Alan Bishop has spent 40 years building insurance broker EBM into a national player and worked through many business cycles over that time, but arguably none as tough as the current conditions in Western Australia.
Alan Bishop has spent 40 years building insurance broker EBM into a national player and worked through many business cycles over that time, but arguably none as tough as the current conditions in Western Australia.
“It’s almost like a little GFC, what’s happening in WA at the moment,” Mr Bishop told Business News.
Against that backdrop he said holding ground was considered a good outcome for his firm.
“Across the board in WA we’re about square with the books, which is remarkable,” Mr Bishop said.
The good news for EBM, which has 220 staff nationally, is that its east coast operations are now on a par with WA and are enjoying good growth.
Mr Bishop believes EBM can continue to match the growth it has achieved over many years.
“We’ve been growing the business generally between 7 and 10 per cent per annum, we think that’s something we can keep up with,” he said.
That long-term growth has come with a few bumps.
Most notably, the firm lost 10 of its 12 biggest clients during the GFC, as a result of corporate failures, forced mergers and projects that failed to proceed.
But one of the big positives has been its RentCover landlord insurance product, which has in excess of 120,000 rental properties under cover.
EBM’s growth has lifted it to become the third largest insurance broker in WA, according to the BNiQ search engine, behind global firm Jardine Lloyd Thompson (see table).
Among all of the big insurance brokers in WA, EBM is the last to be independently owned.
That follows three major takeover deals over the past year: Arthur J Gallagher & Co buying Strathearn Insurance Brokers, to become the number two player; Willis buying CKA Risk Solutions, to become number four; and listed company PSC Insurance Group’s purchase of Reliance Group.
Managing director broking Steve Sparkes believes EBM’s size works to its advantage – big enough to have specialist expertise but small enough to be manageable.
“It’s very noticeable to have a flat management structure where you can speak direct with managing directors that are involved in broking and operations,” Mr Sparkes said.
EBM’s independent ownership isn’t the firm’s only point of difference.
“We have no involvement with any of the aggregators, any of the clusters, the purchasing bodies,” Mr Bishop said.
“That’s been a big change (in the sector) over the past five years, as has the proliferation of authorised reps.
“We have a very negative view on that; it doesn’t give you the same control over compliance and professional standards.
“In our view, it’s a failed life agent model of the 1970s.”
From an operational perspective, Mr Bishop said he had the same focus on clients today as when he started 40 years ago.
“Nothing’s really changed from where we started to where we are,” he said.
EBM currently has seven shareholders, with Mr Bishop being the largest.
The ownership mix has changed recently, after two staff acquired equity from former managing director Jeff Adams, who continues as a non-executive director.
“The next phase is to look at the structure for the next five to 10 years, and how will it provide incentives to others,” Mr Bishop said.
He recognises the need to plan for his eventual retirement but has no immediate intentions.
“I haven’t lost any enthusiasm, I’m still passionate about the business,” Mr Bishop said.
“I’m not interested in selling out to multinationals.”
Helping Mr Bishop with long-term planning will be EBM’s three external directors – Subiaco hotel owner Michael Monaghan, barrister Terry O’Connor and accountant Dalton Gooding.
