Two Agencies Merge

Two longtime East Hampton insurance agencies with deep local roots, which have been doing business quietly on Main Street for decades, just as quietly joined forces earlier this year.

The Osborne Agency, which was founded by Joseph S. Osborne in 1875, and E.T. Dayton, founded in 1906, merged as Dayton & Osborne in September. However, the merger was not publicly announced until last week.

George Yates, who came to East Hampton in 1976, became partners with Ernie Clark, the owner of E.T. Dayton, in 1980, and acquired the rest of the firm when Mr. Clark retired in 1990, is the new company's president. Charles Osborne, the owner of the Osborne Agency, is its vice president.

Expanded Offerings

The new company will continue to serve its primary market, providing property and casualty insurance for homeowners and businesses, but will also expand its offerings of life and health insurance and estate planning.

"By joining together, we'll be able to work much more efficiently and expand our staff," said Mr. Yates. The firm currently has 27 employees.

Dayton and Osborne has moved into the E.T. Dayton building at 78 Main Street, which is undergoing renovation. It shares the building with Dayton-Halstead, a separate real estate company owned by Mr. Yates and Diane Saatchi.

The building once housed The East Hampton Star. During remodeling, contractors discovered a badly sagging floor in the rear of the building, where the newspaper's presses were once located.

"Enough Boutiques"

Mr. Osborne said he would rent the Osborne Agency's building at 35 Main Street, preferably to a business that will serve East Hampton's year-round community. "I think we have enough boutiques," he said.

One of the biggest problems facing property and casualty brokers in today's markets, according to Mr. Yates, is securing insurance for homeowners near the water.

"It was an exposure that was long ignored until Hurricane Andrew hit Florida in 1992," said Mr. Yates. When claims reached the billions of dollars, insurance companies took note. "Suddenly, everybody got very interested," he said. "But it was a little like closing the barn door after the horses are out."

Times Have Changed

While today insurance companies are abandoning the market in areas that are vulnerable, Mr. Osborne said he could recall no such concern when the hurricane of 1938 devastated the area.

"That was long before the days of people being frightened by hurricanes," he said. But, at the time, he added, "most people didn't insure against hurricanes or wind, just fire and lightning."

Although insurance carriers now use computer models to analyze their risk in hurricane-prone areas, Mr. Osborne believes current restrictions will be relaxed at some point. "In time, the companies are going to recognize that Long Island isn't going to sink," he said.

Broker, Not Insurer

Unlike the Cook Agency, which recently launched its own insurance-writing wing, Mr. Yates said, "I see myself as a broker, not an insurance company."

Because both the Osborne Agency and E.T. Dayton had established "highly profitable relationships with carriers, " Mr. Yates believes the new firm will be able to meet its customers' needs.

The company represents a number of major carriers, including Hartford Insurance, Royal Insurance, Hanover Insurance, and Travelers Insurance.

Family Business

The merger brings together "two of the longest running shows on Main Street," according to Mr. Yates.

Mr. Osborne, who joined the family business "as an insurance peddler" after returning from World War II -- when his B-24 bomber was shot down over Italy, and "we had to walk home" -- concurred. Only White's Pharmacy has been around longer, he said.

The Osborne Agency was founded by Mr. Osborne's grandfather. Its original office was in a house at 135 Main Street now occupied by the law firm Osborne & McGowan.

Nelson C. Osborne, once an East Hampton Town Supervisor and Charles Osborne's father, took over the business before passing it on to his nephew, Edward M. Osborne. Charles Osborne later took over from his cousin.

Merger Of Locals

E.T. Dayton, a life insurance salesman, founded his own firm in 1906. Robert Reutershan took over the business in the 1950s. When Mr. Reutershan was killed in an auto accident in 1964, Ernest Clark bought the business.

Mr. Clark, who is now retired and spends his winters in Naples, Fla., said, "I'm glad to see the merger was able to take place. I think it will be to the benefit of both companies."

He was also happy to see a local merger. "I would have advised George against a merger with an outside firm," he said. "I knew the people I did business with, and they knew me. There was a great deal of trust between us. An outside firm probably wouldn't do business the same way."

Still Active At 74

Over the years, said Mr. Osborne, who stills works every day at age 74, the business has seen some "unbelievable" changes. "It was all done by hand," he said. Today, the firm has what Mr. Yates calls a "state-of-the art" computer network.

But Mr. Osborne, in a typically self-deprecating manner, said, "I don't know how to use the doggone things. I can look up information, but I don't know how to put anything in them."