Manuel Zuniga was 10 years old when his father fell off a ladder at work and became paralyzed from the neck down. “One day your father is there, and the next he’s not,” Zuniga said.
From that trauma, Zuniga said he learned perseverance. As a young adult, when he heard from a friend that the San Antonio-based insurance firm Catto & Catto was hiring, he applied for the job only to be turned away for lack of experience. Zuniga went to work for another insurance firm, The Hartford, and a year later returned to Catto & Catto.
Finally hired as a salesperson in 2001, Zuniga today is a client relationship officer leading a team of 22 others and is one of 10 partners at the insurance brokerage firm headed up by CEO Jaimie Hayne, the third generation of his family to sit at the company's helm.
Catto & Catto, which marked its 85th year in 2018, is the largest independent and privately owned insurance and risk management firm in Texas. As more and more wholesale insurance brokers are being acquired and consolidated, it’s also quickly becoming a rarity in the market nationwide.
“One of our core strategic objectives is to remain independent,” Hayne said. “In order to do that – the way we figured out to do that and to stay in business for 85 years – is to spread the ownership of the company to other people besides those in the family, if you will.”
By spreading the ownership out, the company gets diversity of opinions and ideas about how to run the business and how to grow it, he said, and it prevents any one or two people from saying he or she wants to sell.
“All of us who are partners currently have been the beneficiaries of the people before us,” Hayne said. “They all could have at any point in time sold the company and made a short-term gain, but they were all very focused on the long term. They have given us the opportunity to be a part of this company, and we’re all bound and determined to do the same thing for new people who join.”
In 2019, two partners are leaving the company by selling their interest, he added, and three new partners are joining. “That kind of turnover of the ownership has been really healthy and productive for us,” Hayne said. “And it’s just created a whole lot of opportunities not only for the owners, but now for the 75 other people who are part of this company.”
Hayne is the grandson of the firm’s original founder, John Catto Jr. Hayne’s mother was one of the founder's two daughters, Roxana Catto Hayne, the granddaughter of Alfred Gage, who founded one of the largest ranches in Texas.
Established in 1933, the firm became Catto & Catto a few years later when John Catto’s brother Henry joined him. Henry’s son, Henry Catto Jr., served as an ambassador under four presidents and was married to the former Jessica Hobby, daughter of a Texas governor.
Hayne officially joined the firm 25 years ago at the urging of his father, Jim Hayne. As a 29-year-old working for a venture capital firm in Ohio, the younger Hayne said he knew the offer was a good opportunity. “But I didn’t maybe realize how good,” and he now considers accepting the offer was the second-best decision he ever made (after marrying his wife).
Hayne took over as CEO when the firm’s longtime leader, Billy Jinks, transitioned to an emeritus role 15 years ago. Jinks retired in 2013. Hayne said Jinks’ long transition period is a leadership tradition at the company. Zuniga said Jinks provided the mentoring he needed early in his career at the company. “The time he made for me had a huge impact,” he said.
Catto & Catto is an insurance broker, not an insurance company, which means the company gets paid by commission or fees to identify risks for its clients and advise them on how to transfer those risks, business or personal, to an insurance company.
For example, Catto & Catto might represent a company that is at risk of losing money due to a shareholder’s lawsuit, a data breach, or employee injuries and accidents, and advise the client on how to best insure against that risk as well as mitigate it.
“So we surround that core with services that help our clients minimize bad things from happening,” Hayne said, via risk management services, wellness services, and other prevention programs. When bad things do happen, and the client must file a claim, the firm helps its clients respond to them with other types of services. Both of those elements are unique in the insurance broker industry, he said.
Meanwhile, Catto & Catto is defending itself against the tide of locally owned and independently owned firms being consolidated. A January 2018 Insurance Journal article reported that wholesale brokers have been selling off their businesses. “As in the retail agency segment, consolidation among wholesale brokerages is being driven by buyers with plenty of money to spend, the fast pace of technological changes, and aging owners,” the article stated.
“There’s a lot of outside pressure, because of valuations of companies like ours, to sell and so that’s why it’s such a battle,” Hayne said. “Private equity investors have found the insurance brokerage space and love our business model and so they’re just investing heavily, trying to consolidate as much revenue as they can. We’re being approached all the time.”
It’s a great position to be in, he added, but Catto & Catto’s leadership feels there’s value in being a locally and independently owned company. “Locals like doing business with locals,” he said.
Though Catto & Catto has business clients across the state, over half are located within a couple hours’ drive of San Antonio. Most are companies or nonprofits with between 50 and 4,000 employees, though some are as large as Southwest Airlines, which has been a client since Herb Kelleher founded the airline in 1971.
Catto & Catto also helps the executives and owners of those companies with their personal property and casualty insurance needs – homeowners, auto, ranches, and vacation homes. The firm's current total premium volume is $150 million, Hayne said.
“The challenge we have, like so many businesses now, is that our clients are demanding more from us than they did last year and five, ten years ago,” Hayne said. That has propelled the firm to offer more risk prevention programs and ways to control the rising cost of health care.
The other challenge is finding talent, he said. As an industry, insurance is set to lose 400,000 people in the next couple of years as workers age out. Though the average employee tenure at Catto & Catto is already at nine years, Hayne said the firm works at keeping people on board by maintaining a family-oriented work culture.
Catto & Catto has made its home in downtown San Antonio since the beginning. The firm moved to its current address on South St. Mary's Street in 2005 after outgrowing ground-floor space in the former Frost Bros. building on Houston Street. Catto & Catto also occupied the Chandler Building in the 1960s. Now with offices on the top floor of the One Alamo Center, nearly every worker enjoys optimal views and light-filled spaces.
Many of its employees reside south of downtown, Hayne said, and so the firm’s central location is not only convenient, but also a “vibrant” place to be. It’s not uncommon for him to take an e-scooter to lunch, but slowly and carefully, of course. “I am in the risk management business,” he said.