By B.G. YOVOVICH, who has written for national trade publications for more than 20 years
Ask Swett & Crawford's President and CEO J. Neal Abernathy about the length of his tenure with the commercial insurance brokerage wholesale firm, and he replies, "I have been here forever--if you include acquisitions."
Of course, there's an awful lot of change embedded in that "if you include acquisitions" qualifier, and Abernathy's career--especially in recent years, and particularly in the last few months--clearly illustrates how you repeatedly can find yourself working for new organizations, even if you don't ever leave your current employer.
To be sure, there is a long and continuous line that traces from Abernathy's current position all the way back to when he joined the Alexander & Alexander insurance firm as a retail producer in 1981.
A graduate of the University of Georgia with a degree in public relations and a minor in insurance, Abernathy said, "I am one of those few who did not just fall into working in insurance; I actually planned to go into insurance."
His exposure to the industry came at an early age.
"My dad was in the insurance business on the P/C side, and, when I was young, my main adult influences tended to be his business acquaintances and colleagues," he said. "They led an interesting lifestyle. They traveled a lot. Went places, did things. Talked about interesting stuff."
Among the attractions was the opportunity that insurance offered to be involved in a variety of businesses.
"To me, other areas--like finance, accounting, or law--do not seem to get into as many facets of what a business does, and what we do in the insurance business is so broad and covers so many of the different facets of a business or of an industry," Abernathy said. "Not to get too far over our skis, but when people ask 'What social benefit is there to insurance,' I tell them to try to get a loan without insurance. Or try to start a business and not need insurance in the process."
Abernathy's passion and enthusiasm about insurance not only propelled him to the top spot at Swett & Crawford, but also to leadership roles in the industry, including his recent appointment to chair the Wholesale Working Group of The Council of Insurance Agents & Brokers (CIAB).
"We selected Neal because of his exceptional sense and knowledge of the business and the leadership he has continuously displayed in publicly championing the evolving role of the wholesale broker and the entire wholesale distribution channel," said Ken A. Crerar, the president of CIAB. "Neal leads by example in propelling the insurance community forward, using his expertise and experience to lead insightful discussion and promote the key role of risk management in the modern business world."
COLLEGE STRAIGHT INTO INSURANCE
Abernathy wasted no time after graduating from college, going immediately into insurance.
"I was intrigued by insurance and thought I would give it a shot," he said. "When I got into it, I liked it and the rest is history."
And a long and winding history, at that.
After a couple of years, Abernathy moved from the retail to the wholesale side of Alexander & Alexander. Then came a series of mergers and Abernathy eventually became a part of Bryson Associates Inc., which was acquired by Aon Corp. and then was merged into the separately-acquired Swett & Crawford operations at Aon.
Probably the biggest organizational turning point for Abernathy came in 2005, when regulatory pressures prompted large insurance firms--including Aon--to spin off their wholesale operations into independent entities. The Swett spin-off was financed by an investor group which included employees of the company, plus private-equity investment from the HM Capital Partners, Banc of America Capital Investors, and Emerald Capital Group.
"It was one of those change moments," Abernathy recalled. "I had spent all my life doing wholesale business as part of a retail operation. It is a whole different world when you are a part of Aon or Marsh or Willis," as compared to being a standalone company. In addition, Abernathy also had to adapt to his new role as CEO of an independent business enterprise. Part of this adjustment included the need to make changes in his working style.
"The biggest difference in being the CEO probably is that I have to be more guarded and more careful in what I say," Abernathy said.
"I am a very informal kind of guy and a consensus-builder by nature, and I like kicking ideas around with people." However, Abernathy said, "I found that, when I would say, 'have you thought about this' and 'what if we tried that,' someone often would go out and do whatever I had said. It was never my intention. I was just throwing out ideas was not expecting people to be hanging on everything that I say."
The members of his team also had to make adjustments. "It was one of the early big challenges, not just to me, but to the group," recalled Abernathy. "I had to change my thinking process a little bit, and they had to change the way that they interacted with me somewhat."
Another big CEO-related change has had to do with the shift in the nature of the information that is brought to his attention
"People are not comfortable giving you and telling you stuff that you might not want to hear. Or stuff with which they were not comfortable," Abernathy said. In addition, "when you are the CEO, people do not come to you with small things, because you don't have time, and you can become isolated from people if you do not reach out to them."
Since the 2005 spin-off from Aon, Abernathy has overseen a series of mergers and acquisitions of his own, including Oxbridge Insurance Associates, Inc., a Morristown, N.J.?based property and casualty wholesale broker, and Risk Reducers, LLC, a wholesale insurance broker based in Little Rock, Arkansas, and specializing in workers' compensation.
And, most recently and most significantly, Swett & Crawford completed a deal in July to combine Swett & Crawford, America's oldest independent wholesale broker and Cooper Gay, the leading London-based independent wholesale, reinsurance and specialist retail insurance broker.
The new holding company--which will be known as Cooper Gay Swett & Crawford Ltd.--has about 1500 employees in 60 offices around the world and is expected to place about $3.5 billion in premiums.
Toby Esser, the Cooper Gay Group CEO, will serve as the chief executive for the holding company. Abernathy will continue as president and CEO of Swett & Crawford, will lead all North American operations for the new holding company, and will serve as a member of the new holding company's executive committee.
"Neal holds tremendous respect within the marketplace, not only in the U.S. but also here in the United Kingdom. Swett & Crawford is a well known name in the Lloyd's market and Neal is admired by the community," Esser said.
For his part, Abernathy is excited that he now has the opportunity to operate on a global scale. "I have been wanting to do something on a more global basis for the last four to five years, since we came out of Aon," Abernathy said. "About18 months ago, we sat down and looked at where Cooper Gay's business comes from and where Swett's business comes from. It took about two minutes to figure out that because there is no almost overlap, it was worth pursuing a lot deeper than anything that we have looked at previously."
"We are taking two firms, one with no U.S. (business) and one with all-U.S., and putting them together to make a global platform," he said. In particular, the combined entity is seen as better-positioned to comprehensively serve the insurance needs of businesses that are increasingly operating on a global basis.
"It is really exciting. This is a different business model that gives us an opportunity to do things that we could not do before and something that our competitors cannot do."
October 1, 2010
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