By Lori Ehde
Employees at Luverne's Tri-State insurance are bracing for another round of layoffs following a corporate announcement last week.
W.R. Berkley Corporation, which owns Tri-State and Berkley Information Services in Luverne, announced it will discontinue personal insurance services in all of its property casualty insurance companies nationwide.
The decision is based on decreasing business written in personal lines and the need to focus on expanding commercial lines, according to attorney John Thelen.
"Unfortunately, the business is very competitive, and we don't have the scale to be able to operate in personal lines successfully," Thelen said.
Thelen serves as general counsel for Continental Western, the Midwestern group of Berkley companies that includes Luverne's Tri-State.
He said personal lines (individual home and auto insurance, for example) account for less than 20 percent of Continental Western Group's total business.
Employees were told they will likely all know by mid-November how their jobs are affected by the decision, which becomes effective at the end of the year.
In Luverne, 18 underwriting positions are dedicated to personal lines insurance, but that's not to say those specific employees will lose their jobs.
Some were clearly told they would no longer be employed in the company after Dec. 31, and some whose positions are eliminated may be offered other positions in the company.
Tri-State Regional Manager Curt Bloemendaal, Luverne, said the corporate announcement was not anticipated locally.
"We're trying to be as understanding as possible of their situation and how this decision affects them," Bloemendaal said Monday.
BIS President Joel Christensen said his workforce in Luverne will also be affected by Berkley's elimination of personal lines.
"We won't be unscathed by any means," he said Wednesday. "There's a lot of work that some people here do that's related to that business É We've got a lot of projects that support that business."
Christensen said he's still not sure how many of the 114 people at BIS will be affected. "We're assessing our projects and staffing needs, and by mid-November we'll have some decisions made," he said.
Thursday's news reached Tri-State employees already uncertain about the possibility of their jobs moving to Sioux Falls.
The last announcement from corporate headquarters in Greenwich, Conn., came exactly two years ago that regional operations would move from Luverne to Sioux Falls by summer 2001.
When asked about the future of Tri-State in Luverne, he said, "We have determined we would not be relocating in 2002, but it is still in the plan."
Tri-State currently lists 147 employees on its payroll, including 20 in the Sioux Falls office and more than 20 traveling representatives.
Bloemendaal said underwriting employees in the Sioux Falls office don't handle personal lines and likely won't be affected by layoffs.
While the news is hard on affected employees, the community as a whole pays close attention to Berkley announcements.
With an annual payroll of $4.8 million (including Sioux Falls employees and field reps) Luverne's economic health would be affected by Tri-State's absence.
Tri-State, now known as "Continental Western Group, Tri-State Region," owns the 33,000-square-foot building in Luverne and paid nearly $47,000 in property taxes this year.