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Long-term plan makes for smooth transition at Companion Life

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HintonWhen Scott Hinton’s retirement as president of Companion Life was announced back in April, the transition already had been in the works for years. Philip Gardham, who moved up to president from COO on Jan. 1, was hired 10 years earlier as executive marketing officer with the understanding he’d eventually take over the company, Hinton said.

Planning a smooth transition of power is essential in their business, said Hinton, who had worked the last 30 years for Companion.

“The key to our business is relationships. We’re relationship-driven,” Hinton said in a December interview. “That goes down to relationships internal and external. The best way to have good relationships with your market is to have smooth transitions in all your leadership positions.”

The company also announced changes in its organizational structure. The current senior staff for core and specialty markets will report directly to Gardham as well as the sales and marketing of these two areas, the company said. To lead Specialty Markets operations, Jon Anderson was promoted to COO of specialty markets, and Mark Smidt was promoted to vice president of specialty markets.

The new team has been working together for about a year. “We remain a people company,” said Hinton, who’s retiring to Florida after serving as Companion Life president since 2007. “There are no silos here. We all work together.”

Under Hinton’s leadership Companion Life, a member of the BlueCross BlueShield of South Carolina family of companies, has purchased and integrated nine companies and expanded markets to include business in 49 states and the District of Columbia. The company has about 120 employees at its headquarters at 7909 Parklane Road in Northeast Columbia.

GardhamCompanion Life, which has specialized in employee benefits since 1971, markets a range of products such as life, dental, disability, accident and specialty health plans including medical stop loss, limited benefit health plans and group supplemental retiree prescription drug plans, as well as other insurance programs through a network of independent agents and brokers, general agents and managing general underwriters.

Stop-loss insurance is a specialty of Gardham’s and accounts for about $425 million in premiums or more than half of Companion Life total business of $807 million.

Dental coverage has been a growing market in South Carolina, Gardham added. Dental ranks behind medical and life in what employees seek in their benefits package, he said.

Stop-loss is particularly attractive to small companies with 100 or fewer employees that opt to self-insure and pay medical claims out of cash flow rather than buy group health plans.

Individual stop-loss insurance, Gardham said, provides protection for self-insured employers by serving as a reimbursement mechanism for catastrophic claims exceeding pre-determined levels.

Stop-loss reduces the employers’ risk against a high claim on any one individual employee, Gardham said.

For example, if an employee suffers a major health crisis the employer pays claims up to a certain level and anything over that amount is covered by stop-loss.

Another form of stop-loss is aggregate stop-loss, which provides a ceiling on the dollar amount of eligible expenses an employer would pay, in total, during a contract period, Gardham said. The carrier reimburses the employer after the end of the contract period for aggregate claims.

Stop-loss “has been a growing product for us,” Gardham said. “Employers love it because … they have a lot more control of their medical costs.”

The Affordable Care Act has been a driver in growing the stop-loss business as small and medium-sized businesses choose to self-insure over buying group policies, Gardham said.

However, the law’s future appears in jeopardy as the Republican-controlled Congress and White House have vowed to repeal it.

That’s just one of the challenges facing for Companion Life.

In the past 10 years, the company has expanded its product lines and looks to grow its business through acquisitions of large brokerages across the country.

“We have to have viable products going forward regardless of a change in the law,” Gardham said.

Reach Chuck Crumbo at 803-726-7542.

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