April 2015
Final
MID-STATE FARMERS MUTUAL INSURANCE CO.
SUCCESSION PLAN
I. EXECUTIVE SUMMARY
The goal of this effort is to identify and hire a successor for current Mid-State Farmers Mutual InsuranceCo. (hereafter referred to as MSFMIC) Manager with time for him to acquaint the individual with the position, the company, the customers and the employees prior to his planned retirement in (Date ______).
We are establishing a basic timeframe that should allow us to hire the successor by (date______)with the orientation period lasting from a start date of (date______) to no later than (date______). The selection process will be successful with the cooperation of the search team in their availability for meetings and interviews and if we carefully focus on the most important attributes of a future company leader.
II.TIMELINE FOR CONDUCTING SEARCH
TASKTARGET DATESTATUS
1) Define transition and planning process; ______
oversight roles______
2) Conduct strategic assessment of Company______
3) Set compensation strategy______
4) Communication withpolicyholders______
5) Assess strengths & weaknesses of current ______
manager______
6) Assess strengths & weaknesses of staff______
7) Finalization of search criteria & recruitment______
strategy______
8) Identify internal & referred candidates______
9) Begin external search process______
10) Interview and selection process______
11) Orientation of new manager______
III.ROLES AND RESPONSIBILITIES
The (MSFMIC) Board and its Executive Committee will lead the manager successor search and transition planning process. Appointed Board Member will provide technical support with the assistance of Administrative Assistant.
IV.STRATEGIC ASSESSMENT
A. Organization
A strategic planning session was held in MSFMIC office which offered information on the current state of the business as well as some work on potential future actions related to critical issues.
B. Board of Directors and staff
Determine strengths and weaknesses of current managerand each staff position by (date______).
-Manager (self-assessment)
-Assessment by direct reports:
Board of Directors
Administrative Assistant
V.COMPENSATION STRATEGY
Set competitive compensation strategy. Board of Directors will review most recent MSFMIC manager salary survey data, determine if updates are required and recommend a range of compensation by (date______) that is designed to both meet budget demands and attract
qualified candidates.
VI.DEVELOPMENT OF SEARCH CRITERIA
A. Internal Candidates – Pros and Cons
1) Will have knowledge of MSFMIC idiosyncrasies and industry-specific issues.
2) If their experience at other employers is too far in the past and they are not the type
to seek new ways to look at things, they may not bring as many new ideas to the table
as a well-qualified external candidate.
3) In this case current MSFMIC employee has limited experience running an insurance
company (although substantial overlap in selection, promotion and departure
incumbent can help address this).
B. Outside Candidates – Pros and Cons
1) Can be good when the business portfolio requires transformation.
2) Are more likely to be able to reinvent and reposition the business by importing
new ideas, different styles and renewed energy.
3) Could imply the board may not be satisfied with the way the company has been run,
or could indicate that while the past was good, new ideas are needed for future
success.
4) Experience being a managerat another organization can make for an easier transition,
Particularly from the perspective of being accustomed to making ultimate decisions on
important matters.
5) Work experience from another insurance company, particularly one where they were
very involved with insurance and cutting edge products, could bring ideas for new
opportunities and ways of doing things.
C. External Search
1) Determine best places to run advertisements/posting
- Websites (general, industry specific) i.e.: NAMIC, MICAI, EC Management
- Proposed posting/advertising locations would includeinsurance agencies,
NAMIC and MICAI Tammy Walker
- Print ads (magazine, newspapers): Local papers; Chamber of Commerce; etc.
2) Word of mouth recruiting may be important. Contacts in association or industry
organizations will be key sources of candidates. i.e.: Mark Vanderhagen of Financial
Services, Tammy Walker at MICAI, Greg Dykstra at NAMIC.
3) The Board is not currently interested in using a recruiter, although this could potentially
be a back-up plan.
VII.DESIRED TRAITS OF SUCCESSFUL CANDIDATE
A. Personal Traits
The following personal traits are considered desirable for a successful candidate.
-Sound judgement (thoughtful; considers appropriate factors/assumptions; seeks counsel;
anticipates)
-Decisiveness (prioritizes; processes quickly; commits; handles ambiguity)
-Delegation abilities (allocates/shares authority; empowers others; guides/instructs;
offers clear communication)
-Leadership skills (motivates; builds self-esteem/confidence; influential; flexible; leads by
example)
-Initiative (pro-active; generates ideas; goes above/beyond; self-developing)
-Emotional intelligence/maturity
-Integrity
-Able to serve as a positive role model by “living” company values
-No tolerance for ethical or financial misconduct
-Open-minded to new opportunities and ways of doing things
B. Skills and Competencies(for MSFMIC)
The following skills and competencies are considered desirable for a successful candidate. The Board (or search committee) may wish to prioritize these for purposes of the interview process.
-Ability to successfully prioritize and manage multiple projects, including experience
managing detailed planning activities
-Ability to make independent decisions based on sound insurance principles and
communicate these decisions to insureds in clear and professional manner
-Understands the language of insurance and how it works from an economic, legal and
managerial point of view
-Positive, effective management style and day-to-day management skills (finance,
marketing, operations, underwriting, claims)
-Ability to build and maintain effective professional relationships with board, insurance
regulators, reinsurers, insureds, business advisors, and employees
C. Qualifications (for MSFMIC)
The following qualifications are currently shown on the MSFMICjob description, with the exception of the requirement for the candidate to live and work in the Ft Wayne area upon acceptance of the position.
-Minimum of B.S. (preferred)or B.A. degree
-Strong organization and time management skills
-Working knowledge of Microsoft Office Products (Word, Excel)
-Strong background in insurance
-Minimum ten years’ experience with one or more insurance companies in the
areas of underwriting, marketing, systems, reinsurance and regulations
-Minimum of three years management experience with one or more insurance
companies
-Indiana resident insurance agent licenses in property/casualty or the ability to acquire
these in an expedient manner
-Prefer to bewilling to live and work in AllenCounty, as well as have the ability to travel
15-25% of the time which may involve overnight or weekend travel
-Clear criminal record, clean driving record and valid Indianadriver’s license as verified by
a BMV drivers report
-Because Indiana Insurance Code requires the person in thisposition to be bonded, a good
credit report is required.
VIII.RECRUITMENT STRATEGY
- Agree on recruitment strategy by (date______).
- Indentify and invite potential candidates (internal and externals that are referred) to
Participate in the screening process by (date______).
IX.COMMUNICATE WITH POLICYHOLDERS
- Advise policyholdersof pending transition by (date______).
1) Key business partners and policyholders, attorney, NAMIC, MICAI, financial
service manager
2) Key reinsurance contacts (ECM, Boiler RE)
X.INTERVIEW AND SELECTION PROCESS
A. Initial Screening
- Establish initial selection criteria that every candidate must bring to the table to
be considered for an interview, i.e., 4-year degree, management experience, insurance
and those highly preferred i.e. product line experience, etc. by (date______).
- Determine where ads/postings will be placed and begin running them by (date______).
B. Interviews
- Board of Directors and/orinternal staff (with as much coordination with search
committee as they are interested in having) with the help of incumbent will screen
resumes and rank candidates against profile of required/preferred qualifications,
experience and competencies. If search committee/Board of Directorsis comfortable
with this approach, incumbent will conduct telephone interviews and provide notes and
recommendations on those that appear to best meet established criteria. Target date
for having all telephone in interviews completed and notes to Board of Directorsis
(date______).
- Search committee/Board of Directors makes final determination of which candidates to
personally interview by (date______).
- Personality testing is recommended for finalists
- Search committee/Board of Directors or incumbent conducts basic reference checks of
top candidates including but not limited to criminal, credit and driver licenseprior
to personal interviews with search committee/Board of Directorsand notifies committee
of any pertinent information by (date______).
- Search committee/Board of Directors and incumbent interview the top candidate by
(date______)
C. Selection
- Search committee/Board of Directors makes finalist(s) selection recommendation to full
Board of Directorsby (date______). MSFMICBoard will interview
finalist(s) at board meeting and an offer should be extended as soon after this meeting as
possible. Assuming acceptance, it would be optimal for selected candidate to start work
No later than (date______)
XI.ORIENTATION OF SUCCESSFUL CANDIDATE
- Company’s history and structure
- Review company’s mission statement
- Policies and procedures
- Board
- Internal Controls
- A list of current projects
- A list of policyholders
- Upcoming deadlines
- Current and past budgets
- Bylaws and Articles of Incorporation
- Current financial statements
- Board roster and minutes
- Staff roster and resumes
- Summary of reinsurance
- Current business plan
- RFP’s, contracts
- Operation manuals and protocols
- Organizational chart
- Past/future challenges
- Review important dates/annual activities
- Annual meeting
- Tax returns
- Annual Statement to Dept. of Insurance
- Assure quality of the initial work experience for new Manager
- Outgoing Manager to identity and address any outstanding legacy issues
- Ensure Board of Directors have solid relationship with new Manager and there is an
understanding of roles
- Reach a consensus on the overall direction and prioritization of goals
- Agree on evaluation process
- Establish performance monitoring and 3 or 6 month evaluation process for new Manager
- Executive development planning by new Managerand Board of Directors.
- Identify timeframe to revisit strategic plan and direction of organization
- Review/Update emergency succession plan.
- Make succession planning a regular part of board agenda
- Conduct new strategy session with Board of Directors
XII.NEXT STEPS
- Determine budget for search process and possible relocation expenses
- Prioritize/weight of skills, attributes and qualifications
- Create initial advertisements/postings
- Create initial list of questions that can be used to determine candidates’ basic fit for the
position
- Recommend a list of possible interviewers to assist in the early process