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Kanawha CEO retires

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By Johnathan Ryan

Stan Johnson has bid farewell to the company where he spent half of his career in the insurance industry.

Johnson, 64, stepped down at the end of 2007 as chief executive officer and president of Kanawha Insurance after 22 years.

"It has been an interesting career," he said from his nearly empty office in downtown Lancaster, where Kanawha has been headquartered since 1958.

"My significant accomplishment is that the company continues, has grown and is still in downtown Lancaster," Johnson said. "We also have a good future with Humana."

Humana bought Kanawha and its parent company, KMG America, last year for $186 million.

Johnson said it's the right time to step down, because Kanawha needs to move forward with fresh players. Kanawha is Humana's voluntary health and life supplemental insurance wing.

Inspiration

Johnson's first interest in the insurance industry came from seeing insurance agents arrive in Dayville, Ore., a small town where his parents ran a restaurant and hotel. He didn't see many "professionals" come through, but he remembers insurance salesmen wearing suits and having nice cars.

"They looked like they had it together," he said. "That was my first brush with people who appeared to be accomplished."

Johnson started his career in the accounting track for a couple of insurance companies and rose through the ranks as a controller, chief financial officer and executive leader.

He was an executive with National Benefit Life Insurance Co., owned by American Can and a subsidiary of New York Life. At the time, he worked in New York City but lived in Stamford, Conn., with his wife, Dianne, and their three children.

Coming to Lancaster

In 1985, a search committee looking for a new leader for Kanawha Insurance found Johnson in New York and invited him here for an interview. Members of the search committee included Crandall Close Bowles, former CEO of Springs Industries, and former Bank of Lancaster President Jim Bradley.

Johnson said Bradley "strongly suggested" that he accept the job, noting also that Bradley was a man who wouldn't recommend a course of action if it wasn't in your best interest.

Bradley said Johnson was an appealing candidate because he possessed "good judgment, good leadership and a good background in the business he was being hired for."

Johnson said accepting the Kanawha job was the right move.

"It gave me a chance to run a company, which I had never before," Johnson said. "It was a good move professionally."

And because his family already had a vacation home in Hilton Head, he was familiar with the state.

"We had a sort of predisposition to South Carolina," he said. "Finally moving here wasn't that unfamiliar for us."

Changes at Kanawha

In 1985, almost 70 percent of Kanawha's business came from Springs Industries' employees. The company had roughly $70 million in assets and was largely involved in workplace and individual life-insurance policies.

In 2004, before Kanawha was bought by KMG America, the company listed assets at roughly $700 million and almost none of the business came from Springs Industries. By that time, the company had greatly diversified and expanded its business into voluntary supplemental health and life-insurance policies and third-party claims administration.

Johnson said the strong guidance of the Close family, direct descendants of Springs' founders and the principal shareholders in Kanawha for many years, was important in keeping the company profitable.

"They definitely had some staying power," he said.

To grow, Kanawha had to become part of a bigger company, Johnson said.

"The Close family and myself realized that being part of a larger organization was going to be crucial to us reaching our potential," he said.

The company saw a downgrade in its AM Best financial stability rating from A to A- in recent years.

"That was because of our size and the challenge of the business. That's the benefit of Humana coming to acquire you," Johnson said.

Johnson retires from the business with a great appreciation of how insurance helps people every day.

"I think it's a wonderful business. You get to help a lot of people with the products you sell," he said. "Insurance is about protection against the unexpected."

Contact Johnathan Ryan at 416-8416 or jryan@thelancasternews.com