Depending on how you look at things, National Interstate Corp. is in transition and keeps on growing.
For one, revenues were up in 2015 over 2014 — and well up from where they were years earlier.
The niche transportation-related insurer, based in Richfield, also keeps on hiring and is now busting at the seams at its two buildings in the office park off Kinross Lakes Parkway. And it is playing a more prominent role in the area with community outreach.
The company had 715 employees at the end of the year, with the vast majority in Richfield and the balance in St. Louis. That’s up 81 from 634 in 2014 and well up from 544 in 2012.
And come May 5, National Interstate gets a new chief executive officer, Tony Mercurio, 42, who knows the company inside and out — he’s been there since 1997.
Mercurio and current CEO David Michelson also share a significant common background.
“We’re both a couple of Northeast Ohio guys,” said Mercurio, president and chief operating officer. He is from Lorain, while Michelson is from Lyndhurst.
Michelson and Mercurio expect the CEO transition will be seamless and uneventful — basically, business as usual. The two have worked together for 19 years. Michelson, who succeeded National Interstate founder Alan Spachman as CEO in 2008, will stay on as board member and as a consultant.
“For the last couple of years, Tony and I have been working with the board really just on a ready-now development plan, so that when the date came, it was going to be the handoff. Tony’s the guy, he just moves right in,” Michelson said. “He knows the business inside out. He knows the people, he knows the customers. It really is just a smooth transition.”
Good companies have a succession plan, Mercurio said. “We’ve been working on this for a while.”
An important part of the National Interstate story is that the top executives are from Northeast Ohio.
“We literally came from here,” Mercurio said. “We both moved around in our careers for this company and for others. But roads led back to Northeast Ohio. This is where we prefer to grow the organization, with people who understand what it means to be a part of Northeast Ohio. ... We’ve been able to find talent here.”
National Interstate has grown from a handful of people when founded in 1989 by Spachman (who remains as a company director) to well over 700 employees, Michelson said.
“Most of the employees are here. We have 150 or so in St. Louis,” he said, who are with the company’s Van Liner insurance company.
The company has doubled in size in both revenue and employees in the last five years, Mercurio said.
“So, we’re a local company that has a growing presence, especially Summit County but not just Summit.” Mercurio said. “We’re not generalists. We’re not all things to all people. Insurance is not just a commodity to our customers.”
Mercurio will take the top executive spot more than two years after a failed attempt by National Interstate’s majority shareholder, Cincinnati-based American Financial Group, to buy out the company. Other significant shareholders, including founder Spachman, succeeded in opposing the AFG purchase.
The buyout battle had little to no impact on how National Interstate conducted its business, both Mercurio and Michelson said.
“We showed up to work every day,” Mercurio said.
“We didn’t miss a beat,” Michelson said. “Here’s our majority shareholder [AFG] that has excess capital. They are looking at various ways to deploy excess capital. They thought enough of us and our business plan, our management team, to want to pay market value for the balance of the shares when they already had legally controlling interest. We view that as a compliment to us and our business plan and management that they would be willing to do that. ... It’s a chapter that’s kind of closed.”
The focus remains on growing the business, the two executives said.
And that means continuing to hire.
National Interstate does a lot of its recruiting at nearby colleges and universities, including the University of Akron, Kent State, Baldwin-Wallace and others, Michelson said.
“We’re hiring a lot in Northeast Ohio,” he said. The company has a fairly young workforce as well with Generation X and millennials making up a sizeable percentage.
The company says at least 80 percent of National Interstate employees are from the area.
“It’s ingrained in who we are and you see it in our work culture. That’s hard to replace,” Mercurio said. “Our pace is East Coast fast but our mentality and our attitude are Midwest kind. ... Our pace is breakneck. When you sign up, we tell people it is not an easy place to work. It’s not the sleepy old industry that you might think.”
Their “skunk works” operations can bring a new product to market in as little as 90 days, far faster than most other insurance companies, Mercurio said.
Internships bring jobs
The employee pipeline is fed from a number of sources, including internships.
When National Interstate recruits on college campuses for interns, it looks for high performing people in almost any major, Mercurio said. Interns then take part in a formal company program.
“We call the program Ignition,” Mercurio said. “It’s the start. Ignition is the start.”
Ignition includes company culture training, insurance training that includes passing one to two exams weekly, senior management presentations, and soft skills training that runs from public speaking, time management skills, proper clothing and even what forks to use at a fancy dinner.
“We try and round out what maybe they didn’t finish up on campus before we put them at the desk,” Mercurio said. “So, it’s a significant program. It lasts all summer.”
Maybe five years ago, not a lot of people knew much, if anything, about National Interstate, Mercurio said.
That has since changed, he said.
“It’s a wonderful place to work. It’s a growing company,” he said.
And that growth has National Interstate exploring whether it needs to physically expand again at its office park campus.
“We took on a formal objective to be the employer of choice in Northeast Ohio, at least for the financial services sector,” Mercurio said. “I don’t think we’re the secret we used to be.”
Jim Mackinnon can be reached at 330-996-3544 or firstname.lastname@example.org. Follow him @JimMackinnonABJ on Twitter or www.facebook.com/JimMackinnonABJ.