Search for agents amid change
Higher rates, competition, hiring troubles wear on small insurance agencies
When a job opened up at Christopher Kokoras Insurance this summer, the agency’s manager, Anne Bates, hoped to hire someone right away. A help-wanted ad was posted online and published in local newspapers. Months later, no qualified candidates had applied. Bates was surprised.
Sampson Insurance, a 109-year-old agency based in Weymouth, has experienced similar difficulties. “There seems to be a shortage of talent,’’ said president Craig A. Thompson. “When we post a customer service or account manager job, we’ll get the same people we looked at five years ago.’’
It’s one of several challenges facing today’s small independent insurance agencies: They’re dealing with unhappy customers (upset over rate increases), competition from national auto insurers (thanks to changes in regulation), and the not-so-easy task of filling their ranks with the next generation of insurance agents.
“It is getting more difficult to attract young, smart people into the insurance business,’’ said Frank Mancini, president and chief executive of the Massachusetts Association of Insurance Agents. “When you say ‘insurance,’ it doesn’t sound like a sexy career to get into.’’
The average age of an insurance professional is 54, according to the Independent Insurance Agents & Brokers of America. The trade group says young people, women, and minorities are under-represented in the industry.
In an effort to recruit fresh faces, the Massachusetts Association of Insurance Agents is working with YMCA Training Inc., a nonprofit job-training program based in Boston, to prep people for a career in insurance – a field that is expected to grow 12 percent over the next eight years, according to the federal Bureau of Labor Statistics.
Seven women participated in the pilot class this fall. They learned about property and casualty insurance, auto coverage, calculating risk and rating factors, and homeowner’s liability insurance, among other things. The trainees completed internships and will take a licensing exam in January. Three have already landed jobs, according to Anne Meyerson, director of YMCA Training. A new class – with 12 students – started earlier this month.
Bates wants to hire one of the trainees to work for Christopher Kokoras Insurance. Founded in 1982, the agency has 15 employees and offices in Jamaica Plain, Chelsea, Dorchester, Allston, Somerville, and Everett.
Thompson also plans to look to the YMCA program for future recruits. In the past, Sampson Insurance has used headhunters, who charge fees of up to 25 percent of the new hire’s salary, to fill positions.
Thompson, like many others in the field, followed his family’s footsteps into the insurance business. Sampson Insurance was originally founded in Braintree, and several decades later, Thompson’s father bought it. Now, it’s run by Craig Thompson and his twin brother. Seven years ago, they sold their building in Braintree and moved the agency to an office park in Weymouth, setting up shop inside a 100,000-square-foot, four-story brick and glass building on Libbey Industrial Parkway.
Today, the agency has 15 employees and generates $16 million in annual sales, according to Thompson.
All that technology doesn’t necessarily make day-to-day operations any less stressful.
“Revenues have decreased, workload is up,’’ said Thompson. “There’s lot more service involved. Clients are more demanding. People are looking for ways to trim back on insurance.’’
And the Massachusetts auto insurance market has undergone major changes. For decades, rates were set by state regulators. That changed in 2007, when a managed competition system was introduced. Now, auto insurers have more freedom to set rates and reject applicants. The new system has attracted more competition from national insurers that had been reluctant to do business here before.
The changes have affected all insurance agencies, both big and small. For John C. Gallagher Insurance, based in Dorchester, it has been bad news. Under the new system, said owner John C. Gallagher Jr., affluent homeowners with multiple cars in suburban areas are getting discounts, while city dwellers with modest incomes are getting “clobbered.’’
“Go to Geneva Avenue and ask around,’’ he said.
The agency operates out of a tiny, narrow building, steps away from the Fields Corner MBTA station.
Gallagher said the auto insurance overhaul hasn’t helped his working-class customer base. Many are immigrants, have low incomes, and lack easy access to a computer to research and shop around for coverage. They have few assets, and just need bare-bones policies. The big insurance carriers don’t seem interested in writing policies for that kind of driver, said Gallagher.
“A lot of people who come in here are just scraping along,’’ said Gallagher, whose father started the agency in 1955. “If you happen to sell insurance to people who want to buy minimum coverage, those customers aren’t attractive [to insurers].’’
Gallagher said urban residents with good driving records are facing substantial rate increases.
As a result, he said: “We find many unhappy customers coming in here, and we deal with it as best we can. It’s not always pleasant.’’
Gallagher has five children. One son works at the agency, but whether he will one day take over and continue the family business is uncertain. For a small insurance agency serving an urban market, the current environment is discouraging, Gallagher said, and the prospects for improvement are dim.
“The way this trend’s going,’’ he said, “it wouldn’t really be an attractive future.’’
Emily Sweeney can be reached at esweeney@globe.com. 
Tags: challenges, Christopher Kokoras Insurance, federal Bureau of Labor Statistics, Massachusetts Association of Insurance Agents, Sampson Insurance, small independent insurance agencies, smart people
Hi there as i totally like your nice blog, i woudl feel very special if you would want me to blog a long review on your incredible wordpress site in my small Stock market today http://www.wallstreetedition.com would you say yes? Market Stocks