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1712 Magnavox Way, Fort Wayne, Ind. 46804; 219-459-5000;

fax: 219-459-5866

1997 1996

Premium volume $229,142,000 $209,028,539

Gross revenues* $48,430,900 $45,777,250

Employees 277 260

Commercial lines 100% 100%

Admitted business 98% 98%

Non-admitted 2% 2%

* BI estimate.

A competitive insurance market may be slowing its growth, but growth does continue for K&K Insurance Group Inc. as the company continues expanding its program offerings in its sports, entertainment and leisure business niches.

Fort Wayne, Ind.-based K&K's motto is "Insuring the World's Fun," and while competition may be tough, "we're still having fun," said Stephen Lunsford, the company's president and chief executive officer.

In general, this year's story at K&K is very much like last year's, Mr. Lunsford said. "Fortunately, things were going well for us last year and continue to do so," he said.

Formed in 1952 and focusing almost exclusively on motor sports, K&K has since branched out into more than 80 programs, covering a wide variety of recreation and leisure industries.

"We're still a dominant player in the motor sports business. It was the business on which K&K was founded, and we remain pre-eminent in that area," Mr. Lunsford said.

In addition, the company is very much involved in covering professional team sports. "We're involved in the major portion of the programs of roughly two-thirds of the professional baseball and football teams," Mr. Lunsford said.

K&K provides disability coverage for nearly all NASCAR drivers, the coverage for all the Coca-Cola Co.'s special events, and most of the coverages for New Orleans' Mardi Gras celebrations.

It also provides coverage for everything from Super Bowls to bingo halls and from papal visits to the Woodstock '94 music festival. Overall, the MGA provides coverages for more than 250,000 events and associations annually.

"I noticed the other day that we had an inquiry; I think there's going to be a papal visit to St. Louis," Mr. Lunsford said. "I think we're going to be involved in that one as well."

The company's brewpub business is doing well, the CEO said, and K&K recently added a martial arts program to its list of offerings. The company also has enhanced its tanning salon program to include full-service salons.

While virtually all of K&K's business is done as a managing general agent, the tanning salon program is done on a wholesale basis, Mr. Lunsford said.

K&K also introduced a new concession program in 1997, Mr. Lunsford said, geared to providing coverages to vending services at major sports stadiums.

"We're also increasing our writing in the amusement park area," he said.

While K&K has carved out a rather specific niche, it continues to be an area to which other companies are attracted, and new competition constantly is entering the market, Mr. Lunsford said.

"In '97 we did have some new people in the business, and we suspect that three or four years from now they very well may not be here," he said.

K&K meets the challenge that competition raises through the industry-specific expertise it has developed over the decades serving its niche markets, Mr. Lunsford said. Among other things, the company cites its full-service, in-house claims staff -- specializing in the investigation, analysis and disposition of spectator and participant liability claims -- as an advantage competitors can't offer.

As another means of serving its niche, K&K boasts an incident report form it designed specifically for sports, leisure and entertainment risks.

K&K's premium volume reached $229.1 million in 1997, up 9.6% over 1996. That premium figure ranked K&K 10th on the Business Insurance list of the largest U.S.-based wholesalers.

The company had 277 employees in 1997, up from 260 a year earlier. All of its business was commercial lines in 1997, as in 1996, with 98% placed with admitted insurers and 2% in the non-admitted market, again the same as the prior year.

In 1997, the company added CNA Insurance Cos. and Great American Insurance Co. to TIG Insurance Co. and John Deere Co. as those for which it has underwriting authority.

The agreement with CNA involves writing basic and catastrophic medical malpractice business K&K used to write with TIG, Mr. Lunsford said. The arrangement with Great American involves a camp program that provides all property and liability coverages for campgrounds.

The John Deere business, done through a subsidiary operation in Greensboro, N.C., provides coverage for tow truck operators. K&K acquired that Greensboro operation in the early 1990s. The company also has a small sales office in Orlando, Fla.

K&K, whose parent company is Aon Corp., is an affiliate of SLE Worldwide Inc., which provides accounting, data processing and corporate support staff functions.

K&K is the operating entity for SLE, doing business under the K&K name in the United States and out of a Canadian office in Toronto.

K&K is licensed to do business as an excess/surplus lines broker in Indiana, North Carolina, Virginia and Florida.

Overseas, the company does business in London and Sydney, Australia, under the SLE Worldwide name.

In terms of the brokers with whom it does business, Mr. Lunsford said: "We're still doing business with the same people. We still do business with a large number of subproducers, everyone from the large alphabet houses down to the local shops."

Consolidation in the brokerage industry has not had an impact on K&K's business so far, the president and CEO said, though the company is monitoring where its business is being produced to see whether any change develops.

Limits vary across the company's different programs, with capacity consistent in recent years, Mr. Lunsford said.

Among K&K's specific programs, in the area of events and attractions it has crafted programs geared to such areas as amusement parks, aquariums, camps, drum and bugle corps, miniature golf, paintball sites, ski resorts, water parks and zoos.

Leisure and recreation programs include coverages for billiard parlors, bowling centers, gymnastics clubs, motorcycle dealerships, sports coaches and officials organizations, weather insurance, and youth and adult sports leagues.

In addition to K&K's offerings for all the major professional sports, the MGA's sports programs also include coverages for college athletics and college football bowl games, high school athletic programs, intercollegiate and interscholastic liability/medical programs, and sports permanent and temporary disability and accidental death and dismemberment.

Motor sports programs cover everything from formula racing to truck and tractor pulls. There also are such programs as high-limit disability income, independent club event liability, and coverages for owners and sponsors and sanctioning bodies.

Venue and gaming programs run a similarly wide gamut, covering everything from amphitheaters, arenas and stadiums to community centers, country clubs and polo clubs.

K&K's World Wide Web site is proving an effective tool for helping generate new business. "We're seeing a great deal of activity there in terms of potential producer inquiries," Mr. Lunsford said. "Amazingly, we've been having inquiries (on the Web site) from all over the world."

K&K's principal officers include Mr. Lunsford; Jerry Tegan, chief marketing officer; and Todd Bixler, chief operating officer.