Richards Agency, Inc. represents leading insurance companies, offering a complete line of personal, commercial, life- and health-insurance products, although this Wisconsin-based independent insurance agency is quite unique. Don Richards founded the agency (also known as Richards Insurance) in the mid ’60s. Over the years, he established partnerships with his primary sales producers in each of his six offices known now as managing members. “The success of the agency has been a function of the fact that an entrepreneur started the business and then treated his employees like entrepreneurs,” adds Steve Foerster (top left), vice president of Richards Agency, Inc., and managing member of Richards Benefits & Financial Services, LLC. In 1997, Richards sold Richards Agency, Inc., to the employees. Today, the offices and the employee benefit company stock are owned 50 percent by the managing entity and 50 percent by the ESOP. Here, company president Dave Fister (bottom left) and Foerster chat with Profile to break down this unique business route.
1. Empower employees
Richards Agency strives to carry its founder’s entrepreneurial spirit forward. Each office has a managing member and employees that act as entrepreneurs. They bring in and service the business. These individuals set their own goals and work as hard as they please. The split between business and individual insurance sold varies by office. “Because each person knows their market and what they are doing better than I do, they identify whatever market is stronger, and decide the split,” says Fister, president of Richards Agency, Inc. and managing member of Richards Insurance of Beaver Dam. Individuals are encouraged to do what they do best. “We let people gravitate to their level of excellence, what they like doing and where they thrive, which hopefully is the same thing,” Foerster adds.
2. Build Strong Relationships
They may not always see eye-to-eye, but insurance companies trust them, Fister says. “We may not always agree, but they know they are getting something square from us. That isn’t the case with others they deal with.”
He adds, “We don’t, and won’t, mislead them in any way. We certainly help our customers as much as we can, but we will never mislead the companies we work with.” This philosophy has allowed Richards Insurance to build strong relationships with insurance companies.
3. Focus on Service and Efficiency
While its relationships with insurance companies are important, the company commits to customers by investing in service. “When Don Richards hired me, he reminded me it is much more important to keep a customer than it is to get a new one. So, our loss rate is nil,” Foerster says.
They keep one eye on service, and the other one on frugality. “We’ve been able to automate and get our systems where they need to be moving forward,” Fister adds. This has made a notable impact on efficiency.
4. Keep Lines of Communication Open
Customer-service representatives have dual monitors, allowing them to flip back and forth, simultaneously pulling information from insurance company databases and Richards Agency’s system to effectively serve clients. “Although it is standard in the industry to ask customers to have direct contact with insurance companies, we prefer to service our business and personally handle our customers’ needs and concerns,” Foerster says. When outsiders realize Richards Agency employs its own customer-service representatives, they questioned the decision to invest in a separate, in-house service team. “Sure, the insurance company can service our customers, but our clients feel more comfortable with us doing it,” Foerster adds. As insurance companies change, Richards Agency explains it is able to stay consistent.
5. Grow Organically First
Richards Agency strives to grow organically. “It is easier to build relationships from the first point of contact,” Fister adds. “Our model is also built in such a way we need an owner partner.” While Richards Agency willingly explores opportunities to buy available agencies, they thoughtfully approach each growth possibility.