Twenty-five years ago this month, the Massachusetts Bar Association took the novel step of establishing an in-house insurance agency when its former provider of professional liability coverage merged with another company. Then viewed as a risky but worthwhile proposition, the MBA Insurance Agency has since become an integral part of the MBA’s membership offerings while expanding its benefit plans to include life and disability insurance, health and dental insurance, and personal auto and umbrella insurance.
Stephen A. Roach, who chaired the MBA Insurance Committee at the time of the agency’s incorporation in 1997, said that association leaders sought to form a new entity in part to protect the personal details of member subscribers. Beginning when the committee drafted the agency’s founding documents, all contracts with partner insurance companies have stipulated that the MBA retain ownership of member and policyholder information, the latter of which had previously been owned by the broker.
Fellow committee member Owen Gallagher had the original idea to create an independent corporation and helped present the concept to the MBA’s Executive Committee and Board of Delegates, with the support of then-President Kenneth J. Vacovec and Executive Director Susan Waters. As Vacovec recalls, both bodies approved the recommended action with little opposition because they recognized the agency’s promise as a revenue source for the MBA and a cost-saving benefit to members and their firms.
“The whole objective was to provide better service at a lower cost,” said Vacovec, who praised the Insurance Committee members and Waters for their foundational efforts and overall foresight in launching the agency.
The advantages associated with the committee’s proposal were in direct contrast to the limitations of the previous arrangement, which provided inferior coverage and often required small firms and sole practitioners to purchase insurance from different companies, according to Richard R. Eurich, who succeeded Roach as committee chair. In addition, after previously receiving only a small annual stipend from the insurer, the MBA positioned itself to leverage any net income from the sale of policies to better serve the needs of members.
Once incorporated, the agency named its first and only president, Terry Welsh, whose experience in property casualty insurance led Gallagher to nominate him for the job. With the subsequent selection of Tricia Walsh as executive vice president and her continued service in that role, the MBA Insurance Agency has maintained stability in leadership throughout its 25 years of operation. Account Manager Lexie Detz also joined the agency at its inception, and Welsh said she and Walsh have been instrumental in the growth of the organization and its ongoing commitment to excellence in customer care.
Now the state administrator for CNA and the largest writer of lawyers’ professional liability insurance in Massachusetts, the MBA Insurance Agency is the only successful insurance agency owned by a bar association in the entire country. With access to competitively priced policies negotiated by experts in the field, member subscribers can feel assured that they are investing in a quality product because their representatives on the Insurance Committee are fellow lawyers and policyholders with a unique stake in the process.
“I had never seen a potential insured policyholder actually negotiate the terms of the fine print in the policy. That’s what we were starting to do,” Roach said of his early days on the MBA Insurance Committee.
MBA Chief Legal Counsel and Chief Operating Officer Martin W. Healy regards the agency’s establishment as a pivotal moment in the history of the MBA that has greatly enhanced the depth of services provided to members.
“The association was very wise in starting an agency many years ago,” Healy said. “The program has proven to be quite beneficial to the membership because of its value in terms of the protections available to attorneys. This is a very concrete benefit that we can offer to attorneys who are members of the bar, and one of the top benefits that we offer as an organization.”
'Strength in Numbers'
For Roach, the founding member of Roach, Ioannidis & Megaloudis LLC in Boston, the agency’s long-standing focus on safeguarding the interests of small firms like his remains one of its greatest assets and a distinguishing feature in the insurance market. While the committee works to ensure that MBA policies include sufficient protection against liability for all lawyers, its members can also harness their “strength in numbers” during negotiations to act as a voice for smaller practitioners, Roach said.
“Terry and Tricia have stayed on the cutting edge of changes in the law and the industry to provide the best policy out there,” Roach said. “The Insurance Committee makes sure there are no loopholes and even plugs where there could be loopholes. It’s like having an expert buying you insurance.”
Gallagher offered similar sentiments on the quality of coverage available to member subscribers, calling particular attention to the level of customization in the MBA policy as compared to other options within the insurance sector.
“A lot of associations basically buy a standardized policy that could be gotten on the open market and is not tailored to specific situations,” said Gallagher, who is the founder and president of Boston-based Gallagher & Associates. “The MBA policy has a lot of features that you don’t find in the open market, or if you do, many times it is there because the MBA led the way in negotiating with the company to obtain that type of underwriting concession.”
Notably, policyholders not only receive liability coverage in both professional and volunteer settings, but they become eligible for free, lifetime insurance protection when they retire from the private practice of law. On the strength of its malpractice policy, the agency has won Massachusetts Lawyers Weekly’s
Reader Rankings Award for Best Professional Liability Insurance in each of the last four years. CNA, a company with nationwide operations, has also said that the MBA offers “the best policy of any bar program in the country,” according to Eurich.
Exceptional Service Adds to Success
Though best known as an administrator of professional liability insurance, the agency has also worked throughout the years to diversify its portfolio to fully account for the needs of members and their families.
“The Agency has been able to obtain other competitively-priced insurance products available to MBA members, including Group Personal Excess Liability insurance, personal auto insurance, Group Term Life insurance, dental insurance and a range of coverage options in health insurance,” said Eurich, a veteran insurance attorney who currently serves as of counsel to Morrison Mahoney in Boston.
While largely driven by a concern for member privacy, the MBA’s early decision to seek sole ownership of policyholder information has also allowed the agency to build trust and develop long-standing relationships with its clientele. Both Roach and Vacovec indicated that the agency’s reputation for delivering responsive customer service has played an important role in its sustained success since 1997.
“My experience over the last 25 years, both in my firm and elsewhere, is that I’ve gotten excellent service,” said Vacovec, referring to his position as founding partner of Vacovec, Mayotte & Singer in Newton. “If an issue came up, I was able to get the right advice from the insurance carrier and also the agency itself.”
Although it was Gallagher’s initial vision that spurred the creation of the MBA Insurance Agency, he attributes its longevity and continued viability to the work of Welsh and his staff.
“The agency has been successful because we hired the right guy to run it,” Gallagher said.