UmialikXpress
Agency Bulletin
January 7, 2020
Umialik and Western National Insurance Group 2020 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.
As to profitable premium growth, we expect to grow in 2020 in an amount that is very similar to 2019 actual (not the much lower 2019 goal number!) – targeting 8.0%. As to profit, we will once again earn an underwriting profit, control expenses (although they will be higher given technology investments), and invest wisely, resulting in a target Combined Ratio of 95.5%. For those lines of business that have struggled recently (Personal Auto, Commercial Auto, Commercial Package, and Commercial Property), we will continue to take rate when needed in distressed accounts and lines of business. 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 once again be on technology for the agent, including continued improvements to our AgentsOnline portal, increased utilization of the recently launched policy download for all commercial lines, document delivery through eDocs, renewal quoting for personal lines, and other user-experience-enhancing system updates.
This is the sixth year of our initiative to compete on customer experience (though, obviously, we must also have a good product and a fair price – those being the other essentials to success). We will put a majority of our focus on the design and implementation of our new policy and billing systems, with a new Personal Auto product up in 12 months and the entire commercial lines and billing systems upgraded in four years. We cannot stand still for those long implementation years, however, so we will look for opportunities to anticipate customer needs and provide impressive solutions in other ways during that period. This will include further development of our customer relationship platform (Connect) and our policyholder self-service portal (MyAccount); providing results and metrics by individual producer; improving new business triage and responsiveness for commercial lines; and continuing to collect and act on the valuable partner and customer feedback we gather through our “user-centered” systems design initiative.
Finally, we will work to maintain our status as an Employer of Choice, meaning we will be recognized as a place where people want to work and to stay. Besides competitive pay and benefits, we will continue to offer 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 2020 goals:
- Direct Written Premium of $775 million (up 8% over 2019 actual)
- Loss and Loss Adjustment Expense Ratio of 65.9%
- Underwriting Expense Ratio of 29.6%
- Return on Revenue of 9.7%
The resulting Combined Ratio of 95.5% (without dividends), plus investment income, produces a Net Income After Tax (NIAT) of $52.4 million. If achieved, our year-end 2020 Surplus will be very close to $600 million. Note that the above numbers do not include affiliate Michigan Millers Mutual Insurance Company.
Meeting these goals will add a profit of $52.4 million after tax to the bottom line, allowing 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 2020.
~ Stu Henderson, President & CEO
