TAKING FLIGHT

Rough Notes, Jan 2005 by Boone, Elisabeth

Insuring antique aircraft is just one of Arlington/Roe's specialty niches

The Flying Tigers ... the Jolly Rogers ... the Black Sheep ... these names conjure up visions of the rakish daredevils who risked it all to engage the enemy in the fierce air battles of World War II. The planes they flew-the P-38 Lightning, the B-17 Flying Fortress, the Stearman biplane-are treasured by collectors and admired by World War II buffs. Once available for as little as $300, these "warbirds" now sell for hundreds of thousands of dollars, and are becoming increasingly popular, much in the same way as vintage automobiles.

Many World War II aircraft were destroyed after the war, and relatively few remain. For example, just 1,326 Stearmans still exist, and approximately 640 T-6 AT (Advanced Trainer) planes survive today. Many of these legendary craft are still airworthy: Rough Azotes publisher Walt Gdowski proudly flies both his bright yellow Stearman and his sleek T-6, and displays them at air shows: around the country.

Arranging insurance for these and other antique aircraft is a highly specialized discipline that requires both underwriting expertise and market knowledge. Many of these, risks find a home with Arlington/Roe & Co., Inc.,-a specialty wholesaler that is based in Indianapolis and has an aviation office across from the Louisville International Airport in Louisville, Kentucky. Other office locations are Chicago, Illinois, and Grand Rapids, Michigan. The agency is in the process of purchasing another MGA in Bowling Green, Kentucky.

Arlington/Roe was founded in 1964 by Francis Roe, father of the current president and owner, James A. Roe, and operates as a managing general agent and excess-surplus lines broker. The agency's aviation business, which represents about 8% of total volume, is written nationwide. For other lines, the firm is active in five Midwestern states. Initially established in the Roe family kitchen as a Foremost Insurance general agent for mobile home and recreational vehicle insurance, Arlington/Roe has since expanded to offer other specialty personal and commercial lines. The agency operates a separate practice for each business unit, staffed with experts in that line. "When a risk comes in the door, it goes straight to the appropriate practice," Roe says. "What we're trying to deliver to retail independent agents is not only access to markets they don't have, but also the specialty expertise they need. We bring that, strictly on a wholesale basis, to the insurance equation."

Arlington/Roe is now a third-generation family business with Jim Roe's oldest son, Andy, underwriting and producing business in the commercial underwriting practice, and second oldest son, Patrick, in the personal lines department. With some 1,000 years of combined insurance experience, the staff of Arlington/Roe comprises a close-knit group of dedicated professionals. "We're constantly on the lookout for quality people who can help extend the products and services we offer," Roe says. From a kitchen table office in 1964, Arlington/Roe has grown to an organization of some 120 employees and premium volume of $100 million, including a recent acquisition. The firm hasn't forgotten its roots. "We still have my dad's first desk and typewriter here," Jim Roe says.

Serving as vice president of aviation is Connie French, who joined the agency in 1991 with 25 years' experience and was instrumental in establishing the aviation department. Her son, Travis, is an aviation broker and student pilot who will join the agency full time after he graduates from college in the spring. Veteran aviation broker Bryan Smrcina holds a pilot's license and brings to the table some 20 years' experience with both carriers and wholesalers. Bonnie Bryant is an aviation broker whose insurance career spans 30 years. The agency arranges coverage for a wide range of exposures in addition to vintage military aircraft and works with top-rated domestic and international carriers for both aviation and general business. For a complete list of Arlington/Roe's general and aviation products, as well as its practices, see the chart on page 42.

Partnering with agents

Arlington/Roe has relationships with some 1,600 independent agents and brokers for its general business, which is written in Indiana and the surrounding states of Illinois, Kentucky, Michigan, and Ohio. A considerable amount of general business is written through surplus lines carriers. About 300 agents nationwide use the agency for aviation risks; the majority of this business is placed with admitted carriers. "Aviation insurance, while subject to state regulation, has the flexibility of uncontrolled rates that does not apply to the rest of the admitted property/casualty industry," Roe says. He notes that although some aviation insurers specialize in certain risks, Arlington/Roe works with all the leading markets and can offer virtually any coverage an aviation buyer needs.

Many of the retailers for whom Arlington/Roe places aviation business have only an occasional need for the agency's aviation services. "Typically, if a retail agency specializes in aviation insurance, it really doesn't need our assistance," Roe says; however, "an agent might not have access to a particular market, and we might be able to get him or her access. "Our focus is really on the generalist independent retailer who has a customer with a specialty need," whether that be for aviation or other business, he says.