Y12 SUNDAY,NOVEMBER 1, 2009 2ND AN ADVERTISING SUPPLEMENT TO THE INDIANAPOLIS STAR
indystar.com/50years Profiles of businesses that have been around 50 yearsormore
Baldwin &Lyons: Diversification done right
By Holly Wheeler ForCustomPublications
1966, H.C. Baldwin AgencybecameWhen H.C.
Baldwin & Lyons. Itsbusiness
remained confined primarilytotheBaldwin founded
trucking industry until 1992, whenthe insurance agency
it embarked uponanambitious
diversificationplan.that borehis name
in 1930, he likely Calculated risks
That year,Baldwin &Lyonsneverdreamed it
entered t he reinsurance market,would offer the
working primarilywith companies
that insure the catastrophicmarketdiverse a rray of
worldwide.Three years later,theproducts and services
companyentered the private auto Quick facts
insurance market. S ince then,theit does t oday.
Baldwin & Lyonscompanyhas introduced products
Address: 1099 N. M eridian S t.,Most arefamiliar with the including Florida Business Owners phy
Ste. 700, Indianapolisbusiness the original Baldwin and Profe ssional L iability.
Phone: (800) 644-5501
PhotograAgencyspecialized in —brokering “Wehad aclear strategic plan Fax: (317) 632-9444
yerand underwriting i nsurance for the to expand our opera tionand have Website:
Bowww.baldwinandlyons.com
trucking industry—but not many carefully done so,” said Joe DeVito,
JasonChairman and CEO: Gary Millerareawarethat the companyhas president and chief operating
President and COO: Joe DeVitospent the past 20 y ears carefully officer. “Inthe p rofession al liability Photo:
Joe DeVitoispresident and chief operating officer of Baldwin & Lyons.adding newdimensions to its core insurance market, we formed a Info: Baldwin & Lyons is a
business with products that share surplus line insurance company publicly traded property and
casualty insurance providerthe same high-levelrisk as its called Protective Specialty .Wereally around theglobe. AllmanagementFrom the heartland
that markets and underwritesto the hinterlandsoriginal niche. tookthings full circleand formed and administrativefunctions are
adiverse array o fproducts toabrokerage calle dB&L Brokerage, Additional products and services centralized at itsIndianapolis
clients in the U.S. and aroundApioneer’sspirit whichisaspecialized distributor of offered by Baldwin&Lyonsreflect headquarters. Oth er facets of the
the world. Products include
Baldwin himself s et the standard specialtyinsurance services.That howinsurance has changed over the business aremanaged through fleet transportation insurance
to those in the motor carrier,for apioneering spirit at the was exactlywhat the H.C. Baldwin past decade.The company’sCayman agents based in C hester,N.J., and
motor coach and s chool buscompanywith his introductionofa Agencywas the dayHarrystarted Islands-based B&L Capital Markets Jacksonville,Fla.
sectors, includingliability,newconcept calle dself-insurance. the company80ye ars ago.” offers insurance-linked securities and
workers’ compensation, physicalAnother 80 yearsHis agencybrokered policies for Today, Baldwin & Lyonsis reinsurance replacement through
damage and cargo insurance.
commercial vehicl es and trucking an insurance holding company securitized risk, including hedge The insurance business has Other areas of specialty include
reinsurance against catastrophe,fleets but offered the companies that owns Sagamore, Protective, and pensionfunds and bonds. Its changed in the last 80 years, and
private auto insurance to high-the optiontoinsurethemselvesto ProtectiveSpecialtyand B&L property business writes commercial Baldwin &Lyonshas changed
risk operators, commercial andthe extent of ris ktheycould cover. Insurance Ltd. (Bermuda) that business policies in Florida and with it, choosing the right mix
professional liability insuranceThe remainder would be covered write policies andtake the risk. It provides catastro phecoverage of products and s ervices that
and surplus line insurance.
by the Baldwin Agency, saving the also owns three insurance brokerage worldwide. complement its foundationasa Additional services include risk
surveys and analysis, governmentcompanyonpremiumcosts. agencyoperations —Baldwin & With about 300 employees, leader in its industry.
compliance consulting,claimsAs the idea took off,Baldwin LyonsInc., B&L B rokerage and including partnersinNew York, Following the sameformula of
handling,loss control studiesand his partner, VorisLyons, LowPay AgencyIn c. —that market London, Chicagoand Bermuda, vertical integration, the company
and research and developmentbegan writing their owninsurance their owninsurance products and the companydoes alot with afew canlooktoanother 80 years of
in relation to the marketing of
through the company’s new those from additional companies internally and hascontracts with growth.● insurance linked securities.
subsidiary, ProtectiveInsurance. In worldwide. morethan 5,000 i ndependent agents
Time line Q&A with JoeDeVito
1930: H.C. Baldwin Agency opened
in Indianapolis. president and chief operating officer
1944: Owner Harry Baldwin formed
partnership with Voris Lyons. :What has been y our strategyfor
1954: Introduction of Protective Q growth and how hasitbenefited your
Insurance subsidiary. organization?
1966: Agency renamed Baldwin : “Our strategyis fairly unique. We’re
&Lyons. A aspecialtyinsurance company. We
1981: Introduction of Sagamore cananalyze, priceand handle claims
Insurance subsidiary. in areas whereothers might be afraid
1992: Entry into reinsurance because of frequencyofloss and/or
market. severity of loss.
1995: Initial private a uto “We’ve leveraged that skillset and
insurance offering. migrated from the trucking industry—
2008: Formation of Protective whichmost in the industrywould sayis
Specialty Insurance. averydifficult place to be —an dlooked
2008: Formation of B&L for additional areas of opportunityin
Brokerage. whichwecould leverage that specialty,
2008: B&L Capital Markets high-risk-typetolerance to become
yoonsestablished. involvedinother lines of insurance.
&L
Property catastrophe would be one
area wherethere’snot agreat deal of Baldwin
byfrequencyofevent, but when it occurs, it
tends to cost alot of money.We have specialty
Provided“We’re in the public transportation“
Photomarket now, so we insureschool busfolks who are
The first building Baldwin &Lyons built was at 3100 N. Meridian St. The companystayed at thatlocationlines, motor coachlines and limousines,in technical
until it moved to the Landmark Center,1099 N. Meridian St., in 1985.and our personal auto is slanted toward
what used to be called the nonstandardpositions, but
auto market or the high-risk driving anyone product. We’reable to analyze : “We’ve stepped up our communitythat vertical
population—youthful drivers, people market conditions, and we maybevery A involvement in the last fiveyears or
with no prior insurance,people who strongintransportationone year and in so,and it reflects the passions held by ourintegration has
havehad driving violations. We continue property the next depending on howthe chairman, GaryMiller,and me,whichareallowed us to
to lookfor opportunities whereothers industrycycle is developing.That vertical children and education.
fear to tread.” integrationhas allowed us the flexibility “Right now, we’reevaluating adiversify without
necessaryfor us to grow.” concept in whichwewould lookatourbeing dependent
:The products you offer are diverse. corporate giving in relationtoour netQ
How do you specialize in so many divergent :What is your strategyfor income. Almost allofour executives areon anyone
products? Q future growth? compensated on averysimple formulaproduct.
: “The diversityisreally the result of : “Werecentlybought an insurance based uponour net income levelrelative” —Joe DeVito A
our vertically integrated management A agencyinToledo,Ohio,that does to our goal. We’redeveloping aconcept
structure. We essentially brokedown about $20 millioninpremiums. We may that would allowustocontribute to
allofthe product and divisional silos. looktoexpand by buying additional the communityatthe same levelwe
Ithink we’refairly unique in that our agencies and rolling them up into the contribute to executivecompensation,
executives possess generalist insurance B&L Brokerage arm. I’dsay that, more based upongrowthand net income. We
skills but runaspecialist company. We than additional product diversification, think that would be win/win for the
want our executives to be insurance the idea of identifying potential agents people that we’reaffiliated with and give
executives and not just transportationor for broker acquisitionwould be the next alot of incentivetoour folks to make
property executives. expansionfor us.” moneyfor themselveswith additional
“Wehavespecialtyfolks who benefits to the communityatlarge.”●
areintechnical positions, but that :Now that Baldwin &Lyons is in apattern of
vertical integrationhas allowed us to Q comfortable growth, what are some of its
diversify without being dependent on other keyobjectives?
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