New York Marketing Manger for Encompass Insurance Mark McDonnell speaks while PIANY Assistant Executive Director for Government and Industry Affairs Ellen D. Kiehl, Ph.D., CAE looks on.

New York is Encompass’ largest state, accounting for about $214 million of the company’s approximately $2 billion in premium countrywide, $900 million of which comes from the Eastern Region.

The Allstate Group acquired the book that formed the basis for its new independent agency Encompass brand by buying CNA’s personal lines operations; nearly 100 percent of CNA agents elected to continue with Encompass. “Having the research capabilities and the resources that Allstate can dedicate to the company provides an enormous boost,” McDonnell said.

McDonnell noted that Encompass’ new president, Doug Wendt, has recently come to the company from Allstate. Among Wendt’s and the organization’s priorities are: ease of doing business (which they recognize is a business imperative for independent agents); creating a positive sales and employee environment; effective communications; integrity, trust and teamwork; growth and profitability;); top tier products; and effectively serving the company’s “customers” (i.e., independent agents and CSRs).

	New York Marketing Manger for Encompass Insurance Mark McDonnell responded to questions posed by the committee.

McDonnell reported that Encompass currently has over 270 agents in New York and is looking to grow that number by around 10 percent in 2004. He said the company is careful to guard the value of the franchise by spacing out its agency appointments. Encompass agents in New York average around $750,000 in volume. The company has around 160 agents in the downstate area, and their downstate/upstate split by premium volume is around 60/40, “but upstate agents are gaining ground,” McDonnell added.

Encompass takes an active interest in the views of their agencies’ CSRs, tapping a team of CSRs to help its software experts develop the new Interlink automation system that was rolled out in 2003. “We are most pleased with how agents have embraced the new system, as shown in the growth of new business,” McDonnell told PIANY. Through the first three quarters of 2003, the company’s signature package policy saw growth of 118 percent, over the same period in 2002, while monoline products grew by 128 percent, he reported.

“Packages policies are our premier product,” McDonnell said. Packages account for 74 percent of Encompass’ book, “but we are not averse to good-quality monoline business,” he added. McDonnell reported that the company’s loss ratio in package improved by six points through the first three quarters of 2003. The improvement in monoline auto was even greater, but still shy of Encompass’ ultimate goal.

PIANY Treasurer Martin Koles; Industry Liason Committee member Paul Casciaro; PIANY Director Kevin M. Ryan, CIC; and New York Marketing Manger for Encompass Insurance Mark McDonnell.

Responding to agent input, the company’s product strategy will be to maintain its current offering of three different levels (special-deluxe-elite), and differentiating the three options even further, McDonnell said.

Responding to questions raised by the Committee, McDonnell said it is immaterial to the company whether or not an agency chooses to use its service center; currently about $193 million of the book, country-wide, is serviced this way, around $25 million from New York State. “There is no difference in first-year commissions, and a charge of two points upon renewal, for using the service center,” McDonnell added. “We have seen a phenomenal need for this capability; in fact, there is currently a waiting list for agencies to come into the service center. If an agency has a book of a certain size, we provide a separate 800 number that is answered with the agency’s own name. Also, we can help set up a hot-key transfer capability so that customer calls can be transferred seamlessly from the agency to the Service Center, as if from one desk to another within the agency.”

McDonnell also discussed other topics, including mold claims (“they’re growing rapidly in New York”); bridges the company provides from the AMS and Applied systems for generating quotes (“we offer multiple quoting options to accommodate different workflows”); and how the company notifies agents of any claims reported by their customers (“an electronic ‘claim alert’ goes out immediately”).