The top three executives at Beacon Aviation Insurance Services have nearly 100 years of combined industry experience — crucial knowledge to manage the firm's fast growth.
That know-how goes back to the firm's strategy to target aviation industry clients in need of workers' compensation insurance, from municipal airports to fixed-based operators to flight schools. Large insurance companies that offer aviation insurance often overlook workers' comp, the executives say, which made the Beacon opportunity all the more appetizing.
“The insurance market is pretty mature,” says Bob McManus, chief operating officer of Sarasota-based Beacon. “There are not a lot of new things under the sun.”
Still, Beacon has shined bright the past three years. Premiums are up more than 1,000%, from $1 million in 2010, when the firm started to write workers' comp policies nationwide, to a projected $12 million in 2013. The 10-employee company, further, plans to hire at least 30 people by 2016, to follow production volume that's doubled in the past 18 months. Sarasota County officials recently approved $120,000 in performance-based incentives for the 30 projected hires.
“We realize the industry right now is underserved and overpriced,” says Beacon President John Cunningham, an insurance agent who has worked in executive roles in New York, Pennsylvania and Florida. “That's what we owe our immediate success to.”
Tom Danson Jr., a longtime local insurance entrepreneur and a state representative from Sarasota from 1976 to 1984, founded the company in the mid-1990s. But back then it did general insurance consulting. Cunningham joined the firm in 2008, when it shifted to an aviation insurance industry focus. Danson has since retired from Beacon.
Now Beacon does underwriting, sales and marketing for other carriers that seek to get into or grow in aviation workers' comp. Beacon also offers property and casualty insurance, and its products are sold nationwide through more than 150 agents.
Doing business in every state, say Cunningham and McManus, is a blessing and a curse. To the good, going to Alaska, Arizona and all parts in between provides more chances to grow market share. But every state, to the bad, has its own regulatory quirks. Says McManus: “For us to know all the states is a big challenge.”
One big recent success for the firm was being named the exclusive workers' comp underwriter and manager for the National Air Transportation Association. The association, based in Washington, D.C., has 2,000 member companies. It's a score that Cunningham says proves Beacon's mettle against big competitors, like Chubb or Liberty Mutual. “We are doing battle every day with some of the behemoths of the industry,” says Cunningham, “and we are holding our own.”
Cunningham and McManus run Beacon in conjunction with Ray Neff, McManus' onetime boss at FCCI Insurance Group, one of the largest commercial property and casualty insurance underwriters on the Gulf Coast. McManus was with FCCI from 1981 to 2006, and he ended his career there in an executive vice president role, in which he oversaw underwriting, marketing, reinsurance and several other departments. Neff, meanwhile, was CEO of FCCI from 1987 to 1999, when he led the firm through extensive growth in states served, revenues and premiums.
Neff, Beacon's chairman, says a key lesson he learned at FCCI was to make sure employees place equal emphasis on three elements: know the risk in taking on a client; provide the best service to the client; and develop strong relationships with insurance agencies. “We can't just look at each piece of business as a potential commission,” says Neff. “You not only have to do the right thing, you have to do it right.”