Willis Group Holdings Ltd., one of the worlds largest insurance brokerages, plans to open an office here next week that will be managed by Curtis Taylor, former top executive here for Marsh, one of Willis competitors.


The New York City-based, publicly traded company hopes to fill a perceived market void here created by Marshs regulatory woes, corporate restructuring, staffing reductions, and now pending sale of its operation here, Taylor says.


Willis has leased 5,200 square feet of office space on the eighth floor of the Washington Mutual Financial Center, at 601 W. Main, about six floors below Marshs offices, and has hired 10 people, all former Marsh employees, in anticipation of opening its doors officially next Monday, Taylor says.


This is a regional office for the Inland Northwest, he says, adding that he expects the operation to grow to 25 to 35 employees within a year and to reach $50 million in annual premium billings within five years.


My goal is not to be the biggest. Its to be the best at what we do. Organic growth will come from that, says Taylor, who will be Willis managing partner in charge of the operation here and also will oversee a recently opened office in Boise.


Willis is demonstrating its commitment to this market by investing heavily to establish the Spokane office, he says. The office here will offer a range of services, from selling property-and-casualty insurance to employers and personal lines to individuals to designing employee-benefits packages and consulting with clients in areas such as risk and human-resource management, he says.


He asserts that unlike Marsh, which caters heavily to Fortune 500 companies, Willis focuses more on mid-sized companies, which makes it a good fit for the Inland Northwest.


Willis has more than 300 offices in more than 100 countries. In all, its nearly 16,000 associates serve clients in more than 180 countries, its Web site says. It offers professional insurance, reinsurance, risk management, financial and human resource consulting, and actuarial services to corporations, public entities, and institutions.


The Spokane office will target Inland Northwest employers mostly in the 15-to-1,000-employee range, Taylor says.


He says he resigned his position as Spokane-based senior vice president and regional manager of Marshs Eastern Washington and Idaho operations on Nov. 1 to join Willis after being recruited personally by Joe Plumeri, Willis chairman and CEO. Plumeri flew to Spokane to persuade him to come to work for Willis, he says, and had dinner with him and his wife.


Taylor had been with Marsh since November 2002, before which he was the Spokane-based general manager and senior vice president for MSC/Premera Blue Cross, one of Eastern Washingtons largest health-plan providers.


Of his decision to leave Marsh, he says, After three and a half years, I saw the writing on the wall, as Marshs employment here shrunk from around 125 people to fewer than 60 and the company began pursuing a business model of getting out of smaller markets.


Two and a half years ago, Marsh became embroiled in an industrywide investigation by New York Attorney General Eliot Spitzer of alleged abuses in the insurance industry.


It agreed last year, without admitting wrongdoing, to pay $850 million to settle a civil lawsuit filed by Spitzer that accused it of bid rigging. The investigation led to the departure of CEO Jeff Greenberg, the loss of more than 5,000 jobs, and criminal guilty pleas byor grand jury indictments againsta number of top Marsh executives.


Washington State Insurance Commissioner Mike Kreidler announced last summer that more than 15,000 Washington businesses, organizations, and individuals were eligible to receive varying amounts of money from nearly $14 million in settlement-related restitution.


Taylor contends the Marsh office here engaged in no wrongdoing, but was placed in a defensive posture by important clients here that received checksas part of the corporate-engineered settlementand wanted explanations.


Last fall, as part of a broad corporate restructuring, the Marsh office here split into separate, but closely affiliated entities following a partial merger involving Marsh and Mercer Human Resource Consulting, both of which are units of New York-based Marsh & McLennan Cos. The merger, affecting roughly one-third of the about 60 Marsh employees here, combined the two companies health-care and group-benefits businesses into a new company called Mercer Health & Benefits LLC.


In deciding to join Willis, Taylor says, I thought it important that this could provide a home for a lot of my colleagues at Marsh who have lost their jobs or wanted to leave. He says, We will create opportunities for any displaced colleague.


Marsh employees here were informed last week that the Spokane office will be sold shortly, Taylor says. A Marsh source here who asked not to be named says the company is reviewing bids from prospective buyers of the offices assets. The pending transaction involves the roughly 40-employee Marsh property-and-casualty operation here, but not the Mercer unit, the source says.


One possible buyer might be Acordia Inc., a Chicago-based Wells Fargo unit that claims to be the worlds fifth largest insurance broker and the largest bank-owned insurance brokerage in the U.S., with more than 150 offices in 38 states. It recently acquired the assets of Marshs office in Yakima.


Marshs Spokane operation was founded here as McGovern Carroll more than 80 years ago. In 1998, after a series of ownership changes, Marsh & McLennan took over and began operating here as Marsh Inc., Marsh & McLennans insurance brokerage arm. It now simply operates under the name Marsh.


Marsh & McLennan Cos. hasnt released its 2005 year-end earnings report yet, but in the first nine months of last year, it had overall net income of $365 million on revenues of $9.2 billion, down from net income of $865 million in the year-earlier period. Altogether, counting affiliate companies, it employs about 59,000 people.


Willis was scheduled to release its fourth-quarter and full-year earnings this week. For the first three quarters of 2005, it had net income of $240 million on revenues of $1.7 billion, down from $319 million on revenues of $1.69 billion in the year-earlier period.


Contact Kim Crompton at (509) 344-1263 or via e-mail at kimc@spokanejournal.com.