What began as a one-man life insurance operation grew into a team of experts specializing in four areas of risk management: commercial insurance, group benefits, personal insurance and financial services. The agency mission promises to “protect clients' people, property, prosperity and peace of mind,” and employees work to create success from opportunity with that mission in mind. 

The Family Grows

Even though Mahowald Insurance Agency has enjoyed four generations of Mahowald leadership, its partners are wary of calling it a “family business,” which can imply that other people work for a single family. Instead, the website provides this distinction: “We are a family business for all of our families.”

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The founding Mahowald father worked to support his family of three; today, the agency employs 30 and supports more than 90 beneficiaries. Four generations of Mahowald leaders have shepherded the company's expansion. Partners include John Mahowald (managing), Robert W. Mahowald, Robert L. Mahowald, Greg Murray, Marty Mahowald and Dave Mahowald. The agency represents MMIC Group, Travelers, Selective, CNA, Secura, Chubb, Minnesota's four health insurance carriers and more. 

Mahowald produces an annual premium volume of more than $68 million from 60 percent commercial lines, 35 percent group benefits and 5 percent personal lines. The company uses TAM, PaperWise, SharePoint and iPads to increase efficiency and promotes paperless operation. 

Staff members introduce policy information in videos posted on the company's website, giving it a friendly, personal feel. When potential clients visit Mahowald's website, they can read staff bios, get in touch with team members for a specific type of coverage or register for seminars about employee benefits, claim reporting or driver safety. Although Mahowald has a Facebook page, LinkedIn page and a YouTube account, it does not aggressively use social media for marketing. Instead, most new business results from referrals.

See the sidebar  ”The Risk Management Process.”

Word of mouth may bring in prospective clients, but Mahowald has a process in place to help them determine if the agency will be a good fit for them. This way, neither the company nor the potential client ends up wasting time. “The individuals and organizations who want more than just an insurance product at a cheap price are our target market,” Mahowald said.

Stand-Out Service

Producers at Mahowald are more than just salespeople. “We believe the insurance products we sell are just one part of the risk management and employee benefit plans we design for our clients,” Mahowald said. The agency's objective is to manage its clients' risks so well that clients will eventually need less insurance. At a time when consumers view insurance as a commodity with little variance in product or service, this practice helps Mahowald stand out.

Mahowald also helps its clients succeed by partially self-insuring them. If clients perform poorly, the risk of direct loss increases. If clients perform well, the profit is largely theirs to keep. This strategy provides incentives for everyone from insurance carriers to individual employees. Although the agency is compensated less when clients are not fully insured, “this type of program builds long-term relationships with clients that are more important and more profitable in the long run,” Mahowald said.

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Mahowald is known as the only agency in central Minnesota with an expertise in healthcare professional liability. It has had a relationship with St. Cloud Hospital since 1970. Today, St. Cloud has grown to become the flagship of CentraCare Health System, including multiple locations in the area. “In addition to CentraCare, we also handle the risk management and insurance programs for 29 other clinic entities and more than 700 physicians in central Minnesota,” Mahowald said. Mahowald Insurance also represents long-term care facilities such as state-wide Ecumen, a non-profit group, and Country Manor in Sartell, Minn.

Planning for Success

Change is inevitable, especially when an agency has been around since 1930. “As we have grown, the operation also has become increasingly complex,” Mahowald said. The agency is incrementally adapting to more complex products and a larger staff. Because the agency acted wisely during the last hard market and avoided pitfalls such as costly overhead expansion or expensive acquisitions, it kept growing in the current soft market. 

Besides foresight and steady, deliberate adaptation to change, Mahowald Insurance also submits its data to IIABA's Best Practices to compare its progress with its peers. Mahowald Insurance was included among the Best Practices agency list in 2011. In the future, Mahowald has a system in place that allows the next generation of owner-operators to replace the current generation on a specific timeline and with plenty of discussion prior to the changeover so as to avoid confusion and solve problems in advance. 

Agency partners meet semi-annually for strategic planning retreats to discuss growth options and company needs. During these meetings, the partners establish goals, including doubling in size every 10 years and developing a profit-sharing plan. Since then, Mahowald has doubled in size approximately every 7 years and posted 15 percent annually to the profit-sharing plan. Organic growth remains a priority. 

“Lots of organizations say their people are their greatest asset; we believe in actually reinvesting in that asset,” Mahowald said. Mahowald Insurance believes all of its employees should earn professional designations and attend career-enhancing training. Mahowald's advice for agency success includes this adage: “Your business' most valuable assets are the professionals who take care of your clients; invest in them and treat them well.” 

Committed to Community

Community involvement and service is important to Mahowald Insurance. The agency boasts strong histories with organizations such as Boys and Girls Club, Kids Against Hunger and Catholic Charities. A new program titled “Mahowald Cares” was launched this year. “An employee committee chooses a group community service project for our agency every quarter. Employees receive 20 paid hours per year to volunteer with a non-profit of their choice,” Mahowald said. Employees have enjoyed making smoothies with children at a local women's shelter and working on a Habitat for Humanity site. 

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Mahowald executives present a monthly award called OTECHA to the employee who holds closest to agency values. OTECHA is an acronym for the company's chosen values: our clients' interests, trust, expertise, community, history and a brighter future. “Rather than settle on values that spell out something clever, we decided to stick with our values and create our own word,” Mahowald said. 

A brighter future is last on the agency's list of core values. It sets a goal for the company to avoid complacency and “embrace the challenge” each day brings. Employees are “constantly thinking, adapting and improving to better serve” their clients and make Mahowald the best agency it can be both today and tomorrow. 

It's hard to imagine four generations of bank tellers achieving this level of success. It's a good thing Tony took the leap and quit his day job.