The chief executive took a call from a reported longtime client. After Mr. Laurin, 53, made repeated futile attempts to transfer her to the right department, she angrily responded that usually Encon gave great service. But apparently, not this time.
It turned out to be a joke call in collaboration with receptionist Kathy Olson, whom Mr. Laurin was "job shadowing" after she won a silent auction to raise funds for two charities Encon supports.
"When I wrote (a) little note to all staff about it, those four hours - I think I called it ‘Four hours in hell,'" he recalled with a laugh.
When told it was actually titled ‘Life on the firing line,' he responded, "I think my original draft said ‘Hell!'"
Mr. Laurin is the chief executive of a 450-employee managing general agent firm, Schinnerer Group, which is split into the Canadian arm Encon Group Inc. and U.S. section Victor O. Schinnerer & Co. Inc. - necessitating many weeks of business travel a year as he moves between offices in Ottawa, Toronto, Edmonton and four locations spread across the United States.
Encon and Schinnerer serve as underwriters for the products insurance carriers sell to licensed brokers. The full financial risk is assumed by these carriers, while the broker deals directly with the client to find the insurance that meets his or her needs.
The two companies make their money through issuing the insurance; the insurers pay Mr. Laurin's firms for the service.
When Mr. Laurin speaks of Encon's accomplishments, he brings up several hallmarks of consistency, such as clients who have been around for 20 years or more and the high percentage of employees that have remained with the firm for at least 10 years.
But in outlining how the company nearly doubled its revenues to $320 million in 2010 from $185 million in 2002, when he took the helm, Mr. Laurin explained the Canadian company also avoids resting on its laurels.
"Any company that is selling a product, as opposed to just a service, has to take a chance."
"You will not always be successful, but I think you always have to have something in the funnel, allowing you to experiment and stretch into areas (where) there may not be a demand (today), but tomorrow, guess what? You've created demand to a certain degree."
The company also needs to make itself current to young brokers who may not immediately recognize Encon's reach and history, said Kate Harley, Encon's chief operating officer.
"No matter how good we think we are, brokers have choice, and there are more choices in the Canadian marketplace than ever before in the niches we (serve)," she said.
"We have to be able to build their trust in us, build the relationships with them, so we have to be out there more meeting with brokers. Letting them get to know us."
PUSHING HARD INTO A SOFT CYCLE
It is only through constant innovation that the firm was able to grow during Mr. Laurin's tenure.
He arrived at a company operating in Ottawa's bear market of 2002 in the wake of the tech crash. Although business improved after that, world markets hit another sharp downturn in 2008 in the wake of the subprime crisis in the United States, the echoes of which are still reverberating in that country.
While the fallout didn't hit Encon directly - the company emphasized it only works with top-tier, financially stable insurance carriers - there was an indirect impact on business.
During soft cycles, Encon explains, the group benefits business slides because most of its clients are small firms, that tend to make cutbacks to staffing first. The construction industry also slows down, which reduces demand for Encon's building-related products.
On top of that, the rise of underwriter upstarts nipping at sections of Encon's business, particularly the environmental products, has forced the older giant to be nimble.
"What's challenging is (as) competition increases, the price of our product gets challenged, so your profitability gets challenged," Mr. Laurin said.
"So where we are challenged is managing that process with our clients, but also corporately in how you manage your expenses and your overall profitability to keep it at a level that's acceptable."
His approach was to introduce a flurry of new products - such as critical illness insurance and enhanced technology insurance - working to convince brokers that it was worth it to take on more insurance products to sell to clients, at a time when many thought they should cut back.
The gamble paid off - the new products Encon has launched since 2000, when markets were down, have alone produced 40,000 policies and more than $190 million, the firm said. This came partly through above-board service and new hires to keep business flowing as other carriers stalled in the marketplace.
"He's grown the firm dramatically, and at the same time maintained or even enhanced their level of customer service ... they have worked very hard on the issues of deliverables: the quality of service and the quality of expertise," said Brian Scott, the president of Smith Petrie Carr & Scott Insurance Brokers Ltd. He characterized Encon as a "truly significant provider," although not among his firm's biggest clients; it has 50 other insurance providers.
CULTIVATING ‘EMBRYONIC' MARKETS
One of Encon's biggest business risks in recent memory was the introduction of an "alternate insurance market" product in November 2009.
The company analyzed liability submissions it was declining and found most of them were not bad risks, but simply poorly understood ones. The clients did not have good claims experience, lacked professional designations or had a large number of foreign clients.
Encon put together the product through negotiating special coverage with its carriers and on occasion, signing on new carriers to take on these clients.
In two years, the product has added $2 million in premiums and given Encon greater flexibility to accept non-traditional clients, Mr. Laurin said. Further, if the number of insurers willing to take on these risks shrinks, it could bring more opportunities to Encon as other brokers have difficulty finding insurance for the clients.
"We were able to take some underwriters out of their regular work environment and into what is really embryonic as far as products are concerned, and really stretching their imagination as to what they can underwrite on behalf of the carriers," Mr. Laurin said.
LEADERSHIP IN OTHER FIELDS
Mr. Laurin also makes efforts to demonstrate leadership in other arenas besides business.
For his employees, Mr. Laurin said the firm focuses on giving back to its community as well as providing outstanding service for its clients.
A conversation with a neighbour a few years back got him thinking, he said. "She said, ‘We don't all start life from the same starting line.' That always stuck to the back of my head. So that's why we picked that theme."
He asked the employees to find charities in Ottawa that need help - not financial help, but help in other forms. With the theme "youth at risk" in mind, they chose the Dave Smith Youth Treatment Centre, which stabilizes kids in crisis, and the YMCA-YWCA's Second Stage Housing program, which teaches teenagers life skills.
Encon's Ottawa office has given more than $30,000 to these charities, including services such as repainting, landscaping, television sets, toasters and welcome baskets.
Mr. Laurin said his employees have taught him a lot about how to be a leader, especially when it comes to the human side of business.
"They remind me that they're really on the firing line ... They're delivering the values, the promise, and the service standards that we all expect of each other - they are delivering it every day."
ABOUT SCHINNERER GROUP
The two-country company has a Canadian arm, Encon Group Inc., and U.S.-based Victor O. Schinnerer & Co. Inc.
Schinnerer Group handles all aspects of a claim except for the financial capital, meaning that employees do the marketing, underwriting and management of the distribution of its brokers who handle the finances.
• Founded in 1962, Encon is an underwriter with products in professional liability, construction insurance and also group and retiree benefits. Some of its lines for businesses include liability insurance for directors, environmental insurance for the construction industry, and errors and omissions insurance for medical providers. It has 230 employees, including 165 in Ottawa, and other offices in Toronto and Edmonton.
• Founded in 1938, Schinnerer is an underwriter specializing in the property casualty business. It has products available for architects, engineers, professional liability, directors' and officers' liability and miscellaneous errors and omissions. It has 220 employees with offices in Washington, D.C., New York City, Sacramento, Calif. and Houston.
Sources: Jean Laurin, Encon Group Inc., Victor O. Schinnerer & Co. Inc.
