Mike King is no horse whisperer. But the Canadian accredited insurance broker and the owner of Intercity Insurance Services Inc. in Aurora, Ont., knows about the special relationship horse owners enjoy with their animals.

“Having been a horse owner, I can attest to the fact that when this family member gets hurt, it can be very distressing,” he says.

In fact, it was King’s knowledge of horses and the lifestyle associated with recreational horse ownership that led him to the insurance business — and to building a niche market business targeting recreational horse owners. He is one of about 15 brokers nationwide who specialize in horse insurance products. “It was horses that brought me into the insurance business,” he says, “not the other way around.”

Raised in Toronto, King, 50, rode horses as a youngster and spent his teens and early 20s as a farm manager, buying and selling horses, judging competitions and teaching riding. He also competed in Canada and the U.S.

He entered the insurance business in 1992, after working in Western Canada and Ontario for more than a decade in sales and marketing jobs. His aim right from the start was to sell horse-related insurance products. He worked with a local broker who specialized in equine insurance.

“He was kind enough to give me an opportunity and taught me the insurance business,” he says of his mentor, who lives and works — as a competitor now — practically within spitting distance of King’s office in Aurora’s old city hall.

In 1998, Capri Insurance Services Ltd. of Kelowna, B.C., a wholesale client of King’s at the time, approached him with an offer to form a partnership in order to make inroads in the Ontario market. “That’s how this company came to be,” he says. Another satellite office exists in Gananoque, Ont. Capri provides accounting, claim and underwriting support.

Intercity positions itself as a general insurance broker providing home and auto insurance, but a good 70% of the company’s gross annual volume is related to horses. The company boasts 1,800 clients, a good number of them the very same horsey set that so appealed to him as a teenager — teenage girls.

“What is it about girls and horses?” he asks with a shrug, although his daughter, now 23, rode for only one season before calling it quits. (His son, 25, spent several years riding and competing.) But parents have long been indulging this obsession, and King’s client base is made up primarily of middle- to high-income businessmen who want to protect their equine investments.

The business grew significantly in 2002, when Intercity signed a deal with the Ontario Equestrian Federation, Ontario’s primary equine sport organization. Intercity is the exclusive supplier of product to its 16,000-strong membership. Some liability insurance related to the ownership of horses is included in membership dues, King says. The relationship allows for direct marketing opportunities and opens the door for future sales of horse mortality insurance.

While Intercity can’t contact OEF members directly, it does encourage members to call with any insurance questions; this often leads to a deeper relationship. But Intercity also makes the overall focus of the firm education, not selling.

“It’s a high-maintenance situation,” King says of the arrangement with the OEF. “We field a lot of inquiries from members that aren’t income-generating.” To that end, the office has grown to four staff, including one young service rep and producer hired last May.

King’s focus on customer service — offering consultation and education — is a critical distinction between his services and those of some brokers in the field. “I like the idea that we are able to unravel some of the mystery,” he says. Having a love for the animals and an understanding of the issues — the two biggest fears of horse owners, for example, are fire and colic — makes for a sense of job satisfaction.

King thinks long and hard about the future of equine insurance in general and of Intercity in particular. In Canada, he says, there are about 1.2 million horses, only about 30% of them insured. The number of horses has grown over the past three or four years, he says, and this might spell an opportunity for growth.

Another factor that points to potential growth for the business is the overall shift away from rural life. “When I was a kid, most of us had a neighbour or relative who grew up on a farm,” King says. Those days are gone, and with them the intuitive approach to animal management that used to rule the barn.

@page_break@“Today’s horse buyers rely, perhaps, more heavily on us to help them protect their horses and their properties,” he says.

There are other challenges. The continual need to create demand for service is a big one, he says. While the average value of horses in the Intercity portfolio is $15,000, horses can be bought for as little as $500. With exporters offering $1,000 on-the-hoof for slaughter and export, many individuals don’t see the real need for insurance.

“What keeps me awake at night is wondering how I can reinvent the product,” King says. “How do I reinvent the need?”

The good news is that his target consumer is well ensconced in Canadian culture. He points to the late baby boomer’s tendency to have only one child — with a tidal wave of recreational dollars thrown that child’s way — as leading to more pleasure riders down the road.

King’s goal is for Intercity to be seen not as the biggest broker offering equine insurance but as the most informative. “It would be very easy for us to become complacent and sell our product on price and not advertise, not do the education, not do the external things that are very important to sustain the business,” he says. “If we stopped doing that, we would shrivel up.”

Another potential source of business is farm property. As riders, or their parents, get close to retirement, they might decide to reduce their horse-boarding costs — which average $600 a month in Ontario — by moving out of the city and buying that retirement farm, he says. The bonus for King and Intercity is that farm property insurance has a higher profit margin.

In line with his desire that Intercity be an information brand, King devotes some of his time and resources to public speaking and teaching. For example, he often organizes information sessions at boarding facilities to which he invites a veterinarian. The topic of discussion: what the insurance will cover and clients’ responsibilities. This past year, Intercity joined a lawyer and a number of other consultants and created a course for the University of Guelph’s online equine program. It is an investment in the future, King says: “It’s going to help our business 10 years from now.”

King doesn’t do any riding any more, and there are days when he misses it intensely. But he and his wife, Carol, have a cottage near Bancroft, Ont., and like to travel, leaving little room for the 24/7 reality of horse ownership. He hasn’t completely given up on the romantic vision of retirement. “I’d love to have one or two breeding horses out in the paddock,” he says. IE





Answer that phone – or else



Lip service is often paid to the notion of customer service, says Mike King, but he believes it is essential with a niche product that is relatively low-margin.

“These are cookie-cutter products,” he says of equine insurance products. “You’d buy the same product from me as from my competitors.” The only distinction is the level of customer service, he says.

His advice to others operating in a niche industry is: know your clients and know your product.

“You only have one chance at impressing a client with your knowledge,” he says. “If you’re not sincerely knowledgeable, your consumer is going to know immediately because they know at least as much as you do about what you’re trying to sell.”

It’s also why he makes certain that his staff understand one basic — if old-fashioned — element of customer service: “If someone has made the effort to pick up the phone and dial my phone number, somebody had better answer that phone or there’s going to be blood on the floor.” — Wendy Cuthbert