How Rick J. Lindsey Got Into The Business:
Rick grew up in the Salt Lake Valley, graduated from Cottonwood High, was a hockey star (trained with 1980 Olympic team until last cuts), and enjoyed Utah’s outdoor recreation. He has been in the insurance business his entire working life, starting as a teenager in the mailroom and typing policies for his father’s brokerage. He has worked at virtually every job that exists in the industry.
When he was a young agent, he was frequently frustrated with the lack of flexibility and creativity in the insurance products he was able to sell and the rigidity of the firms he worked with.
He saw many risk categories and business activities that companies would not cover with liability insurance because they were high-risk. He has noted, “If you wanted to cover Evel Knievel jumping over the Snake River you had to call Lloyds of London.” Today, high-risk businesses don’t need to call Lloyds. They can receive coverage from Prime Insurance.
In those early years, Rick also felt that insurance companies were too quick to settle when facing possible lawsuits – even when they were in the right. He saw the “litigation machine” abusing insurance companies and their clients with frivolous lawsuits.
Thus, wanting to take a different approach, Rick worked toward owning and steering his own company. He merged his brokerage into Prime Insurance Company over 20 years ago, became the CEO, and took a majority position. He moved the company headquarters to Sandy, Utah, starting with just seven employees.
Today, Prime Insurance is among the most successful companies in the entire industry, with 200 employees, and growing rapidly, clients in all 50 states and U.S. territories, and writing $286 million in premiums in 2020.
Here’s an example of Prime’s “can do” attitude: In 2004 in Chicago, the owner of the infamous “Bartman Ball” decided he wanted to blow up the baseball as a promotional stunt. The baseball was the one missed by Chicago Cubs outfielder Moses Alou when Cubs fan Steve Bartman reached over the left-field fence and interfered with the catch. The Cubs went on to lose Game 6 of the National League Championship Series and the ball achieved notoriety.
Restaurant owner Grant DePorter, who owned the ball, needed insurance to blow it up, but couldn’t find a company that would ensure the stunt. Rick heard about it and consulted with some explosive experts who told him the detonation probably wouldn’t create much more than a puff of smoke. So Prime insured the demolition of the Bartman Ball – and enjoyed doing it.
It’s challenging to cover high-risk activities, which is why most companies avoid them. It’s even harder to make a healthy profit with this coverage. But Rick gives entrepreneurs true peace of mind and has built a remarkable business doing it.
Prime By The Numbers:
- Revenue growth has averaged 29% annually over the last 10 years. Even more remarkable, over the last three years, revenue growth has averaged 63%.
- Expense Ratio. A 100 percent Combined Ratio is considered break-even, and below 100% is profitable. Prime’s five-year Combined Loss & Expense Ratio average is 72% — demonstrating remarkable profitability. The industry average is 103%, which means Prime has performed 31 points better than its industry peers.
The Prime Process
Rick has been asked many times how Prime can be profitable while insuring high-risk businesses that other companies won’t touch. The answer, he says, isn’t anything magical. It is simply executing first-class business practices such as getting the little things right; knowing and collaborating with the customer in a real partnership; fighting for the customer; training, enabling, and motivating capable employees to perform well; and creating a business culture of excellence and pride.
He maintains excellent quality control because all business processes are executed in-house, including underwriting, policy issuance, risk management, legal work, and claims adjudication. Prime provides “full contact” customer service. Clients receive regular visits and communications. Clients have 24/7 accessibility and support because bad things can happen at any time.
Rick is personally available to all clients and employees at all hours. He provides his personal cell phone number to everyone and has instructed staff that when a client calls for any reason he will talk to them.
How Is Prime Insurance Company Different?
A major business differentiator is Rick’s willingness to fight for clients in court against plaintiff attorneys, rather than quickly settle frivolous or exaggerated claims. He believes the industry inclination to settle even frivolous lawsuits has damaged the industry and the people and businesses who are insured. The rush to settle encourages frivolous lawsuits and higher settlement demands, resulting in a downward spiral in fairness and costing more in the long run. The industry is threatened by a tsunami of litigation that increases the cost of insurance and makes companies fearful of insuring high-risk activities.
While he has no hesitancy to settle claims when warranted, Rick will go to court and fight hard for clients who are in the right, even if it costs more than settling. Prime is not afraid of the legal system and is not afraid of spending money to win in court. Prime does not allow its clients to be taken advantage of. Prime reverses the pressure and tactics of the plaintiff lawyers. It will cost them more to fight Prime.
He doesn’t expect anything from anyone else than he’s unwilling to do himself. He’s in the trenches with employees and clients every day. Countless times he says, “Call me, conference me in when a client has a problem.” His accessibility is remarkable. Every employee and every customer has his cell phone number, and he takes the calls any time, including at night, on weekends, and on holidays.