When Mike Lewers father started his niche benefit brokerage in 1956, it was well before the idea of finding a specific concentration as a broker or agent was common advice spouted by sales coaches and industry experts.
Instead, Chuck Lewer entered into his niche of targeting gas station franchise owners with employee benefit plans because he saw an opportunity to reach a market that no one else was thinking about.
From there, Lewer Companies in Kansas City, Mo., was born. Today, it boasts several specialties, including two benefit practices that focus on the convenience store franchise niche which stemmed from the original gas station premise as well as a foreign student insurance niche through group policies at colleges and universities.
The company has grown tremendously in its 58 years, and in addition to benefits, now operates a financial advising practice and a third-party administrator platform. These four silos report directly to Mike, 63, as the president of the company. He took over in 2004 for Chuck, 86, who is mostly retired but still attends board meetings on occasion in the capacity of founder of the brand.
The niche focus, when it comes to the benefit businesses, is something that Mike and his colleagues say they hope will maintain their relevance as brokers in the industry for years to come, even as many other brokers question how theyre going to survive just the next few years.
John Owens, who is also Mikes brother-in-law, is Lewers leader for the convenience store niche. Were very optimistic about the future, says Owens, vice president of special markets and a broker who has worked at the company for 34 years.
The transition from 2010 [with the passage of the Affordable Care Act] to now hasnt been the most fun. Theres a lot of doubt and uncertainty in the field. But were excited about our unique products and service that we have for this particular industry.
Niche-based benefits are a strategic move that many industry experts are touting more than ever.
Focusing on a specialized market will ensure long-term growth through the power of compounding relationships. Serve one client exceedingly well, then the next, then the next and before you know it you will own the space and not only survive [but also] thrive, says Mark Gaunya, EBA Advisory Board member and principal at Borislow Insurance in Methuen, Mass.
And Mike says that while its helped his business to have such focus, it hasnt been a straight path for the company to get to where they are today. It has also been extremely important to him, as well as his father, to be as adaptive as possible to the changes going on in their niche industry.
Just like the health insurance industry has evolved in recent years, so too has the gas station franchise specialty.
Getting started in the insurance business in the mid-1950s in Texas, where he was located at the time, the senior Lewer was drawn to the profession because, as his son describes, it provided unlimited opportunity.
Chuck and his wife had four children back then, including Mike, and went on to have a total of nine. Mike says his father knew early on that he needed a job that could provide for everyone. With insurance, Chuck saw that the harder he worked, the more he got out of it, and that made sense to him as his family continued to grow.
At that time in the Ft. Worth, Texas area, oil was the name of the game. Chuck had the idea to start calling on the head of the personnel department at Conoco, as the gasoline company was called before it became ConocoPhillips in a 2002 merger, because he wanted to get into the business somehow of providing insurance for this market. It was a brave move at the time, considering the standard practice to break into the business was making a list of your friends and family and prospecting through their contacts. This was a different path already.
The junior Lewer explains that after three years of trying to call on the Conoco executive, Chuck finally got a break, and it happened to be in the area of providing the companys wholesalers and dealers gas stations, mostly benefits.
[Conoco gave him] the authority to go out and individually contact their several thousand commissioned agents and dealers that were scattered around many parts of the country and to offer them a program that [Chuck] had developed that was predominantly a retirement plan funded by a life combined with annuity product, Mike says. So thats really where it began.
With that opportunity, Chuck decided it would make more sense for his company to be centrally located, so in the early 60s he moved his family and planted roots down in Kansas City, where Mike has remained running the business to this day.
For years, the Lewers successfully sold benefits to the Conoco franchise owners the locally owned gas and service station with several mechanics and maintenance men and women on staff and grew the business to incorporate other clients as well, based on their expertise.
There were still people who wiped your windshield, checked your car tires and serviced your car, all while you got gas, Mike says of the gas station industry when he got into the business. That was the old days. The owner was often a mechanic, they had a relationship with Conoco, and he hired three or four other mechanics and paid them well. And, provided them benefits, of course.
In the 90s, everything changed. Over the last 25 years, youve seen a dramatic change, he says. The service station model has been replaced with convenience stores attached to the gas stations, still franchise-owned, but often staffed by clerks who are less specialized than the mechanic employees of the old model.
There are 200,000 some-odd convenience stores out there today, and there were roughly that many service stations out there, Mike continues. Theres been almost a total conversion over to the convenience store, which tends to have high turnover, lower wages in that group. So, affordability of benefits is a major factor for them. Diversity is big in that group, and there are a lot of part-time people versus full-time.
He adds that this switch was a crucial moment for the Lewers. If they hadnt paid close attention to change along with their clients employees, they wouldnt still be in existence.
We had to adapt to how we communicate and design their portfolios, Mike says, adding that adaptability is key if youre going to survive as a broker in any niche market, as most industries have a time of revolution.
Mike acknowledges that they got somewhat lucky with where the gas station market transition ended up. The convenience store is a relatively stable business model, he explains. People are, for the foreseeable future, most likely going to have a need for snacks and drinks as they pump their gas or drive across the country.
If our niche was home construction companies, that would have been interesting, he says.
Growing and adapting with the business, and having been entrenched in it for decades, bodes well for maintaining a client base even in difficult times for the benefit industry like the post-ACA world of today. One of their clients, 7-Eleven, has about 6,000 franchises across the country in more than 30 states.
Mike prides himself on their ability to service these large, national distribution networks that operate franchises locally.
I talked to a group of franchisees earlier this week and one of them provided really positive feedback about Lewer, says Lisa Record, 7-Eleven Group insurance manager in a testimonial statement to the company.
He told the group that he had requested information on benefits through Lewer and the next morning had a very thorough e-mail waiting for him offering a great variety of coverage.
He also said that [Lewer] did not do a hard-sell job on him, which he appreciated. ... Thanks for working so well with our franchisees. Word of mouth spreads quicker than any other form of communication around here.
The exceptional service that creates happy clients like Record couldnt be done without carrier partners that are equally dedicated to the niche market theyre servicing, Mike says.
On the convenience store business, they work primarily with The Standard, PanAmerican, National Guardian Life and Trustmark.
It requires a non-traditional solution, Mike says. You cant just pull out your Blue Cross plan that works for folks making $25 an hour. Were working with carriers so that we have a variety of programs that cover minimum essential coverage thats sort of a segment of straight indemnity plans.
He says their goal now is to provide their convenience store clients with coverage options to present to their employees to avoid the individual mandate penalty, as well as an affordable plan that meets the other requirements of the ACA.
Finding another niche
Mike was so satisfied with the niche approach to benefits that when he wanted to expand his business back in 1991, he opted for another niche market.
This time, he says he asked himself where his own passion lies in order to determine a segment of the market to focus on an important step for any broker also looking to get into a specialty.
It came to him when he thought about his family. Hed lived with his wife and children in Canada for 10 years while running a Canadian version of the family business, and both of his children had studied abroad and come back from their experiences changed he had a passion for international education.
And so he thought, why not encourage and support, in our own little way, the students who choose to study abroad in the U.S? They need guidance on the health care system here, given that its extremely different than in most countries, and they also need protection in the form of insurance.
Passion is a big deal to me, Mike says. Pick a niche that you feel you could be passionate about. If youre a golfer, youd be passionate about country clubs or golf courses. Also, look at the competitive environment. Is that niche underserved? And is there a way you can differentiate yourself in the niche?
When building this section of the business, Mike had already learned how crucial the carrier relationship is to the success of niche benefits. He found Trustmark Insurance was very entrepreneurial, they understand niches and they understand specialties.
Today, business has grown to cover about 15,000 foreign students who are studying within the U.S. borders.
John Anderson is a senior vice president at Trustmark working on the student insurance accounts, based in Lake Forest, Ill., who says that despite the hiccups with the ACA, their partnership with Lewer is poised for success.
Theyre a very creative bunch, trying to figure out whats going to be compliant with the ACA but also meet these students needs, he says. Theyre really experts in these fields. We really value their relationship. Theyve been great partners with us and we have common goals.
Mike says hes passionate about both benefit areas his company serves, because of the history of the gas station and convenience store branch that his father built from the ground up, and the student insurance branch that he created himself.
Im not sure I would have said passion is important 20 years ago, he reflects, but emphasizes that its been a key to enjoying each step along the way.
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