship.”
An holistic approach
Jonathan adds: “Our audit process involves looking at both the risks that need to be mitigated and the strengths and opportunities that could be enhanced. This approach changes the client’s view of our agency from a company that sells insurance to a trusted advisor that helps them be more successful.
“I take particular pride in one of our success stories,” he continues. “The first company to go through our audit process was a building materials manufacturer. The CEO is a very bright guy who had founded the business and knew his customer base very well. Nearly all of those customers were residential. He had the internal resources and employee passion that would allow him to grow the commercial area, but it hadn’t been a primary focus in his strategic plan.
“Our report was a catalyst. As we communicated his team’s desire and energy to focus in this area, they reevaluated where this fit in the model. The results have been remarkable and, of course, that produced additional opportunities for us. It was a classic win-win and has been a great story for us to tell when we meet with prospects.”
Learning by doing—then doing more
About 11 years ago, Clark-Theders began building a claims management database for clients with large auto fleets. “We had two significant clients with multiple locations that needed a faster way to submit claims and assess their risk mitigation efforts,” Jonathan says. “We populated the database with the names, driving records and length of employment of all employees. The database also integrated the particulars of the company’s drug and alcohol policy so that when a claim occurred, whether or not drug and alcohol testing was needed after an accident immediately popped up. We also connected this employee database with loss control and claims data.
“One of these companies hired a lot of seasonal drivers and experienced higher claims volume during the peak seasons. We decided to mine the database to determine just what factors contributed to the increase. We assumed that age would be one of the factors, but were surprised that age had little to do with accidents. The data showed that most of the accidents occurred between 45 and 60 days after the driver was hired. What seemed to be happening was that the driver would be extremely careful for the first month and then settle in to a comfort zone. Once that occurred, accidents started to climb. We worked with the company to institute driver re-evaluation training after 30 days and claim frequency dropped significantly.”
If using technology to produce improved results worked for one type of company, Clark-Theders people suggested, “Why don’t we use what was learned to better manage risk for all our clients?” And so, RiskSOURCE™ was born. RiskSOURCE looks at the Strength, Opportunities and Under-standing Risk Critical Exposures (SOURCE) for every commercial client. The process looks at non-insurance solutions and utilizes a variety of techniques to identify, measure and reduce risk while enhancing an organization’s ability to perform. Each decision about how to manage risk is examined in light of its impact on the client’s bottom line.
Jonathan concludes proudly: “We have a 100% hit ratio with the prospects who have gone through our RiskSOURCE process. And clients have seen an average savings of 24% in their insurance premium, even after we have found deficiencies in their previous insurance program and added new or enhanced coverages. Our retention rates are extremely high in commercial lines, with our worst being 96%, and a number of years we have seen retention of 99%.”
The agency has continued to build on its RiskSOURCE brand by offering RiskSOURCE inspection services and inviting clients to participate in the RiskSOURCE Academy, which offers monthly lunch and learn sessions on a variety of topics designed to help improve a company’s bottom line, including management improvement, effective marketing, ergonomics, what files you must maintain and for how long, and so on. “These sessions are educational and rarely insurance focused,” Jonathan notes, “in keeping with our philosophy of being a trusted advisor rather than only an insurance sales organization.”
Translating this to personal lines
In addition to Jonathan and Rick, the third sales person at the agency is Jean Mabry, CIC, CISR. “This area has been a real challenge,” Jonathan points out, noting that “there has been so much marketing out there that has tended to commoditize the personal lines product. We needed to find an area where that was not the case, so our team sat down and went over our experience.
“Once again, we were surprised by the results of our analysis. We found that the typical demographic factors we targeted were not indicative of a good, long-term client. What really mattered was whether the prospect would meet with us face-to-face. Jean started saying to clients and prospects: ‘we need to meet with you so you fully understand what you are buying.’ That has made a huge difference. Our hit ratio is much higher and our clients are more comfortable. And we’re enjoying very high retention rates.”
Claims as opportunity
“While no one likes to have a claim,” Jonathan notes, “for us, it is a time to really shine. Whenever one of our clients files a claim with us or direct with the insurance company, we are immediately notified by our automation system. We also are notified about who the adjuster is. We immediately call the client and copy the adjuster in on all calls and correspondence. We go beyond turning in the claim. We are an active part of the claims process with our clients.
“Once a claim is closed, we survey the client using Constant Contact® with a brief five-question survey that asks about how the claim was handled and whether they were satisfied with the result. We give this information to our carriers and it really helps to establish a relationship where we are all in this process together. Our scores are very high, often scoring top numbers in all five categories. So we follow up with those satisfied clients by asking for a referral, and they’re almost always willing to recommend us.
“This year, we’ve closed 1,200 claims and have built up a nice pipeline of prospects who want to hear from us.”
Corporate citizen par excellence
“Probably the most near and dear part of our success has been that it has allowed us to make a difference in our community,” Jonathan points out. “We encourage all our employees to get involved in community activities. Each employee is given 30 paid hours a year to volunteer with a nonprofit organization of his or her choice. In addition, our CTIA Cares committee, which is comprised of eight staff members, identifies a bimonthly service project in which every employee can get involved. We also find ways to involve clients. One project involved sending supplies to our troops in Iraq and Afghanistan. One of our clients donated their own manufactured lip balm and we packaged it and sent it out.”
Last year, the Clark-Theders staff provided more than 900 hours of donated labor to charitable organizations. “This has been the most rewarding aspect of my job,” Jonathan says. “It’s been wonderful to see how the culture of our office has changed. We always considered ourselves to be a family, but this has really served to tighten those bonds.
“In 2010, we started a new program—CTIA Cooks. We were always good at sending out cards to vendors, employees and clients, but felt that we wanted to do more when there was a special event that warranted more attention. Our Cares committee thought providing a dinner would be a nice gesture for people who were laid up or who had just had a baby or any other life-changing event. So we borrowed the kitchen from a caterer that is located in our building and made our own spaghetti sauce. When there is a need we add salad, bread, pasta and a homemade dessert to round out the meal. A client donated salad dressing. It’s really been a great team builder and the recipients are very grateful. Amanda Shults, our chief marketing officer, had a great time designing the logos for CTIA Cooks and CTIA Cares. We’ve done 45 dinners so far this year. It’s been very gratifying.”
Jonathan also has been involved in helping other family businesses succeed. He is a supporter and serves on the Board of Advisors of the Goering Center for Family & Private Business at the University of Cincinnati. Courses cover succession planning, communication techniques, strategic planning, governance issues, leadership development, compensation issues, advisory boards, and conflict resolution. The objective is to prepare the next generation of family business owners to manage the family firm. Interestingly, the Center’s Founder John Goering, was the recipient of one of the agency’s dinners this year.
“We want to increase our philanthropy,” Jonathan maintains, “and are also working to get more of our clients involved in the effort. Just imagine what a difference we could make if all businesses marshaled their resources.”
Clark-Theders Insurance Agency has received numerous awards, including the BBB Torch Award for Marketplace Ethics, as well as recognition for its charitable work from Smart Business magazine and from the Goering Center. To this, we add our own recognition of the agency as the Rough Notes Marketing Agency of the Month.
© 2011 Rough Notes Company. Reprinted with permission.