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The Monday Q&A: Why a new insurance company chose Richmond

Al Harris March 9, 2009 9

admiralWales-based auto insurer Admiral announced last week that it was locating its U.S. headquarters in Richmond. The company was founded in 1993 and is third largest insurer in the United Kingdom.

Andrew Rose, president and chief executive of Admiral Americas, is a Virginia Tech engineering graduate. Several years ago, he got married and made his first move to Richmond to work for Capital One. He later went to the Darden School of Business.

Rose worked for Progressive Auto Insurance and later Countrywide before the mortgage market collapsed. Rose’s job search led him to Admiral, and he moved overseas for the expanding insurance company.

Now Rose is coming back to America to head up the company’s new operation. BizSense talked to Rose recently about Admiral and why they picked Richmond.

Below is an edited transcript.

Richmond BizSense: How many cities were considered for the headquarters location, and why was Richmond ultimately chosen?

Andrew Rose: We investigated probably 10, seriously investigated six, and it came down to four: Richmond, Charlotte, Chicago and Dallas. A whole variety of criteria went into the decision, including cost of living, availability of workforce talent, business climate, transportation infrastructure and availability of state grants. At the end of the day, Richmond was best value proposition for our company.

RBS: What grants did you receive from the state?

AR: The one received thus far was through the Virginia Department of Business Assistance called the Virginia Jobs Investment Program. It is something that would help us defer some of our training expenses. In the insurance business, you have to incur the cost of all the agent licensing, and anything to help us defer that is great. When we first started exploring Richmond, they immediately came to us and said they can help with that.

RBS: Who is Admiral America’s target customer?

AR: Love to say anybody with a steering wheel, a little more targeting. We take orders over the phone and Internet. First thing, you are going to need to want to shop and be serviced that way. Beyond that, it is whatever the demographic is that supports that. Probably more urban than suburban and a little bit younger. We will have a rate for anyone who calls.

RBS:
How will you brand the company?

AR: We are called Admiral Americas, but that is not what we are going to be called to the consumer. One thing we are going to do this week is launching an online competition to ask people to help name this company. What do you want the next great auto insurer to be named? What would resonate with you as a consumer? Rather than spend tens or hundreds of thousands of dollars with a branding firm, we are going to ask you to name us.

RBS: What parts of the United States will Admiral Americas focus on at first?

AR: We will roll out state-by-state, go into a couple states later this year. We’ll make sure everything operates the way we want them to, and then a much broader expansion is to follow.

RBS: Why now, considering we are in the midst of a global recession, is Admiral deciding to launch their American division this year?

AR:
Admiral’s business model is working, so they actually started international expansion a few years ago. The company expanded to Spain in 2006, Germany in 2007 and Italy in 2008. The U.S. was on a list of five countries we were considering. It was the next logical choice.

If you would allow me to pick a time to start an insurance company, this would be the pinnacle of moments to start it. We were able to get infrastructure like IT systems and real estate at unheard-of costs. The availability of high quality talent in the Richmond area is at unprecedented levels.

From a consumer standpoint, it is even better. Consumers are shopping around more to save money and willing to change insurers for less money. Being loyal to an insurer that’s charging you $150 dollars more than the competition, they are saying, “Sorry, but I’m switching.”

RBS: How much business does the company plan to do in the first year?

AR: We are not trying to be the biggest insurance company there is. If we end up being the biggest, fantastic, if we end up being a billion dollar auto insurer in the U.S., we’ll be very satisfied. A billion dollar player doesn’t even crack the top ten insurers. From our perspective, you can be large and profitable and still be small on a typical scale.

One of the tenets important to us is being a different company. We believe fun in the workplace is good for us. Happy employees are better for the customer. One element that is not unique to Admiral but to the extent that we make it unique is that we are extremely frugal. Cheap is the not-so-nice way to say it. We do a push-up for each sheet of paper we print. It’s silly, but it’s symbolic. It imparts the mentality that every expense we take out of the equation can ultimately return to the customer.

Al Harris is a BizSense reporter. Please send story scoops to Al@richmondbizsense.com.

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9 Comments »

  1. Gary Stewart March 9, 2009 at 10:17 am - Reply

    Andrew welcome to Richmond Virginia and wishing you much success. I would be interested in meeting with you or the contact whom you have appointed to procure printed items for Admiral.

  2. Dusty Kafrissen March 11, 2009 at 9:16 am - Reply

    Hi, Mr Stewart, and welcome!
    As the newest addition to the Wyndham Richmond Airport Sales team, I would be happy to invite you for a site visit in order to consider our newly-renovated hotel as a possible place to conduct your training as well as any overnight accommodations you may need. I’m sure we can work within your budget.

  3. Linda Subach March 11, 2009 at 5:12 pm - Reply

    Hi, Mr. Stewart and Congrat’s!
    Welcome back to Richmond. I’d like to meet with you and your staff when you get here. I own my own Real Estate company and would like to help you with your move to the states. I can create your own personal website of homes available in the areas that you might like to live in. Have a safe journey and looking forward to meeting with you.

  4. Karen Chenault March 12, 2009 at 8:00 am - Reply

    Hello Mr. Rose,
    I normally don’t solicit complimentary subscriptions to Virginia Business magazine in this manner, however I saw this information, since you will be relocating to our area I believe that our magazine will interest you. Our magazine covers all types of topics related to businesses located in Virginia and we have even incorporated a global view where executives have a foot within our state as well as outside of our country.
    Please let me know when you arrive and where you are located so I can get your complimentary subscription started. No strings are attached at all.
    Let us know how we might assist you.
    Karen Chenault, Circulation Manager

  5. Terry R. Louderback August 12, 2009 at 7:37 am - Reply

    Mr. Rose,

    I wish you and your company well on your new endeavors! My company, Worth Higgins and Associates, is a unique printing company located in Richmond, VA We offer a number of different services beyond what a typical printing company would offer. I believe that these value added services would be most beneficial to your company. Please contact me at your earliest convenience. Thank you.

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