BULLETIN
January 8, 2019
Western National Insurance Group 2019 Annual Business Plan
The areas of focus for Western National Insurance Group remain the same four pillars as in the past: profitable premium growth, deep relationships with select agents, a differentiated customer experience, and being an Employer of Choice. Our work in 2019 will continue to build upon our achievements in these areas from years past.
As to profitable premium growth, we expect to grow in 2019 in an amount that is very similar to 2018 – targeting 6.3%. As to profit, we will once again earn an underwriting profit, control expenses, and invest wisely, resulting in a target Combined Ratio just under 95%. For those lines of business that have struggled recently (Personal Auto, Commercial Auto, Commercial Package, and Commercial Property), we will take rate when needed and tighten risk selection (which is why we target lower growth percentages than historical levels). Growth by way of acquisition will, once again this year, be entirely opportunistic (and less likely than in the past decade).
We remain committed to the independent agency system to distribute our products and services. Our agents are our partners, and this commitment ensures we do right by them, as they will do right by us. The focus this year will be on technology for the agent, including completion of commercial policy download, First Notice of Loss and portal enhancements, underwriting tools, communications with eDocs, and like projects.
This is the fifth year of our spoken intention to compete on customer service. Obviously, we will also have a good product and a fair price, the other essentials to success. Much of our past work in customer service has been focused on creating a foundation (selecting systems, building culture), and we will now focus just as much attention on delivery of tools to our customers – both agents and policyholders – in order to “anticipate and impress”. This will include continued development of our customer relationship platform (Connect) and our policyholder self-service portal (MyAccount), as well as acting on the valuable partner and customer feedback we have gathered.
Finally, we will continue to be an “Employer of Choice”, meaning we will be recognized as a place where people want to work and to stay. We must ensure that pay and benefit packages remain competitive, but we also need to offer other things people want in a work environment today, including wellness initiatives, charitable and family time off, educational and advancement opportunities, and a work environment and culture that is both welcoming and nurturing.
Turning to the actual numbers for 2019 goals:
- Direct Written Premium of $705.5 million (up 6.3%)
- Loss and Loss Adjustment Expense Ratio of 66.7%
- Underwriting Expense Ratio of 28.3%
- Return on Revenue of 9.1%
The resulting Combined Ratio of 95% (without dividends), plus investment income, produces a Net Income After Tax (NIAT) of $47.3 million.
Profit added to the bottom line will allow us to ensure that we always pay the covered claims of policyholders, that we can remain a stable market when we are needed, and that we can reinvest in people and processes that improve our products and services. We look forward to doing so in 2019.
~ Stu Henderson, President & CEO
