A problem-solving approach and a niche market focus

Rough Notes, Apr 2001 by Zinkewicz, Phil

Santa Rosa, California, agency goes from $1.1 million to $5 million in commissions in nine years

If you see a problem, it's probably because you are a part of the solution." That admirable rule of conduct has guided Lynne Wallace both in her personal life and professional career. And, it is apparently a rule to which both her family and colleagues adhere very strongly as well.

The personal side we'll get to later, but on the professional side, Lynne is president and principal of the Santa Rosa, California-based Matsen Insurance Brokers, a firm that has experienced significant growth-$1.1 million in commissions in 1991 to just under $5 million last year. Matsen was founded in 1946 by Ralph Matsen. By 1964, he had expanded operations to include employee benefits, life and estate planning and both personal and commercial divisions, with an emphasis on providing insurance services for larger commercial risks. Among the other principals at Matsen are R. Glenn Matsen, chief executive officer; Wendy David, chief financial officer, and Timothy D. Chanter, president, Matsen Financial Services.

The Matsen agency prides itself, according to Lynne, in providing a broad range of risk management and insurance solutions for just six industries: real estate; construction; technology/telecommunications; hospitality; goods and services; and health care services. Products include commercial property and casualty coverages, directors and officers liability insurance, errors and omissions, intellectual property and various forms of financial services products such as 401 Ws, mutual funds, annuities, employee services, and more.

But what makes Matsen stand out from other agencies is its selfdescribed mission-"Ask yourself often: What does it look like for the customer?" And, according to Lynne, it is equally important to listen to what they have to say.

"We have grown to be a large regional brokerage firm by providing alternative solutions to client risk management and insurance needs," she says. "Our clients are located throughout the United States and some of the things we offer include alternative risk funding through captives, certificate tracking online, IPO insurance planning and implementation, leading edge workers compensation solutions and full surety bonding, among other products and services.

"At Matsen, we believe that as long as the people on our team are growing, we can achieve vertical growth as a company. On average our producers generate over $400,000 in annual commissions with new producers hitting approximately $250,000 within about three years," says Lynne whose own book exceeds $1.3 million. "Opportunities abound for anyone willing to get out of the box and learn to do new things new ways. Producers who were good are now doubling their income ... just because they now can."

Asked how Matsen Insurance Brokers does all this, Lynne uses the recent controversial television hit "Survivor" to drive home her point. In that show, 16 people were left on an island with nothing to eat but rice. One person was voted off the island in each episode, the one remaining person to garner a million dollars as the prize. The winner was a man named Rich.

"Three key elements made Rich the winner-focus, value, and strategy," says Lynne. "Rich never lost focus ... he was there to win a million dollars. While others became sidetracked by relational issues and soap opera drama, Rich stayed focused. He added value by making a spear to go spear fishing so that there would be more to eat than just rice. The strategy came when he formed an alliance with three other participants and they were the last four survivors."

The key elements that assisted Rich in his quest for the million dollars are the very same ones that Matsen uses, says Lynne, and which other agencies can use to achieve growth. "Focus: Identify your niche, really listen to your customers, and know the competition better than they know themselves," she says. "Value: You must continually invest in yourself and your people, train yourselves in everything that will specifically create niche wisdom. Our strategy is to do everything possible to make a broker of record letter to us the only logical choice."

In terms of strategy, Matsen has broken some serious ground. Inside the agency, she says, Matsen has achieved "a huge victory" by virtually removing tension and encouraging cooperation between producers and account managers. "What we have done at Matsen is to unleash the power of the account manager. Historically, in the insurance brokerage business, we have had producers and customer service representatives (CSRs), whom we prefer to call account managers because that title is more representative of what they do. Often, rifts develop between the two functions because the people we have been calling CSRs have been limited in terms of personal growth. We felt this old model was unfair. While the producer initially brings in clients, the account manager plays a huge role in developing ongoing client relationships, meeting and exceeding client expectations and our commitments on a daily basis. Under our approach, the producer opens up new relationships while the account manager fosters existing ones. We felt there should be more equality between the two functions."