Sullivan Curtis Monroe Insurance Services, LLC, (SCM), is an insurance and risk management broker in Southern California. With several hundred employees, and three offices, SCM is a regional firm offering a just-right approach to companies that feel they are too big for a local broker, but still want personalized attention that they couldn’t get from a mega-broker. SCM has practice groups that service clients in real estate, construction, auto dealerships, the food and beverage industry, environmental chemical and engineering, manufacturing, and distribution.
Steve Paulin is a senior vice president at SCM who has been in the business for 35 years as a risk management and insurance expert. Paulin had been familiar with captives, but when he saw that they had been restructured to be more cost-effective for middle-market clients – the base he currently works with at SCM – he decided to learn more about them.
Discovering the benefits of enterprise risk captives
“I was introduced about four years ago to the enterprise risk captive concept. I saw it was a wonderful opportunity for me to bring additional value to my clients, and differentiate myself from the competition. This led me to learn more about captives and gain the necessary knowledge and competency to introduce and educate my clients and prospects.”
Paulin spent a year vetting and understanding how captives could benefit his clients. “I went to conferences, clinics, and attended webinars. I had some introductory conversations with clients and the positive response was gratifying.” He spent additional time studying and having deeper conversations, which developed opportunities for feasibility studies and captive formations.
Timing was on Paulin’s side. As he’s been learning more and more about captives, his clients have been climbing out of the recession – now, as clients are making more profits, Paulin is ready with answers about captives.
“The captives we’ve put together so far have been primarily for manufacturing clients,” says Paulin, who is planning to expand the captive offering to more practice areas in his firm shortly.
Working with clients on captives
Paulin finds that his competition hasn’t really caught on to the benefits of enterprise risk captives yet, so he is generally the first one to introduce this topic to his clients. “Being the first to do this, along with periodic follow-ups has positioned me to get the call for further discussion. I walk clients through a short presentation that incorporates many of the points I’ve gleaned from working with Intuitive,” he says. “I talk with the client about captive benefits that are relevant to their operation, such as the ability to cover risks that are excluded or they decided not to buy. Then, I tie in the tax advantages and wealth management benefits through creating a captive.”
“I explain to clients that the work I do involves assessing and evaluating their programs, which has been a core competency of mine, and that we partner with Intuitive who handles the management aspects of the captive.” This usually leads to a more detailed presentation by Intuitive.
A new way for clients to look at risk management
Paulin credits captives with enhancing his practice. It offers the opportunity to have a different conversation with business owners about how they can better manage risks and gain profit in the process. “Captives have helped me feel very confident that I’m offering new alternatives to help structure effective risk management programs for my clients,” he says.
Even after four years, Paulin finds it’s more of a pull than a push. “There isn’t a lot of awareness yet about captives,” says Paulin. “There are business owners who have a perception of a captive for certain types of coverage, like workers’ compensation, but they don’t have a working knowledge or a deep understanding of it. It’s an opportunity to educate business owners.”
Paulin has spent so much time reading and learning about captives, he’s accumulated an archive, and has written a whitepaper. “I find I get to a plateau and I think I know all the info about captives,” he muses, “But then I’ll read an article and I’ll think, ‘Oh, here’s something I haven’t thought of about a particular use of the captive.’ There’s a need for ongoing education, and this is an opportunity to structure a program in a new way.”
To handle the interest in captives, SCM recently hired a marketing specialist to build a program around captives. “We plan to formalize a marketing program using Salesforce, and Benchmark emails distribute white papers, Executive Briefings and other information including webinar invitations. The ability to touch a lot of people with relevant information once a month will help increase awareness,” he says.