What Top Insurance Producers Do Differently with Paul VanderMarck

Paul [0:00:00]: Plus people think of insurance the product that don't use very often.

Paul [0:00:03]: We think that should change.

Paul [0:00:04]: The role of insurance should be much more as a partner in people's lives and helping them avoid bad outcomes.

Callan [0:00:13]: Welcome to The Insurance Growth Lab.

Callan [0:00:14]: Where we go deep on the growth campaigns and strategies driving real results in the insurance industry.

Callan [0:00:20]: I'm Callan Harrington founder Flashgrowth and each episode, I sit down with marketing and growth leaders from carriers and Sure tech and top brokers to break down one specific initiative, whether it's how they marketed a product, scale a channel or solved a specific growth challenge.

Callan [0:00:38]: It's no fluff just tactical insights you can apply in your own company.

Callan [0:00:42]: Alright, Paul.

Callan [0:00:47]: So I know.

Callan [0:00:48]: I say this on every episode, but there are so many different areas because you've had a your career and we'll talk about this here a little bit here.

Callan [0:00:56]: You've been at a number of very high growth companies.

Callan [0:00:58]: And where I'd like to start is, can you walk us through something that's just influenced how you think about sales and growth.

Paul [0:01:09]: Sure.

Paul [0:01:09]: I'll tell you there's nothing to new with insurance, just a personal story that it's always stuck with me.

Paul [0:01:14]: So one the things I do for fun is I'm mountain in bike.

Paul [0:01:16]: A number of years ago, I wanted to buy a new bike, and I went to through a couple shops.

Paul [0:01:21]: And the first bike shop I went to The sales guys said, great.

Paul [0:01:25]: You want any a bike.

Paul [0:01:26]: Let me show you, I've got these.

Paul [0:01:27]: I've got these.

Paul [0:01:28]: These are great.

Paul [0:01:29]: People where to like these.

Paul [0:01:30]: Asked them a couple questions, and we were done.

Paul [0:01:33]: And the next weekend and I went to a different shop.

Paul [0:01:35]: And the sales guy, who I...

Paul [0:01:38]: I met when it came in the shop said, okay.

Paul [0:01:40]: Great.

Paul [0:01:40]: Let me ask you a couple of questions first.

Paul [0:01:42]: Said, how often you ride?

Paul [0:01:44]: And where do you ride?

Paul [0:01:45]: And what kind of riding do you like to do?

Paul [0:01:47]: And what bike do you have now?

Paul [0:01:49]: And why do you want a new bike?

Paul [0:01:51]: What is about your current one that you don't like and that you want, you know, why you wanna need a different bike?

Paul [0:01:56]: And we talked to a few more questions like that?

Paul [0:01:59]: And they said well, look, I have these bikes here in the shop.

Paul [0:02:03]: This is the bike, I think you'd really like.

Paul [0:02:05]: And here's why.

Paul [0:02:06]: And here's how it fits everything you've told me about what you're looking for in high ride and and so forth.

Paul [0:02:12]: And I didn't go to third shop.

Paul [0:02:14]: I bought that bike from that guy in that shop.

Paul [0:02:16]: It's always stuck with me is it was a very sort of visceral tangible experience of what great selling looks like.

Paul [0:02:25]: Of, understand what your customers needs are what they're looking for build trust, help them build confidence in the purchase they're making, make a great recommendation that that leads to sale.

Paul [0:02:37]: And so that was very simple is nothing through do insurance, which is a much more complicated product than a a mountain bike But I think there's lessons there that I've certainly taken with me and my career and that lots of us can learn from.

Callan [0:02:50]: That's an interesting story to me for a couple of reasons.

Callan [0:02:52]: One, I spent the majority of my career either, in sales are then and then ultimately leading sales organizations and then revenue organization organizations.

Callan [0:03:00]: So sales has always been at the...

Callan [0:03:02]: That's always a soft spot that's always kind of, like, at the root.

Callan [0:03:05]: And one of the things that always when I was younger in my career, you know, I would watch Wolf Wall Street, boiler room, the classic sales movies, and I was, like, alright.

Callan [0:03:16]: That's it.

Callan [0:03:16]: Like, that's what you need to do.

Callan [0:03:17]: You just need to be super aggressive all the time.

Callan [0:03:20]: Never turn it off, and that's how you're successful.

Callan [0:03:22]: And then when I tried that, it was so in ineffective

Paul [0:03:28]: for work so long.

Paul [0:03:29]: Right?

Callan [0:03:29]: It didn't work so well.

Callan [0:03:30]: And then, especially when you start to get into enterprise.

Callan [0:03:33]: And you know it's funny.

Callan [0:03:33]: You said, sure is a lot more complicated, but at core exactly...

Callan [0:03:37]: And you mentioned that you took a lot from that.

Callan [0:03:39]: That's what it is.

Callan [0:03:40]: It's your c creating a solution, and the best salespeople people that are out there are just as much a consultant that can c...

Callan [0:03:49]: Help c create this solution together, And if you don't do that, I think it's really hard to get million dollar deals in my opinion.

Callan [0:03:56]: And I'm saying million is like a a big benchmark, but that could be a couple hundred thousand Whatever those enterprise deals are, I've found that to be very difficult if you don't take that approach.

Callan [0:04:05]: I'm curious.

Callan [0:04:06]: Have you seen kind of the same throughout your career?

Paul [0:04:10]: Well, for sure, there's this stereotype around sales that maybe plays well in movies and whatnot, which couldn't be further from the truth of what effective sales looks like?

Paul [0:04:19]: And I think in its foundation and whatever business here and whatever the product is unless you're, you know, buying some complete commodity, like, aaa batteries, which you're perfectly happy to order on Amazon and and pay the cheapest price for.

Paul [0:04:32]: Any more sophisticated product, there's a degree of consumer education involved.

Paul [0:04:38]: There's a valves to be found of not overwhelming the the potential customer with detail.

Paul [0:04:44]: But educated them to a point that they're making informed decision that you're building trust that you're advising and they're well making that decision.

Paul [0:04:52]: And that's very true in in our business and home insurance.

Paul [0:04:55]: It's a complicated product, much more complicated than people appreciate.

Paul [0:04:59]: It's not a product people buy very often.

Paul [0:05:01]: Fortunately, it's not a product they use very often in terms of actually calling on it for a claim.

Paul [0:05:06]: And so people rely on a trusted adviser to help them make that purchase.

Paul [0:05:12]: It's part of why home insurance hasn't moved online despite what, you, many people claimed.

Paul [0:05:16]: Maybe ten years ago with the the big rise of the insure tech wave.

Paul [0:05:20]: It's not actually a product people are dying to go buy online.

Paul [0:05:23]: It's a product that people wanna buy with with good advice from someone they trust helping them, you know, helping them make that choice.

Callan [0:05:30]: Yeah.

Callan [0:05:30]: I completely agree.

Callan [0:05:31]: If for people that don't know you.

Callan [0:05:33]: I mean, you you have the steps to back this up, you grew risk management solutions Rms from a startup up into a three hundred million dollar revenue business.

Callan [0:05:41]: Sage is now over three billion in premium.

Callan [0:05:44]: They have nine hundred seventy thousand policy holders in the third largest cap bond sponsor globally with over three point one billion outstanding.

Callan [0:05:51]: So you've seen a lot.

Callan [0:05:54]: And one of the areas that I really wanna dive into and and we talked about this beforehand was when I was an agent.

Callan [0:06:01]: One of the things that I always want to know where what are the top producers doing?

Callan [0:06:07]: Because I remember we would do contests and I would look...

Callan [0:06:10]: I would do almost to the t.

Callan [0:06:12]: I was just telling you is not to do, and I would just grind and grind and grind, and I'd look at the leader board and I'm like, I'm not even...

Callan [0:06:19]: We're not even the same stratosphere.

Callan [0:06:20]: Like, not even close.

Callan [0:06:21]: And though so I just started asking, like what are the top people doing and then trying to replicate that.

Callan [0:06:26]: So you see a lot of this.

Callan [0:06:27]: And especially since, you know, SageSure is in those really tricky coastal regions that that they write a ton of business in for the top producers there of Sage, what are they doing differently?

Paul [0:06:42]: Great question.

Paul [0:06:42]: I'd say, look, any business have to be clear who your customer is, what market you're serving and and focus on being really great at that as opposed to being I think being spread too broadly and not being as effective in any part of your market.

Paul [0:06:56]: We know who we serve and who our products are built for.

Paul [0:07:00]: We target will be referred to as a preferred customer.

Paul [0:07:02]: We write insurance focused on people with high quality homes who are responsible homeowners who take care of those homes and want great coverage to protect them in the case of something bad happening.

Paul [0:07:15]: And the producers who work with, service that market.

Paul [0:07:18]: And so that's different than somebody who's lead is selling non standard auto and trying to cross sell home, for example.

Paul [0:07:25]: So we don't work with all producers.

Paul [0:07:27]: We producers who are good fit with our product and the the customers they're they're principally designed for So the players we see that work well are within that base of producers we partner with.

Paul [0:07:39]: And I think the thing we see that's most common among those who are most successful.

Paul [0:07:45]: Is they're selling on value?

Paul [0:07:47]: They don't treat the products a commodity and sell on price.

Paul [0:07:52]: They understand that products are not all the same, even though sometimes home insurance has perceived to be a commodity.

Paul [0:07:58]: There's there's substantial differences between the products.

Paul [0:08:00]: And they understand the customer's needs, they help them understand not all the complexity of insurance, but the most essential elements of coverage decisions they have to make.

Paul [0:08:10]: And they make a clear recommendation of that customer once they understand what they're looking for and they educate them on their options in terms of coverage.

Paul [0:08:19]: And then they're very successful at not only closing sales, but retaining the customer over time and position themselves to be trusted the adviser over the course of their homeowners ownership maybe beyond that home, through others over time as opposed to be in somebody just facilitate the transaction.

Callan [0:08:36]: So that makes sense.

Callan [0:08:37]: I'd love to dive into this a little bit more, because I think most...

Callan [0:08:40]: This would be actually be a good pull to run I because I think most agent would probably say they take more of an advisory role.

Callan [0:08:48]: I mean, I know I certainly did when I was an agent.

Callan [0:08:51]: And...

Callan [0:08:52]: But I'm curious like, if everybody thinks that, what is true advisory?

Callan [0:08:56]: What does that actually look like?

Callan [0:08:58]: Because not everybody's a top producer in this area, Are they doing something differently in how they're running their discovery?

Callan [0:09:06]: Is it their ability to provide them with information that other agencies don't have access to?

Callan [0:09:13]: Well, and I'm just curious in your experience.

Callan [0:09:15]: What does that look like?

Paul [0:09:17]: Great question.

Paul [0:09:17]: I'm sure there's...

Paul [0:09:18]: There are multiple parts to it.

Paul [0:09:19]: I'd say the part that's most evident to us and that I had in mind.

Paul [0:09:22]: We're just talking about is...

Paul [0:09:24]: And we see particularly visible now in a softening market where we have more competitors coming the market.

Paul [0:09:30]: People being more aggressive wanting the business.

Paul [0:09:33]: And that to be clear, that's very different than the world we lived in for the last several years.

Paul [0:09:37]: We've been in p card market conditions.

Callan [0:09:39]: Hundred percent.

Paul [0:09:40]: Many of our competitors left these markets.

Paul [0:09:42]: Some of them went out of business entirely, some withdrew from states entirely, others just stopped running new business and canceled existing business and so forth.

Paul [0:09:51]: And now, now the markets softened, reins insurance, reins insurance rates have come down significantly.

Paul [0:09:55]: Other things have changed the market capitals more readily available, and we have there are more people in on our markets who want this business.

Paul [0:10:03]: And when our when our producers have a customer, a potential customer who has just bought a home, let's say, it needs home insurance, we see very different patterns of behavior.

Paul [0:10:14]: So people may aspire as you say it's all being in a trusted adviser.

Paul [0:10:18]: And so forth, the way they actually engage is clearly different.

Paul [0:10:21]: And what's one way that that's most visible to us is the difference in product in the degree to which producers actually...

Paul [0:10:29]: I mean, some cases understand those differences and truly can relate the relevance to the customer and how they sell so to give you an example if you pick a state like Texas we have a product that has a number of features.

Paul [0:10:43]: There are other products that are very different.

Paul [0:10:45]: And so we'll see a case where a producer may quote multiple products.

Paul [0:10:49]: They'll find the lowest price one, and they'll go to the customer and recommend that product.

Paul [0:10:54]: And say, Does home insurance?

Paul [0:10:57]: Here's the price it'll satisfy you need your mortgage, and I can get this bound for you.

Paul [0:11:02]: That may be a surplus line's policy that has a roof payment schedule, which means for your twelve year old roof, you're gonna get a have any sense the dollar for a roof claim, it may have restricted water damage coverage, and other forms of restricted coverage.

Paul [0:11:19]: We have a policy that's an admitted policy with full replacement cost roof coverage that's a all peril policy as opposed to the apparel...

Paul [0:11:29]: The other policy being named peril policy that includes mitigation programs that you'd benefit from as a policy holder.

Paul [0:11:36]: It's a radically different value proposition.

Paul [0:11:39]: Our product versus that other product.

Paul [0:11:41]: If a producer simply goes to customer and says, here's the cheapest premium I can get you, they're not selling on value, They're not setting themselves up as an adviser their that policy.

Paul [0:11:52]: If they say to them, look, these are some the key differences you should understand, in the insurance products you could purchase.

Paul [0:11:58]: Here's some scenarios of future potential losses, and which policy we'll cover those losses and which ones won't, how much of recovery you get?

Paul [0:12:07]: That's a very different kind of conversation have.

Paul [0:12:09]: And The customer, you may decide one of those that better fit for the customer and the other after you get through a discussion with the the customer, but that's a very different way to engage, and that's what I'm getting at when I talk about.

Paul [0:12:22]: The differences we see in the behaviors of the best successful producers we work with.

Callan [0:12:27]: One of the interesting things on that.

Callan [0:12:28]: And I'd be curious on how you guys help with that.

Callan [0:12:31]: You guys have definitely put a huge effort into the technology.

Callan [0:12:35]: The technology is known to be extremely good, and that's not just me saying that that's from agent feedback directly.

Callan [0:12:40]: But you know, one of the things I'm curious about it is because one of the things I hear from agency principles all the time.

Callan [0:12:46]: And I've kinda got a different.

Callan [0:12:48]: I, you, my background, I was an agent, but I spent the majority of my career on the insured tech side.

Callan [0:12:52]: And so for a long time, and I still get these, like, from agencies.

Callan [0:12:57]: You know, I'll ask them, you know, what is something that doesn't exist today that is a big problem you have and you you would love to find it in a solution or somebody would work with or a company to do this, whatever that might be.

Callan [0:13:09]: And the number one thing that always comes up is new producer onboarding and training.

Callan [0:13:13]: And in so many agencies.

Callan [0:13:16]: Now it's very different at...

Callan [0:13:18]: And I'm not seeing all agencies are like this.

Callan [0:13:20]: I just think a lot of them.

Callan [0:13:21]: It's passed on through tribal knowledge and shadowing and ride along and things like that, where when I had a digital agency.

Callan [0:13:30]: Right?

Callan [0:13:31]: It was very...

Callan [0:13:31]: It here's what we do here.

Callan [0:13:33]: Here's what this situation is.

Callan [0:13:34]: But it wasn't really...

Callan [0:13:35]: I I wouldn't put any of those there's like true advising, like, what you are talking about.

Callan [0:13:41]: And so my question is, Do you guys help agencies at all with that?

Callan [0:13:45]: Meaning, like, you're showing...

Callan [0:13:47]: Okay.

Callan [0:13:48]: So you mentioned your policy is better.

Callan [0:13:49]: Makes sense.

Callan [0:13:50]: And obviously, there's gonna be some bias involved with that.

Callan [0:13:53]: But that being said, Do you have any...

Callan [0:13:56]: There's whether it's through the tech or through resources that you provide that can educate on why these specific things are better.

Callan [0:14:04]: And of course, the easy answer is, well the agent that is the agent's job.

Callan [0:14:07]: And I agree with that.

Callan [0:14:08]: But I am curious is do you guys support that process at all?

Paul [0:14:12]: Good question.

Paul [0:14:13]: We...

Paul [0:14:14]: I think for several years as we've gone through the, you know, the hard market we talked about.

Paul [0:14:19]: Our focus has been very much keeping product myself?

Paul [0:14:23]: For our producers who desperately needed product to sell securing capacity.

Paul [0:14:27]: You mentioned our the cap on issuance as we've done, we've we'll place on the order of seventy billion dollars of first event reins insurance limit this year across all of our our carrier partners, it's been a big focus for us to ensure we have the capacity to support from reins insurers and Cap pod investors.

Paul [0:14:42]: And now there's two enable growth in these markets and keep supporting our producers and and having insurance ride to their customers.

Paul [0:14:50]: You know, during that period, it's been...

Paul [0:14:52]: I'd said been less focus on producer education on the product, and it's been a bit taken for granted that this is what we stand for as a brand.

Paul [0:15:00]: People of history working with us know that.

Paul [0:15:02]: The...

Paul [0:15:03]: Like I said the best producers already sell on value sell on the gaps of understanding the the key differences in products the customers need understand.

Paul [0:15:11]: As we've come into this softer market, this is something we've been reflecting on a lot.

Paul [0:15:16]: How do we help what role do we have in helping our producers understand those critical product differences, you know, bring them to delight, help them educate educate the end customer.

Paul [0:15:26]: I just recently had a did a webinar with one of our one of our larger producers where we walk through some examples and said, if you were selling a named Carol's policy to a customer.

Paul [0:15:36]: We said, here's an example of a real claim with one of your customers that we paid recently where somebody was cutting down a tree and there are.

Paul [0:15:44]: Diy didn't hire somebody else.

Paul [0:15:46]: Made a mistake.

Paul [0:15:47]: The tree fell in their house, damage the roof in their gutter and so forth.

Paul [0:15:51]: That was a covered loss.

Paul [0:15:52]: It would not have been a covered loss under named peril policy is accidental damage.

Paul [0:15:56]: As we walk through some of these examples, and we do things like that to help educate our producers on on product differences.

Paul [0:16:03]: You mentioned technology, we control all of our own technology build ourselves.

Paul [0:16:07]: That lets us do things like, promote aspects of product features and mitigation programs and things like that into the the quoting experience to remind our producers, they're there to remind them they can bring those up with with customers.

Paul [0:16:20]: And there's more we need to do.

Paul [0:16:22]: We have a...

Paul [0:16:23]: In this shifting market.

Paul [0:16:24]: There's...

Paul [0:16:24]: As you say, part of it is the job of the producer to be an expert and the products are selling.

Paul [0:16:29]: But there's more we can do as well to to help them with that.

Callan [0:16:34]: And that makes total sense.

Callan [0:16:34]: I do wanna talk about the soft market and dive into that a little bit deeper as well.

Callan [0:16:39]: I think one of the interesting things, and we talked about this a little bit was that you know, you mentioned how these are my words not yours.

Callan [0:16:48]: Like, you guys were kind of a gods send during the hard market because you were writing stuff that everybody was running away from.

Callan [0:16:55]: And so you gave agents and lifeline to be able to write a lot of that business.

Callan [0:17:02]: But the interesting thing is, now as we're going into a soft market.

Callan [0:17:06]: Like you said, there's more capacity and people are gonna start to be more I've already seeing carriers be more aggressive from a rates perspective and and just opening up what they're willing to write.

Callan [0:17:15]: You know, I'm curious with bigger agencies and they think much more three to five years down the road.

Callan [0:17:22]: But as a new agent, and I remember when I a new agent, it was somebody's got a pulse, I'm gonna try to find a policy for them, But I'm probably just gonna try to find the best fit that I possibly can, and I'm not gonna go through all of that, and I'm not saying that was right, but it was just kind of the reality.

Callan [0:17:36]: How do you close that gap in You know, it's like, the number one thing I'm thinking is somebody writes, let's just say, couple hundred policies with the carrier.

Callan [0:17:45]: That carrier went way too aggressive on trying to to drive new business.

Callan [0:17:49]: That carriers out of business.

Callan [0:17:50]: That is gonna be a world to hurt for that agent.

Callan [0:17:54]: How do you guys try to support that area?

Callan [0:17:56]: I know it's probably tough too because you can't just say, oh, we've got the best product Like, we're gonna be here in a couple years because that doesn't mean these other people aren't saying the same thing is that more just looking at the track record and things like that or does that look like?

Paul [0:18:10]: It's been a rough few years to be sure for a lot of our producers.

Paul [0:18:13]: And that I've lost track of how many conversations I've had with our producers over the last two, three, four years who've had hundreds or thousands of policies they've had to move.

Paul [0:18:23]: Because they wrote business carriers who then fell apart in the hard market.

Paul [0:18:28]: And again, either went our business entirely withdrew from regions, whatever it was.

Paul [0:18:33]: That's a lousy place to be as an agent and we have lots of people saying to us.

Paul [0:18:39]: I will be a loyal partner of yours forever.

Paul [0:18:41]: You've been here for us.

Paul [0:18:43]: The stability you have is critical for us and for our customers, and whatever happens the market, like, we are strong partner of yours forever and appreciate your stability and you're being here for us during our time.

Paul [0:18:56]: And all that.

Paul [0:18:56]: Then this operating market comes and what happens, they still have those intentions, we still have the history together, but you have producers who Haven't been that through that before.

Paul [0:19:05]: And you have more competition.

Paul [0:19:07]: I don't one of our producers in Louisiana just called me last week and called to say, hey.

Paul [0:19:14]: Here's what we're seeing in the market in terms of I won't I won't say names but certain large captive carriers getting really aggressive coming after the business they haven't wanted in a long time.

Paul [0:19:22]: And so people are finding themselves in a more challenged market having to compete or perceiving it to keep more...

Paul [0:19:30]: Compete more on price.

Paul [0:19:31]: And so I think the point we're talking about of how do you sell in value, the strategy remains the same with Tactics exchange.

Paul [0:19:39]: And for example, we're seeing now is is producer saying for me that to not lose a lead and to be in the game when someone calls me and says, hey, I've got a quote in this ballpark from somebody else.

Paul [0:19:50]: They need to have something to put forward from a economics perspective that keeps them in the game.

Paul [0:19:56]: Is the tactics we see changing, in some cases, at least or producers producer saying, look, I gotta start with a more stripped down version of the product, and for example, start with the roof schedule option of the product to get the premium down or start with a higher deductible, then get the customer in the conversation, then talk them through hear the considerations of what your options are.

Paul [0:20:17]: And often still end up in a good place in terms of the customer having better coverage and buying the higher value option or product, but they're working to that.

Paul [0:20:26]: And I think part of our our work as well and supporting them and that, and how they go through their quoting process to bring the customer along in a market that's very different than it's been for number of years.

Callan [0:20:38]: Yeah.

Callan [0:20:38]: Do you see any of...

Callan [0:20:40]: I got pretty much got the answer to this, but I'm curious.

Callan [0:20:42]: Do you see those top producers having to move some of those accounts because the pricing.

Callan [0:20:49]: I mean it sounds like the top producer had reached out to you And my guess is that something was along the lines of, hey, are you guys gonna be getting more competitive because we're getting a lot of heat from x carrier that's coming in here.

Callan [0:21:04]: I don't wanna switch the business, but this is getting hard.

Callan [0:21:07]: My guess is that was the genesis of it.

Paul [0:21:10]: Exactly that sort of conversation.

Paul [0:21:11]: So this...

Paul [0:21:11]: I mean, we're in a softening market, reins insurance rates are coming down, we've just completed most of our reins insurance program renewal across many of our carriers in a number of states, reins insurance represents twenty thirty, even more percent of the end cost and retail cost to the product.

Paul [0:21:29]: And so reins markets offering translates directly to improvements in some cases, and some markets on pricing of the product for the customer.

Paul [0:21:38]: So there's a...

Paul [0:21:40]: Yeah, that's part of the conversation is what's...

Paul [0:21:42]: One of the plans what's happening in terms of pricing for the product as well as like I said, the tactics of, okay.

Paul [0:21:48]: How do we...

Paul [0:21:48]: What do we do And how do you help us operate in this, you know, in a very different market dynamic than we've been dealing with for a while?

Callan [0:21:56]: Of course, soft market's one of the big market dynamics.

Callan [0:21:58]: And, of course, Ai is the other big one.

Callan [0:22:01]: And one of the things I'm curious is is like, how...

Callan [0:22:04]: From carrier perspective, feels like there's kinda times that I know you guys are an Mg, but operate as a carrier in a number of different ways as far as how you actually go to market.

Callan [0:22:15]: You know, one of the things I see from a carrier perspective quite often is they wanna use more Ai But at the same time, there's reasons politically that it's harder for them to deploy More.

Callan [0:22:28]: And then some real security reasons on why they've need to be kinda careful on doing that.

Callan [0:22:32]: For you guys, how do you think about how you deploy Ai.

Callan [0:22:38]: And I'm sure you're using it quite a bit on kind of the core product.

Callan [0:22:41]: So I've heard you say before that you guys kinda sit in between more of that kind of the legacy type of carrier and an insure tech?

Callan [0:22:50]: Has that changed as that as you're going into this new era?

Callan [0:22:53]: Or how do you think about that?

Paul [0:22:55]: What, on your...

Paul [0:22:55]: Your last point, I would say, I think of us as as post legacy pre tech.

Paul [0:23:01]: In terms of where we sit in this general evolution of the industry.

Paul [0:23:05]: So we've been writing business for sixteen years now, the fundamentals for our business are very much about being great under writers and technology enabled, but not about being a tech business.

Paul [0:23:17]: And very, very different than a lot of what insure tech was about with direct to consumer and tech first and worry about loss ratios in underwriting second.

Paul [0:23:27]: That's never been our game for us we've always been most more traditional if you will in the sense of believing that the only way you build a durable business space just to be a great under and consistently generate underwriting profit.

Paul [0:23:39]: And at the same time, to be...

Paul [0:23:42]: We invest very heavily in technology and analytics.

Paul [0:23:45]: To enable us to do all of what we do and do it well.

Paul [0:23:47]: So that's where we sit in the world of insurance.

Paul [0:23:50]: To your restaurant Ai specifically, we're using Ai throughout the business as you'd expect.

Paul [0:23:55]: We use Ai and using it very actively in software development.

Paul [0:23:59]: We use it in building a whole variety of sort of models and capabilities and the data science for realm to help us do various things the business better.

Paul [0:24:06]: We use it operationally to to improve speed and efficiency of various back office operations.

Paul [0:24:13]: So it's Obviously, the world Ai is rapidly the evolving and we're we're an active adapter and user at many forms.

Paul [0:24:19]: I think in a way, the...

Paul [0:24:21]: What one of the more questions in this space is, what does Ai mean for the future of insurance.

Paul [0:24:25]: Distribution.

Paul [0:24:27]: So we can talk about that for a minute.

Paul [0:24:28]: I mean, just seeing what's happened to the the publicly traded stocks of a number of insurance distributors in the last couple months.

Paul [0:24:35]: And how spooked investors were And I think all of that was overblown, but it it raises important questions about what does happen in the future and where this Ai sit.

Paul [0:24:45]: So I can tell you, my own view, I don't know better crystal ball than anybody else.

Paul [0:24:49]: But my own view on on this, I think a lot of that early early reaction was overblown.

Paul [0:24:53]: When you see happening today is a lot of all of us.

Paul [0:24:57]: I think you're experiencing the move to using chat Ai tools as the new front door to the Internet as it's often explained.

Paul [0:25:03]: So it's instead of trying to go to search engine and searching for information to find and answer the question you have, You us straight to a chatbot, like, claude or Chat, and you actually ask them where you ask your question and actually get an answer much more efficiently.

Paul [0:25:16]: So it's becoming very quick with the new front door to the internet in that regard.

Paul [0:25:20]: For an insurance shopping perspective, people shopping for insurance on the Internet have never been great insurance customers.

Paul [0:25:28]: Most of the people shopping their are shopping there for a reason.

Paul [0:25:32]: They've been dropped by their existing insurer and had significant rate increases often due to loss history or other characteristics or there's highly prone to churn and not being a apparently customer over time.

Paul [0:25:44]: Is the data is shown pretty clearly that the quality of those customers in terms of loss experience and longevity is core.

Paul [0:25:51]: And most of our our producers back to your earlier question.

Paul [0:25:56]: Our successful producers are not sourcing customers off of Internet searches is as opposed to other ways to find people who are the process of buying of home.

Paul [0:26:05]: So a customers instead of going through Google now goes through chat To search for insurance.

Paul [0:26:11]: That doesn't change anything fundamental up who they are as a customer.

Paul [0:26:14]: And how good a fit they are relative to where our customers come through different channels today.

Paul [0:26:20]: I think where Ai gets more interesting is how people are turning to it increasingly as something they can give advice as it's able to pull from lots of other information experience and summarize that in effective ways.

Paul [0:26:33]: And so I think the back to the earlier discussion of of the role that producers play and educating the customer and give them good advice in recommending product.

Paul [0:26:41]: I think this scenario, I think about most often is what happens when the customer comes to you as an agent, and you give them a quote in a product recommendation.

Paul [0:26:50]: And back to my story about buying a Mountain bike, extent you've educated them well, on the decisions that to make on the product options, and they trust that they feel confident in making the decision to buy the product you're recommending, then you're done.

Paul [0:27:06]: To the extent the role you play is largely saying, here's an option too, but they don't feel particularly informed or sufficiently confident making the decision yet.

Paul [0:27:15]: In the world of Ai where they increasingly turned next, may not be to another agent, it may be to their Ai chatbot, to say, here's the quote doctor that I got from my my agent.

Paul [0:27:26]: What do you think about this?

Paul [0:27:28]: And if you think about how these, you, these Ai tools work, you'll get an answer, and then it'll ask you a question about what to do next?

Paul [0:27:34]: And you can easily imagine this scenario which is.

Paul [0:27:37]: Well, this product has these features and these questions about it.

Paul [0:27:41]: Would you like me to give you some examples of claims when this product might not cover you fully?

Paul [0:27:47]: Oh, yeah.

Paul [0:27:48]: Sounds like good idea.

Paul [0:27:49]: Yes.

Paul [0:27:50]: Okay.

Paul [0:27:51]: Here's some examples.

Paul [0:27:52]: Next question.

Paul [0:27:52]: Would you like me to suggest some other insurance options that might not have those deficiencies?

Paul [0:27:57]: Oh, sure.

Paul [0:27:59]: Yes.

Paul [0:27:59]: Then before you know it?

Paul [0:28:01]: Where's that customer going?

Paul [0:28:03]: And that customer finding a different channel to buy insurance.

Paul [0:28:07]: I doubt it's through the chat tool directly, but you may end up with a different agent or you're some of the producer at that point.

Paul [0:28:13]: And so I I think about that scenario when I think about where Ai is going and what I means for insurance distribution, and I think I got back to talking earlier, the producers who are doing the best job in educating the customer and selling insurance effectively.

Paul [0:28:30]: I think they're less exposed to that.

Paul [0:28:31]: Other than the ones who are are at greater risk of of seeing the business go elsewhere.

Callan [0:28:37]: You know, an interesting thing about that is is twofold.

Callan [0:28:42]: And when I think about this from, like, in an an agent's perspective.

Callan [0:28:45]: One in Kyle from Clear covers episode, and he was talking specifically about, you know, there's gonna be this Ai orchestration layer.

Callan [0:28:53]: We're starting to see this right now.

Callan [0:28:54]: Right?

Callan [0:28:54]: Like, At first, the chat were essentially used as a...

Callan [0:28:58]: Like, the Ai tools, the frontier models were used as a search engine.

Callan [0:29:01]: And then you started to delegate task.

Callan [0:29:03]: That could be copy that could be drafting emails, things like that were some of the most common ones.

Callan [0:29:07]: But now we're moving into...

Callan [0:29:09]: You know, like, it's not that we haven't been here, like, people that were using Open Claw when it first came out We're already doing this, but now we're going into more of this orchestration layer.

Callan [0:29:17]: And this is where in coworker that's is probably the one that's broaden the most people, Claude c tool, where it's going and it's working with other Ai agents, and it's running specific, a series of tasks to an ongoing task and what it's doing, and we're moving into that layer.

Callan [0:29:35]: And the interesting thing and what I'm hearing you say is, and it sounds like there's a very big opportunity.

Callan [0:29:40]: One.

Callan [0:29:40]: Somebody...

Callan [0:29:40]: The text out there that nail that orchestration layer or if that ends up being a...

Callan [0:29:46]: You know, one of these frontier models, if the insure tech that can plug into that in order to pull that off.

Callan [0:29:52]: It's probably a huge opportunity there.

Callan [0:29:53]: But two, to your point, it feels as if if the agent that's going to position themselves different, is gonna be the one that builds the best relationships and has the most expertise.

Callan [0:30:06]: Because one of the interesting things is if you take any type of like Ai few fluency course.

Callan [0:30:11]: And I recommend people do that the Claude got a great one on this And one of the exercises that they have doing.

Callan [0:30:15]: And I'm not saying that this won't get more accurate at will, but it says they want you to seek essentially the flaws of of these models.

Callan [0:30:23]: And so using Opus four point six, which is arguably the most powerful model right now Now that could change by the time this episode is even released.

Callan [0:30:30]: But the quad four point six, I used to be obsessed with the game of Squash.

Callan [0:30:34]: Got into it when I was later later, but I I went all the way in, learned all the strategies everything else.

Callan [0:30:40]: And so I said give me a basic strategy for a piece within squash.

Callan [0:30:44]: And what it gives it to you, sounds great.

Callan [0:30:46]: If you didn't play that game a lot, you would read that and say, oh, this makes sense.

Callan [0:30:50]: This is in the weeds.

Callan [0:30:51]: This is detailed, like, this is really good.

Callan [0:30:53]: But if you've...

Callan [0:30:55]: You're an expert on this, it's missing key pieces.

Callan [0:30:57]: And I think that's very much what's going to happen in the nearest term from people that are going on to get insurance through just through one of these chatbot bots.

Callan [0:31:07]: And the one that you're referencing, of course, was the insurer...

Callan [0:31:09]: When ensure if I did the Chat Gp bot.

Callan [0:31:11]: That's what sent a lot of the markets in in chaos when it came to the insurance world.

Callan [0:31:16]: So I'm curious if you see that similar in that relationships and expertise or we're gonna be those differentiator.

Callan [0:31:23]: If you think it's something totally different than that.

Paul [0:31:26]: I think you have to start with the advantage that producers have today is they have the customer.

Paul [0:31:30]: Any successful agency has a strategy for how requires leads, which to my earlier point is not just about people searching for insurance online, they're plug in with loan origin officers and real estate agents and others in their community to capture a lead a point where someone has need and intent by insurance.

Paul [0:31:48]: So that remains their starting point of they own the customer.

Paul [0:31:52]: The question is they convert that customer or what happens.

Paul [0:31:56]: And so to my early example, you can imagine one way of losing the customers is you don't serve them fully enough and helping them make a good decision to could inform decision.

Paul [0:32:08]: I think you can talk about, well, the Ai models have limitations and it's dangerous so people go there And and so forth the reality is that's just the pace of at which the technology is developing, it's getting better and better very quickly.

Paul [0:32:23]: And so I think everyone can point to examples and entertain themselves with cases of, of, the Ai did something silly or ridiculous are gave me obviously false answer.

Paul [0:32:33]: And I think it's important.

Paul [0:32:34]: And, I have three teenagers and they're growing up with the stuff in their lives and a core part of learning how to use the tools is we're using the tools learning how to use them well, and when to trust them when to be skeptical how to check that the results make sense and and so forth, and that's part of just Ai literacy that everyone's having to pick up and with the evolution of these tools.

Paul [0:32:58]: But they're going to get better.

Paul [0:32:59]: They already can give you pretty good answer is to a lot of complicated questions about insurance.

Paul [0:33:03]: And so I don't think the bet anyone should make is they're not gonna be good enough for people to trust them be making decisions.

Paul [0:33:12]: There maybe people making bad decisions to your point without realizing they're making it.

Paul [0:33:15]: And the question more for producers is they have the customer.

Paul [0:33:19]: They have the lead.

Paul [0:33:21]: How do they deliver a great experience to that customer that helps them make a confident well informed decision.

Paul [0:33:29]: Which by the way, may involve probably doesn't involve in the future, them learning how to harness those tools themselves.

Paul [0:33:34]: And so the the way I think about it and you asked about this in a slightly different way, a few minutes ago, if you've been running an agency for thirty years, and you have decades of experience, in advising people on what to buy, You see them having claims.

Paul [0:33:50]: You see what happens when they have claims, and you're selling to a customer today, you bring all that to bear and given them advice and saying, I've seen this before out a customer went through this and so on and so forth.

Paul [0:34:02]: Then you hire our new producer.

Paul [0:34:03]: How long does it take for you to get them to the point there as effective as you, not just in their technical knowledge, but their ability to pull together that sort of history of experience and irrelevant examples and so forth, for one individual prospect.

Paul [0:34:18]: Ai can be a great accelerator of that.

Paul [0:34:21]: If you can harvest your knowledge and your data and your experience as a business and train something that works off of that and is relevant to your region and your customer base and your products, that can be a hugely powerful multiplier of, you know, your ability to operate wells of business and also get newer people up to speed much more quickly and and make them as effective as a more experienced agent.

Paul [0:34:44]: So I think that's the businesses were producers were leading the most into how they can take advantage of Ai are thinking about it all along lines.

Callan [0:34:52]: Yeah.

Callan [0:34:52]: I...

Callan [0:34:52]: You know, as we're talking about this.

Callan [0:34:54]: You could probably get seventy percent of the way there with Claude skills and then using Claude style of learning to get there, which I think is probably pretty interesting.

Callan [0:35:04]: So Paul, you know, we talked about a lot.

Callan [0:35:06]: We talked about the soft market.

Callan [0:35:09]: We talked about the growth of SageSure about what the top producers are doing You know, I'm curious, you've been in a number of these companies.

Callan [0:35:17]: You've seen a lot of success here now at SageSure.

Callan [0:35:19]: If you and I are sitting down in ten years time, and everything went to plan, where will you be?

Callan [0:35:25]: What you be doing?

Paul [0:35:27]: I'll probably still be here.

Paul [0:35:28]: That's my plan.

Paul [0:35:31]: We have big ambitions.

Paul [0:35:32]: We feel like we're just getting started.

Paul [0:35:34]: And I think part of what motivates us is we have a vision of a future for this, that's very different than it is today.

Paul [0:35:43]: And I I said something in passing earlier that I I hope I have a chance to come back and clarify things is this this is it, which is...

Paul [0:35:51]: I said you most people think of insurance to product they don't use very often.

Paul [0:35:55]: And we think that should change.

Paul [0:35:56]: And we're not the only ones to think this, but we think that the role of insurance fee be much more as a partner in people's lives in helping them avoid bad outcomes, not just being there to help them recover when they do.

Paul [0:36:08]: And like you're looking a lot of what we've been investing in recent years.

Paul [0:36:11]: It's been driving toward that vision.

Paul [0:36:14]: It's bringing mitigation programs to life where, you know, where our customer doesn't just get insurance from us.

Paul [0:36:19]: As we talked about before.

Paul [0:36:20]: Good coverage and we'll be there for them when they have a loss and so forth.

Paul [0:36:23]: It's also advice and programs that help them avoid losses.

Paul [0:36:28]: So we've been rolling out programs to help people that monitor their homes proactively to avoid having electrical fire losses.

Paul [0:36:35]: We've been doing work in the field, tell help people mitigate their homes to prevent hurricane damage and in future catastrophe events.

Paul [0:36:44]: And and the response has been incredibly positive from our customers nor producers about the notion that their insurers, therefore them, they've vested interest in, you know, we're obviously a share aligned interest with the policy, and not having damage in future events not having tragic things to go through.

Paul [0:37:01]: But that's us is a big part of what motivates us as a a future where that's much more regular part of how people think about insurance and the role we play.

Paul [0:37:09]: In our policy owner's lives.

Callan [0:37:11]: And I think that'll fundamentally shift people do think about insurance, one hundred percent.

Callan [0:37:15]: Insurance for every day, not necessarily just the worst day.

Callan [0:37:18]: So I think that makes total sense.

Callan [0:37:20]: Paul, this been great.

Callan [0:37:21]: I appreciate coming on.

Callan [0:37:23]: I know I put you on the hot seat on a number of questions.

Callan [0:37:26]: So I appreciate the answers Just a lot of fun.

Paul [0:37:29]: Thank you for inviting enjoyed that conversation.