Fast Focus
	He had thoughts of farming but ended up at McKinsey.
	To woo talent and rebuild the insurer, he understood he had to rebuild the psychology of the town.
	While the economy has hit other carriers hard, Hanover is ready to pounce on new opportunities.

The Wizard of Worcester

Fred Eppinger comes home to save a failing carrier and ends up reviving a glorious theater and the spirits of a struggling town.

By  Leslie Werstein Hann

Everywhere he goes, picking up materials at Home Depot for his workshop or testifying at a contentious legislative hearing, people stop what they are doing to thank Fred Eppinger, the president and CEO of Hanover Insurance Group in Worcester, Mass.

They thank him for turning around a foundering property-casualty insurance company with a once-proud history. They thank him for his company’s $3 million contribution—and his personal six-figure donation—to jumpstart the spectacular renovation of a grand theater that had become an abandoned movie multiplex. They thank him for the company’s commitment to the city schools and youth organizations. They thank him for renewing the belief among the citizens of Worcester that theirs can be a first-class city, a place where tourists visit to catch a show and young people find high-tech jobs.

In reality, they probably should be thanking Eppinger’s parents, who have been married 61 years and live on Cape Cod. His father, Fred Sr., who gave up a full ride at Cornell University to support his family during the Depression, and his mother, Leona, a high school valedictorian who worked as a housekeeper for a renowned doctor, discouraged Fred Jr., the fifth of their six children, from his singular ambition: running the family chicken farm in nearby Spencer, Mass.

“My parents talked me into going to college because I didn’t want to go,” Eppinger says. “My dad sold me half the farm for a buck a year before I went to school to get me used to how hard it was. And his point was you can always buy a farm later…but you want to give yourself choices.”

Eppinger, now 50, chose to stay close to home, attending College of the Holy Cross in Worcester and thumbing rides home to work the farm on weekends. After a few years with an accounting firm, he ventured to Dartmouth College to the Tuck School of Business, where a professor directed him toward McKinsey & Company, the prestigious consulting firm well known as a CEO factory. McKinsey opened Eppinger’s eyes to a new world. Having rarely traveled outside New England when he started in 1985, Eppinger left McKinsey 15 years later logging 20,000 miles in a month.

“I’d always been a small place guy,” he says, but “it didn’t really matter where you came from or what you looked like; if you lived within the values and made a difference, you got ahead.”

Eppinger’s next stop, in 2000, was an insurance technology company called ChannelPoint, and a year later he went to The Hartford, where he absorbed lessons from industry icon Ramani Ayer, the chairman and CEO.

He might have stayed longer but for the call in 2003 that seemed right out of a Frank Capra movie: Come home to Worcester (pronounced WIS-tah) and save the failing insurance company.

The company was Allmerica Financial Corp., and Eppinger knew it well. Allmerica began its life as State Mutual Life Assurance Co., founded by a former Massachusetts governor in 1844. For most of its 160 years, it had been a respected employer, deeply involved in the Worcester community. Eppinger’s Aunt Theresa and Uncle Frank worked there for decades, and his sister-in-law, Christine, and her sister worked there, too.

In 1989, a former executive of Fidelity Investments sought to transform the regional life and p-c carrier into a national financial services powerhouse. State Mutual changed its brand name to Allmerica in 1992, and three years later it converted from a mutual to a stock company.

More than once, Eppinger had turned his consultant’s eyes on the p-c subsidiaries, Hanover and Citizens. In the mid-1990s, McKinsey analyzed the largest p-c insurance companies search for those with the best long-term performance during the 15-year period from 1979 to 1993. To Eppinger’s surprise, his hometown company ranked in the top 10.

By the time Eppinger got the call to run Allmerica, however, “the company was a mess, to put it plainly,” says Cliff Gallant, equity research analyst with Keefe Bruyette & Woods, which makes a market in Hanover stock. “When he came in, it looked impossible. A lot of people thought this was a zero.”