CHALLENGE: Win and keep big accounts.

SOLUTION: Build a brand around training.

the HA

Anyone in commercial insurance sales has

seen those big, hairy accounts with lots of accidents and

workers comp claims. And just like when you watch a

monster movie, you want to hide your eyes. >>

44 INDEPENDENT AGENT n November 2012 YJAP/veer



“Our producers are trained to look for

What We Learned

Agency principal Ken Ewell regrets some employee placement mistakes—

which he calls “putting the wrong person in the wrong spot. Just


“Obviously 90% of the time when you make a mistake there,” he says, “it’s

always your biggest mistake. It’s not just a mistake for you—it’s a mistake for the


“What do you learn from that? Can you put systems in place to reduce the

uncertainty? You have to try.”

Graham seeks “sustainable, profi table organic growth,” Ewell says. “We’re on

that path now. We learned a lot from the economic downturn and some mistakes

we made in how we manage. We applied that. We have a good strategy, and it’s

based on being very, very careful to get the right people on the bus, and get them

in the right seats. And commit to their training.”


But in the Philadelphia area, chances

are an independent broker named Graham

has tried very hard to land those hairy

accounts. In fact, the fi rm is built around

swiping them from large public brokers.

The economic downturn hurt Graham, as

construction had represented nearly 40% of

its book. So the fi rm diversifi ed into health

and human services (e.g. nursing homes

and long-term care facilities), real estate,

energy, technology, law practices, food service

and hospitality, and manufacturing—

all large, diffi cult and high-hazard risks,

according to President & COO Ken Ewell.

Graham’s producers seek middle and

upper-market, privately held accounts

paying property-casualty premiums of

$500,000 or more. The targets have at least

100 employees covered by benefi ts programs

and seek to outsource their risk management

needs, entering into a long-term

partnership to lower their cost of risk, says

Ewell, 54.

Graham writes some very large fi rms,

including well-known franchise chains.

According to Ewell, there is a common

theme: “We want to write the ones that

have a lot of claims. The thing we do best is

manage workers comp claims.”

Claims Operation

The average Graham client spends $1.2 million

on p-c insurance premiums and related

claims costs annually, with a $200,000


The largest cost for Graham’s clients is

workers compensation. One 20-year client—

a family-owned business, the third-largest

fi re truck manufacturer in the U.S.—pays

a $1.2 million premium on workers comp

alone, with a $250,000 retention. Thus, the

claims operation is key to Graham’s success,

Ewell notes.

“Our consultants work with the client

on the largest claims,” he says. “We bring

injured workers back to the job. And we

defend clients against product liability

claims. In the last 10 years we have saved

clients $40 million alone on claims that were

fi rst denied by the insurance company.”

Safety Consultant

Another client was paying $8 million for

workers compensation placed by a large public

broker—but Graham’s team dropped it to

$2 million, says Ewell. “It’s about a safety

culture and a disciplined approach to safety

programs. They had 2,000 employees and a

$500,000 deductible. They spent $8 million

a year on claims—that was all their own

dollars. We saved them $6 million of their

own money.”

To win the account, Ewell says, “We asked

questions of the client—‘We hear about

$8 million for workers comp. We hear low

employee morale.’ We share information of

our other clients and ask, ‘Does your broker

do that for you?’ Until that client crosses

a pain threshold, they won’t change. Our

producers are trained to look for the pain

threshold. Turns out $8 million was their

pain threshold.”

Graham applied its standard process

to the account. Every job was examined

and evaluated, says Ewell. “We looked for

unsafe conditions and unsafe workers. We

told workers we were going to train them

to be safer because they make more money

when they work—their salary is more

than workers comp payments. It is in their

economic interest.”

Further, the fi rm assembled a panel of

the “best doctors,” he says, to address the

frequent shoulder and knee problems. “It’s

an accountability system—we found the

managers and the supervisors who could

be the best. We showed them that we care

The Graham Company


FoUNDeD: 1950

GroSS reveNUeS: 2010, $35.2 million;

2011, $36.2 million; 2012, $36.5

million (est.)

INSUrANCe emPLoYeeS: 150

reveNUe Per emPLoYee: $243,000

bUSINeSS mIX: Commercial property-casualty,

90%; employee benefi ts,

8%; personal p-c, 2%

CArrIerS: AIG, Chubb, Liberty

Mutual, Lloyd’s of London, Miller,

Travelers, W.R. Berkley and some 100


CLIeNT CoUNT: Commercial

property-casualty, 200; personal p-c,

130; benefi ts, 40

reTeNTIoN rATe: 95%

TeCHNoLoGY: Applied Systems

Vision, Zywave

CoNTACT: Ken Ewell, president and

COO; kewell@grahamco.com,

215-567-6300; grahamco.com.


the pain threshold.”

about them and that there will be no more

fun and games. There will be discipline.

“We tell the client it’s not rocket science.

It’s discipline and clarity and consistency

of what you’re doing.”


For Graham’s high-service model to work,

says Ewell, it must hire and retain the

right staff.

The fi rm sports a 12-1 ratio of service

to sales personnel. There are 150 employees—97

technical and support staff, 18

producers, 12 account managers, 10 claims

consultants, seven training professionals

and six safety consultants.

Graham hires producers from various

industries. As Ewell relates, “We want good

business people fi rst. If we’re just good

sales people, we won’t get the right kind of


Employees understand that the fi rm

is known for three things: hiring excellent

people, committing to invest in their

career-long training and basing everything

on merit, says Ewell. “If someone earns it,

they get the reward. If they don’t, they

don’t. It’s a meritocracy. It’s not perfect but

it works.

“That philosophy is like raising a family

—we want to do what’s best for them but

we expect great things,” he says. “Our

clients are our partners, and our employees

are like family.”

Swans Apply Here

In new hires, Ewell says managers seek

four things, known collectively as the

acronym “SWAN”:

1. Smart

2. Work hard

3. Ambitious

4. Nice (generally a good person)

And once on board, training is the

“foundation” of Graham, says Ewell, with a

team dedicated solely to training new and

existing employees on insurance and risk

management expertise. The training lasts

for three years, including six months of

coverage school followed by mentoring in

the fi eld.

Taglines matter

Ken Ewell learned a few things about the challenges—and benefi ts—of creating

a tagline to complete a brand identity. “It’s a tricky business to come up

with something that can capture in few words what we do,” he says. After a

process conducted last year with a consulting fi rm, The Graham Company’s tagline

is “Actions matter.”

“There’s a reason why many clients and insurance company partners roll their

eyes when brokers talk. We all say the same thing,” Ewell explains. “Those who

differentiate are the ones who do what they say they’re going to do. Actions do

matter. We do what we say we’ll do.

“We are not all things to all people, but for those clients we serve, we want them

to see us in a way that we know we advocate their interests above our own,” he

says. “We are their partners and we want them to thrive and succeed in their business,

just as we want our employees to feel part of the family and know we care

about their happiness and long-term growth and success.

“We approach our clients and share with them how we treat our employees:

benefi ts, supplemental benefi ts, safety programs. It’s why we’re here—we have the

best team, best tools, best training, best incentive system, best clients. You don’t

have to think with different minds. What’s good for your client is good for your

employees and partners.

“People can say a lot, and they do. And we do too. But our deeds match our

words. That’s not just about credibility—but where reliability comes from. ‘Actions

matter’ is the shortest way to say it.”


New hires typically “come from outside

the industry,” Ewell says, noting that

lawyers, accountants and engineers are a

key source.

For example, one employee previously

worked at a large construction company,

and before that commanded a U.S. Navy

nuclear submarine. At Graham, he works

on large construction accounts with risk

management and engineering applications.

beer Cart Friday

Graham seeks large accounts—

at least $100,000 of revenue.

When the team wins an

account of more than $200,000, it’s

time for beer cart Friday, says Ken

Ewell. The producers who wrote the

account push a cart around and serve

everyone a beer. “We borrowed that

from [North Carolina agency] Senn

Dunn,” he says.


Ewell says the math if simple. “We pay

salaries of [more than] $100,000 in a lot

of instances. After three years we need to

have 75% to 85% of them still here. We

need to do as best a job in hiring up front

as we can. We do at least 12 interviews

plus emotional and psychological testing.

It’s okay to be a little crazy as long as

you’re a good producer.”

Retaining accounts also is important.

With such large revenues per account, it

hurts to lose one, says Ewell. “So we need a

high retention ratio, and choose the right

clients up front. That is key. We don’t just

chase anything.” Apparently it’s working:

The fi rm has a 95% retention rate. Being

privately held also helps the relationship,

he adds, as 90% of clients also are privately


Joys of the Cross-Sell

Graham is expanding an employee benefi ts

operation—started from scratch in 2007.

“It’s fast-growing and where we are best

positioned to serve the p-c client,” Ewell

says. The fi rm has 35 benefi ts clients

IAmagazine.com November 2012 n INDEPENDENT AGENT 47

generating $3 million—some 10% of the

agency’s overall revenue. “It’s growing at 20%

to 25% each year. We’re starting to get some

scale there.”

What about leveraging p-c and benefits

at the same client? Ewell is cognizant of the

traditional challenge where the p-c producer

doesn’t want to bring in a benefits producer—

and vice versa—as it could “mess up the


Graham decided to address that challenge

head on, he says. “We built our whole benefits

department around the cross-sell and to overcome

that and allow human nature to take

place. Once clients trust you and you are credible

and relatable, they are glad to bring you

in—especially before a competitor gets in.”

In fact, Ewell notes that 90% of Graham’s

new accounts have been generated by account

rounding. “Now our biggest challenge is to get

producers who will not just cross-sell but will

go out and do net-new business.

“We had a high level of expectation of

service from clients. We thought, ‘How can

we ever overachieve on that with employee

benefits?’ But our clients said, ‘If you can do

half as good a job as you do on the p-c side,

it will be three times as good as we’re getting

now on benefits.’”

Graham also is proactive on the myriad

of regulations governing health care reform

legislation, many of which are complex, says

Ewell. The firm “helps our clients meet their

compliance obligations by keeping them up

to date on the reform regulations that affect

their employee benefits programs. With provisions

taking effect from now until 2018, we

are continually checking in with our clients.”

And when it comes to customer communications

around health care, Ewell insists carriers

and brokers that recently gutted call centers

are in trouble. “The minority that made

investments in human capital in servicing the

client are the ones that are doing well. The

ones who are just riding it out are in trouble,”

he says.

“I believe health care reform will be an

amazing opportunity for the brokers who

really are client-focused and have really

invested in value-added services. The clients

are going to need it. The world is changing

and clients need help.” I

van Aartrijk (peter@aartrijk.com) is an IA

contributing editor.

48 INDEPENDENT AGENT n November 2012 IAmagazine.com

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