As Pekin Life Insurance celebrates its golden anniversary, it’s poised to become an even bigger name in the industry.
This year, Pekin Life Insurance Company marks its 50th year of operations. Over the last five decades, the firm has expanded into 21 states across the United States, and today, it competes with big companies like Allstate—yet many central Illinois residents remain unaware of its operations, awards and accomplishments. From auto to homeowners to life, Pekin Insurance is on its way to becoming one of the country’s major insurance companies.
A Series of Expansions
While Pekin Life Insurance Company was founded in 1965, one must go back 94 years to find its roots. In 1921, a group of Tazewell County Farm Bureau members gathered together to form an insurance business, their primary mission to provide automobile insurance to other Farm Bureau members. The idea was a novel one and carried with it a great deal of risk: cars were a fairly new commodity for the general public. But it was a risk that was rewarded. The Farmers Automobile Insurance Association continued to grow, even in the face of the Great Depression and World War II.
In the early 1960s, the company, now under the Pekin Insurance umbrella, was still located in a relatively small office in downtown Pekin—but it was on the verge of a significant expansion. The success of its property/casualty operations allowed the company to consider a new type of policy: life insurance. It was already using a network of independent agents, offering personalized policies based on its customers’ individual needs, but in order to use the same system for life policies, the company first had to convince its agents of the viability of the concept. Brian Lee, current senior vice president and chief operating officer – life, credits former company president Robert Tebben for keeping this vision alive. “He was the person who really supported the independent agent system.”
Along with sales director Keith Holloway, company leaders went out to the agencies that had contracts with Farmers Auto Insurance Association and asked them to consider selling life insurance, in addition to property/casualty insurance. “That was a big change back then—most agents had never sold life insurance,” notes Todd Clark, senior vice president and chief operating officer – property/casualty. ”To go from there to now, when these agencies are putting up big numbers in life insurance, has been one of the greatest accomplishments in this enterprise: the synergy between the property/casualty company and the life company.”
And so, under Tebben’s leadership, Pekin Life Insurance Company was formed, and on December 31, 1965, the first 165 life insurance policies were issued to agents, stockholders and employees. Around this time, the company moved to a much larger building on Court Street in Pekin, and it would continue to expand over the years. The Court Street campus, which remains the company’s home office to this day, recently required yet another expansion, and now has a new location on Parkway Drive—a sign of its continued growth.
Today, while the life company continues to operate in tandem with Pekin Insurance’s property/casualty venture, it has ventured into states where the company does not plan to expand its property/casualty side. Coastal states, for instance, are of little interest to Pekin Insurance’s property/casualty operations, due to the ever-present threat of hurricane damage—but they are viable markets for life insurance. This makeover was a game-changer: it now has multiple distribution channels with life-only agencies and brokerage operations.
Scott Martin, CEO and president of Pekin Insurance, explains that it is this willingness to diversify that makes Pekin Insurance unique among the competition. “There are different distribution channels by product line,” he notes. “We sell life insurance and health insurance—but we also sell life insurance that is used to pre-plan funerals through a network of funeral homes and a product called ‘Credit Life’ through a distribution channel of banks and car dealers.”
Most recently, with the advent of the Affordable Care Act, the company faced a challenge that required a restructuring of jobs, as well as policies. But the leadership at Pekin Insurance saw this as an opportunity: it allowed them to rethink old models and create new business ventures. Rather than focusing on individual plans, for instance, the company added a new division known as Group Plan Solutions, a third-party administrator (TPA), which helps businesses self-fund benefits for their employees, ensuring they receive the promised benefits while analyzing claims to save clients money.
Advances in technology—especially with regard to data analytics—have greatly transformed the way the company operates. “The IT team is now part of every aspect of what we do,” notes Diane Steiner, vice president of life underwriting. Indeed it is: instead of rating from a manual, the company now issues customized rates for each customer, thanks to advances in data mining. “If you buy automobile insurance from us—or any company, for that matter—there is so much data and predictive analytics produced to come up with the price you pay,” says Martin, who declares this the single biggest industry change he’s seen in nearly four decades with the company.
And technology is even changing the location of its workforce. The company’s massive IT team does not necessarily have to be located in the same building, and they can work from anywhere, allowing it to hire experts from around the country. Computerworld Inc. recently named Pekin Insurance one of the top 100 “Best Places to Work in IT” based on IT challenges, compensation and benefits. “The workforce of the future is going to be far different than it is today,” Martin explains. “The company will probably always be here—but we are going to have employees scattered all over the country.”
In 1983, the company notched one of its greatest achievements to date: hitting $1 billion in life insurance. “It took 18 years to do this,” Lee notes. “Now, by the end of 2015, we will hit $16 billion.” And with more than 750,000 policyholders, the property/casualty company, parent of Pekin Life Insurance, is quickly nearing the one-million mark.
Even with this remarkable success, the company has no plans to change the location of its headquarters. Today, Pekin Insurance has 700 employees at its Pekin location alone, and leadership makes it clear that they value their local workforce. “We don’t have a big call center where they get an anonymous person from somewhere else,” Steiner explains. “People can talk to someone who made a decision on their case.”
It all comes down to the Midwestern work ethic, Lee adds. “The well hasn’t run dry of hardworking people who really want to help others. That’s what makes us a unique company when compared to others—we still hold that near and dear to our heart.”
Poised and Engaged
While the organization’s most successful line remains auto insurance, Pekin Life Insurance Company is still expanding, and CEO Scott Martin hopes to see growing geographic diversification in the coming years. “We are just scratching the surface,” Lee adds.
The company is also working to foster greater employee and community engagement. “We would like to make the company better from an employee’s perspective,” Martin declares. After all, Steiner notes, “Everybody knows somebody who works here, or who is related to someone who works here.” Recently, the company implemented a program that allows employees to take two paid days of leave to volunteer for local nonprofits and charitable organizations. “The company has always been generous in our community involvement and support,” Lee explains. “We want our employees active in the community.”
And like so many companies based in central Illinois, it is their hard work and connection to the community that allows the business to flourish. “What sets us apart is the relationship we have with our agents,” Martin notes. “They aren’t numbers to us—they are real people.”
And as it celebrates its golden anniversary, the Pekin Life Insurance Company is poised to become an even bigger name in the industry. “We’re stretching our wings,” says Lee. iBi
The Pekin Insurance home office is located at 2505 Court Street in Pekin. For more information, visit pekininsurance.com.