Insurance Firms Tap Into Hispanic Market

Susie Nicholas tripled her insurance agency business in three years after hiring a manager and a lead agent who share a common trait — they’re Hispanic.

Best Stop Insurance Agency Inc. in Springdale concentrates on the Hispanic market and has as many as 100 walk-in customers per day, Nicholas said.

Data from the U.S. Census Bureau for 2000 said Hispanics make up 8.5 percent of the population in Washington and Benton counties, or about 26,401 people.

If the Bureau’s population estimates and the same percentage held true over time, the number of Hispanics in the two-county area grew to 29,043 by July 2003.

Another Bureau number generated by the American Community Survey Profile in 2002 said there were 31,708 Hispanics in the Fayetteville-Springdale-Rogers metropolitan statistical area at that time.

One thing’s for sure, the Hispanic population is growing right in step with the rest of Northwest Arkansas.

Insurance agencies fill 14.75 pages in the Fayetteville-Springdale edition of the Yellow Pages published by SBC Communications Inc. But only a handful appear to actively pursue the Hispanic segment.

Nicholas said her office had to overcome the language barrier, but hiring Hispanic customer service representatives made the difference. She said that about 70 percent of her customers are Hispanic and most of them refuse to deal with anyone else in the agency except the agent who originally helped them with their policies.

She said the company has high retention rates because her agents develop relationships with the customers.

Alma Barcenas, assistant manager of Best Stop, said a lot of people who come into the agency won’t deal with any other agent. She said many customers feel more secure speaking to a Hispanic person than a non-Hispanic bilingual or even through an interpreter.

Barcenas said a lot of Best Stop’s business is through referrals and word-of-mouth.

Nicholas declined to disclose her annual billings, but she said her agency writes about 200 new policies a month, mostly for auto coverage. She has started to see an increase in commercial and home policies as well, writing about two each per month, she said.

Best Stop offers insurance through 13 different companies including Progressive and AIG.

Nicholas said one obstacle she’s encountered is that many of her customers tend to pay in cash. She said before she assembled her current staff, the till would occasionally come up short. As a result, she is working with an outsource IT company to develop software that tracks transactions and accounts for every penny. She hopes to market the software to other agencies once the development is complete.

Rod Badely, owner of a State Farm Insurance Agency in Rogers, said about 70 percent of his business comes from Hispanic customers.

Badely moved to Rogers in 2002 to serve as a liaison to the Northwest Arkansas Hispanic community for State Farm.

“We’re just like anybody else, but we are bilingual,” Badely said.

Badely’s agency receives about 80 applications a month. He mostly writes auto coverage, but about 50 percent of his auto policyholders are also taking life insurance. He said “family” is very important to Hispanics and that has contributed to the strong life insurance sales.

He estimates that he retains about 90 percent of his auto policies and about 95 percent of his home policies.