K&K Insurance celebrates 50 years of success
K&K Insurance of Fort Wayne, Indiana, celebrates its 50th anniversary in 2002. Perseverance, dedicated employees and hard-working independent agents, along with successful “partnerings” have built K&K Insurance into one of the largest managing underwriters in the United States, with over $365 million in written premiums. Today K&K is part of the Aon Corporation, a world leader in risk management, insurance brokerage, reinsurance, and human capital consulting services.
K&K’s 50-year growth story actually begins a little more than 50 years ago … The year is 1948 and many Americans enjoy stock car racing. It is a dangerous sport, one that could leave you disabled for life. Imagine that you are racing around a dirt track and your car crashes, leaving you severely injured. You have a family-and that family depends on you. Whom do you turn to?
Nord Krauskopf, a Fort Wayne businessman with vision, founded a special risk insurance brokerage company to meet those pressing needs.
K&K-the beginning
Krauskopf was an ordinary man, a roofer by profession and a stock car racer on the weekends. He and his wife, Theodora (Teddy), often could be seen racing on the local tracks. There was no insurance to protect the racers, nor did they really think in terms of risk. Their sole goal was to win the race and have a good time. To protect those who did crash, the racing participants would all contribute equal sums of money to a benevolent fund, which covered medical bills and family needs. However, the benevolent funds could easily be depleted by a series of serious accidents.
Krauskopf recognized the need for insurance and seized the opportunity to fill it. In 1952, he put his love of car racing aside and set out to find insurance for racecar drivers. He located Charles Lenz, a broker from Lloyd’s of London, and presented him with a bold idea-to build a sound and powerful business protecting racecar drivers and tracks. In the early 1950s, racecar driving was seen as a dangerous sport-a hobby for thrill-seekers-and not many insurance companies were willing to take on that risk. But the plan that Krauskopf presented to Lloyd’s was simple: He would travel around the Midwest marketing coverage to many tracks, thus creating a premium pool adequate enough to cover the risks associated with the sport.
In order for tracks to carry the K&K Insurance policy, they had to adopt safety rules such as installing a blockhouse for the starter, wire mesh in front of the stands, guard rails around the outside and inside of the tracks; and allowing the track to be inspected yearly Lloyd’s agreed to write the risks; the partnership was sealed with a handshake, and K&K Insurance was founded. Today K&K provides motorsports insurance to more than 60% of the country’s short-track facilities and about 85% of the major speedways. It also insures roughly 65% of the teams racing in the major series.
K&K expands into new markets
With K&K salespeople dotting the nation, Krauskopf allied himself with other strong insurance men such as Greg Mosher. In 1973, Mosher became a partner, lending his expertise in sales and public relations.
His addition to the K&K team proved to be profitable, as K&K began to expand into new markets in the sports, leisure and entertainment industries. Professional associations became one of K&K’s most lucrative markets-with high-volume sales.
Late 1970s-early 1980s K&K and Yamaha enter into personal lines
Deciding that the time was ripe to develop personal lines, K&K once again launched into an arena that no other company would risk offering personal insurance to buyers of Yamaha motorcycles. Dealers had direct phone lines into K&K so that customers could immediately purchase insurance at the point of sale. The lines were so busy that K&K had to have state-of-the-art wiring installed in its offices to receive the volume of business. This business venture into personal lines was extremely profitable; however, keeping up with individual state requirements eventually became too time-consuming to continue the personal lines business. It was time to refocus on their core business strategy of special risk commercial insurance.
End of an era
Nord Krauskopf retired in 1980 as chairman and owner of K&K Insurance Group. Krauskopf had built the company into a $10 million corporation with approximately 200 employees. K&K moved from the Krauskopf house to another Ft. Wayne location, before building its current home at 1712 Magnavox Way.
New ownership
In 1984, Lincoln National Corporation purchased K&K and provided the capital needed for continued expansion. That capital, combined with the hard marketplace of the 1980s, allowed K&K to grow its sports, leisure and entertainment business. K&K’s expansion began in the fair and festival industry and from there grew into para mutual racing and on to professional and amateur sports. The focus was to provide a dedicated, long-term, stable insurance source for those industries. In 1986, K&K wrote $50 million in written premiums; after just three years, premium volume leaped to $100 million. K&K continued to add programs including ski resorts, amusement parks and various franchised dealership programs. Lincoln National Corporation eventually made the decision to divest itself of product lines not related to their core life insurance business and, in 1993, sold K&K Insurance to Aon Corporation.
Aon Corporation’s purchase of K&K from Lincoln National Corporation marked the beginning of another aggressive growth period that took the company from approximately $160 million in premium volume to approximately $360 million in 2001. Aon’s extensive resources and worldwide reach provided the support K&K needed to continue to reach for its goal of becoming the largest provider of sports, leisure and entertainment insurance in the world. Aon’s global expertise also helped establish several offices outside the United States.
Under the direction of Chief Executive Officer Steve Lunsford, an Aon veteran and former president of Aon Reinsurance Corp., K&K continued to expand its market share in virtually every specialty program segment in which it operated and today offers over 100 specialty sports, leisure, and entertainment programs.
In 1994, K&K established a holding company, SLE Worldwide, Inc., to set up offices in Canada, Australia, London and Mexico City. Although adverse economic conditions at the time eventually led to the closing of its Mexico City operation, the SLE offices in Sydney, Australia, and London, as well as the office in Toronto, Canada, grew steadily through the application of the same entrepreneurial principles and operating philosophy that K&K used in the United States. The offices were initially run by K&K employees to ensure that the K&K program business philosophy and exclusive focus on sports, leisure and entertainment risks would be carried out. Since that time, Aon’s European operation has assumed management of the SLE offices, allowing K&K to focus on the United States and Canada.