By ALEX PHILIPPIDIS
Five years ago, Adam Friedlander wasn't too
hopeful that he would be able to pass the family insurance business onto a
fourth generation. But, by changing its product mix to emphasize insurance
for business people, the 71-year-old New Rochelle agency has managed to
survive and grow anew.
Friedlander Group Inc. manages "safety" groups of restaurants,
retailers and wholesalers whose total 1,000 members qualify for discounts
on their state workers' compensation premiums by keeping claims down and
emphasizing safety in the workplace.
That approach has paid off in a premium volume which has
climbed more than fourfold, from $5 million in 1992 to $22.5 million this
year-- the sixth-highest volume among the insurance agencies appearing in
the Business Journal's "List" June 16.
"We project sales of $40 million by the year 2000. Everything
is all gelling and working right now," Friedlander said.
Friedlander manages United Restaurants of New York Workers'
Compensation Safety Group No. 556, which declared a 52.5 percent dividend
to all its 250 members who had policies in effect between Sept. 30, 1995,
and Sept. 30, 1996.
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Workers' comp safety group members, for example, receive
an advance 25 percent discount as well as the dividend. Those dividends
have increased over the past three years from 30 percent for 1993-94. In
all, some $7 million has been paid out to members in dividends -- refunded
premiums paid by members but not used to pay out claims.
Safety groups like those offered by Friedlander have long been
part of the insurance seen. But their popularity has grown in recent years
as businesses seek to cut costs and independent insurance agents look for
ways to survive.
"Different kinds of businesses have also done well with them,
as long as they don't have extensive claims over time and as long as they
watch what they're doing," said Emanuel Levy, editor of Insurance Advocate,
a trade magazine in Mount Vernon with a weekly circulation of 8,500.
"Everybody comes out ahead."
Among the business people who agree are Peter Samaha, whose
Alps Management Inc. of Armonk has saved several thousand dollars per year
on workers' comp premiums in the three years since joining Friedlander's
safety group. Alps is the franchisee owner-operator of 12 McDonald's
restaurants -- 10 in Westchester and two in the Bronx -- that employ a
total of 500.
"We always had a pretty good
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track record on workers'
compensation claims, but our rates were not as low as I thought they should
have been," Samaha said. "The safety group is not only good for the bottom
line but they make it safer for my people to work."
Friedlander Group started out in 1926 as a traditional seller
of general insurance products like life, auto, home and business. After the
mid-1980s, when workers' comp premiums skyrocketed, more insurance sellers
got into the business -- causing a supply-and-demand drop in premiums for
independent agents like Friedlander Group.
Friedlander joined his family's agency in 1983 and became its
president 10 years later. After repositioning the agency, he crafted his first
business plan, complete with a mission and values. He put it down on paper
after being inspired by the book "Built to Last: Successful Habits of
Visionary Companies" (HarperCollins, 1994).
"It crystallized everything I was thinking," Friedlander said.
"I had operated on a mental business plan, but this book gave me the impetus to
formalize it. It took us from being a company with some direction to one
where everybody in the firm understands our mission."
That mission -- offering insurance "solutions" to retailers,
wholesalers and restauranteurs -- has been esconded on a poster on the
desk of every one of the firm's eight salespeople and 10 support staff.
Also ensconded: Friedlander's goal of $40 million in premiums by 2000.
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