Preferred Mutual builds 125-year legacy by sustaining its values

NEW BERLIN -When policyholders call to make a claim on their insurance coverages with Preferred Mutual Insurance Company, they think they are due something, says Christopher P. Taft, the company's president and CEO.

What they are surprised to find is that Preferred Mutual agrees and even looks at their policies to find out if there is further coverage than what policyholders were expecting, Taft says.

'We look for coverage for you, the policyholder," Taft says. 'We look to cover you and we look to protect you. We don't look to dodge our responsibilities. We look to stand behind our responsibilities."

Preferred Mutual will celebrate its 125th anniversary later this year, and Taft says the mutual-insurance company, which is owned by its policyholders, has sustained its values of ethics and transparency and "servant leadership" since its founding by Frank E. Holmes.

Holmes modeled the company after the first insurance company in the United States, which was founded by Ben Franklin in 1752.

"Our secret sauce is our culture," Taft says of his New Berlin-headquartered company. "The leadership team follows a very strong model of service. They're great leaders in terms of seeing two steps ahead and seeing around corners. There's a very strong emphasis on servant leadership" to Preferred Mutual's policyholders, agents, and employees.

Taft said Preferred Mutual's legacy of its first 125 years in existence is that it has great employees, and it knows how to keep and inspire employees.

Preferred Mutual currently employs 285 people, and Taft notes that he meets with every new employee in the first three to four months following their hire.

Taft also notes that Preferred Mutual has committed that no employees must come to the office until June to accommodate employees who are parents and whose children are attending school virtually.

Taft wants employees to be treated well, to be rewarded, and to know that errors will not result in unfair punishment.

"It's ok to make a mistake," Taft says. "It's about what you learn about the mistake. That is an essential success factor in moving forward in a contemporary way." Taft also says that it is important that the culture at Preferred Mutual is successful because it only works with independent agents who have a choice on what insurance companies they recommend to clients. Preferred Mutual has a network of more than 500 independent agents throughout New York, New Jersey, Massachusetts, and New Hampshire.

'We market ourselves through independent insurance agents," Taft says. 'They're not captive. They are truly independent. They have a choice what company they want to sell with. You have to make yourself special. We have strong relationships with them. We understand their needs and we treat them like employees. In terms of our values, they are our partners."

Taft notes that Preferred Mutual gives awards to recognize independent agents who have been with the insurer for 25 years, 50 years, or even 75 years. And he says that is a testament to the company's culture that independent agents stay with the company through multiple generations.

"Our value proposition is something we consciously look after - and I mean that in a maternalistic way - we look after and take care of the best interests of our policyholders, our agents, and our employees," Taft says.

Another key aspect of Preferred Mutual's culture is entrepreneurship and a focus on growing profitably, Taft says.

In the 26 years since Taft first joined the company as chief financial officer, Preferred Mutual has grown from an $80 million company to a $352 million company, he says. Taft also says that the net equity owned by Preferred Mutual's policyholders has increased from $25 million to $250 million.

Taft was hired as CFO by Robert A. Wadsworth, Preferred Mutual's chairman and then-CEO. Taft, who is a certified public accountant by training, had been working from one of the "Big 4" accounting firms and wanted to move into the operations side of a business.

Wadsworth "gave me that path to learn about the industry," Taft says. "I loved that he insisted Preferred Mutual was about serving other people and protecting other people."

Taft says his job as CEO is to apply those existing values of Preferred Mutual to the contemporary marketplace and the changing expectations of policyholders.

He says Preferred Mutual invests heavily in technology, including data analysis to find ways to reduce premiums for policyholders.

Taft says that Preferred Mutual has navigated the COVTD-19 pandemic well because it had devised a business-continuity plan about five years ago. As part of that plan, every single employee was given a laptop and a backpack and required to bring that home with them every single night. The CEO says that the business-contingency plan means that employees do not need to drive into the office during a winter storm and put their lives at risk and the lives of others at risk.

And while it was not expected, the business-contingency plan put Preferred Mutual into a good position to handle employees all working remotely for a year. The only people who have to come to the office are a handful of people who handle the mail and ensure it gets scanned in and has been fully imaged, Taft says.

"Ninety-eight percent of our business is run remotely," he says.