Ronald K. Richey
Encyclopedia
Ronald K. Richey was the chairman, president and chief executive officer of the Torchmark Corporation .
in 1926. The youngest of five boys, his brothers were Marion, Earle, Jr., Keith and Leland. His father owned a drug store where Richey worked. After serving in the Army Air Corps during World War II
, he received his undergraduate degree from Washburn University
in 1949 and a law degree from Washburn Law in 1951. In 1989, the school awarded him an honorary doctorate of commerce. While an undergraduate he was initiated into the Kansas Beta Chapter of Phi Delta Theta
. During law school he was a member of the law fraternity Delta Theta Phi
.
Richey was married to Florence (Kane) Richey. The Richeys met at Washburn where Florence was a member of Delta Gamma
. Their children are Robert Richey, a retired insurance executive and founding member of the McHeadley Society, Chris Richey, CEO of Neosho Capital, and Linda Richey Graves. Linda is married to former Kansas Governor Bill Graves
. The couple had six grandchildren.
in Oklahoma City as vice president and general counsel. He was eventually elected chairman and chief executive officer and maintained that position until 1980.
Globe Life was purchased by Torchmark, and, in 1982 Richey was elected President of the Birmingham
, Alabama
-based Torchmark Corporation. On January 1, 1985, Richey was named president and chief executive officer of Torchmark Corporation. Under Richey’s leadership, Torchmark successfully integrated several of the companies it had spent more than half a billion dollars to acquire during a buying spree in the late 1970s and early 1980s. These acquisitions included Globe Life and Accident Insurance Company, Continental Investment Corporation and United American Insurance Company
. Continental owned Waddell & Reed
and United Investors Life Insurance Company
.
While many other insurance providers were lured into the high-return, high-risk junk bond and commercial real estate markets of the 1980s, Torchmark maintained three-fourths of its invested assets in reliable, government-guaranteed securities and short-term investments. When the bottom fell out of the junk bond and real estate markets in the late 1980s, Torchmark emerged unscathed. Torchmark's conservative investment strategies earned its primary subsidiaries the industry's highest ratings. The national scandals, however, did affect the company, in the form of increased contributions to the federal guaranty fund to bail out insolvent insurers.
The 1990s began promisingly for Torchmark, as 1992 marked the company's forty-first consecutive year of growth. By then, its stock price had shot up an astronomical 1,675% from its 1980 levels. In 1994, however, the company experienced some setbacks. In large part as a result of some poorly performing investments and the fallout from several different legal disputes in Alabama stemming from alleged misconduct by agents at Liberty National Life Insurance Company
, the company's growth streak was snapped. Revenues declined to $1.9 billion from 1993's $2.2 billion and net income dropped $31 million from 1993's results, to $269 million.
1994 also saw some alterations in the company's business balance as Torchmark made the strategic decision to focus more heavily on its life insurance operations at the expense of its health insurance ones (life insurance products tended to have higher operating margins, build better assets, and be under less year-to-year growth pressure). Buoyed by the acquisition of American Family Life Insurance Company for $552 million in November of that year, Torchmark's life insurance revenues jumped 16% from 1993's levels, while the health insurance sector contracted by 31.2% over the same period.
The restructuring of 1994 helped stanch the decline in Torchmark's revenues, as 1995 sales climbed to $2.1 billion, recouping nearly all of the 1993-94 drop. Net income, however, declined nearly 47% from 1994 ($143 million) as a result of poor growth in the Medicare
supplemental insurance
sector along with the company's litigation exposure, heavy debt burden from the American Family Life acquisition, and underperforming oil and gas investments. (The Medicare business had been slumping ever since federal legislation enacted in 1992 capped the commissions that vendors of such policies could charge.) To remedy this situation as best it could, Torchmark opted to divest itself of its holdings in the energy industry to streamline its operations and dedicate itself more effectively to its core insurance, mutual fund, and asset management businesses. In 1995, Torchmark liquidated its investments in Torch Energy Advisors, Inc., the Black Warrior coal mine and its holdings in Nuevo Energy Co.
Ritchey retired as CEO in March 1998 and chairman in 2002.
From 1982 to 1999 he was a trustee of the Washburn Endowment Association
and later a trustee emeritus. He was also a former member of the Washburn Law board of governors. Richey and his wife were the benefactors of the Richey Scholars Program at Washburn making them one of the university's most generous donors in its history. Around the time of his graduation from law school, Richey joined together with eight other Phi Delta Theta
fraternity brothers to form the "Free Society of GNIP-GNOP." For more than fifty years, this group has sponsored prizes for best note and comment at Washburn Law.
Richey previously served on the board of directors of Full House Resorts . From 1998 until 2004, Full House was led by CEO William P. McComas. McComas and Richey were fraternity brothers at Washburn.
Family and education
Richey was born in Erie, KansasErie, Kansas
Erie is a city in and the county seat of Neosho County, Kansas, United States, and situated in the valley of the Neosho River, about a mile Northeast of the river...
in 1926. The youngest of five boys, his brothers were Marion, Earle, Jr., Keith and Leland. His father owned a drug store where Richey worked. After serving in the Army Air Corps during World War II
World War II
World War II, or the Second World War , was a global conflict lasting from 1939 to 1945, involving most of the world's nations—including all of the great powers—eventually forming two opposing military alliances: the Allies and the Axis...
, he received his undergraduate degree from Washburn University
Washburn University
Washburn University is a co-educational, public institution of higher learning in Topeka, Kansas, USA. It offers undergraduate and graduate programs, as well as professional programs in law and business. Washburn has 550 faculty members, who teach more than 6,400 undergraduate students and...
in 1949 and a law degree from Washburn Law in 1951. In 1989, the school awarded him an honorary doctorate of commerce. While an undergraduate he was initiated into the Kansas Beta Chapter of Phi Delta Theta
Phi Delta Theta
Phi Delta Theta , also known as Phi Delt, is an international fraternity founded at Miami University in 1848 and headquartered in Oxford, Ohio. Phi Delta Theta, Beta Theta Pi, and Sigma Chi form the Miami Triad. The fraternity has about 169 active chapters and colonies in over 43 U.S...
. During law school he was a member of the law fraternity Delta Theta Phi
Delta Theta Phi
Delta Theta Phi is a professional law fraternity and a member of the Professional Fraternity Association. The smallest of the three internationally recognized law fraternities , Delta Theta Phi is the only one of the three major law fraternities to charter chapters in the United States at...
.
Richey was married to Florence (Kane) Richey. The Richeys met at Washburn where Florence was a member of Delta Gamma
Delta Gamma
Delta Gamma is one of the oldest and largest women's fraternities in the United States and Canada, with its Executive Offices based in Columbus, Ohio.-History:...
. Their children are Robert Richey, a retired insurance executive and founding member of the McHeadley Society, Chris Richey, CEO of Neosho Capital, and Linda Richey Graves. Linda is married to former Kansas Governor Bill Graves
Bill Graves
William Preston "Bill" Graves , was the 43rd Governor of Kansas from 1995 until 2003.Graves was born in Salina, Kansas in 1953 to parents who owned a trucking firm...
. The couple had six grandchildren.
Career
After graduating from Washburn in 1951, Richey served as an attorney with the Kansas Insurance Department and later as Legislative Manager for the American Mutual Insurance Alliance of Chicago, Illinois. In 1964, he joined Globe Life And Accident Insurance CompanyGlobe Life And Accident Insurance Company
Globe Life And Accident Insurance Company based in Oklahoma City, Oklahoma, provides life and health insurance coverage nationwide. Globe was founded in 1951. The Company’s executive offices are housed in Oklahoma City and now include more than 3.8 million policyholders . The Company has more than...
in Oklahoma City as vice president and general counsel. He was eventually elected chairman and chief executive officer and maintained that position until 1980.
Globe Life was purchased by Torchmark, and, in 1982 Richey was elected President of the Birmingham
Birmingham, Alabama
Birmingham is the largest city in Alabama. The city is the county seat of Jefferson County. According to the 2010 United States Census, Birmingham had a population of 212,237. The Birmingham-Hoover Metropolitan Area, in estimate by the U.S...
, Alabama
Alabama
Alabama is a state located in the southeastern region of the United States. It is bordered by Tennessee to the north, Georgia to the east, Florida and the Gulf of Mexico to the south, and Mississippi to the west. Alabama ranks 30th in total land area and ranks second in the size of its inland...
-based Torchmark Corporation. On January 1, 1985, Richey was named president and chief executive officer of Torchmark Corporation. Under Richey’s leadership, Torchmark successfully integrated several of the companies it had spent more than half a billion dollars to acquire during a buying spree in the late 1970s and early 1980s. These acquisitions included Globe Life and Accident Insurance Company, Continental Investment Corporation and United American Insurance Company
United American Insurance Company
United American Insurance Company , based in McKinney, Texas, provides supplemental life, health, and accident coverage. UA was founded in 1947. Today, UA operates in 49 states, the District of Columbia, and has more than 850 people working in the Home Office...
. Continental owned Waddell & Reed
Waddell and Reed
Waddell & Reed Financial, Inc. is an American asset management and financial planning company founded in 1937. It is a publicly traded company as of 1998, with its headquarters in Overland Park, Kansas...
and United Investors Life Insurance Company
United Investors Life Insurance Company
United Investors Life Insurance Company , based in Birmingham, Alabama, provides individual life insurance and annuity products. United Investors was founded in 1961. UILIC has more than $14 billion of insurance in force . There are more than 150,000 polices in force and more than 1,400 licensed...
.
While many other insurance providers were lured into the high-return, high-risk junk bond and commercial real estate markets of the 1980s, Torchmark maintained three-fourths of its invested assets in reliable, government-guaranteed securities and short-term investments. When the bottom fell out of the junk bond and real estate markets in the late 1980s, Torchmark emerged unscathed. Torchmark's conservative investment strategies earned its primary subsidiaries the industry's highest ratings. The national scandals, however, did affect the company, in the form of increased contributions to the federal guaranty fund to bail out insolvent insurers.
The 1990s began promisingly for Torchmark, as 1992 marked the company's forty-first consecutive year of growth. By then, its stock price had shot up an astronomical 1,675% from its 1980 levels. In 1994, however, the company experienced some setbacks. In large part as a result of some poorly performing investments and the fallout from several different legal disputes in Alabama stemming from alleged misconduct by agents at Liberty National Life Insurance Company
Liberty National Life Insurance Company
Liberty National Life Insurance Company , located in McKinney, Texas, has been providing life and supplemental health insurance for more than 100 years. LNL provides individual coverage through home and workplace sales. LNL is licensed in 49 states with thousands of Sales Agents and Managers in...
, the company's growth streak was snapped. Revenues declined to $1.9 billion from 1993's $2.2 billion and net income dropped $31 million from 1993's results, to $269 million.
1994 also saw some alterations in the company's business balance as Torchmark made the strategic decision to focus more heavily on its life insurance operations at the expense of its health insurance ones (life insurance products tended to have higher operating margins, build better assets, and be under less year-to-year growth pressure). Buoyed by the acquisition of American Family Life Insurance Company for $552 million in November of that year, Torchmark's life insurance revenues jumped 16% from 1993's levels, while the health insurance sector contracted by 31.2% over the same period.
The restructuring of 1994 helped stanch the decline in Torchmark's revenues, as 1995 sales climbed to $2.1 billion, recouping nearly all of the 1993-94 drop. Net income, however, declined nearly 47% from 1994 ($143 million) as a result of poor growth in the Medicare
Medicare (United States)
Medicare is a social insurance program administered by the United States government, providing health insurance coverage to people who are aged 65 and over; to those who are under 65 and are permanently physically disabled or who have a congenital physical disability; or to those who meet other...
supplemental insurance
Medigap
Medigap refers to various private supplemental health insurance plans sold to Medicare beneficiaries in the United States that provide coverage for medical expenses not or only partially covered by Medicare...
sector along with the company's litigation exposure, heavy debt burden from the American Family Life acquisition, and underperforming oil and gas investments. (The Medicare business had been slumping ever since federal legislation enacted in 1992 capped the commissions that vendors of such policies could charge.) To remedy this situation as best it could, Torchmark opted to divest itself of its holdings in the energy industry to streamline its operations and dedicate itself more effectively to its core insurance, mutual fund, and asset management businesses. In 1995, Torchmark liquidated its investments in Torch Energy Advisors, Inc., the Black Warrior coal mine and its holdings in Nuevo Energy Co.
Ritchey retired as CEO in March 1998 and chairman in 2002.
Other activities and interests
Richey was active in a number of industry and charitable activities. He was a former president of the Association of Oklahoma Life Insurance Companies, a former director of the American Council of Life and Health Insurance and board member for the National Cowboy Hall of Fame and Western Heritage Center.From 1982 to 1999 he was a trustee of the Washburn Endowment Association
Washburn University
Washburn University is a co-educational, public institution of higher learning in Topeka, Kansas, USA. It offers undergraduate and graduate programs, as well as professional programs in law and business. Washburn has 550 faculty members, who teach more than 6,400 undergraduate students and...
and later a trustee emeritus. He was also a former member of the Washburn Law board of governors. Richey and his wife were the benefactors of the Richey Scholars Program at Washburn making them one of the university's most generous donors in its history. Around the time of his graduation from law school, Richey joined together with eight other Phi Delta Theta
Phi Delta Theta
Phi Delta Theta , also known as Phi Delt, is an international fraternity founded at Miami University in 1848 and headquartered in Oxford, Ohio. Phi Delta Theta, Beta Theta Pi, and Sigma Chi form the Miami Triad. The fraternity has about 169 active chapters and colonies in over 43 U.S...
fraternity brothers to form the "Free Society of GNIP-GNOP." For more than fifty years, this group has sponsored prizes for best note and comment at Washburn Law.
Richey previously served on the board of directors of Full House Resorts . From 1998 until 2004, Full House was led by CEO William P. McComas. McComas and Richey were fraternity brothers at Washburn.
Honors and recognition
Richey received numerous and awards for both his professional accomplishments and philanthropic endeavors including:- Distinguished Service Award from Washburn UniversityWashburn UniversityWashburn University is a co-educational, public institution of higher learning in Topeka, Kansas, USA. It offers undergraduate and graduate programs, as well as professional programs in law and business. Washburn has 550 faculty members, who teach more than 6,400 undergraduate students and...
, 1993 - Bronze Award Winner, Insurance Diversified Category, CEO of the Year, 1993
- Bronze Award Winner, Insurance Diversified Category, CEO of the Year, 1992
- Silver Award Winner, Insurance Life/Health Category, CEO of the Year, 1991
- First Place Winner, Finance Industry CEO of the Year, Financial World, 1990
- Outstanding Insurance Executive, 1991
- Honorary Doctor of Commerce, Washburn UniversityWashburn UniversityWashburn University is a co-educational, public institution of higher learning in Topeka, Kansas, USA. It offers undergraduate and graduate programs, as well as professional programs in law and business. Washburn has 550 faculty members, who teach more than 6,400 undergraduate students and...
, 1989 - First Place Winner, CEO of the Decade, Financial World, 1989
- Kansan of Distinction, Topeka Capital Journal, 1987