Finance and insurance pioneer Pat Ryan plans to retire Aug. 1 from Aon Corp., the global insurance juggernaut he founded in 1964.
Ryan, 70, has been Aons executive chairman since he stepped down as CEO in 2005 after 41 years.
The transition to a new management team under the sound leadership of Greg Case is complete, Ryan said in a statement on Wednesday. Aon is extremely well-positioned for continued growth and success.
Ryan said he plans to continue to be an active shareholder.
In 1962, Ryan forever changed how auto dealerships operate when he created the first F&I department at Dick Fencl Chevrolet in suburban Chicago.
I put in a system where I had to see every customer, Ryan said in a 2005 interview with Automotive News. I offered them the dealership financing, whether they were going to go to a credit union or pay cash or go with their own bank. I asked if I could also sell them credit insurance.
Said Keith Crain, chairman Crain Communications Inc. and publisher of Automotive News.: Pat Ryan was a fixture in the automotive industry finance business for many decades and he taught most dealers the importance of F&I.
Before Ryan introduced his concept of selling credit life insurance directly to dealership customers, dealership salespeople handled financing. The practice at the time was inconsistent, scattered across multiple banks and other lenders.
Ryan soon expanded his concept by hiring his own employees to promote the idea to other dealerships throughout the Chicago area.
In 1964, he founded Pat Ryan Associates. The small underwriting agency specialized in distributing credit life insurance products to dealers. Eventually, it grew into the insurance behemoth that Aon is today, with 500 offices in 120 countries that generate more than $7 billion in annual revenue.
Ryans business experience began at his fathers suburban Milwaukee Ford dealership where he worked as a porter and a salesman.
He stayed in the dealership world when he opened his first F&I department three years after graduating from Northwestern University in 1959.
The spread of F&I throughout the Chicagoland area that followed was met with mixed reactions from salesmen, while dealers reveled in the new source of revenue.
At a Montreal dealership conference around 1967, Ryan met and befriended auto racing legend Roger Penske. Ryan invested in Penskes businesses soon thereafter. Penske now is his own automotive conglomerate with holdings throughout the industry, including the nations No. 2 auto dealership group.
Mike Cook, Ryans Detroit office manager in 1972, told Automotive News in a past interview that when a store added Ryans system for an F&I department, it doubled finance and insurance income in 60 days.
The key to making money through F&I, Ryan said, was clearly explaining the potential benefits to be had through the dealership to every dealership customer.
The idea was 100 percent solicitation, Ryan told Automotive News in 2005. We made it mandatory that the finance person had to expose every customer to the products we offered. That made a significant difference.
From local to global
Pat Ryan Associates eventually grew into Ryan Insurance Group, which added consulting and advisory services to its practice of providing insurance products to dealers.
In 1978, Ryan began to grow his small Chicago-based auto dealer specialty firm through acquisitions. That year his company acquired brokerage subsidiaries of Esmark Corp., adding commercial and industrial risk management services.
Ryan Insurance later merged with Combined Insurance Company of America and later acquired Rollins Burdick Hunter, which was the 7th-largest insurance broker in the world when Ryan bought it in 1982.
As Ryan Insurance continued to grow and bring other companies under his umbrella, Ryan changed the company name to Aon Corp.
Aon continued to expand its reach in the United States through the 1980s and into the 1990s. In 1991, Aon acquired Hudig-Langeveldt. This made Aon a global player.
Frankly, in six years (following the Hudig-Langeveldt acquisition), we went from doing business in one country to doing business in over 100 countries, Ryan told Automotive News sister-publication Business Insurance in 1997.
But Aon ran into a spot of trouble when then-New York Attorney General Eliot Spitzer launched probes looking into potential bid rigging and steering business by Aon. The company agreed to a $190 million settlement in early 2005, but no employees were implicated.
After his retirement, Ryan will continue to chair the Board of Trustees at his alma mater, Northwestern University.
Donna Harris and Sally Roberts of sister publication Business Insurance contributed to this report