Spotlight on Security & Alarm Insurance Producer Jon Lipton

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Security & Alarm Insurance Producer Spotlight: Jon Lipton, Castle Rock Capacity

From his career start as a Foreign Exchange interbank spot trader to his current role as president of Castle Rock Capacity, LLC,  Jon Lipton knows the devil is in the details. Jon’s in the spotlight this month as a top producer in our Security & Alarm Insurance Program.

“My pet peeve is when a client or prospect is quoted a lower rate, because the agent doesn’t understand the exclusions, conditions, endorsements and sometimes warranties involved in the client’s business. Insurance is an extremely complicated product.  Clients of course want the best price, but not at the expense of spotty coverage.”

A 23-year veteran in the insurance industry, Lipton holds both Certified Insurance Counselor (CIC) and Construction Risk Insurance Specialist (CRIS) designations and is a licensed property, casualty & life insurance broker. He’s president of Castle Rock Capacity, LLC, with offices in New York’s financial district.  Castle Rock is a member of EPIC Brokers & Consultants, among the top 10 privately held insurance brokers in the USA.  Lipton is an active member of the Professional Insurance Agents (PIA) NYC advisers board and an executive board member with PIA New York State (Albany).

While his practice focuses on Construction, Real Estate & Product Liability, Lipton is also one of our Security & Alarm Insurance Program’s top producers. We chatted with him a couple of weeks ago to learn more about his practice and share tips for other producers from his 23-year history.


First, tell us a bit about how you got started in the insurance industry.

“I actually started my career as a Foreign Exchange interbank spot trader with one of the largest French banks globally.  The foreign exchange market is the largest and fastest-moving markets in the world.  But when I saw that on-the-job heart attacks were not uncommon, and technological advances in the banking industry were eliminating human traders, I realized this was not a long-term career path.”

After multiple conversations about his frustration in the banking industry and with a child on the way, Lipton’s brother-in-law, Jay Levy, invited him to work for his company, Morstan General Agency, as an underwriter.  A year later, he decided to form ARM of New York, a retail property and casualty agency from scratch in Queens with industry veteran Russell Weinstein. Ten years later, he launched another New York-based agency, Castle Rock, with his brother Brett.

Capacity Group purchased 50 percent of their business in 2015; in 2017, EPIC Insurance Brokers & Consultants, headquartered in California and with offices throughout the United States purchased Capacity Group. In 2018, Business Insurance magazine ranked EPIC in the top 10 privately held owned brokers.

“Agreeing to be acquired by a much larger agency was probably one of the best decisions I made in insurance,” Lipton recalls. “It certainly opened the door to much more opportunities.”


What are your thoughts on the education requirements and training for agents?

The barrier to entry to become a licensed insurance agent is relatively low. This is a huge problem in our industry.  Each state has its own set of requirements to obtain an insurance license; I can only speak for New York.  To obtain your property & casualty license in New York, one must take a 96-hour accredited property & casualty insurance course and pass a proctored state exam with a 70 or better.

“I strongly urge newly licensed insurance brokers to first work for another company, whether a retail agency, wholesaler or insurance carrier before going off on their own. They’re just not properly trained to open up their retail agencies right out of pre-licensing class. In my case, I had worked as an underwriter for a large wholesaler, then spent several months working at a retail brokerage. Plus, my partner was a very seasoned veteran of the insurance industry.

“Security & alarm insurance – and all insurance – is an extremely complicated product.  The unknowing general public is buying a product they don’t understand. They expect the insurance broker to be able to advise and explain a 100+ page policy in a few short sentences.   The pre-licensing classes are a great start, but they’re more theory-oriented. There’s certainly a lot more training needed to advise and insure one’s clients properly.  I have been in this industry for 23 years, and I learn something new every day.”

Related: Core Commercial spotlight on Scott Mosher, Mosher & Associates

Speaking of an unknowing general public, what misconceptions do clients often have about your job?

“First, they think that every $1,000,000 insurance policy provides the same coverage, no matter who you buy it from. They also think it covers everything and anything. They don’t understand the complexity of insurance and that policies contain exclusions, conditions, endorsements and sometimes warranties that could preclude coverage.  On top of that, each insurance company has its own set of exclusions, conditions & endorsements.

“It’s our job to read the policy forms and educate them, explaining what is covered and what is not. For example, nightclubs, bars, and restaurants typically have exclusions for assault and battery and liquor liability. Alarm installers many times have exclusions for errors and omissions coverage.

“Many times, my prospects and clients receive lower quotes because of these exclusions.  When I ask to review the other quotes, I get a lot of pushback because prospects think they’re getting an apples-to-apples comparison in the quotes. This happens not only in Security & Alarm insurance, but in all types of coverage.

“It is the smart and educated broker that understands the needs of their clients and makes sure necessary and applicable coverages are included.”

A second misconception is that clients and prospects think that agents plug their information into a computer, and it spits out a quote, no matter what the type of insurance.   They can’t understand what takes so long to get a policy quoted and issued, and why it takes so long to makes changes and issue endorsements. In many cases, the changes must go down a long supply chain, from the client to the retailer. In some cases it also goes to a middleman or wholesaler and then to an insurance carrier.  Many insurance carriers are not in a rush to make changes in a timely fashion, he observed.


What personal tips and shortcuts have made your job easier?

“I spend a lot of time with my partners and employees to understand our workflow.  We’ve developed software that allows us to streamline our workflow.  When our staff of six show up at events, we’re asked, Where’s the rest of your staff?  People can’t believe that we operate with only six employees.”


What’s the worst part of the job and how do you deal with it?

“The worst part of my job is dealing with current clients and prospective clients who have been offered low insurance quotes from inexperienced brokers who don’t make sure that their client’s insurance is properly classified. It’s true with Security & Alarm insurance – and other types of commercial lines. They don’t bother to read insurance quotes for proper coverages and important exclusions. This results in lower inaccurate quotes, and exposes the client to catastrophe financial loss in the event of a claim.  The worst part is that these people only find out they’re not properly covered until after a claim. At that point, it’s way too late.”

Related: Spotlight on Security & Alarm Producer Chris Bell

What’s the most enjoyable part of the job?

“Closing on an insurance deal, no matter what the size, and the client is extremely happy.”


What do you do differently from your peers in the same profession?

“The care that I take with my clients. We constantly review our client’s policies to see what we can do to improve their coverage.  We are also constantly updating their information in our system, to make sure their information is current. Third, we make a point to keep up with the industry by constantly and consistently reading coverage articles and case law. By reading case law, I discover why some claims get denied so we do not make similar mistakes.   Sometimes there are simply coverage gaps that could have been plugged with unknown endorsements. Only a well-read and educated broker would know about these endorsements from reading coverage articles and case law.  Or a separate coverage could have provided coverage. A good example of this is offering a manufacturer a separate product recall policy, because in most cases it’s an exclusion on a general liability policy.


What advice would you give to those aspiring to join your profession or advice to newbies in the field?

Ask a lot of questions, LISTEN and read, read and keep reading.  This will serve you well for learning security & alarm insurance – and all other commercial and specialty lines.


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