Founded in October 2006 by Jerry Becerra, CPCU, Barbary Insurance Brokerage is an independent insurance broker in San Francisco.
At a time when small independent insurance agencies are being absorbed by larger institutions, he believes that there is a need for smaller agencies that have personal connections with their clients. The staff members at Barbary each bring a different set of skills to help their clients and work as a team to provide the best service possible.
MO: What inspired to you to launch your own insurance brokerage firm?
Jerry: I have been in the insurance industry since 1983 and have been working mostly with commercial clients since 1985. I most recently worked for 20 years at a well-known and successful agency in San Francisco, ending up as their vice-president of sales. For me, I reached a point in my career where I did not make a very good employee in the sense that I wanted more control over higher level decision making. I very much enjoyed selling insurance and working with salespeople but I also wanted to have control over the budget, have more flexibility to create marketing plans, implement new technology, etc. I was in my mid 40’S and felt that if I wanted open an agency I needed to make the change while I was young enough and had the energy I knew it would take to succeed. Once I made the decision to open my own agency it was a matter of implementing it.
MO: What separates you from the competition?
Jerry: That a difficult question to answer. A business consultant and good friend of mine who encouraged me to open the agency told me that what I did was very different from what most insurance agents do. I did not understand exactly what she meant but I took the feedback very seriously and it helped me focus on what I feel makes a difference. I have to begin by saying that I am often my own worst critic. I want to do a great job for every client and for every situation. That is not remotely possible and so I am often personally disappointed. However, I believe that my desire to do a great job for every client comes through and my clients truly believe that I am working in their best interests.
As with every business, it all starts at the top. Because I set high standards for myself and set high standards for the way we treat clients, my employees tend to follow my lead. I am very proud of all the work they do. Each of them understands that we are here to take care of our clients. We are not complacent about how we handle the frequent bumps in the road. We make every effort to go a step beyond what is normally expected.
As an agency we have a reputation for being able to handle some of the more difficult coverage needs that arise. While I do not want to build a business strictly around doing difficult things, I think that if you prove you can handle the tough stuff people will also give you an opportunity to work on the easier business. They also are willing to refer you and our business is based largely on referrals.
MO: What’s one marketing strategy that’s worked really well for you?
Jerry: A long time ago I learned that really good insurance agents were not simply salespeople. Great insurance agents are engaged in their communities and spend a lot of time giving back to the communities they serve. This is very important because our product is really a promise. When an unforeseen event strikes we promise to help our clients recover from the loss. When the time comes we have to deliver on that promise. This involves a great deal of trust.
In addition to owning an agency I do a lot of volunteer work and I have been an active volunteer in my community for over 20 years. I have raised money for non-profit organizations, organized events, taught classes, traveled to trade shows to promote my city as a tourist destination, served on four boards of directors for non-profit organizations and donated money to important causes. I can’t say that any one of those things brought me business but what it did to was build my reputation within my community. I think people know that I care, I am engaged and I will be here in the long run.
Remember, I am selling a promise to help people. In the end I think that reputation is everything and that actions speak for themselves. I think that my clients know who I am and feel they are working with someone who has integrity. Because of that they stick with me and they refer me.
These days I feel that too much emphasis is placed on building networks quickly. I see young people with a thousand or more connections in their on-line networks. I think social networking is good but it is only a tool. It cannot replace a reputation that takes years to build. Those connections need to be real connections to make a difference. There is no substitute for being on the ground working with people. They will remember that you volunteered to help their favorite non-profit earn money because they were there working side by side with you. They probably will not remember what you posted on a web site a week ago.
I think nearly any business could benefit from being engaged in its community. It is a long term strategy not a quick fix, but it builds a base of support that cannot be built any other way.
MO: Can you elaborate on the significance of Barbary Insurance Brokerage joining United Valley and what this means for the direction of the company?
Jerry: The public is not aware of many things that affect independent insurance agencies. We are expected to meet premium volume commitments with each insurance carrier we represent and we are expected to be profitable for our insurance companies. However a lot of things are out of our control. Claims happen and sometimes insurance companies make decisions that can make it more difficult to meet their volume commitments. A small agency can be very vulnerable to unexpected changes which could lead to losing appointments with insurance carriers and then not being able to deliver services to its clients.
For many years the independent agency system has been developing clusters where many small agencies pool their business to have access to more insurance carriers and negotiate better relationships with insurance companies. Although I had good company appointments, I knew my agency was vulnerable to sudden changes in the market or clients having large unexpected losses. In
January of 2012 I began looking for a cluster relationship to help expand my markets and to protect the agency from unexpected changes. I was referred to United Valley by another United Valley agent. Although I looked into working with other clusters I was impressed by how professional United Valley was and by the great relationship it had with its agencies. They also spent time vetting my agency to make sure I was a good fit for them.
That was just as important to me because I wanted to be part of an organization that was committed to quality. Our relationship with United Valley expands the number of insurance carriers we represent. As a cluster United Valley is somewhere in the top 25 largest agencies in the country so my relationship with them gives me the clout of a large broker. However I am still completely independent with my own branding and marketing. It helps shield my agency from changes in the marketplace and so it allows me to focus more of my attention on helping my clients. Also networking with other United Valley agents gives me access to ideas and feedback from my peers which helps me in my business decisions.
MO: What are some trends in your industry that you think that our readers should be paying attention or taking advantage of?
Jerry: Focusing on commercial lines, I see two trends that need people’s attention. Nationally workers’ compensation has not been profitable for insurance companies for several years. We are seeing rate increases across the board and I think that the trend will continue for a while. It does not seem to be as bad as it was in 2002 when rates skyrocketed, but I think rates will continue to move upward for a while. For businesses that are large enough to have workers’ compensation experience modification factors, the best thing they can focus on is loss prevention and loss control. Your insurance company and agent can help with this. Often a change in the loss control factor has a bigger impact on premium than any credits your insurance agent can negotiate. On average a business should have a factor of 1.00. If a business has a credit factor of .90 and then has some serious losses let’s say its factor increases to 1.05. That does not sound so bad but it is essentially a 15% rate increase. There may not be much your agent can do to offset the impact of the experience modification factor, especially if your account is already receiving maximum credits. Spending some money on loss control will save you money in the long run and help stabilize your premiums.
Secondly companies are looking for ways to get higher premiums to cover losses from natural disasters. I have seen a few companies inflate the estimated replacement values on buildings as a way of getting higher premiums. They may not be able to take rate increases to cover losses so they may be manipulating the coverage limits to drive up the cost. Take a good look at the recommended coverage limits and ask your broker to do an independent cost calculation. You may also want to get a contractor’s estimate for replacements cost. Sometimes a large increase in replacement cost is justified but if you are seeing large increases several years in a row or sudden dramatic increases to the building coverage limits, do your homework and make sure the limits are justified.
MO: Were you surprised to find out that you are one of the top 1% most endorsed on @LinkedIn in United States for Insurance?
Jerry: I think everyone who received an announcement from LinkedIn must have been surprised. How would we know about those statistics? What it meant to me was that I was very successful at networking within my circle. People say some very nice things about me and my agency. I hope that I can continue to meet their expectations.
MO: How do you plan to keep the momentum going?
Jerry: We have recently expanded our offerings into the health insurance arena by brining on board a wonderful health care agent who has great experience and shares our agency’s values. I see the changes in the health industry as an opportunity to enter the market. People will be shopping and asking a lot of questions and so we may have the opportunity to speak with clients who are now more open to hearing other points of view.
Also, since 2007 we have been target marketing so certain types of clients such as apartment building owners, the food industry and the tech industry. Our target marketing is bearing fruit and so we are getting more business in areas where we want to grow. This is important because it feeds our insurance carriers and it is easier for the agency to manage a more homogeneous book of business. It makes it easier to place coverage and to shop for competitive quotes at renewal. I expect the growth to continue in those areas and I hope it will fuel agency growth overall.