NORTHUMBERLAND, Pa. July 19 (BestWire) — Keystone Insurers Group said it has added two more franchisees to its list of Kentucky partner agencies — and its executive vice president said the company is eyeing moves into other states.

As Hall & Clark Insurance Agency in Prestonsburg and Ison Insurance Agency of West Liberty join Keystone's more than 210 independent agencies in six states, Colin R. Buzzard said several U.S. independent agencies have asked about when Keystone would be entering their states. Keystone is owned by its employees and franchise partners in Pennsylvania, North Carolina, Virginia, Indiana, Ohio and Kentucky. Each partner is an independent agency.

"That is flattering, but no business model can afford to outrun its supply line, and Keystone is no different. Even if we had the resource, or supply line, not every opportunity is a good one," he said in an e-mail.

Tennessee will be Keystone's next state, Buzzard noted. In addition, Georgia and Alabama "are attractive, and Illinois, although litigious, may hold promise," Buzzard said, noting that parts of New England may work, as might Wisconsin and Minnesota. "So much depends on the economic environment, the legislative and regulatory climate, the inherent risk of a state — can you say Florida? — the unknowns and unexpected such as we've seen in the Gulf region, and the associations within a prospective state."

Keystone's main goal is to expand into states have the proper environment: a fair and progressive legislative/regulatory climate; "a legal environment that does not foster entitlement;" among other attributes, he said.

When choosing a state, Keystone's business premise is that Keystone corporate, potential franchise partners and Keystone's carrier partners must all benefit. "You can delude yourself, but if any one of those entities is not winning, it ain't working," he said.

Buzzard cited Keystone's initial consideration of Maryland, seen as a natural move from Pennsylvania, when it was first pondering expansion. "The demographics proved unattractive, the legislative climate was not particularly business-friendly, and there was a limited number of opportunities that fit the Keystone mold. While they would not have been a good choice in 2003, we have seen elements of Maryland change and it is on our radar," he noted.

Buzzard praised the independent agent relationship within Keystone, calling them the "backbone of the insurance industry" who provide risk solutions to protect the assets of their customers. "Simultaneously, they work with the insurance companies and regulators to solve issues that affect the entire industry. These agencies are entrepreneurs who run their own successful business while managing both vendors and customers in a highly regulated industry. They are the solution providers in our industry."

"Never is a mighty long time, but I cannot foresee the day that Keystone would consider doing business with a Geico, State Farm, Nationwide and the lot," he said.

Keystone Insurers Group was started in 1983 by four central Pennsylvania agencies, which joined forces in a difficult market. In 1999, Keystone changed its model from a cooperative arrangement to that of a franchisor and rapidly expanded throughout Pennsylvania to more than 110 locations. The group has continued to expand since then, and has entered other states (BestWire, Feb. 8, 2010).