When Bill Rue Jr. graduated from Duke University in 1997 with a degree in economics and political science, selling insurance in his father’s business was the furthest thing from his mind. “At 21 I had to make it my own way,” says Rue, who headed off to Wall Street for a career as an investment banker with Merrill Lynch. He then doubled down on that choice by enrolling in the MBA program at Wharton in the year 2000.

But in 2001, during a summer job at Sarnoff, where Rue participated in a group trying to create spin-off businesses for some of research center’s cutting-edge technology, Rue saw some of the excitement associated with smaller enterprises. “I realized I didn’t know anything about running a small business,” he says. But he also knew he was already associated with a great family business. “So why not,” Rue says. “My father had always wanted me to get involved, but didn’t push it. He was shocked and thrilled.”

Earlier this year Rue, 37, succeeded his father, William M. Rue Sr., as president of the now 96-year-old firm. While most family-owned businesses are lucky to move from the founder to the second generation, Rue Insurance is now headed by a fourth generation leader.

The young president knows that not everyone puts the words “insurance” and “excitement” in the same sentence. But he sees an opportunity in that reality. “It’s a tough industry to get people excited about,” he says. “It’s dominated by a lot of guys in their 50s and 60s. But all these individuals are going to have to retire eventually. And when they do some relationships will have to change.”

The Rue agency, which already has expanded by acquiring an agency in Keyport in 2010, may well acquire more in the future. “We’re not going to be an aggressive buyer in the same numbers as a larger broker,” Rue says, “but if we do a couple a year I think we’re going to be in great shape.”

Today Rue Insurance is a brokerage and advisory firm whose 8,000 individual and 3,000 commercial clients generate close to $100 million in premiums for the industry.

“There aren’t that many fourth-generation businesses out there,” says Rue. “I think it gives the client an advantage knowing that there is stability here. We have clients going back 30, 40 years.”

Not surprisingly the Rue family has fine-tuned the succession process over the years. Rue’s great-grandfather founded the business in the hamlet of Windsor in 1917. At that time Charles E. Rue, the owner of a feed and grain mill, had been asked to join the board of directors of Farmers Reliance Insurance Company. As a board member, Charles was able to sell property insurance to his feed mill customers.

Nine years later he went into partnership with his son, C. Lester Rue, to create Chas. E. Rue & Son insurance at 349 West State Street in Trenton. In the summer of 1949 college graduate Charles L. Rue Jr., son of C. Lester Rue and grandson of Charles E. Rue, went to work for firm. His two colleagues in the office were a salesman and, depending on the day, a clerk. By 1962 the firm had expanded to Nottingham Way in Hamilton Township.

In 1965 the agency changed from a partnership to a corporation. William M. Rue, the younger brother of Charles L. Jr., joined the business in 1969. He was soon involved in helping the firm expand into commercial lines of business, and when Bill Rue joined the company in 2002 he followed a similar approach, helping the firm move into health insurance.

Helping move the firm into uncharted territory also gave the incoming family member “his own place in the firm and more credibility,” says the younger Bill Rue. “When I started I sat in the back and did the real basics — not quite entry level — checking policies and things like that. There was no special office. When we knew we wanted to get into the health insurance field it was up to me to figure it out.”

When the younger Rue joined the firm, Rue’s health insurance revenues were around a $200,000-per-year trickle. Today the division brings in around $1.2 million in annual revenue. “When I came on we really created a brand new division to do health insurance and really built up that entire department,” Rue said. “I went out and learned the industry, learned the business, talked to a bunch of carriers, built relationships, and started it from the ground up.”

Now, with President Obama’s massive federal health program looming, Rue’s health insurance division could be a springboard for more growth. Rue plans to use social media, especially Twitter, to keep customers and potential customers informed as the new legislation is implemented starting in 2014.

A major challenge will be reconciling federal dictates with disparate state legal codes and public policy. “Insurance tends to be a state-by-state issue, and so to have a federal plan for 50 states that all have individual departments and differences is really difficult to do,” Rue says. “Here in New Jersey we have new mandates as to what’s going to be covered as a small business, and our mandates may not match what other state mandates are.” An example is lead poisoning: “[It’s] an important piece in New Jersey because of the old buildings that we have, but in some states that don’t have the historical apartment buildings that may not be a big deal and so that coverage doesn’t need to be in there. So those are the details that now unfortunately are starting to come out.”

Moving into health insurance was also a logical response to Rue’s clients’ needs. Says Rue: “A lot of our commercial clients were saying, ‘we’re already buying part of our insurance from you, why aren’t we buying the rest of it?’”

Another area of growth is in cyber-liability, which could become an issue for the entire spectrum of small businesses, from physicians to pool contractors: “So now you have quite a bit of information stored in a computer system that people can hack into. Someone could get on that system, they could pull people’s social security numbers, their health information. People can steal medical insurance I.D. cards, which people actually sell and will use for the health insurance benefits. For a physician’s office there’s lots of exposure, but your insurance policies don’t cover anything like that. When you’re looking at an office that may have 5,000 or 10,000 records, the dollar amount goes up pretty quickly.”

Asked what Rue’s greatest strength is, Rue says “it’s definitely our people and the kind of culture we’ve tried to create.” Rue is committed to continuing education, or CE, a program developed by firm partner and operations executive Liz Allen.

Rue sees value in keeping the firm’s intellectual capital relevant and up-to-date particularly because the industry’s age demographics tend to skew older. “If the average age of the agency force tends to go up, there are some old ideas and old thinking there, and that’s why for us education is important, to stay on top of what’s going on in the industry, what’s new, what’s different and that benefits our clients,” Rue says. He believes that one critical difference between his firm and his competitors is the high level of expertise among Rue personnel. When an individual or business talks to someone at a competitor, “they may not have the same technical competencies we do.”

By Rue’s count, 70 percent of the firm’s “direct contact individuals” have some kind of advanced insurance degree, including the eight course Chartered Casualty and Property Underwriter (CPCU) and the Certified Insurance Counselor (CIC) designations.

Rue trusts its staff with research projects that keep the business out in front of industry trends. An example has been management’s approach to social media, which Rue expects to more fully integrate into the firm’s marketing strategy in the near future. Rue and his executive team recently huddled with a group of young employees and tasked them with making recommendations about how the firm can enhance its Facebook and Twitter presence. For Rue, the firm’s trusting reliance on its people is fundamental to its corporate well being: “What makes this organization work is that you don’t have people at the top saying this is what everybody has to do.”

Rue sees social media instilling a new outlook for an industry still yoked to the stereotype of the chalky life insurance salesman “trying to peddle some product you don’t need.” For Rue, this perception is becoming outdated in an increasingly complex world that is accompanied by increased risk for businesses and individuals.

In the days after Sandy, when cell phone service was limited and Rue Insurance had more than 1,500 claims calls in the first week (more than might normally occur in a whole year), Rue posted information about mobile claim centers and extended weekend hours to its Facebook page. Customers using the resources on Rue’s Facebook page generated 250 “likes,” for each of which the company donated $5 to recovery organizations.

Rue is active in the community on cloudless days as well. The firm, which supports the North Trenton Little League and several other organizations, again looks to its employees to determine where to take an active role outside the organization. The company has an employee club that organizes a once-a-month event. On the day U.S. 1’s reporter visited, the firm was having an international pot luck lunch.

And on the second Friday of each month Rue sponsors an agency-wide employee meeting. “We let everyone know where we stand with respect to revenues, profit goals, and so on,” says Rue. “We are a pretty transparent operation.”

Within the industry Rue is also pretty high visibility. Rue says that calls have come in from larger agencies thinking about a possible acquisition. “I think we have the ability to keep going as we are,” says the fourth-generation leader, who — it should be said — lives in Cranbury with his wife, Ashley, and six-year-old daughter and four-year-old son: William M. Rue III.

Rue Insurance, 3812 Quakerbridge Road, Hamilton. 609-586-7474; fax, 609-586-3991. www.rueinsurance.com.

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