Graham Cook has been Des Moines’ most eccentric corporate leader for decades. Standing more than 6-foot-6-inches tall and skinny, he jokes that he would be typecast to play a mortician in a horror film. Usually dressed more like a 19th-century poet than a president/CEO of a conservative insurance corporation, Cook and his art collection have long been the envy of many souls trapped in conformity.
After hearing that he was somewhat lost amidst the free time of retirement, we asked to lunch recently. He chose Exile, a pub and brewing company in the Western Gateway. He marveled that brew pubs and craft breweries have become so successful.
“They had a short run in the 1970s and early ’80s, but those almost all failed rather quickly. When I was young, the crowd I ran with was content with the cheapest beer,” he said, agreeing that young folks today have more expensive tastes.
Cook thinks that has become a challenge for the life insurance industry.
“I don’t think many millennials are willing to insure any kind of risk. They want to spend their money on more immediate gratifications. We had a matching 401K program at Homesteaders, and few signed up,” he observed.
Cook’s success in the industry was as unconventional as his wardrobe. He began working part time at Homesteaders Life when he was a student at Drake. An English major, he was assigned to write and publish the corporation’s newsletter.
“That was before computers. Publishing a newsletter required skills with scissors, paste pots, cameras and printers, but it was a good way to learn about the company,” he recalled.
The company liked Cook’s work enough to offer him a full-time job upon graduation in 1969.
“I was paid the grand sum of $500 a week. My mentor, Jim Wilson, liked me enough to let me do all kinds of different things — stuff no 21-year-old kid probably should have been doing. My big perk was that they flew me all over the country, first class. I had to be one of the only $500-a-week employees in the nation with a drawer full of first-class amenities,” he joked.
How did the company change during Cook’s five decades there?
“When I started, we sold everything. We were not big enough to be doing that. We needed a niche where we could stand out. In the 1970s, prefunded funerals were not yet on line. I was writing ad copy for the company then. I remember one of my taglines like I wrote it this morning: ‘Don’t let your final expenses become a burden for your loved ones.’
“That became our niche. We flipped pre-funded funerals into life insurance funded funerals. Now everyone does it, but we were early through that door. Funeral homes became one of our biggest customers. Now, $4 billion a year is spent on prefunded funerals. That number grew dramatically when the feds allowed prefunded funeral policies to become tax shelters and shelters for income regarding Title 19,” he explained regarding the maximum assets someone can have and still be eligible for Medicaid.
Cook said his English-major-to-president/CEO journey was a strange one.
“I spent about 70 percent of my time visiting funeral homes, casket makers, morticians and embalmers. I never dreamed when I was in high school that my life would take that direction. No one does, I hope,” he recalled.
The challenges to the industry are already here, he said.
“The popularity of crematoriums is a huge challenge to funeral homes,” Cook said. “They used to make their margins on the sale of hardware like caskets and tombstones. With more people choosing cremations, they have to move into services. Today, casket companies are starting their own insurance companies to sell Granny a guarantee that she will be laid to rest in a cemetery rather than being tossed to the wind. Funeral homes resemble car dealers in this. The money is made now on services, not on profits off car sales. This is harder today. Price is the main factor in most purchases, other than beer. I think the last full-service gas station in town is closing. I always paid their higher prices in case I needed them to come and tow me sometime.
“The next biggest challenge to life insurance is low interest rates. They cut our margins, and they do not appear to be going up again in the near future.”
Retirement hasn’t been a boon to increasing Cook’s art collection, however. Simply put, he ran out of places to put it.
“I will say this though. Bonnie Percival (Percival Gallery) told me to ‘never buy a piece that sticks out in an artist’s body of work. Evaluate the entire body of work, and you will be successful collecting.’ This has served me well. Despite the fact that I did reject offers to buy a Chuck Close self-portrait and a Robert Cottingham marquee painting that would have made me lots of money. Today, I am mostly interested in lesser-known artists. If you go to an art fest, don’t buy the only painting you like in an artist’s booth. Like them all or don’t buy,” he said.
Retirement hasn’t been all it’s cracked up to be either.
“I don’t like it. I loved the regularity of fully scheduled days,” he said. “I drive by schools today, and I can’t understand where all these kids are going at 2 p.m. When I was in high school, I was busy until after dinnertime with classes and activities. College was the only previous time in my life when I had gaps in my schedule. I didn’t like it then either. I recently joined a skeet shooting group. All the others are retired military guys, and I like being around their discipline.”
Cook is on many boards of directors, and his favorite is Drake’s interdisciplinary leadership curriculum.
“It is a brilliant idea,” he said. “Only 6 percent of American universities have leadership courses in multiple disciplines. Yet leadership is the No. 1 thing 80 percent of businesses look for in graduates. And they don’t mean being a fraternity pledge master.
“Kids today are so much more mature and capable than I was at their age. One Drake student came to Homesteaders to pitch us on joining their movement to get rid of disposable plastic water bottles. Someone told him we would have to do a cost benefit analysis, and he presented us with one,” he said. ♦