Massier’s and Garner’s arrival on the scene couldn’t have been more fortuitous as the insurance industry of Western Canada was undergoing a transformation in the early 1960’s that almost brought about the demise of the Toole Peet agency. The industry experience and fresh enthusiasm Garner and Massier brought to the Toole Peet office was reminiscent of Barney Toole and George Peet in their heyday when the two founders devoted their early partnership days to finding new ways for the firm to profit. Similarly, the sixties were a time for new ideas – and Garner and Massier were full of ideas.
While Toole Peet had developed a small book of business in the Direct Agency side, it was not a self-sufficient operation. However, urged on by Massier, the firm had quietly expanded by purchasing two, small, one-man agencies.
The results were much better than anticipated, as Massier had been able to recover the purchase price in less than a year. The first purchase, that of H.B.MacDonald, gave Massier an opportunity to demonstrate his blossoming sales ability. H.B.MacDonald had a small client base of well to do, under-insured individuals and businesses that Massier, using his underwriting knowledge, quickly turned into a client base of well-to-do, properly insured individuals and businesses. The pattern for success was laid down. But, because the General Agency was still so profitable, the directors didn’t feel the need to aggressively continue the purchase of other agencies.
Selling the General Agency
The status quo quickly changed in 1963 catching everybody but Massier and Garner, it seems, by surprise. Just as the two were presenting arguments to continue making agency purchases, the major insurance companies took steps that would make change inevitable at Toole Peet. The companies, realizing that the western provinces, and particularly Alberta, were becoming major revenue sources, began to open their own offices in the principal cities. The result was that their representatives, the general agencies, were no longer needed. The companies began dealing directly with the agents. After one or two insurance companies had led the way, all the insurance companies rushed to follow. The writing on the wall was then obvious to the directors – Toole Peet was about to lose its General Agency business and with it at least fifty per cent of the firm’s revenue. Sun Alliance, one of the General Agency companies, had announced its intention of opening its own offices and had made an offer to buy Toole Peet’s book of business and take some of the staff.
“We basically had a gun to our heads,” Bill Toole recalls. “It was either sell it or lose it.”
Interestingly, one of the advocates of the sale to Sun Alliance was Jim Garner. As George Eaton pointed out at a directors meeting, Jim was arguing to sell the business that employed him. “You’re selling your reason for being here!” Eaton told him. On the surface, Eaton was right but, like Massier, Garner could see the potential of the Direct Agency, especially when there were many agencies available with retirement-age owners anxious to sell for cash to a reputable firm like Toole Peet that would treat their clients well.
Knowing they had no option but to sell the General Agency the directors (Bill Toole, Robbins, Eaton, Massier and Garner) generated a business plan that would see the General Agency continue on and then, when it reached its highest marketable value, be sold to Sun Alliance which would take most of the staff. The directors agreed to invest the proceeds in the purchase of direct agencies.
Massier knew, however, that one more move had to be made to ensure the plan’s success – Garner was to became co-manager of the Direct Agency and, together, they would build the business. The key to success was in the ability of Jack Massier and Jim Garner to make sales. Without sales, the operation wouldn’t survive and the money from Sun Alliance would be lost. Today, nobody assumes credit for putting the two men together as managers but all recognize it was a very positive reflection of the confidence Bill Toole had in Garner and Massier. Massier was outgoing and exuberant, almost impulsive. Garner was thoughtful, meticulous and precise. Bill Toole provided the analytical balance.
The plan proved a spectacular success. While both men planned strategies, made acquisitions and consistently turned in higher and higher commission totals, it was Massier who led the way while Garner, just slightly back, kept the office running smoothly. A spirit of competition kept the two men on their toes and whenever Garner turned in a month with the high totals, the entire office knew that they could expect Massier to rise quickly to the challenge.
In purchasing the new agencies, typically, Toole Peet would pay an owner up to one and a half times the existing annual commission and recover this investment within 12 to 18 months. The acquisitions yielded new policyholders from throughout the city, varying from Chinese restaurant owners to long-haul truckers. Each acquisition was evaluated, the clients contacted, and the sales process begun.
While some of the firm’s resulting profitability can be attributed to the buoyant economy, a large measure has to be attributed to Massier’s innovative approach to selling insurance policies. Prior to the sixties, agents would generally approach a prospective client and sell him a specific policy for a specific risk. For example, one salesman might sell a client a policy for his car. Another salesmen might sell the same client a fire insurance policy for his house. A similar haphazard process would take place with the retail and industrial prospects. Eventually the clients would be sold a filing cabinet of disjointed policies.
Jack Massier developed “Account Selling”. Using the knowledge he had gained as an underwriter for ten years, he would introduce the existing and prospective clients to the concept of having one master policy, one expiry date and one agent for all their insurance needs. In that way, the client had a systematic method to monitor his costs and policies and the agent was always aware of the account’s renewals, adjustments, and new coverages. It worked so well that Toole Peet soon learned that the real value of the agencies they were buying was in the client lists, not in the commissions upon which the purchase price was determined.
By 1965 Massier and Garner each had an assistant. Ray Marcil started with Massier in 1962, became a director and partner in 1979 and took early retirement in 1988 to pursue interests outside the insurance industry. He brought many valuable accounts to the firm, such as the Stoney Tribal Administration, many of which are still retained. Peter Jones started in 1964, also became a partner and director in 1979, and continues with the firm today as a consultant with an office.
One of the reasons the Toole Peet strategy in the 1960’s was so effective was the professional attitude of Massier and Garner. Building upon their thorough training in underwriting, they both supplemented that knowledge with continual upgrading through the newly-introduced industry courses. Both men, for example, became Canadian Certified Insurance Brokers when the designation was first offered. Over the years Massier’s resume grew to include Kinsmen Club responsibilities, Most Loyal Gander of the Blue Goose, a director of the Insurance Agents Association, a member of the Ranchman’s Club and the Knights of Columbus. Similarly, Jim Garner’s activities within the industry kept him active and aware of ongoing changes. He has been a President of the Insurance Institute of Canada (Alberta Branch), President of the Society of Fellows, Alberta, and a director of the Insurance Agents Association.
“We were continually educating our salesmen and staff,” Massier recalls. The firm continues that program today. Much of the support for the new professionalism came from Bill Toole who, as a Chartered Accountant, placed a high priority on combining education with practical experience.
While more involved on a daily basis in mortgages, property management and appraisals, Bill Toole contributed to the sales efforts by following the example of his father and his uncle with an active involvement in the community and in business organizations. He was a member of the Kiwanis Club and later the Rotary Club and was on the boards of the Calgary Family Service Bureau, the Catholic Family Service Bureau, the United Way, and on the first board of the Calgary Law Foundation. He was finance chairman for Merv Leitch in the inaugural campaign of Peter Loughheed’s Conservative government. He continues his membership at the Glencoe Club, the Ranchmen’s Club, and the Calgary Golf and Country Club.
When the profits were to be allocated, at years end, it was Bill Toole who provided the balance and negotiated the bonuses and incentives that all accepted as reasonable. “There were some heavy meetings,” Garner remembers, “but things were always resolved.”
The Toole Peet name gained visibility during the sixties with sponsorship of a chuckwagon at The Calgary Stampede. In those days the chuckwagon canvases were sold to individuals, not to commercial sponsors.
Unfortunately the William Toole and George Peet wagon, driven by Tom Glass, never won; however, its association with the firm of Toole Peet irritated the national insurance brokers who, at the time, were doing all they could to gain acceptance in the Calgary business community. Locked out of the chuckwagon races and seeing the William Toole and George Peet wagon running night after night at the Stampede eventually became too much for them, and they protested to the Stampede Board that the wagon was commercial, not private. The Stampede solved the problem by turning the event over entirely to the commercial sponsors shortly afterwards. The price rose beyond the level justifiable by a local insurance brokerage and The William Toole and George Peet canvas never ran again.
Besides the long lunch hours sometimes taken by the employees and department managers during Stampede week, the other important time for reduced formality was the annual Christmas Party which was held in the basement of the office. The file cabinets were pushed aside, the dust and cobwebs cleared away and the celebrations lasted well into the morning hours. As spouses were not invited, the annual party often yielded a year’s worth of comments – according to Garner who was a bachelor at the time and found the evening much to his liking. Today’s parties include spouses.
When the oil boom was at its peak in the 1970’s, Toole Peet’s insurance department stayed on the sidelines while the national brokers courted the major oil companies in hopes of recording some of the huge premiums being generated. Instead of having to fight over every renewal of a drilling rig or production facility policy, Toole Peet found a much more lucrative way to participate in the oil boom.
Throughout the city the building contractors were struggling to keep up with the demands for the construction of new office space. Sometimes as many as 20 cranes were at work in the downtown area. Each day the contractors and sub-contractors prepared thousands of bids for the projects. Each bid required a bid bond and Toole Peet had a bid bond facility that no other agency or brokerage firm could match.
“On bid day, our office was like a checkout line in Safeway,” Massier recalls. “You couldn’t keep up with the phone calls.”
Contractors would refer their sub-trades to Toole Peet for the bonds. Of course, if Toole Peet was where the contractors and sub-contractors got their bonds, then Toole Peet was where they bought their insurance. For a period of four or five years, Toole Peet had the power of attorney for the Canadian Pioneer Company and during that time they used their bid bond facility to build an insurance commission base that would see the firm through the very tough times ahead when the National Energy Program and falling prices turned the oil boom into a recession.
When Pierre Trudeau’s Liberal Government announced the NEP in 1980, it was the beginning of a recession in Calgary that hurt everybody. Unemployment rose from 3.8 per cent to 10.3 per cent in three years. Housing and land prices crashed. Even banks and trust companies tottered and failed. It was as if an artery had been cut and the bleeding couldn’t be stopped. Rigs, workers and entire companies left the province.
But Toole Peet survived in better condition than most of the other independent and national agencies, many of which had to close their doors or form unhappy mergers and alliances.
Massier recalls how the recession hurt Toole Peet’s bottom line. The contractors, which formed a substantial part of the firm’s commission base, had their annual premiums based on estimates of revenue which, at year end, would be adjusted according to the actual results. For several years during the 1980’s, the year end refunds for some of those insured were higher than the earned premiums.
“But we always moved forward,” Massier points out proudly today. Everybody worked hard, made sacrifices and the firm inched ahead.
One of the more interesting aspects of the firm, but one rarely observed by the outside world, has been the financial relationship between the partners and the firm. From the earliest days of Barney Toole and George Peet, the firm has always held that the partners should be recognized monetarily for their contribution to the firm as a whole. Consequently the concept of profit sharing began at Toole Peet right at the beginning when Archer Toole, King Graburn and Henry Jones made their first agreement with the two founding principals. While the profit sharing concept created a business that was essentially a partnership within a corporation, the concept also provided a strong cohesive factor that bound the group into a team. While certain personalities naturally took a more visible role than others within the partnership, the profit sharing concept gave everybody a chance to use their particular strengths for the benefit of the entire firm. For example, Sidney Robbins used his extroverted personality to cast a net across the insurance industry and capture important business contacts. George Eaton meticulously ensured the agency was providing the best service possible to its clients.