LTC Global continues to expand

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November 13, 2008

By Greg Stiles

Mail Tribune

The founders of LTC Global Inc. demonstrated a knack for changing speeds and direction shortly after forming their enterprise six years ago.

The rapidly growing company located in the Woolworth Building in downtown Medford provides financing for long-term care insurance agencies as well as sales and marketing support. It also markets and distributes long-term care insurance products throughout the U.S.

LTC's principals — Mark Dinsmore, 51, Richard Pitbladdo, 51, and Eric Anderson, 48 — worked together at a GE Capital office in San Rafael, Calif.

"They were moving operations back East and we didn't want to move back East," Anderson said. "The idea we were talking about — actuarial risk management consulting in reinsurance transactions — was a little bit more difficult of a market to get into. We kind of knew what the business was going to be ahead of time, but the direction it took was a little bit of a surprise."

They set up shop in Medford, primarily because Anderson had bought a home here a few years earlier. Their game plan changed dramatically when they bought Conseco's ACSIA Long Term Care unit from the bankruptcy court in 2003.

Instead of merely consulting in the industry, the partners were financing the people who sell long-term care insurance and selling an array of products as well.

"We see potentially about a $10 billion to $20 billion market," Dinsmore said. "It's been penetrated perhaps a percent or two and we have more than half of that market share."

This week, the company announced acquisition of United Insurance Group Agency Inc., a life and health insurance agency based in Milford, Mich., from Penn Treaty American Corp. LTC Global also acquired UIG's three subsidiaries, giving LTC Global entrance into the Medicare Supplement and Medicare Advantage arena.

"That moves us out to look at broader senior markets," Dinsmore said.

United Insurance Group Agency's 15 offices roughly triples LTC Global's physical presence and pushed the employee count to 250. About one-tenth of LTC Global's staff works in Medford.

"Our costs (for being in Medford) are a little higher and taxes are a little higher than we pay in other locales," said Dinsmore, in an interview from Michigan. "We're very happy with the people we've found, although there are specialties we have a hard time filling — actuaries, for instance. (Actuaries deal with the financial impact of risk and uncertainty.) On the other side, this is a beautiful place and we love being here."

The company prefers keeping offices open in faraway sites to keep contact with clients, but back-office tasks are sent to Medford.

When the credit crunch hit this summer, agencies started losing finance options. One of the tools LTC Global uses is loaning money in exchange for renewal commissions.

"You can get better margins if people have no other options to get financing," Dinsmore said. "At the same time our costs have gone up and we're becoming a little more careful and maintaining a higher cash balance; you never know what bank is going to fail tomorrow. All this has generally made us more cautious and also a little more profitable."

The company anticipates $20 million in sales this year and expects to double revenue annually for the next five to 10 years.

"At that point, we hope to have half-a-billion in sales and we think we can do that by only doubling the number of employees," Dinsmore said

Reach reporter Greg Stiles at 776-4463 or e-mail business@mailtribune.com.

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