At the start of this year, Eastern Insurance announced the appointment of Tim Lodge as its new President & CEO. Signalling the start of a new era for Massachusetts’ largest independent insurance agency, Agency Checklists thought our readers would be interested in learning more about Mr. Lodge with respect to both his career in the insurance industry and his vision for Eastern Insurance going forward. He was kind enough to take the time to speak with us and share some of his insights about his priorities for Eastern, the state of the industry, as well as the importance of building an inclusive culture that brings out the best in each employee. Here is what he had to say:
Congratulations on being named the new President of Eastern Insurance. How has the transition been going thus far?
Thank you. Fortunately, I have had the benefit of working closely with John Koegel, our former President who has transitioned to a new role at the agency, for quite some time. His mentorship, knowledge, and guidance have been immeasurable in my transition and continue to be as he extends his tenure with Eastern Insurance (EIG) as our Chief Acquisitions Officer. Under John’s leadership, Eastern Insurance has developed a model of exceptional service for our customers and grown to become an employer of choice in the industry. I am honored to continue this path with the help of our outstanding colleagues.
Many of our readers enjoy learning how others got their start in insurance. Could you share with our readers how you got your start in insurance?
I graduated from Fairfield University in 1998 with a BS in Sociology and a double minor in Finance & Business Management. During my senior year, I attended a job fair on campus and was introduced to representatives from The Chubb Group. The discussion caught my interest and inspired conversations with my father who was very familiar with the importance of commercial insurance acting in his capacity as a chief financial officer for several manufacturing companies over his career.
The opportunity to join an industry that plays such a critical role in our macro and micro economy and the prospect of being able to work with and learn from a variety of different customers was very appealing to me. Upon graduation, I applied for a commercial underwriting position with Chubb in their New Haven office, transitioned over to the agency side of the business a few years later, and I have never looked back or regretted my decision to build a career in the insurance industry.
When did you first join Eastern Insurance?
I joined Eastern in July of 2013.
What attracted you to joining the company?
There were two primary attributes that drew me to Eastern. The first was the culture. I joined Eastern as a Sales Executive and it was readily apparent to me that Eastern was a growth-orientated organization. It also became clear to me that Eastern believed consistent growth could not be achieved without passionately caring for its colleagues, customers, and communities.
The second attribute was Eastern’s reputation in both the insurance industry and our local communities. Eastern Insurance had already developed relationships with most of the major national and regional insurance companies in our market. When speaking with carrier representatives, the underwriting community was overwhelmingly positive about the mutual respect they had for the leadership team, sales executives, and account managers within the Agency. Within our local communities, Eastern Insurance has benefited greatly from our close relationship with our parent company Eastern Bank, which has been committed to philanthropy through the Eastern Bank Foundation, with more than $240M in charitable giving since 1994.
Just how big is Eastern Insurance today? Could you share with us your premium volume or market share?
As of December 31, 2021, Eastern Insurance manages approximately $900M in premiums and is the second-largest insurance agency in MA. We have over 400 employees in 22 locations across MA and RI.
What is the relationship between Eastern Insurance and Eastern Bank?
The synergy between Eastern Insurance and our parent Eastern Bank is incredibly strong. We are supported in all areas of our business, in particular from a financial perspective. Eastern Bank provides a financial standing and balance sheet that many of our peers cannot match, which helps us support our customer relationships, invest in the tools we need for success and keep our acquisition pipeline strong. Most importantly that support comes in many forms to benefit our colleagues that are a distinction of working for our organization.
The strength of our relationship provides us, as an agency, with a link to many more solutions to our customers’ needs. More so than ever, operating in a consultative way and having access to solutions for our client base is incredibly important as the environment has evolved, as well as customers’ expectations, and where we fit in that value chain.
In addition, Eastern Bank has a fourteen-person management committee of which I am a member. It is a collaborative group that provides support around strategic thought, initiatives, and planning. So, again, there are a lot of synergies between the two.
Have you begun planning for Eastern Insurance in a post-Covid landscape?
We have not been in a hurry to return to the same structure we had prior to the pandemic. Finding a workable work-life balance for our employees is one of my main priorities.
What do envision as your main priorities over the next year, as well as the near future?
We are excited with the progress we have made to attract, retain and develop some of our industries’ top talent, as well as the investments we have made to achieve operational excellence. We believe that keeping the experience of our customers as our north star along the journey and focusing on these areas has positioned us well to accelerate profitable growth, which continues to be our number one priority.
Since Eastern Bankshares, Inc., the holding company for Eastern Bank, had an initial public offering in 2020, Eastern Insurance is now part of a public company. How would you describe the transition to being part of a public company?
The conversion and public offering have provided significant additional resources, which we can use to grow customer offerings, accelerate new business opportunities, and better serve our customers and communities.
Has there been a change in the agency dynamics or the way you do business as a result? If so, how?
The decision to go public was one that we at Eastern Insurance were extremely excited about, as it represented a chance to open many opportunities to our clients, communities, and employees. The offering raised capital that can support our goals of market expansion through organic and acquisition growth. In addition, the recent developments in Eastern’s leadership structure included some key promotions at Eastern Insurance, which were intended to deliver our clients the best customer experience by utilizing a more consultative approach and integrating new technologies to enhance that experience and drive operational efficiencies.
It appears that the COVID-19 public health crisis is turning a corner. How has Eastern Insurance and its employees weathered the pandemic?
We have taken the pandemic very seriously at Eastern and have made decisions from the beginning focused on protecting our employees and our customers. Our colleagues have done an outstanding job transitioning to a virtual environment and they continue to be flexible as we determine what our new “normal” looks like.
What about remote work? Have you returned to the in-person working model or are you planning to offer a hybrid working situation going forward?
Given the nature of our business, a portion of our staff has remained in-person throughout the pandemic as was necessary to service our customers requiring face-to-face transactions. We are beyond grateful for their dedication and commitment to the needs of our clients. Many employees found they were able to perform their jobs effectively on a remote basis and we feel many will be able to continue to do so. We continue to take our time to understand this new dynamic, analyze the situation, gather feedback from our colleagues and make decisions that are in the best interest of our customers, colleagues, and communities.
How is Eastern dealing with the hiring crisis? Has it instituted any programs in order to attract new talent?
I am glad you asked this question. We have spent the last year building muscle around our training program. It really started with a focus on our road to equity, we wanted to create an environment where we could attract more diversity to our workforce.
We realized, however, that to attract and retain the best talent, we needed to develop a comprehensive training program with the tools needed to succeed at Eastern and within the industry. Our team created a rotational program, starting with five weeks in a curriculum with Personal Lines, to understand the business from a very ground level, coming from the outside in, followed by five weeks in Commercial Lines, and then lastly five weeks in our Employee Benefits division.
We launched the program this past December, training four of our colleagues from Eastern Bank who were interested in learning more about the insurance industry. After finishing the program, all four individuals wanted a permanent position with the agency and we now have two additions to our Benefits Group, and two in our Commercial Lines department.
Again, we developed this program through the lens of our road to equity and diversity, and we feel confident now that we can bring in somebody from outside the industry and give them a full understanding and awareness of our business.
Ultimately, we want to lean into people’s strengths. That is our philosophy around the development of our colleagues. Let’s not spend a lot of time working on somebody’s weaknesses, let’s lean into their natural talents and abilities. Once they have an idea of what those talents, abilities and strengths are, we can offer career path opportunities that I think many of our independent agent peers can’t provide.
Overall, how do you think insurance, in general, and the Massachusetts insurance industry, in particular, have changed because of COVID-19?
From Eastern’s perspective, the insurance industry has successfully navigated through the numerous issues related to COVID, which is why we believe it to be one of the most resilient industries in our economy. With that said, the insurance industry is not immune to the staffing challenges experienced by all industries and the ability to attract and retain new talent. The number one question on every CEO’s mind is how we navigate through this new landscape and provide flexibility and balance in any return to office plans so as to alleviate the stress and workloads created by COVID and its resulting staffing issues.
There is a huge amount of consolidation going on right now in the Massachusetts insurance industry. What are your thoughts on this consolidation as well as the huge influx of private equity money that is entering our industry?
2021 marked another record year for the number of individual agency acquisitions, largely driven by tax uncertainty, high multiples, and increasing demand. The interest in private equity investment in the industry has expanded during COVID as our industry has once again proven to be resilient to economic headwinds. This expansion has moved into Massachusetts with the investment in, or acquisition of, many local agencies by private equity over the past few years. While I expect this trend will continue in 2022, it may be tempered for those private equity firms that are highly leveraged with the recent interest rate increases.
Eastern has increased its agency acquisitions over the past year. Do you plan on continuing to acquire agencies in Massachusetts? What type of agencies is Eastern interested in acquiring?
Eastern welcomed the Michals Insurance Agency on March 1, 2022, marking our 35th agency acquisition since 2002. We have developed what we believe to be a well-orchestrated acquisition process over the past 20 years, which leverages the benefits of adding intellectual capital through agency acquisitions while minimizing the amount of disruption to our colleagues. Our acquisition strategy will continue to focus on agencies that are a strong cultural fit. In addition, we will seek out opportunities that are led by individuals who share our belief in a consultative approach to serving customers, can expand our service offerings, and can enhance our commitment to exceptional client service.
What about in New England? Any plans to expand into the region?
We do not have any immediate plans to acquire outside of our current footprint, although we are licensed in all 50 states and have several national programs.
Is there anything else that you would to add or share with our readers?
Hopefully, we have shared some relevant information about Eastern Insurance for your readers; where we are going, what our goals are, and how we are accomplishing those goals. Our focus is not only to make Eastern an attractive place for new entrants into the industry but also for any seasoned veterans that might be looking for a different landscape. I worked for Aon for 12 years with some of the best people I ever worked with, and with whom I am still in contact. But after 12 years, I felt I needed something different for a variety of reasons. I didn’t know much about Eastern when I made that change, but perhaps if I had known them through an article like this, I would have gotten there more quickly.
So, I hope this interview shows people who we are, and why we think we’re a great organization going in a great direction. A great place to work for as well as to work with. For those who would like more information, please visit us at https://www.easterninsurance.com/.