MERGER OF AGENT GROUPS IN MINN. IS LESS THAN A PERFECT MARRIAGE

MERGER OF AGENT GROUPS IN MINN. IS LESS THAN A PERFECT MARRIAGE

Can competing agent organizations survive as one?

A little more than a year after the Professional Insurance Agents of Minnesota (PIA) and the Independent Insurance Agents of Minnesota (IIA) merged to pool their financial and political resources, members admit to problems.Parent organizations at the national level - the National Association of Professional Insurance Agents and the Independent Insurance Agents of America, both based in Alexandria, Va. - are monitoring their progress as they try to evaluate whether a merged group can competently serve its membership.

Money remains a sensitive issue. Members formerly active in only one of the two local groups are paying $50 to $150 more in dues than they paid before the merger, said Thomas Arenson, a PIA national director, although members that were active in both groups before the merger are paying less.

Members of the combined group, the Insurance Agents Associations of Minnesota (IAAM), now pay dues to the two national organizations.

Before the merger, PIA members were active in a profit-sharing program with their national headquarters. Any profit made by PIA on educational courses and conferences, for instance, was shared with the national organization. In exchange, membership fees were lower.

The IIA of Minnesota had no such arrangement, and its members paid higher dues.

"There are some members who don't approve of dues going higher," said Mr. Arenson.

Another early test of the merger was the selection of a single president. When they first merged on Jan. 1, 1991, the PIA and IIA each installed presidents to jointly head the association.

But in October 1991, the IAAM's membership voted to make Sid Mason president of the merged group for one fiscal year ending this October. Mr. Mason had been IIA president-elect.

This fall, the president-elect of the former Minnesota PIA will become president, said Mr. Arenson.

The choosing of presidents based on former group affiliation is only a temporary procedure, Mr. Arenson said. As the association matures, officials will discount former ties.

Mr. Mason referred to the former two-president operation as the "two-headed monster." Nevertheless, retaining both presidentswas a necessary evil to endure in the early days following the merger, he explained.

So was keeping both groups' individual educational programs. That, too, was a temporary dilemma.

"We tried to keep all of the programs," said Daniel J. Riley, IAAM executive vice president. "That was a mistake. After eight to 10 months, we had to decide which programs benefited our members the most."

The merged group also dealt with the problem of differing management philosophies.

The PIA followed rules instituted by its national office in Alexandria, while the IIA was allowed by its national office to set administrative rules at the local level.

The PIA "liked to govern from the top down, and we (the IIA) liked to govern from the bottom up," Mr. Mason said.

To compromise, the groups combined their philosophies.

Mr. Mason partly attributed the compromise to the PIA being "intrigued" by the IIA's grass-roots policy.