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Tuesday, Jul 16, 2024

From ‘Zero Business’ to $1.45 Billion

Tom Corbett changed careers from medicine to insurance for a variety of reasons, including supporting his family. When he opened the Newport Beach office of Alliant Insurance Services Inc. in 1977, he had “zero business, which was unnerving.”

“We never thought it would grow tremendously,” Corbett recalled. “We weren’t thinking like that. We were trying to survive when we opened the office.”

Now, 42 years later, his company is thriving from its headquarters at 1301 Dove St., where its name is on top of the building.

The chief executive of 25 years said last year went far better than planned.

“It’s one of the best years we’ve ever had, probably the best,” the 72-year-old Corbett said in a phone interview.

“We’re doing great.”

In 2017, sales at the employee-owned company crossed the billion dollar mark to place 11th on A.M. Best list of the largest global insurance brokers. Last year, sales increased another 28% to an estimated $1.45 billion.

If it reaches $2 billion, it has a chance to jump as high as fifth place, which in 2017 was occupied by BB&T Insurance Holdings Inc. with $1.92 billion.

Much of Alliant’s growth was due to at least 18 acquisitions during the past three years. Acquisitions last year alone boosted sales around $150 million to $175 million.

The firm last year also saw its highest ever organic growth in the “double digits,” which Corbett called outstanding. The bottom line was up 12%, he said.

The company added 600 employees last year for a total of 3,500.

During the decade, revenue has grown four-fold from $462 million in 2011 while employee growth has more than doubled from 1,464.

For all these reasons, Corbett is the Business Journal’s Businessperson of the Year in the finance category.

Alliant’s Edge

Alliant, which has a history dating back to 1925, pools customers’ premiums to seek the best possible rates from insurance companies.

The Los Angeles native originally planned to be a doctor, earning a degree in microbiology from California State University-Long Beach.

When he began selling insurance, he said the industry at that time had many average workers doing the status quo. He thought if he could provide above average solutions, he could win customers.

Corbett differentiated himself by focusing on certain industries, beginning with municipalities.

Nowadays, Alliant designs proprietary insurance products for areas like health and workers’ compensation, and liability for specific industries such as construction firms.

His agents developed a deep expertise in the sectors they service such as law firms, restaurants and even valet parking companies. It represents a majority of the Indian nation tribes in the U.S.

“We’ve had a great year in most of those areas,” he said. “Just about every part of the company is doing at or above the revenue planned.”

He likes to say insurance is about risk management and problem solving.

“There’s a lot of personal reward in analyzing a problem, figuring out what may work and bringing the solution to your customer,” he said in a prior interview with the Business Journal.

Two-Year Extension

The company is majority-owned by 1,000 employee shareholders and it also has a few outside investors, such as sovereign wealth funds, pension funds and insurance investors.

“We’re very proud of the distribution of our equity,” Corbett said. “We don’t intend to change that.”

The company’s Employee Benefits Group this year ranked No. 424 on Forbes’ annual list of America’s best midsize employers and No. 26 in its industry category of business services and supplies.

Corbett himself has signed up for another two years as chief executive.

“I’ll be around awhile,” he said. “I enjoy what I’m doing and the people. My wife would say getting out of the house periodically is not a bad idea.”

Corbett has a wry sense of humor, giving advice such as if you don’t want to talk to anyone at a party, “tell them you sell insurance.”

Acquisition Spree

Last year, Alliant completed at least 10 acquisitions in states such as Illinois, Texas, Florida, Idaho and Oregon.

Its biggest deal was acquiring the New York-based Crystal & Co., which added 450 employees in 11 offices.

“We’ve had a lot of great people join us and many times their clients come with them,” Corbett said.

He doesn’t expect to expand outside the U.S., saying the industry has a lot of complexity abroad and the U.S. has many opportunities for growth.

The company plans to continue growing both organically and through acquisitions to grab market share and “hopefully not screw it up.”

Corbett expects to continue buying companies so he can expand both by geography and sector expertise.

“We’re not looking for sellers. We’re looking for people to buy in,” Corbett said. “We’re looking for successful people who want to continue to build successful operations on a larger national platform. There are a lot of people with great talent. For one reason or another, it’s time to transition to a different structure.”

The company intends to remain headquartered in Orange County.

Like a true insurance salesman, Corbett added, “We’d love to pick up more local Orange County clients.”

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Peter J. Brennan
Peter J. Brennan
Peter J. Brennan has been a journalist for 40 years. He spent a decade in Latin America covering wars, narcotic traffickers, earthquakes, and business. His resume includes 15 years at Bloomberg News where his headlines and articles sometimes moved the market caps of companies he covered by hundreds of millions of dollars. His articles have been published worldwide, including the New York Times and the Washington Post; he's appeared on CNN, CBC, BBC, and Bloomberg TV. He was awarded a Kiplinger Fellowship at The Ohio State University.

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