By CYRIL TUOHY, managing editor of Risk & Insurance®
BOSTON---As U.S. Census takers fan out across the nation to record its latest ethnic makeup, Aon Cornerstone Innovative Solutions announced April 27 that it had entered into a deal with Magic Johnson Enterprises. The deal means Aon will be able to offer its clients access to consulting, licensing, supplier services and capital management supplied by Magic Johnson Enterprises.
"We've grabbed our best minority business to date," said Leonard E. McLaughlin, president of Aon Cornerstone Innovative Solutions. "Our competitors are 18 months behind us at least."
Aon Cornerstone, formed in April 2009 to offer risk management and human resources services to minority-owned businesses, already has partnerships with Washington, D.C.-based PRM Consulting Group; Wayne, Pa.-based AV International; and Detroit-based Schooner Consulting & Management Services Inc.
Aon Cornerstone offers minority-owned businesses access to the scale and capacity that Cornerstone's parent, Aon Corp., can provide.
Johnson, who spoke at an Aon-sponsored dinner in Boston at the annual gathering of the Risk and Insurance Management Society Inc., called the deal an "honor," and one that would ultimately succeed.
"I'm not used to losing, and I'm not going to lose in this effort," he said.
Johnson, who retired from basketball in 1996, built a billion-dollar business empire with stakes in real estate, restaurants and theaters. One of the nation's most successful minority business executives, he has built his wealth in part by investing heavily in urban markets.
Business owners there want to grow, said Johnson, but sometimes can't as they have neither the scale nor the connections with large insurance brokers or carriers to help them.
Access to insurance markets is sometimes a problem, agreed one Indiana-based agent.
"Carriers will only give you consideration if you have scale or volume, and if you have no volume, why should carriers care?" said Roosevelt Haywood III, president of Haywood and Fleming Assoc., an insurance agency in Gary, Ind.,
Aon Cornerstone fills that gap by connecting business owners with the brokers and the carriers, according to McLaughlin, who added that Magic Johnson "truly understands how to make minority businesses grow."
Terms of the year-long Aon Cornerstone-MJE deal were not disclosed.
Speaking in a separate interview, Haywood said that Aon Cornerstone has built up an early lead compared with its competitors when it came to making inroads with minority businesses.
Aon Cornerstone, he said, had "really run with the concept, and I don't know of anyone else who has."
Haywood, former chairman of the National African-American Insurance Association, noted that Marsh Inc., the only other U.S.-based broker with the scale to match Aon, was itself no stranger to developing partnerships with minority business owners.
While Haywood called the Aon Cornerstone deal with MJE "a plus," he also said that there were plenty of other brokers capable of offering capacity and resourcefulness to handle the needs of minority-owned enterprises.
"I am working with a collective of African-American-owned insurance firms in Chicago, and we call ourselves the "Alliance," and none of us are part of Cornerstone," he said.
According to the Pew Research Center, 19 percent of Americans will be an immigrant in 2050, compared with 12 percent in 2005. By 2025, the immigrant, or foreign-born, share of the population will surpass the peak during the last great wave of immigration a century ago.
The Latino population, already the nation's largest minority group, will triple in size and account for most of the nation's population growth from 2005 through 2050, according to the Pew Research Center.
Hispanics will make up 29 percent of the U.S. population in 2050, compared with 14 percent in 2005, Pew found.
April 29, 2010
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