Like many of the best agencies in the Commonwealth, Deland, Gibson Insurance Associates of Wellesley has been family owned and operated since 1900. Now helmed by the third and fourth generations of the Gibson clan, the agency has evolved over the years from a generalist agent into a top risk-advisor and insurance manager. With more than $40,000,000 in written premiums, however, the core of the agency’s success is in its clear mission as a client advocate and its innovative approach towards its producers which allows them to own their own book of business.
Charlie Gibson, who represents the third generation of the Gibson family, and is the president of the agency, sat down with Agency Checklists to discuss his agency’s history and its approach to recruiting and retaining talent, which includes his two sons, who will represent the fourth generation of Gibson leadership at the company.
Deland, Gibson has a rich history and family legacy as an independent, family-owned insurance agency. How did your agency start and what has been its growth over the years?
In 1959, a fellow named George Wrye joined the firm, and it became Deland, Gibson and Wrye, and remained that way until the 1960s. In 1972 or 1973, we merged with the Meade and Gale Agency and became the Deland, Gibson, Meade and Gale Agency, which also gives you an idea as to the size of the agency then. When we were Deland, Gibson and Wrye, the agency was two-and-a-half million in premium. Meade and Gale was one-and-a-half million in premium, so the agency grew to four million in premium and we thought we were huge!
We existed like that during the rest of the 1970s, growing a little bit but nothing spectacular.
And then in 1983, we moved to Wellesley, where we have been for 31 years, and that became the jumping board for our growth. That same year, Paul Ronty joined us. He was a friend of my father’s, and he had a pretty nice book. The next year, in 1984, Phelps Edwards left his agency, Rollins, Burdick, Hunter, and joined us with a very nice book.
So all of a sudden, we had a lot of new carriers receiving a lot of volume. The staff kept growing and to fast-forward to right now, we are an agency with just under $40,000,000 million dollars in premium and close to six million in revenue.
So looking back to when we thought we were big at four million in premium. Now, with almost six million in revenue, we are very happy with that.
What was your own introduction into agency life?
Well, it is funny we are having this conversation today because today is my 42nd anniversary with the agency. I first started working for the agency in 1972 after finishing Clemson University and the Navy. I basically, flew in from Vietnam and walked in the door 42 years ago today.
Wow. Congratulations. What did you do in the Navy?
Well, my job was in a reconnaissance squadron on the U.S.S. Kitty Hawk and so I would process pictures of bridges, railroad yards, whatever the Navy was looking to target for the bombing squadrons in Vietnam.
So after doing that, you left Vietnam for Boston.
Yes, I basically got off the plane and went right into 33 Broad Street.
So it sounds like you always knew you were going to join the family business?
I knew it all along.
What do you think has been your agency’s secret for keeping family members interested in staying in the insurance business?
Well, I have told both of my sons that there is no pressure to join the firm. I think they both have seen that I have done okay but, they had to come to the decision themselves. My oldest son, Chip, actually worked for Brown Brothers Harriman in Boston for three years before he decided to join the firm. My other son, Ted, also worked outside the agency but in insurance. He was in the claims department for Norfolk and Dedham for three years before he came over.
So they both had the opportunity to try other things and to make the decision to come here. And they both have opted to join the firm. Chip has been here now for almost 10 years and Ted almost five.
So it seems the issue of agency perpetuation has been taken care of at Deland, Gibson.
Yes, in terms of a plan in place, it’s almost signed, sealed and delivered. We just have to work out some final details, but in five or more years, I won’t be walking out the door, but I won’t be running the place either.
Which is a great because I will have the opportunity to see which jobs each one will take over and will be around to mentor them and to help keep the ball rolling. But, agency perpetuation is something that we have planned for; we are definitely not winging it. I think it’s important to walk out gracefully and with a well thought-out plan in place.
Any advice for other agents trying to get their family to stay in the insurance business?
It is such an individualized thing, an agency perpetuation plan. But like we tell our insureds, it is so important to have a plan in place, in case anything happens. The same goes for agencies. So whether an agent is trying to keep his agency in the family or needs to find an outside person or firm, it is something to be faced and planned for.
Going back over the history of your agency, it is interesting to see two major agents leave their agency and to bring over their book of business to your agency. What do you think was the major attraction?
I’m sure location, but a lot of it was friendships too. I mean, Phelps Edwards knew my father going back to the old days, as well as Paul Ronty. Over the years, we have just kept attracting producers, which I think has happened because of our legal make up. Our producers here own their own books. It is almost like their 401K or IRA. We pay them, obviously, a percentage of the business, and then keep the balance to staff the agency and run everything else.
But I think it is this idea of everybody owning their own book, which was really attractive to these two gentlemen at that time. Nowadays, we have 12 producers here and we have continued with the same model from the early days of Ronty and Edwards and it has been working very well from those days right into 2015.
So your producers today still own their own books of business. Is your agency still interested in hiring more producers?
Yes, definitely. If a person reads this and is excited about what we are doing here, then absolutely we are interested in hearing from them.
For example, three years ago, a fellow with no insurance knowledge whatsoever joined us. He had his 100 ton captain’s license and was an experienced Captain. We trained him and sent him to lots of insurance classes, a lot of Roger Sitkins classes and he is now hitting home runs every day. He’s grown his book to almost, well over $200,000 in commission. To use the famous phrase, he talks the talk and walks the walk. He’s out meeting his fellow Captains and Marine Contacts, whether they own a marina, run a whale watch fleet, or whatever, because he knows their language.
And, he joined our firm because he knew by becoming a producer here after all that work he put in in getting and growing that business at the end of the day he could have that ownership of it.
No, I really don’t. To the best of my knowledge, I don’t know of any other agency that is using our kind of model. I think for the most part the producers at all the other agencies are employees. Here, they are not independent contractors, but they do have that ownership interest. I don’t think that book ownerships is something that is very popular in the industry right now.
Your agency’s model is similar to the model for law firms in Massachusetts. Did your agency develop the model?
No, actually, we just kind of backed into it. I mean, we realized it was working and there was really no reason to change it, so it just kind of evolved. My father had all these brokers in the back room on Broad Street (the former Deland Gibson office in Boston) and they owned their own books. Eventually, you know as in the case of someone like Phelps Edwards, he retired in 1995 and we still have commission on the books that’s obviously a house accounts with a profit.
As it happens, our CSRs get to know the clients over the years and the transitions simply work. We have a number of producers who have retired now and their books keep rolling along.
What about when someone wants to move their book of business over to another agency?
Well, the funny thing only one has ever moved on. All of our producers have abided by our agreement and either stayed or passed away or retired with us buying their business.
What about acquisitions, have you grown your agency by acquiring other agencies as well?
No, not really. The only time we truly purchased an agency was when we acquired the Westwood Insurance Agency in the mid-1980s. That’s the only time we’ve truly bought an agency. Everything else has been, in terms of growth, has been organic growth through the addition of quality producers.
Do you see your agency entering into more acquisitions in the future?
Yes, but it is not a big focus. Every so often, we do talk with someone who is interested in selling, but we have come to the realization that we just want to concentrate on the model that we have. You know, we would much rather work on having quality producers come in rather than get involved with buying a 10 person shop and worrying about the staff, etc. You know it has never been our strength and so we are not going to start getting heavily involved with it now.
What do think about the trend of the consolidation of agencies in Massachusetts?
Well, I have seen the numbers of how there are 1,300 agencies now and that there are going to be much less in a few years. I hope that this trend of consolidation will help make this industry a stronger one. So I am not against consolidation, I think there are a lot of agencies just hanging on and if consolidation can strengthen the overall quality of agencies and increase the level of professionalism of the overall agents in Massachusetts, that is important.
We are involved with the MAIA and a lot of insurance education for agents and some of the stories we get about advice that other agents and agencies have given to their clients, it’s unbelievable. You want agents to be professional, and education is a big part of that.
What about the introduction of Managed Competition? Have you seen increased competition from the direct writers?[pullquote]It all goes back to our relationship with our clients; they are our friends – Charlie Gibson[/pullquote]
It really did not affect us that much. It all goes back to our relationship with our clients; they are our friends. We do see a little bit of competition from Liberty, but overall I would say that our strong relationships and the value we bring to our clients helped us retain them.
Who do you write your major auto with?
Commerce. We probably write about five million with Commerce. We also write a lot with Safety, Arbella and Norfolk and Dedham.
What other companies do you represent?
Of the major national stocks and mutual, we pretty much have everybody. There are a few that we don’t have, but overall we have most of the major carriers. [The same with the domestics.] So I guess to answer the question in a different way, there is really no one we really feel we need to take on.
As to revenue size, which side of your agency is bigger Personal or Commercial?
The surprising thing is given our revenue size, I believe we are within $20,000 dollars of being 50/50 down the middle between Personal and Commercial.
What is your general overall outlook for the future of the Massachusetts insurance industry?
I’m excited about the future. I’m a boomer, my kids are 32 and 30. They are millennials, and it is just a whole new way of understanding how their peers want to buy insurance. At the agency, we have been big proponents of Roger Sitkins (Now InCite Performance Group) and his way of doing business for the last several years now, and his idea of getting away from selling insurance by price.
Rather it is about putting a value into the insurance transaction as a trusted advisor, like an attorney or an accountant would be. So it is about getting the trust of our clients in providing guidance and selling insurance rather than just selling for price. Price is a part of the equation, it just should not be the most important part.
On a last note, if someone reading this interview was interested in learning more about becoming a producer at Deland, Gibson, what would you tell them? What should be their first step?
To just send us an email. They can email me at Cgibson@delandgibsonins.com, Tom Skelly at email@example.com, or my son Chip at firstname.lastname@example.org. We would be glad to talk to anyone interested in learning more about our agency. They should also check out our website: delandgibson.com as it does a good job showing how we are unique.
Is there anything you would tell that person to think about before getting in touch with you?
Oh, that’s a good question. They should know that they will have equity in their business. They should also know that at Deland, Gibson, we don’t think of insurance here as a commodity. So, for anyone who is interested in coming in to talk with us, we would be very interested in them being able to talk about how they would be able to use the trusted advisor approach [in growing their book of business].