By Kensie Hamilton
For our first executive issue, the staff at West Virginia Executive went on the search for an experienced, widely-knowledgeable Mountain State professional who not only had a business that has exceeded the state’s borders but who could share with us important insight as to what is taking place in West Virginia’s business community.
We chose Gregory Burton, president and CEO of BrickStreet Mutual Insurance Company, because of his diverse background in business and because his current position revolves around workers’ compensation, a product that crosses over many industries around the country.
As president and CEO, Burton oversees policy direction, strategic plan implementation and budget development while providing leadership for this regional company. His past experience includes serving as cabinet secretary of the West Virginia Department of Administration; chairman and former board member of the West Virginia Health Care Authority; assistant vice president of Investment Banking at Ferris, Baker Watts; head of Corporate Trust with Bank One and assistant vice president of Bank of West Virginia. Considering this, we felt strongly that he would be able to provide the insight on the business climate in West Virginia for which we were searching, and his comprehension of the challenges of a West Virginia company doing business on a national level only adds to the benefits of a conversation with him.
WVE: BrickStreet Mutual Insurance Company was the result of a major overhaul of the state’s workers’ compensation system. Tell us about the events leading up to the founding of BrickStreet.
GB: In 2003, West Virginia’s 90-plus-year-old, state-run workers’ compensation system was in disarray and faced more than $3 billion in unfunded liabilities. As a result of the high costs of workers’ compensation insurance, existing businesses were leaving the state and new businesses were not considering West Virginia as an option. In 2003 and 2004, major legislative reforms were passed and enacted under Governor Bob Wise’s leadership, as well as some key legislators like Speaker of the House Bob Kiss, Senate President Earl Ray Tomblin and Senator Brooks McCabe. These legislative changes allowed the system to stabilize and the next key legislation to pass—the privatization piece. In 2005, then-Governor Joe Manchin signed Senate Bill 1004 into law, beginning the move from a monopolistic, state-run system to a competitive market of private insurers. West Virginia Employers’ Mutual Insurance Company, now known as BrickStreet, opened its doors January 1, 2006, becoming the first private company to offer workers’ compensation coverage in the Mountain State’s history.
WVE: You have been involved with BrickStreet since before its founding. How did you get involved?
GB: I started with the West Virginia Workers’ Compensation Commission on April 1, 2003, when the system had more than $3 million in unfunded liability and was losing approximately $1 million a day. Through a lot of hard work and dedication by a number of our employees who were willing to make tough choices, workers’ compensation in West Virginia saw significant change—administratively, legislatively and medically—that ultimately led to the formation of BrickStreet.
WVE: What is it like working for a company owned by policyholders instead of the traditionally owned company?
GB: Working for policyholders versus working for a traditional stock company is a breath of fresh air. In a stock company, you are constantly looking at the bottom line trying to hit certain growth and return on equity percentages, which at times can cause your core values to be tested as you try to hit those numbers each quarter. Working for a policyholder-owned company, returns and hitting financial targets are important, but there is greater flexibility in delivering services to our policyholders as well as giving back to the communities we work in.
WVE: How many locations does BrickStreet operate, and how many employees does it have today?
GB: BrickStreet currently has three offices: our corporate headquarters in Charleston, WV; a Midwest regional office in the Chicago suburb of Naperville, IL and a South/Mid-Atlantic regional office in Charlotte, NC. Within the three offices and several home-based operations, we have 380 employees.
WVE: What would you identify as the most crucial decisions leading to BrickStreet’s success?
GB: Expansion was crucial for us. We wanted to remain a strong economic force in our home state of West Virginia; in order to do this, we needed to reach across state lines and build on our foundations.
Enhancing our technology has been vital to our success as well, and our regional growth would have been very difficult without it. We’ve continuously improved and innovated to create solutions for our agents, policyholders and vendors that make working with us more effective and efficient. This includes the recent launch of our new interactive portal, StreetConnect.
Working hard to earn our A- rating from A.M. Best was important as well. We initially earned this in 2010 and have since been able to maintain this excellent rating. Having an A.M. Best rating allows us to compete on a larger scale, placing us among the most financially secure insurance providers in the nation and indicating our excellent ability to meet our ongoing insurance obligations.
WVE: How were you able to position BrickStreet as one of the largest writers of workers’ compensation coverage in the nation?
GB: When BrickStreet opened its doors in January 2006, we were the 15th largest insurance company writing workers’ compensation coverage in the United States, the second largest West Virginia-based insurance company and the fourth largest insurance company with offices in West Virginia. The impressive task we faced was rising to the challenge of maintaining these figures. I think we’ve done pretty well—and our A- rating from A.M. Best has been a key part of this.
WVE: BrickStreet currently has a presence in seven states. How does doing business in these other states compare to doing business in West Virginia?
GB: Many other states have had private workers’ compensation systems for much longer than West Virginia. For this reason, we’ve found that agents and companies in these states are well versed in the products we offer and the services we can provide. This has provided a great opportunity to bring tools back to our teams in West Virginia so we can further educate our agencies and policyholder companies in the Mountain State about the industry.
WVE: What is BrickStreet’s strategic plan for growth into additional states?
GB: We’ve identified niche markets and corresponding geographic regions that can take advantage of our key specialties in the more labor-intensive sectors like mining, heavy manufacturing and energy. Driving safety culture is very important to us; we want to help mitigate risk for our policyholders, and these industries are a great way we can make an impact. During the next few years, we intend to continue expanding regionally into Alabama, Tennessee, Georgia, South Carolina, Maryland and Washington, D.C.
WVE: What are the benefits of being located and headquartered in West Virginia?
GB: Definitely the work force we are able to attract, as well as being able to utilize the relationships we have built over the years in the state. We have a great work force, and our employees are very dedicated to what they do, striving to provide the best customer service possible.
WVE: How has BrickStreet directly impacted the Mountain State’s economy?
GB: We are proud to have been a part of making West Virginia a more business-friendly state by driving down the cost of workers’ compensation insurance. Rates in West Virginia have gone down more than 60 percent since January 1, 2006. We would like to think that BrickStreet’s work with the West Virginia Governor’s Office and the West Virginia Insurance Commission has played a small part in helping drive the rates down by delivering great customer service to our policyholders and getting our claimants the medical care they need to get back on the job as quickly as possible.
WVE: From where you stand at the helm of such a large, regional company, what is your perspective on West Virginia’s business climate?
GB: The business climate in West Virginia continues to evolve into one that allows us to compete in the Mountain State, as well as regionally with major out-of-state companies. As we expand into other states, we find that the West Virginia Office of the Insurance Commission is easier to work with than regulatory agencies in other states because many of the employees at the commission were instrumental in helping us get set up from day one.
WVE: Has BrickStreet faced any challenges due to economic uncertainty? If so, how are you dealing with them?
GB: The last few years have been volatile and unpredictable for all markets in the U.S. and across our region, and the insurance industry has been no different. We’ve remained financially stable during this economic turbulence by managing our assets with a conservative approach to investment and maintaining adequate reserves to ensure claims coverage and support business growth.
WVE: How does working with so many different industries impact the success of BrickStreet?
GB: It actually makes it easier. While we have markets and industries in which we focus heavily, having a large variety allows us to see the larger picture of the industry and the business climates of each state. We haven’t put all of our eggs in any one basket, so to speak, which gives us the opportunity to be financially stronger and a more well-rounded company.
WVE: What changes do you see for BrickStreet in the future?
GB: We will continue to round out our regional footprint during the next few years and continue to grow our book of business in a manner that makes sense for our policyholders.
WVE: Is there anything else you would like our readers to know?
GB: BrickStreet is a company that has deep roots in West Virginia and is proud of all of the hard-working and dedicated staff we have in the Mountain State, as well as in our regional offices. With the leadership provided by our board of directors, we will continue to strive to provide the best possible customer service through our BrickStreet 360° business approach to workers’ compensation insurance.
