How might an agency grow from a small, two-man operation with one office, to one with multiple locations, partnership relationships around the world and over $94 million in commercial lines premium volume? Basically, by focusing on helping clients make the right decisions for the long term, rather than being captives of the pricing cycle, according to Lassiter-Ware Insurance, one of the three winners in this year's National Underwriter Commercial Insurance Agency of the Year award program.

“Convincing the client or potential client to purchase something that is not in their best interest may gain us business in the short run, but in the long term we will have sacrificed our credibility,” said Ted Ostrander Jr., president of the Leesburg, Fla.-based Lassiter-Ware, in his award essay.

“We would rather focus on assisting the client or prospect in feeling understood and supported, rather than constantly worrying about whether we have award-winning closing techniques,” he added, explaining a philosophy that helped the agency win an Honorable Mention in this year's award program.

Describing how this philosophy developed, Mr. Ostrander said his agency was formed in 1912 in a small town 50 miles from Orlando.

In the mid-1980s and 1990s, the agency expanded into commercial lines and began to grow and develop. Mr. Ostrander said the agency saw it was competing with the likes of Brown & Brown and other larger agencies and brokerages that represented nearly every insurance company.

“We figured they have every company in the world, so if we try to compete on price, we're probably going to lose the battle,” he said. “So we need to be able to compete on service and product offering, and do it differently.”

Mr. Ostrander said there was no specific order regarding what services were added, with the firm's capabilities and offerings evolving to meet the demands of its client base.

Competing on service rather than price has paid off in the long run for Lassiter-Ware, according to Mr. Ostrander, but he noted the key is determining exactly what the client needs.

Offering services does nothing if the client does not want them, he pointed out, adding that Lassiter-Ware has been able to distinguish itself by taking the time to determine what its clients require for their specific challenges, rather than force-feeding them cookie-cutter solutions.

Mr. Ostrander said the best way to pick up business is through agent-of-record letters. Carriers do not want to lose renewals, he explained, and will fight hard on price to keep them, even if the insured switches agencies.

Mr. Ostrander said his agency tells the client that the carrier they are with is the best around with respect to price, and focuses the conversation on services provided by the client's current agent. With the services Lassiter-Ware provides, Mr. Ostrander said he is willing to compete agency-to-agency.

Beyond the standard commercial and personal lines insurance programs, Lassiter-Ware said it provides:

o Risk management services, including risk identification and analysis, regulatory compliance, and workplace safety and loss control.

o Employee benefits and services, including group life and health plans.

o Business financial planning.

o Non-insurance business support, including employee leasing (via a professional employer organization), individual employee retirement counseling and employee payroll administration.

o Individual and family insurance planning, such as long-term care, retirement plans, and individual life and disability.

The agency has grown tremendously by offering diverse services, according to Mr. Ostrander, who noted that agents selling group insurance, for example, all use the same basic set of carriers, “so the only way you compete is with a service model.”

That service-oriented philosophy for group benefit products has helped Lassiter-Ware further develop its service model for its p-c business, Mr. Ostrander explained.

Expanding on some specific services Lassiter-Ware offers, Mr. Ostrander said the agency targets its loss control support on reducing claims. “A lot of agents will say, 'we have loss control,' but they're not concentrating on what the issues are, and those are the claims issues.”

Mr. Ostrander said his agency outsources loss control to one firm that specializes in many areas. For example, on a construction risk, Mr. Ostrander said Lassiter-Ware will speak with the insured to see where loss control challenges are, and then bring in a loss control expert that specializes in construction exposures.

Lassiter-Ware also strives to provide unique claims service. The agency's claims department has four employees who do work associated with most standard claims departments–such as taking first reports, following up and performing claims analyses.

What sets his agency apart, according to Mr. Ostrander, is that the vice president in that department, who is a licensed adjuster, also acts as a “claims advocate,” serving as liaison between the insured and carrier after a large loss, and mediating between the two parties when there is a conflict to get each side to understand the other's point of view.

Mr. Ostrander said the agency also offers human resources audits free of charge for clients who do not have HR employees on staff. An agency HR professional works with clients and goes over hiring and firing practices, and sets them up on an HR program, Mr. Ostrander noted.

Technology also plays a role in the services Lassiter-Ware offers. For example, clients are able to get online certificates and print auto ID cards.

Meanwhile, as a member of Assurex Global Partners, Mr. Ostrander said his agency can leverage the expertise of other large Assurex agents around the world.

Additionally, for Lassiter-Ware risks that have exposures outside of Florida, the agency can call other Assurex locations in that market and they will service the line.

“If the client has a large presence in another state that is not adjacent to Florida, we will arrange with one of our Assurex partners to meet the client and handle the insurance for us,” noted Mr. Ostrander. “The partner will keep us informed of all issues relating to the out-of-state exposures, and we can let our client know they are being handled by an agency in the other state with the same abilities as our agency handles the local exposures.”

Branding the agency also plays a significant role in Lassiter-Ware's strategy for success. The agency achieves name recognition through involvement in professional and civic organizations, sponsoring events, issuing press releases to the media, advertisements, junior achievement and career days, seminars and educational programs, and through its Web site, www.LassiterWare.com.

The agency also benefits by being largely employee-owned, which means “we never lose sight of what fuels our business–our customers,” the firm noted in its award essay.

Mr. Ostrander said 44 percent of the agency's stock is in the ESOP, with the remaining 56 percent owned by 20 different stockholders in the agency. Those 20, he explained, are either producers, managers of departments, or senor executives in the agency.

The ESOP structure, he said, provides incentive to producers and also to staff–who, he explained, believe strongly in the concept that they are owners in the agency, not just hired hands.

While the continuing soft market changes the landscape of the industry for both carriers and agents, Mr. Ostrander said Lassiter-Ware will continue its strategies with respect to competing on service. He said the agency has not changed its model just because insurance prices are falling.

The firm's award essay explains that you can't afford to stand pat in the current soft pricing environment, as the agency looks to delve into underserved markets, network with colleagues, and listen to clients and prospects to develop new ideas.

The agency has also restructured its organization in an attempt to streamline operations and assist with organic growth.

“Previously, our seven offices were managed by a producer at each location,” the firm said in its essay. “Our current structure is more streamlined, with four executive vice presidents representing p-c, employee benefits, PEO services and operations reporting to our president/CEO.”

Both the award essay and Mr. Ostrander mentioned a strong focus on cross-selling services as an important soft market strategy as well. Mr. Ostrander said producers have been instructed to work as a team–offering, for example, group benefit products to p-c clients and vice versa.

When a producer for a given line visits a client, Mr. Ostrander said they will take producers of other lines just to introduce them to the client and to let the buyer know that Lassiter-Ware offers those services.

Commenting on how the soft market has affected Florida specifically, Mr. Ostrander explained the state had been “somewhat immune” to the price decline trend until January of this year. Since then, Mr. Ostrander said Lassiter-Ware has been helped by the strength of its non-p-c business, such as group health and its PEO. He noted that in the current market, it is tough to find success on just p-c business.

On the struggling economy in general, Mr. Ostrander said the Florida construction industry, in which Lassiter-Ware does a lot of business, has been hit particularly hard.

However, he said clients who have reduced staff and do not want to do their own payroll anymore have been more interested in the PEO services offered by the agency, creating new opportunities for revenue growth and to become a more valuable business partner with buyers.