Thriving in a small town

Despite an increasingly competitive marketplace, Ives Insurance Brokers president Jeff Ives explains how the Canadian broker has continued to thrive in this evolving industry

Thriving in a small town

Opinion

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IBC: How has specialization impacted on your brokerage’s success?
Jeff Ives: What we have done in the past 10 years is try to segment and silo our operations so our construction specialists only focus on construction and our transportation specialists only concentrate on transportation, and so forth. What we have found is that the way the marketplace is changing in Canada, you can’t be a jack of all trades any longer. We find that if you specialize in segments and become very good in those segments, people find you. By becoming specialists, it certainly helped us grow into one of the largest brokers in the region we work in.

IBC: How did you select the areas to specialize in?
JI:
The largest segments of our business operations are transportation, construction, manufacturing, and we also have a small business unit and personal lines division, but transportation is our largest sector. These segments are somewhat complicated. When you start dealing with complicated industries, and you get good and knowledgeable in those industries, you become harder to beat. In today’s world, I don’t think many people can say they are good in all lines of business anymore. To be successful, you have to pick a path and focus on building that path. You need to have a main focus on the type of business you want to write and concentrate on. By focusing on things that can be complicated and that other people are kind of afraid of, it allows you to become very good at those, and clients find you when you’re a specialist.

IBC: How does your brokerage approach the hiring of the next generation?
JI: Our industry does a poor job of letting people know how good this business can be. Generally, the first time we all deal with insurance is when we are 16 or 17 years old and have to buy our first car insurance and insurance companies want to charge us $500 to $600. So most people’s first taste of insurance is that they hate it. We do not promote the industry to university and college students by telling them about all the different career options there are in insurance. By not doing that, it makes it difficult to recruit.

So to combat that, we go out to universities and colleges to recruit, as well as to trade shows and job fairs, and we talk to those folks about the opportunities in insurance. We started a process with the local college to start offering courses as part of their business studies program to try and generate a positive image in the industry, and part of that is also educating people about the benefits of an insurance career.

IBC: What are your thoughts on the tech revolution in the insurance space?
JI: The way technology is moving is fantastic as long as I can be a part of it and control parts of it. The scary part is that it is moving very quickly and it’s developing a competitive notion to myself and other brokerages. Do I think we need a consumer-facing product where clients can log in and make policy or information changes? One hundred percent. There are certainly different areas where we can get into the technology game. One issue we see is that a lot of our partners are making it no secret that they have online consumer facing products that may or may not be available for us to distribute in the same fashion, and that’s been a challenge, but we need to find a strategic way to navigate through that collectively.

IBC: What has been the main challenge for Ives this past year?
JI:
One of the top challenges is that our main trading partners, the insurance companies we deal with on a daily basis, are now competing head-to-head with us in certain segments, using multiple distribution systems. Insurance companies in the direct market are now buying up insurance brokers and increasing valuation multiples, and some are even cannibalizing their own business to grow their direct market segment. For the selling brokerage, this is a good thing, but for the brokerage looking to expand and grow, it is more challenging. In some cases we have to look at different business models, potentially partnering with insurers or setting up strategic alliances with other brokerages; it’s exciting yet challenging at the same time.

How do we maintain those relationships as open and aggressive as they have been when we know there is an opportunity that they may come in and go after the business we are placing with them now? We cannot just sit back and complain. We need to find a balance there. As brokers, we have to look at our own portfolios and operations to identify what’s best for our business in this evolving marketplace, as trying to keep clients has been more of a challenge in the past five years than in the past 35. Brokerages that continue to innovate and reinvent themselves will continue to be successful. We are and will continue to be one of those brokerages.

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