Kevin VanDyke and Andy Norman opened their St. Augustine agency around Thanksgiving last year but already they are thinking big. They plan to grow their business in the Jacksonville metropolitan area not just by outselling other agencies but also by acquiring commercial books or agencies.
VanDyke knows what it’s like to be part of a big operation, having been with a $130 million wholesale nursery. The insurance and risk management issues he dealt with as chief financial officer and then president of that firm piqued his interest in owning his own agency. “I always felt like I could offer people help based on my experience buying insurance,” he told Insurance Journal.
Norman was a producer with a local independent agency, Thompson Baker Agency, in which his father used to be a partner before he sold out to younger owners. Norman joined the agency in 2002 right out of college. Over the years, as he gained more sales and experience, he also grew impatient for the next phase in his insurance career.
“I saw what it was all about and decided that I wanted to be an agency owner. My previous employers kind of thought that too and they encouraged it but they weren’t on the same timeline that I was on.” They were thinking ownership in maybe five years. “But I decided I want it now,” said the 30-year old Norman.
Their first maneuver was to lure carriers.Norman had his own and some of his father’s contacts over the last 20 years that helped them get some contracts.
Norman thinks carriers are more willing to take a chance on new agencies in a soft market. “They’re trying to grow also. Their exposures are down, the premium is down so they’re looking to take a chance on guys like us who are willing to write with them.”
They still have one gap in their carrier roster to still fill; they are looking for a market for their agribusiness accounts.
Their market, the Jacksonville metro area, is dominated by two established commercial agencies but they like their own odds. “Candidly our brand new agency has more producers than either of them. I think there’s a sense in a lot of agencies where they may have great customer service and back office but they don’t have the production. That’s all we do right now is produce. If we’re not getting new business, then we’re not doing anything,” said VanDyke.
Norman believes that the struggling economy actually works in their favor because employers are reviewing every expense trying to save money. “We’re probably getting more looks from people shopping than we would in a normal steady economy,” he said.
Salesman Norman even sees not having much business on the books as an advantage at this stage. “We don’t have to think about having this account coming up on 3/01 that has to be renewed or that we can’t focus on new business now because we’ve got all these renewals in a soft market,” he said. He acknowledges that renewals are a “problem” they might welcome in the years ahead.
Eventually personal lines could be 40 percent of their business but for now they are both concentrating on commercial accounts. Norman can’t go after accounts from his previous agency but VanDyke is mining his former business contacts and they both have lots of friends to call upon. VanDyke is zeroing-in on agriculture and agribusiness, landscapers, contractors in general and professional liability. Norman is utilizing his expertise in the condominium association market and is more of a generalist in the businesses he goes after.
They are also hoping to grow through acquisitions, “especially if we could find somebody with a commercial book,” according to VanDyke.
Owning a fledgling agency has meant adjustments for both men.
For Norman, it’s meant appreciating every sale more. “I do my little commission dance even for the small ones now,” he said.
VanDyke has had to adjust to working in a downscaled environment. “The main thing is for me is I used to run a $120 million business with 400 employees and now I run a company with a partner and a staff person. So there’s a bit of an adjustment in terms of the resources at my fingertips. I think that and going from the top of the mountain to the bottom of the learning curve and doing it very rapidly,” he said.
“Basically he’s got to get his own coffee now,” Norman quipped.
Other agents are also starting new agencies across the country, according to an Insurance Journal report profiling some of the industry’s newest entrepreneurs. The other profiles include:
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