Speare & Company Entertains a Successful Business Approach

In our continuing series on Agency Insights, we look at Calif.-based Speare & Company, which offers property/casualty and employee benefits insurance brokerage services and risk management solutions to a wide variety of businesses, including manufacturing and distribution companies, real estate owners and developers, technology and hospitality companies, apparel companies, etc. In addition, Speare & Company has specialties in entertainment, lawyer’s professional liability and private schools. In the last two years, the company has increased revenues by over 25 percent and grown to over $100 million with 80 employees. Recently, Tom Alper, executive vice president of the company, who shares the day-to-day company responsibilities with Robert Bryar, president, spoke with Insurance Journal about the company’s growth, challenges it has faced, and where it is headed.

Insurance Journal: Tell us a little bit about the formation of the company?
Tom Alper: Speare & Company was founded by Ray Speare in 1946. Five partners, led by Arthur Alper, Bob Borisoff and Ernie Scanlon purchased the company in 1985. In 1997, Bob Borisoff and Ernie Scanlon sold their interests in Speare & Company and Robert Bryar and myself obtained ownership interests in the company. In 2001, Robin Martin, Neil Alper and Gary Skerik became owners and partners. Speare & Company has maintained a stellar reputation in the Southern California business community as a dependable, progressive insurance brokerage, which is evidenced by their extremely high retention of clients. Because of the cordial, ambitious and creative environment, producers and staff find Speare a great place to work. Since 1997, strategic growth initiatives and day-to-day operations have been led primarily by Robert Bryar and myself. Speare & Company has nearly doubled in size in the last five years and currently has over 80 employees in their new offices in Sherman Oaks, California.

IJ: How has the hard market impacted the company?
Alper: Like most insurance brokerages, the hard market has bolstered Speare’s revenue growth. The hard market presents new challenges. With insurance company investment returns still relatively low, careful underwriting has become more important to carriers than ever in their effort to achieve return on equity. The “tightened underwriting” and rate increases that come with the hard market means that Speare must be even more diligent in our efforts to present complete and detailed submissions to carriers; and, it requires creative, cost effective alternatives for clients in the risk management and claims area.

IJ: Tell us about your entertainment product. What are some of the challenges in selling this product?
Alper: Speare & Company’s Entertainment Division arranges insurance for feature films, TV series and specials, commercial and music video production companies, celebrities, concert tours and special events. There are unusual requests nearly every day—insurance issues arising from stunts, people participating in reality TV activities, aerial photography, underwater filming, filming wild animals, etc. Try explaining to a client that they have a two Buffalo deductible for their production. That was one of the terms I negotiated while insuring a herd of Buffalo! Some of the other unusual risks included insuring David Blaine when he stayed inside a block of ice for two days in Time Square in New York City. And as for the bizarre yet educational experiences was a workers’ comp claim from a production company client that was among the first to enter an Egyptian tomb—previously closed for centuries! Even though the filming went well, a few days later, this person came down with flu like symptoms that proceeded to get worse. Crypt curses and Mummy Mojo aside, the viral infection was unidentifiable by esteemed UCLA physicians. Even their most advanced medical technology could not isolate the virus. After several different antibiotic treatments the person was finally cured. It was later discovered that when a tomb is unsealed—prior to entering it—it is important to let the tomb “air out” before allowing anyone to enter it. In addition to the
unusual, egos and personalities are also part of my daily life,
like when a superstar wanted to fly his helicopter to the set during production. Speare & Company’s Entertainment Division is one of only a handful of agencies in the USA with a high level of expertise and longstanding relationships in the entertainment insurance industry.

IJ: You also offer environmental and professional liability products among others. What are we seeing as some of the exposures clients are currently facing?
Alper: The clients are faced with several exposure concerns, of which one of the significant ones is the lack of capacity and a sufficiently broad marketplace to offer coverage. While there are several carriers that purport to offer a market, most are limited in their real appetite. Some of the significant exposure considerations facing most of our clients are: off site storage sites (approved dump sites) and potential long term liability from future EPA actions and interpretations; contracting exposures involving environmentally related installations including completed operations and the environmental third party risks, along with the potential gray areas between consulting and contracting operations; significant confusion and lack of knowledge on the part of governmental entities seeking the services of our clients, while at the same time making unreasonable demands for environmental coverage their legal departments believe they need. We typically have to deal with clerical or engineering staff following requirements dictated by municipal legal departments that do not fully understand the limited coverage available while making unreasonable demands for “manuscripted policy language” and “out of date policy forms.”

IJ: How have you kept your company on pace with or ahead of your competition and what is the volume of competition out there for you?
Alper: Speare & Company is on pace with and often times ahead of their competition primarily due to Speare’s responsiveness and high level of personal service. Our exceptional ability to market risks along with our vast array of industry relationships keeps our clients’ pricing and terms competitive. In addition, Speare has the ability to offer value added services such as loss control, engineering and workers’ compensation claims management services. We believe our combination of VIP service and competitive pricing along with our reputation for integrity and reliability are all major factors to consistently maintaining and growing our clientele.

IJ: What about agents who may want to start up an Entertainment Division—do they hire someone from the industry? Buy a book of entertainment business? Can you impart any words of advice?
Alper: Well, after doing this for as long as we have—I can honestly say there is no easy way. Hiring someone or even a few people who have worked within the entertainment insurance industry doesn’t mean immediate success. The entertainment industry is a particularly demanding one requiring a high level of expertise and instant responsiveness. You need market appointments and cooperation from the carriers and those relationships need to be developed over the years. Over the last 50+ years, Speare has developed an infrastructure of markets, back office support teams and personnel who are available at a moment’s notice. You can’t predict when and/or what your client may need because many of the entertainment insurance projects are totally unique.

IJ: Where do you see Speare & Co. in five years?
Alper: Speare & Company is perfectly positioned to maintain a high level of growth without sacrificing the VIP service we provide to our clients. Smaller agencies are having difficulty meeting carrier commitments and global brokerages are consolidating—often resulting in reduced service and attention to their clients. Speare is a middle market insurance brokerage that offers the expertise of larger brokerages with a higher level of personal service and responsiveness. Everyone at Speare & Company is excited about our company because we’re staffed and positioned to successfully compete and succeed. We’ve laid the groundwork over the last 50+ years and we’re poised to take on any future industry and client challenges.

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