He built a tiny insurance agency into a fortune

A businessman who dropped out of the University of Oregon to make his fortune in the insurance industry is now heading the school's athletic department.

Pat Kilkenny, who spent 22 years transforming a small San Diego insurance firm into a $1 billion business, was named Wednesday as the UO's new athletic director, succeeding Bill Moos.

Colleagues say Kilkenny's business acumen, ability to motivate and personal touch are skills that will serve him well in his new job.

"Building a business, you need a team," said Andrew Barile, an insurance consultant who advised Kilkenny early in his career and later went to work for him. "A team is a team. ... The concept is exactly the same: Get everyone on the same page working together."

Kilkenny said that when he was growing up in Eastern Oregon in the 1960s, people left their keys in their cars and their houses unlocked.

"I grew up in an environment where I trusted people," he said. "The same thing applied in the company I built. ... It's all about empowerment and delegation and trust. People want to work in a culture where they are given a lot of autonomy ... to go out and make a difference, where someone isn't constantly looking over their shoulder."

After graduating from Heppner High School in 1970, where he was student body president, Kilkenny attended the University of Oregon. Though described in past news stories as a 1974 graduate, Kilkenny left the UO in 1973 without a degree. He studied pre-law and journalism.

Kilkenny said he got a job in the insurance industry in December 1973. He enrolled for winter classes, but the job required him to travel frequently, and later to move - first to Seattle, then to San Francisco - so he never finished his studies.

From 1979 to 1984, he owned a majority interest in a Seattle firm that sold specialty insurance. In 1984, he acquired Arrowhead General Insurance Agency Inc. in San Diego. At the time, Arrowhead was a small company with $2 million in premiums for non-standard auto insurance, aimed at high-risk consumers.

Over the next 22 years, Kilkenny built Arrowhead into a nearly $1 billion business, underwriting and producing commercial, worker's compensation and personal insurance products for 19 national and specialty carriers. The firm is now the largest privately held insurance program manager in the country, CEO Frank Ruyak said.

Kilkenny sold his interest in the company last summer but retains the title of chairman emeritus. He said his net worth is "north of $100 million."

In 1988, Kilkenny turned to Barile, then a New York insurance consultant, to help him expand the company beyond personal insurance and into commercial. Barile advised him how to grow the business, find markets and structure deals.

"He had tremendous vision, and he learned fast," Barile said. "Back in 1988, he told me constantly he wanted to build a $1 billion premium agency. ... He never was afraid to take a risk."

He also had a can-do attitude that should help in his new job, Barile said. When he was trying to expand into commercial insurance, he had no agents, no underwriters, no information technology.

"His philosophy was, don't worry, we can make it happen," he said.

Ruyak, who has known Kilkenny for about 20 years, said Kilkenny made sure he surrounded himself with the right people, and was willing to delegate. "He is by no means a micromanager," Ruyak said.

Along the way, Kilkenny became one of the UO's biggest fans and boosters. His office at Arrowhead was festooned with UO memorabilia, Ruyak said.

Since 1998, he has given $1 million for the construction of the Moshofsky Center practice facility, $1 million for the expansion of Autzen Stadium and $1.5 million for architect's plans for a basketball arena.