RHS 065 - Chris Burand on Clean Data and Boosting the Value of Your Agency

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Speaker 4 In a crude laboratory in the basement of his home,

Speaker 5 Hello, everyone, and welcome back to the show.

Speaker 5 It's great to have you here, and I have a guest today, one of the smartest guys in our industry, someone who thinks about our business in a way

Speaker 5 at a depth that I think many of us just are unable to go oftentimes because we're so busy running our agencies or doing it, whatever it is we do.

Speaker 5 You know, the fact that Chris Buran has the ability to deep dive into agencies, operations, valuations, ENO exposures, all the education he does around lines of business, coverages, obscure policy forms,

Speaker 5 it's incredible. And I've wanted to have Chris on the show for a while.

Speaker 5 Even before he was on Cass's show, which is a great episode, and you should check that out as well.

Speaker 6 But

Speaker 5 it is just, it was such a pleasure having him on because i love nerding out on this business i just do i think that there are so many nuances to the insurance game and all the different places that you can take it and

Speaker 5 when you can have an hour with someone like chris who thinks so deeply about the business um

Speaker 5 there's just always going to be an incredible amount of value extracted and that's exactly what this episode is so uh I'm Chris, you can get him at baran-associates.com.

Speaker 5 Everything will be linked up in the show notes. If you go to ryanhaley.com, you can check it out as well.

Speaker 5 We also talk about his education, which is baraneducation.com. And I highly recommend that you connect with Chris on LinkedIn.
You subscribe to his newsletter, which is tremendous. And

Speaker 5 just have him in your ecosystem. Have him in your knowledge set.

Speaker 5 You will not be disappointed that you do.

Speaker 5 I want to just let everyone know if you haven't already, make sure you subscribe to the show, iTunes, Spotify,

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Speaker 5 It helps more sponsors find the show. It helps more vendors find the show.

Speaker 5 It helps more people who want to be a guest, you know, because some of the guests we have actually just reach out to me and that's how we connect,

Speaker 5 which helps everybody because then we get to share more and

Speaker 5 have more cool voices on the show.

Speaker 5 and and all that good fun stuff.

Speaker 6 So finally, the last thing before we get to

Speaker 5 the actual episode, I want to give a shout out to today's sponsor, Agency VA. Agency VA is changing the game for me.
We talk a little bit about VAs in this episode.

Speaker 5 I wanted to get Chris's take on VAs in general. He had some interesting thoughts.
But I'll tell you,

Speaker 5 so I have a VA who's helping me with two aspects of my business.

Speaker 5 One, helping me just clean up my accounting and getting some of the basic accounting processes taken care of, making sure that you know things starting to be coordinated my commissions paid versus expenses going out starting to uh itemize the expenses and and and so i can better understand what i'm actually spending money on um because as i've said in the show before my accounting thus far has been is there more in my checking account than there is on my credit card and as long as that's as long as there is then i felt like i'm doing okay so but agency uh wes and and ben and their entire team um i have a va a part-time va who's helping me with that and then i I have another individual who is helping me get my data squared away and getting my onboarding squared away and getting

Speaker 5 making sure all the information is properly from my better agency and from different, you know, different quotes that I'm doing.

Speaker 5 And all of that is properly set up in my agency management system as long with some prospecting stuff.

Speaker 5 So it's a game changer for me because it allows me to free up my time to prospect and sell, prospect and sell, prospect and sell, put revenue on the books. That's the name of the game for me.

Speaker 5 And Agency VA is helping me do that.

Speaker 5 If you are struggling in that spot, if you are feeling overwhelmed by the day-to-day tasks of the business and not growing your business, then stop what you're doing. Go to agencyva.com, reach out.

Speaker 5 Go to agencyva.com, reach out. Just talk to Wes, talk to Ben, talk to someone on their team.
Get a feel for what a VA can do.

Speaker 5 I promise you, you will not be disappointed. And if you set it up right and you commit to the process, you are going to move your business forward.
Agencyva.com, tell them Hanley sent you.

Speaker 5 Let's get on to Chris.

Speaker 4 You know,

Speaker 4 the ruling just came out of

Speaker 4 Great Britain that a whole lot of COVID-19 related business income claims should have been paid and not denied.

Speaker 7 So let's start there. What does that, what does that mean? Like, what is, I, so it's Great Britain.
So does that actually mean anything to us other than just a judicial precedent um

Speaker 7 you know is there any what are the ramifications for us because that

Speaker 4 if if all these claims start getting paid i mean it is a game changer in so many ways for sure yeah so there's a couple of things that potentially could come out and so the really was literally just announced 20 minutes ago.

Speaker 4 So the details, I don't have the details of it yet or anything. But

Speaker 4 one is it sets a precedent and causes people here maybe to look a little deeper and go, wow, should they be paid here?

Speaker 4 But depending on the scale of the claims that the court says should have been paid in Great Britain, it could affect the reinsurance markets here.

Speaker 8 Yeah.

Speaker 4 Without question. So there's a direct, potentially a direct ramification to that ruling to the U.S.

Speaker 7 So a lot of the,

Speaker 7 we'll just call them legacy carriers in the united states you know they have they have large sets of reserves of their own but these insurtech carriers the lemonades the hippos the swifts uh they are they have very small reserves in relation to their to how much they leverage reinsurance in their business do you could they be the most vulnerable to something like this if all of a sudden reinsurance rates start going through the through the roof or if reinsurers just simply start hopping off of different contracts they have?

Speaker 4 Yeah, it could definitely have a problem, create a problem for them without question.

Speaker 7 What are the ramifications of that down to like a, you know, a retail agency like mine? You know, is that

Speaker 7 some of these conversations, and I've had agents say this to me before, mostly in jest, but you know, there's always a hint of seriousness.

Speaker 7 They're like, that's interesting, but, you know, if I'm writing a $1,500 bop, you know, what does that really mean to me?

Speaker 7 Like, what, does it, does it trickle down that far to a main street retail agent where

Speaker 7 these almost like global ramifications and reinsurers and all this, you know, catastrophe losses, like

Speaker 7 at face value, I'm like, yeah, that sounds bad, but does it really impact us day to day?

Speaker 4 Yeah, it does. It truly does.
It's,

Speaker 4 I'll give you a great example of that on a homeowner's policy.

Speaker 4 So I have a client who is complaining that that a particular carrier wanted to get off these homeowners policies that had never ever had any kind of a loss.

Speaker 4 So why?

Speaker 4 Well, one of the reasons why is because of the way the carrier's reinsurance contract reads.

Speaker 4 So you'll see actions that are potentially

Speaker 4 nonsensical.

Speaker 8 Yeah.

Speaker 4 On the surface, it's nonsensical to get off of a homeowner's policy that you've you've written for 10 or 15 or 20 years. That's never had a loss.

Speaker 4 And being able to bridge what's actually happening behind the scenes with what's causing that action is sometimes really difficult for the retail agent to see.

Speaker 4 But this is what happens when reinsurance markets change is you'll start seeing things like this.

Speaker 4 And if you think it through, or if you were lucky enough to have the data, you'd be able to see it all the way through and understand it.

Speaker 8 Yeah.

Speaker 7 So for, so for a retail agent, you know, again, just we're talking mainstream retail, you're

Speaker 7 my takeaway from that would be

Speaker 7 I,

Speaker 7 we want, that's, this is where having flexibility in your markets, access to markets, being, being, having the ability to pivot

Speaker 7 accounts from one market to another when things like this come up. This is where this maybe is so valuable and or maybe even plays into the valuation of an agency.

Speaker 7 If you are, you know, if all of a sudden a carrier starts non-renewing your accounts and you don't have the ability to

Speaker 7 get that to communicate with that client and move that client to a new market, um, you're in trouble. I mean, you're going to start to lose business that way.

Speaker 4 You are.

Speaker 4 It's true. It's one of the funny things, you know, we haven't really had a hard market since 2002, 2003.

Speaker 4 AIG said today that it was 2010, but I think it was, I kind of disagree. I'd say it's 2002, 2003.

Speaker 4 And

Speaker 4 we've lost, that's a whole generation, Ryan. You know, that's 20 years, right? Yeah.

Speaker 4 And so people have lost the

Speaker 4 knowledge, the collective knowledge of how to use markets as you go through a market cycle because we haven't had one.

Speaker 4 So historically, and now's a great example of that, is

Speaker 4 this is why every agent in America, every independent agent in America should always have

Speaker 4 represent one of the top most highly rated carriers

Speaker 4 because those are the carriers that can bend and flex when times get tough.

Speaker 4 I had the CEO of one of these really highly rated carriers ask me a couple of years ago, he said, does anybody even care about our rating anymore? Do they care the difference between an A

Speaker 4 and a B minus?

Speaker 4 And, you know, in many cases, it had gotten to that point. But the market right now is such a phenomenal example.

Speaker 4 Like every independent agent in America should represent an A plus or multiple A plus rated carriers.

Speaker 8 Yeah.

Speaker 7 So why is that? I mean, just because, so like, like I'm a fifth grader, why, why does that matter? Because if I'm sitting here and someone calls me, right?

Speaker 7 And in my mind, I'm going, carriers don't give two flying craps about me.

Speaker 7 You know what I mean?

Speaker 7 All that matters is that I put this business on the books, that I get $250 so that I can keep the lights of this enterprise on or put money, food on my table, or, you know, whatever. Like, I'm,

Speaker 7 it doesn't matter to me. Right.
So that's, that's, and that's what you most likely have in your head. Most agents are scrambling.

Speaker 7 It costs so much to get a piece of business in that the last thing you're going to do is risk it by saying, hey, pay $250 more.

Speaker 7 You know, if that were the case, obviously, that's just because they're highly rated doesn't mean they're always more expensive. Pay $250 more because this carrier is A ⁇ .

Speaker 7 This one is B minus.

Speaker 7 Even though I pretty much you're guaranteed to have your claim paid because the state most likely has a fund that backs it up, even if they go insolvent.

Speaker 7 And if the rate goes up, I'm just going to move you to someone else anyways. So, you know, but you should pay $250 more for this carrier over here.
Like, you know, how does that,

Speaker 7 why should I care if I'm a retail agent?

Speaker 4 Sure, good question. One is, is that as the market hardens, those B-minus carriers are less likely to be able to even write the account to begin with.

Speaker 4 So it's not a matter of $250 more. It's you will have an opportunity to write it or you won't.

Speaker 4 And a lot of the really highly rated carriers are less dependent on reinsurance. The really highly rated,

Speaker 4 it's kind of a,

Speaker 4 it's it's almost a spinal taps in ways that our ratings go because the differences can seem rather tiny. What's the difference between an A and A plus and an A plus plus?

Speaker 4 But

Speaker 4 when, you know, an A and A plus, especially an A plus plus,

Speaker 4 quite often the quality of their capital is superior, not just the amount of capital. So they have flexibility in these marketplaces like this to do things that the others won't have.

Speaker 7 And by the quality of the capital, you mean the institutions that in which they're able to draw capital from or the plate where they have the capital, it is safe, secure, stable,

Speaker 7 easily accessible if needed.

Speaker 7 Is that what you mean by the, when you say that?

Speaker 4 Yeah, sort of kind of.

Speaker 4 So quality of capital could be like one carrier has a whole bunch of their capital invested in junk bonds and another one has it in long-term U.S. bonds.
Which, what quality is better?

Speaker 7 Well, today, I don't know that that's an easy answer, but not an easy, as easy today, but

Speaker 4 yeah.

Speaker 7 No, I hear what you're saying.

Speaker 7 And so, okay, so the ramifications of that are, and I, I know we're kind of nerding out on this, but I love this topic because this is all this stuff that like you'll be at a conference and you'll hear a carrier come up and they'll talk about these things.

Speaker 7 And I would rather the listeners of the show who are sitting at that conference or on that webinar don't just gloss over these things because I do actually believe that they're important.

Speaker 7 Because even though we can re-rate people, I think everyone that's listening knows when you constantly have to re-rate someone because the carrier is getting off the market or, you know, they come in super low and then all of a sudden they're raked.

Speaker 7 You, you know, once you can kind of blame that on the carrier, but if that's consistently happening because of the markets that you're putting your business with, you start to look like the schmuck.

Speaker 7 You start to look like you don't know what's doing. Because

Speaker 7 the from for most of the relationships that we have as independent agents

Speaker 7 the carrier doesn't matter to the the client what matters is that the client believes that you think it's a good carrier so so that relationship if that carrier keeps jumping off okay i'm just I'm trying to to pair to everyone who may not be following exactly why these things are so important.

Speaker 7 So,

Speaker 7 okay, so they're in junk bonds and

Speaker 7 which are highly volatile. So now what you're saying is they come in, you place the business with that carrier, and then

Speaker 7 they're in this volatile market as a way to,

Speaker 7 someplace to place their capital and whether they're making investment income out of it or whatever. And if that all of a sudden bottoms, well, now they may have had $100 million on the books.

Speaker 7 That's just, that's half as valuable.

Speaker 7 So now in order to equalize, hit their quarterlies, if they're public or whatever, they need to adjust rates or get off risks that are risky to minimize downside, something like that. Is that am I?

Speaker 4 Yeah, they'll have to get off risk, and it won't matter if it's risky risk or just plain risk. They'll just have to give up, get off risk.
So, for example,

Speaker 4 in the first, at the end of the first quarter, give or take, there's one carrier that literally lost a billion dollars in capital due to investments.

Speaker 4 And so, that changes a billion dollars is a lot. Most anybody's, you know,

Speaker 4 so it makes a difference.

Speaker 4 The other reason it matters, Ryan, and again, we've lost the collective knowledge of why in many ways, is that historically, these really highly rated carriers wouldn't grow very much during a soft market.

Speaker 4 But during the end, you know, it used to be like a seven-year cycle, clockwork type of thing.

Speaker 4 During the hard market, they would grow hugely. And if an agent represented one of those carriers, they would grow hugely because they would have the only game in town writing new business.

Speaker 8 Yeah.

Speaker 4 And so that's another reason why it does matter. And I think it's going to matter in this marketplace today,

Speaker 4 the hardening of it.

Speaker 7 So you believe that the market is hardening? That you see, that's what you're seeing?

Speaker 4 By line of business, it's a weird, it's the weirdest hard market.

Speaker 4 I researched hard markets back to the 40s.

Speaker 4 This is the weirdest hard market that I can find on the books

Speaker 4 because there's not a lack of capital. Hard markets are almost historically driven almost entirely by lack of capital.
This one's not being driven by lack of capital. There's still plenty of surplus.

Speaker 4 It's that there isn't surplus in very specific lines of business, and there isn't adequate rate in very specific lines of business. So

Speaker 4 it's very much by a line of business business as to how hard the market is or will become.

Speaker 8 Yeah.

Speaker 7 Is that now, what is the reason for seven-year consistent cycles almost on like clockwork? I remember when I first got in the business, 2007,

Speaker 7 you know, we were a few years off of the 2002.

Speaker 7 My father-in-law would tell stories, you know, you guys don't. don't know what it was like, you know, when it, you know what I mean, everything's easy for you.

Speaker 7 All you got to do is get someone's info and you're going to write the business, you know, because they're going, and he's just busting our chops.

Speaker 7 but you know that was kind of the way it was like rolling into 2006 2007 all you had to do was get someone's information and you were writing the account there was always somebody cheaper and um

Speaker 7 and you know so really that's changed a little but not really i mean you can kind of always find someone cheaper and

Speaker 7 So it's been, I would believe it's really been 20 years because even 2010, I mean, I was still selling and 2010, that didn't feel,

Speaker 7 I mean, after everything that went on leading into the crisis, maybe, but that felt more like a small correction than a hardening because everything started going back down again. Um,

Speaker 7 what has caused seven, seven, seven? Now we're looking at 20 years. What has been the reason for that?

Speaker 4 Oh, that's a that's a great question. Uh, there are a lot of reasons for it.
So,

Speaker 4 one reason I think is that there's maybe um better regulatory um actions to keep carriers maybe

Speaker 4 arguably more conservative in their reserving. Let's put it that way.
Okay.

Speaker 4 That's helped some. But another reason that isn't being looked at very deeply is insurance is less important today than it used to be.

Speaker 4 And I would encouraging, I've been trying to encourage carriers and brokers and everybody to wake up that it's not 1970s America, but our forms that we sell

Speaker 4 are based on 1970 they're not based on 2020.

Speaker 4 and i've got i've got some diagrams based on ambest data that shows

Speaker 4 that literally shows insurance is less important as a role a percentage of gdp

Speaker 4 and that losses are less significant relative to gdp than they were 20 years ago the frequency of losses um one of the changing things that happened after 2010

Speaker 4 was that the frequency of losses decreased precipitously and it's never increased back to its prior levels.

Speaker 4 Even though we have millions more people, millions more cars, millions more businesses, millions more of everything,

Speaker 4 the absolute number of claims, pure absolute number of claims, didn't go back to what it was prior to 2010.

Speaker 4 We just don't have as many covered losses, so insurance isn't as important.

Speaker 4 There's two reasons for that.

Speaker 4 Really important reasons. Yes.
One is that the world's just a safer place, which is awesome. The safer the world is, the less important insurance is.

Speaker 4 Number two is we insure the wrong things.

Speaker 4 And if we don't start insuring the right things,

Speaker 4 nobody's going to have a need for us.

Speaker 7 So that's like the best interview tee up statement that's possible. So what are the wrong things and what are the right things?

Speaker 7 That's like the ultimate layup. Like you just put it like right over the cylinder and I just had to push it right in.

Speaker 4 Well, you know, there's an argument to be made that outside of

Speaker 4 outside of major fires, there isn't a whole lot of need for fire insurance. Almost nothing really in the big scope of things burns down anymore.

Speaker 4 You take arson out, you take wildfires out, there's not a lot left, honestly.

Speaker 4 But

Speaker 4 who is insuring intellectual capital?

Speaker 4 Aon did a study that showed that 87%

Speaker 4 of the SP 500's

Speaker 4 total value

Speaker 4 is in non-tangible, intangible assets,

Speaker 4 i.e. intellectual capital.

Speaker 4 Where do you,

Speaker 4 who offers that policy? Who's selling that policy?

Speaker 7 That's a really,

Speaker 7 so I'm sure that you have more. I just want to jump in real quick because

Speaker 7 I had an issue with this.

Speaker 7 I had a company whose intellectual property was programmed, was software that they had developed.

Speaker 7 And I started reading, so my mind went to naively, they just need a tech E ⁇ O policy, right? Tech E ⁇ O. The name says it all.
This is everything they could possibly need.

Speaker 4 But it doesn't cover it.

Speaker 7 But because

Speaker 7 I'm a nerd,

Speaker 7 like any, like most of, I started reading through the form and I'm like, wait a minute, this is like basically a standard E ⁇ O policy, except it has the word tech in bold letters on the top, which, you know, is more of a classification of business than it is an actual adjustment to the policy language.

Speaker 7 And, you know, I

Speaker 7 granted, I want to be fair, there were a few, we'll call them schmooggy givebacks to the fact that what they were building was a, was a, um, a technology product, but it was more, it was more as it regards an intam intangible damage to a third party than it did to the intangible asset that they had created in terms of this actual software that they're selling.

Speaker 7 That if it goes poof or gets ripped or stolen, they are out of business or are severely hindered.

Speaker 4 Yeah, I mean, somebody comes and steals the contractor's tools, you have a policy for that. Someone comes and steals your software, where's your insurance policy for that theft?

Speaker 8 Yeah.

Speaker 4 And it happens all the time. Oh, yeah.

Speaker 4 So that's what we're missing. I'm a certified business appraiser, which is a

Speaker 4 pretty tough designation to get.

Speaker 4 And And in becoming a certified business appraiser for insurance agents,

Speaker 4 you have to be able to analyze the

Speaker 4 intangible assets because a book of business is an intangible asset.

Speaker 4 Someone steals your book of business, Ryan, where's your theft coverage?

Speaker 4 Yeah.

Speaker 4 And that our world operates not on screwdrivers and someone stealing tools and things. It operates on intellectual capital today.

Speaker 4 If the insurance industry wants to remain relevant, we've got to ensure what is important.

Speaker 7 Is there anybody that's doing it?

Speaker 4 There are a couple of firms out there that do it, a couple of

Speaker 4 brokers that specialize in it.

Speaker 4 You have to really understand what you're selling.

Speaker 4 understand that there's probably not one single policy. It's usually going to be a combination of policies required to provide the full, all the coverage that someone needs.
Yeah.

Speaker 4 So we teach some classes on it,

Speaker 4 but a lot of people are selling cyber thinking that's where the coverage is, but most, yeah, that's not where it is. No.
Tech ENO, most of those forms will throw in a little bit this way or that way.

Speaker 4 But almost all of the forms, like you said, are based on if it damages someone else. It's a liability policy.
It's not, lack of a better term, a theft policy. Yes.
So, you know,

Speaker 4 there's certain countries out there. They don't come to the United States to steal

Speaker 4 screwdrivers. They come to the United States to steal intellectual capital.
It happened to a neighbor of mine,

Speaker 4 a small businessman who made this really neat, unique little utensil.

Speaker 4 Another country stole the design, sold it for half the price. What happened to his market?

Speaker 4 Right?

Speaker 4 He needed insurance for that. He didn't need insurance for, honestly, he didn't need insurance for the injuries it would cost somebody.

Speaker 8 Yeah.

Speaker 7 No, you're 100% right. That was that when I was reading the tech language, when I was reading the language of that particular carrier's tech E ⁇ O policy, which

Speaker 7 you know, I sold the guy anyways.

Speaker 7 I mean, I mean, I made him aware of what was happening, but you know, I basically said to him, this is covering you for your product doing damage to someone else, not necessarily someone stealing it.

Speaker 7 But it was, there it was. It was just again flashing lights.
This is, there was, I think it was $25,000 for intellectual property theft, which this is a bit, this is a seven-figure business.

Speaker 7 So what is $25,000? That doesn't even, that doesn't even count for the lawyers to wrap the business up and shut the doors. Like, you know what I mean?

Speaker 4 That doesn't even contain a retainer.

Speaker 7 Yeah. And, you know, it's not like you can go in and say, hey, I want this 25 turned into a million on a, this is not even an option.
They don't have any way to rate for it. So

Speaker 7 I agree with you. It is, it is, it's almost why I've stayed away from the tech industry a little bit so far in my, in, in this part of my career, because,

Speaker 7 you know, the tech E ⁇ O policy, there's nothing special about it. I mean, I know a lot of carriers like to write it because it's, there's not that much to it.

Speaker 7 I mean, you're, basically, the only thing they're really covering is your damage to someone else through the software that you've created or through the services that you've created which is a relatively low risk item in truth so that's i i this idea is there any what what else or maybe there isn't but like this idea of we're insuring the wrong things is very interesting to me um is there any other aspects of of business in general that you feel like we're we're kind of misaligned on for for 2020 yeah so i think business income i think just traditional business income.

Speaker 4 When we, so

Speaker 4 we have a, I do my regular consulting business, but we also have an educational company. We teach, I would argue, the most in-depth business income coverages

Speaker 4 available anywhere in the industry.

Speaker 7 And is this available to, do people have to be part of a membership program or they can just come in and sign up and take the classes?

Speaker 4 They can sign up and take the classes. Most of them are for a whole department at a time, but we've created one for individuals that just want to learn more than what their agency is offering to.

Speaker 7 And is that at burand-associates.com? They can find it all there.

Speaker 4 You can find it at Burand Education.

Speaker 7 Gotcha. Buran.
Okay. And I will have, so you can either go directly, also have it on the show notes for everyone listening.

Speaker 7 I'll have a link over because I am an enormous believer in education in general. I just got my CWCA

Speaker 7 through

Speaker 7 Press and Diamonds shop. So I, you know, I'm an enormous believer in investing ourselves educationally into this industry.
I really think it's a true differentiator.

Speaker 4 It is. Yeah.

Speaker 7 So that's, that's great to know. And I'll have that all linked up and stuff.

Speaker 4 Okay, so business income. But business in

Speaker 4 business interruption, most people take the class, and I'm not denigrating because

Speaker 4 their options have been limited, but there's three kinds of business interruption.

Speaker 4 One of the reasons people don't have the right business interruption coverage is because we're not offering all three kinds. And most businesses do need all three kinds.

Speaker 4 So one is we need to understand just your basic business interruption and offer it and in the right fashion.

Speaker 4 So one of the observations we've made in our classes and studying polling people taking the classes is there's this

Speaker 4 centering around the worksheet.

Speaker 4 but not the time elements.

Speaker 4 The worksheet without the time elements is kind of a pointless exercise.

Speaker 4 So you have to be able to put the two together and we find that there's a real lack of understanding of the time elements.

Speaker 4 And then you have contingent business income. Contingent business income is beyond compare.
It's so critical and it's rarely sold. Almost, it's rarely even offered.

Speaker 4 When I do my E ⁇ O audits, I find probably a majority of people don't even know it exists.

Speaker 4 And then the third kind is a specialty business interruption coverage. Usually that kind of coverage is available only through specialty brokers

Speaker 4 and it is by SIC code. So in other words, you have to find that kind of business interruption coverage.
It's usually a contingent type that is specific to SIC code for manufacturers.

Speaker 4 And then there would be a different program for restaurants and a different program for hospitals or what have you. Or even if it might even be more segmented than that.

Speaker 4 But those particular programs, if you find the right one

Speaker 4 for you, that SIC code,

Speaker 4 boy, do they make all the difference in the world

Speaker 4 for a client that has a business income problem related usually to regulation, which is a lot of what the COVID-19 business interruption issue is all about.

Speaker 4 So understanding that with the products already available can make a huge difference. Very underserved part of the marketplace.

Speaker 7 And why don't most agents,

Speaker 7 so I'll tell you, I mean,

Speaker 7 I won't say I have a master's education of

Speaker 7 the

Speaker 7 business income with the contingent, but

Speaker 7 the SIC code specific, I'll be honest with you, I didn't even know that that existed.

Speaker 7 I didn't even know that that was a possibility or that there were specific policies that broke down business interruption into

Speaker 7 a line of business to cover their, I didn't even know that was there.

Speaker 7 Why do you think that is, that that's not widely known? And why do you think agents don't focus on this? Just, it's tough to sell. Is it as simple as that?

Speaker 4 I don't. I think part of it is that most of the insurance industry's educational courses are based on industry standard forms rather than proprietary forms.

Speaker 4 And that's where most agents learn learn about products available. I think that's one of the shortcomings of the industry is this focus on standardized forms.

Speaker 8 Yeah.

Speaker 4 So

Speaker 4 if you don't know something exists,

Speaker 4 it's hard to go look for it.

Speaker 4 And if you're going to educational classes and people aren't talking about it, it's it's really hard to figure out and find out.

Speaker 8 Yeah.

Speaker 4 I think that's the number one reason.

Speaker 7 Say that again.

Speaker 4 I think that's the number one reason.

Speaker 8 Yeah.

Speaker 7 Yeah. I, you know,

Speaker 7 starting this agency has been eye-opening for me in many, in many ways. And I said this to you when we did a pre-call last week or two weeks ago, whatever it was.

Speaker 7 Inso much as a producer, I thought I got a good education from my father-in-law. I got a really, really solid producer education.
And

Speaker 7 when I went to Trusted Choice and built Agency Nation, I got to have so many conversations with so many amazing people like yourself. And I did the podcast there.

Speaker 7 And man, I came out of that going, geez,

Speaker 7 I've talked to people up, down, inside, left, right, you know, of the industry, every part

Speaker 7 from CEOs to marketing reps to carriers to underwriters, claims, adjusters,

Speaker 7 you know,

Speaker 7 to every type of agency that I thought existed. And

Speaker 7 then when I started the agency and I started getting smacked in the face day after day with the realities of having to think about all this stuff, which can be so heady and so high level, but at the same time,

Speaker 7 you know, keep the business actually operating, like actually do the,

Speaker 7 it is a really difficult process to manage because you hear things

Speaker 7 like what you're talking about, the depth of what you're talking about. And I think every agent

Speaker 7 worth their salt hears that and says,

Speaker 7 I would love for all my clients who need a coverage that rich to have a coverage that rich. At the same time, the idea of actually

Speaker 7 investing yourself, creating the brain cycles, implementing the process,

Speaker 7 finding access, whether through a specialty broker or a carrier, and actually implementing it into your, into your, your client base feels so overwhelming that you just don't do it, right?

Speaker 4 I mean,

Speaker 4 it really is.

Speaker 7 That's a huge, like that one simple thing thing is such a huge process when you break down all the pieces, which is why I feel like we all default to standardized forms because it's just, it doesn't take me 40 brain cycles to wrap my head around a standard form where, you know, a business interruption class form specific to, you know, plumbers or whatever.

Speaker 7 I'm like,

Speaker 7 how is it different than the one?

Speaker 7 for electricians you know what i mean like you know and and it it just feels like a lot of brain cycles i just think that's a that's a very tough aspect of our business is

Speaker 7 as much as a lot of this stuff feels like it can be straightforward uh very little in our industry actually is yeah ryan you're right and and it is it's it can be really overwhelming no twice about it um

Speaker 4 i've

Speaker 4 i live that and see it daily it is really overwhelming You know, there's a lot of options, though, to help make it more bite-size.

Speaker 4 One is to learn

Speaker 4 about it. You know, one of the things, the reasons it takes like you said, 40 brain cycles

Speaker 4 is because it's the part of the learning curve. So the more you learn, the faster you cycle through the process.

Speaker 4 So the key to it is learning, like you said earlier, is taking the time to learn it in depth and probably go a little further than industry standard. You know,

Speaker 4 I think CE is one of the worst things that ever happened to our industry.

Speaker 4 So what I recommend to people quite often anymore is go do your CE on one of those programs where you can get, you know, six hours and 45 minutes for $100,

Speaker 4 right? And then go spend your real money on real education elsewhere and not worry about CE.

Speaker 4 I think that's really good advice.

Speaker 4 It's the best way to get the education so you don't have to think so hard about some of these things.

Speaker 4 And then if your book is big enough, start picking some kind of a specialty. It'll make it a lot easier and a lot more rewarding.

Speaker 4 I've got a buddy who built a multi-million dollar commission book on nothing but contingent business income for one SIC code.

Speaker 4 So

Speaker 4 one of the ways to not have to worry about all these things is just that focus.

Speaker 8 Yeah.

Speaker 4 And

Speaker 4 I think most producers listening would be very happy with a multi-million dollar commission book.

Speaker 7 I think they would too. I think they would.
I think that,

Speaker 7 so I always try to put things in context of the struggles that I'm having personally because I don't know. If I'm struggling with it, I'm assuming others are as well.
And I know unequivocally that

Speaker 7 finding some sort of niche or focus or specialty is the answer.

Speaker 7 I just, there's, there's no, there's not really a counter argument to it. I guess what makes it legitimate is that there is a counter argument that just doesn't actually add more value, right?

Speaker 7 So generalist would be the counter argument, but

Speaker 7 I feel like highly profitable generalist agencies are more of an edge case than a rule, where highly profitable organizations with three to five specialties or somewhere in that range, maybe one to three, depending on what they are, they are more often profitable.

Speaker 7 So that's what kind of proves the case is: you need to have a counter argument.

Speaker 4 Otherwise, it's a conspiracy theory.

Speaker 7 So

Speaker 7 that being said,

Speaker 7 it is so difficult to say no to business that, you know what I mean? Like, you know, the answer. I know the answer is just pick something.
It honestly doesn't matter.

Speaker 7 I should just put, post the notes up on my wall, have my kid take a dart, close his eyes, throw it at the wall, and whichever one he hits, it's like, like, okay, I'm into, you know, barber shops run by women on the West Coast.

Speaker 4 Okay, there it is, let's go. And, um,

Speaker 7 and you just fight it. You, you,

Speaker 7 I, I have an account that I'm gonna write today that is a $986 bob, and I don't know why that I'm doing it. I have no idea why I'm doing it.
I literally have no idea why I'm writing this account.

Speaker 7 I don't want it. I'm not interested in it.

Speaker 7 The guy's kind of annoying, but he called me. I rated him up while I was on the phone with him, and I'm going to write the account.
And

Speaker 7 I say that, I don't, I don't want to belittle that because it's business and I should be happy. And

Speaker 7 the mechanism is working because he found me online and, you know, was kind of already sold because he'd watched a couple of videos. So I shouldn't complain.
But at the same time,

Speaker 7 it's not. That's not the future.
There's no part of that is the future of where I'm going.

Speaker 7 And I'm going to write it anyways. And no, I'm sitting here telling you that I shouldn't.
So

Speaker 7 I just, I, I, I don't know that I have a point to this story other than to say, I, I found it very interesting that while logically

Speaker 7 it is, it makes so much sense to dial into a niche and emotionally, it is so incredibly difficult.

Speaker 4 It is hard. No choice about it.
Um, you know, it's a fear driven.

Speaker 4 You know, it's fear-driven, right? The fear is if I don't write this 986, where am I going to get the next 986? It's not ready. It's not right there.
Yeah.

Speaker 4 Especially when you're starting out, it's next to impossible to stay that disciplined. So, you know, when you're just first starting out, it's best probably to write whatever you can write.

Speaker 4 But

Speaker 4 at some point in time, those that express the discipline in some form or another, they always win.

Speaker 8 Yeah.

Speaker 4 100% of the time.

Speaker 7 So I want to dive into,

Speaker 7 I want to kind of of pivot just a little bit our conversation here as we continue to roll on

Speaker 7 to agency valuations, as much as you're willing to talk about that topic. I know it's a big part of what you do, and you're one of the best in the country at it.
And

Speaker 7 I'm very interested in

Speaker 7 We all, so a good, good buddy of mine, and I don't know if you know him or not. His name is Chris Langell.
He runs Advisory Volved. It's an insurance website business.

Speaker 4 And

Speaker 7 he put out a tweet the other day that said simply,

Speaker 7 we don't sell insurance to sell insurance. And his point was,

Speaker 7 we sell insurance to feed our families, go on vacation, have a lifestyle that we want, you know, whatever. There's a reason why this just is the mechanism for many people.

Speaker 7 This is the mechanism in which. we've decided to make the income or build the lifestyle that allows us to do what we want.
Okay.

Speaker 7 So

Speaker 7 starting an agency, even though I'm nowhere near selling,

Speaker 7 you kind of can't help but at times think about the end, think about where we're going. So

Speaker 7 you've talked about how

Speaker 7 we're ensuring the wrong things. So

Speaker 7 in that regard, or with that understanding, I think it's fair to say that there are probably aspects that would build agency value over the next 10, 20 years that maybe weren't as important to building agency value the previous 10, 20 years.

Speaker 7 And if that's wrong, that's fine. So maybe what are some of those things or what are one of those things that if you are a young agency or a growing agency

Speaker 7 and you could step in right now, intervene into their agency and say, hey, if you just focus on this one thing,

Speaker 7 it'll tick your trajectory up in value. This will really help long term if I could interject right this moment and fix it for you.

Speaker 7 What's something like that, if that long-winded meandering question makes any sense?

Speaker 4 Yeah, no.

Speaker 4 One of the biggest differences from 10 years ago or 20 years ago and today is data. Data, data, data, clean data.

Speaker 4 Data makes scale possible. Lack of data prevents scale.

Speaker 7 If this were Cass's podcast, he'd be doing this thing where he acts like he's losing his mind.

Speaker 4 He'd be like, oh, Chris, oh, hold on.

Speaker 7 Let me write that down. He'd be scratching it.
Um, sorry, I can't help but make fun of Cass. He's my favorite.
So, um, that is

Speaker 7 that is an answer that makes complete sense to me. Um,

Speaker 7 but I think for a lot of agents, that that does not make sense to them, right? They don't, I think, uh, and I don't mean that in a belittling way for anyone that's listening.

Speaker 7 I think it's just the idea of data has been tossed at us and used both from a very deep, rich standpoint and at a very shallow kind of giving the word multiple meanings.

Speaker 7 So, when you say clean data, what does that mean in a practical sense to an agency owner who's sitting and listening to this?

Speaker 4 All right. So very, very succinctly, let's start with accounting.
Having good accounting data is crucial.

Speaker 4 Really good accounting data is really crucial.

Speaker 4 Because if you don't have good accounting data, you don't know really what status your agency is in.

Speaker 4 A buyer comes in, they're going to discount it because they can't trust the numbers.

Speaker 4 And it reduces your flexibility. So like when the pandemic hit, if the United States government hadn't stepped in and offered lots of loans with very little data required on the loan application,

Speaker 4 a whole lot of businesses in America would have gone kaput simply because they have bad accounting. and a lot of agencies fall into that category.
So very practically, daily basis, good accounting.

Speaker 4 On a client basis, actually inputting correct data into

Speaker 4 your agency management system,

Speaker 4 including going back to earlier, the SIC codes. Recording the SIC code of your individual business clients is unbelievably valuable on a go-forward basis.

Speaker 4 from so many different angles.

Speaker 4 So when I go into agencies and I'm looking at their files and

Speaker 4 I can't tell right from wrong what's happening or they say, oh yeah, we don't always put that information in or like on the prospect module of an AMS system, they're not inputting any of their prospects in there.

Speaker 4 So it's like, so how can you ever re-solicit these people?

Speaker 4 You have to start from scratch, whereas you save so much money having a lead list that's been built over the years from people that you already talked to.

Speaker 4 Man, that's worth a lot of money, that lead list.

Speaker 4 So it's about very practical data being entered daily and accurately. Does that help?

Speaker 7 Yeah, I think it does. I think that

Speaker 7 one of the things that I found very interesting when I first joined my wife's family's agency, and I just use them as a barometer all the time.

Speaker 7 even though they're they it's a highly incredibly well-run agency um one of the things that they they that we had to clean up over the years was that um they there was a prior partner in the business and obviously employees come in and employees come out and they've been in business for 47 years and it's a testament to the work they do but at the same time you have employees who would use one field for phone number and another field they would just put they would put information in random text boxes right and and all of a sudden you would go we would try to pull information because one of the things that I started to implement when I was there was Infusionsoft because we were on TAM and there was no real way to market out of TAM.

Speaker 7 So we said, okay, we'll take the data, we'll export it out of TAM, we'll put it into infusion, and we'll start to market there.

Speaker 7 And then we'll just, yeah, we'll have dual entry, but at least we'll be able to communicate and connect. And

Speaker 7 we couldn't do it. We couldn't do it because the manual labor process, once we...

Speaker 7 Once we were able to export the data out, just the differences in how people had used fields and how they had inputted things over the course of time was

Speaker 7 so I mean, I mean, today, I guess, yeah, you could hire a VA and have them clean it up, but, but it was too much work.

Speaker 7 It was literally too much work when we started to actually break it down for it to be valuable because it just was so, it had been used so many different ways for so long.

Speaker 4 So

Speaker 7 I mean, that, so, so that. So what you're saying is today or, or in the next 10 to 20 years, these are the kinds of things that are actually going to have an an impact on value.

Speaker 7 Because when I bring up data to some agents today, they'll just say to me, yeah, Ryan, that's cool. Except, you know how agents get valued? They take EBITDA,

Speaker 7 they times it by two, and then someone writes a check for that. And

Speaker 7 I just can't believe that, one, I don't actually believe that it's that simplistic, though I'm sure it does occasionally happen.

Speaker 7 But at the same time, I can't believe as we become more sophisticated and

Speaker 7 systems talking to each other becomes more just a given part of our business that this isn't going to, that people are going to pay the same when the data is not clean or whatever.

Speaker 4 Two points. One is activity codes are

Speaker 4 maybe the worst example of people using multiple activity codes for exactly the same thing. And those activity codes are really valuable pieces of data.

Speaker 4 So that's a great, like putting telephone numbers in different fields. That's a really just the same thing.
But here's the other part. Let's say it is simple.
Let's say it is two times EBITDA, right?

Speaker 4 Let's just leave it at that.

Speaker 4 Six times EBITDA or 12 times EBITDA or whatever the number is.

Speaker 4 If you have good data, you'll have a bigger EBITDA.

Speaker 4 So even on a simple basis, your value increases.

Speaker 4 If you have good data and you use it constructively, you will have a bigger EBITDA, all else being equal.

Speaker 8 Yeah.

Speaker 7 And you can tell me if you do not have knowledge of this particular project or are interested, but

Speaker 7 the NEON project, are you familiar with Seth and some of the things he's doing and some of the ideas around how he's trying to

Speaker 7 anonymize and

Speaker 7 then scale data over agencies so that we can be more efficient and what are your feelings on a project of that nature?

Speaker 7 It doesn't, you don't have to specifically reference neon just the idea as a whole and and do you think something like that actually is valuable to agents long term if it can be pulled off if it's possible if it if it can be pulled off there's a possibility the problem i think with any of these data projects there's a number of these kinds of data projects yeah

Speaker 4 is is that There's no standardization of process in agencies, much less across agencies.

Speaker 4 And so you use activity codes for an example.

Speaker 4 Until you have some consistency, it's next to impossible to do any kind of analysis of what

Speaker 4 works best.

Speaker 8 Yeah.

Speaker 4 So I think that's one of the biggest, biggest issues that we have in those kinds of projects. Conceptually, there's a lot of value, a whole lot of value.

Speaker 8 Yeah.

Speaker 7 The thing that I have been impressed with, and

Speaker 7 I'll just talk to the end because of all the the data projects and I know there are many that's just the one that I'm the most familiar with

Speaker 7 was

Speaker 7 their ability to look at

Speaker 7 the second and third layer reasons for for a particular high level action so

Speaker 7 it takes four days to get a quote back from X carrier Let's just say, bam, that's the data point. Okay.
So if we were to just to position that against five days for Y carrier, we could say, well,

Speaker 7 let's, you know, we need to stay away from Y carrier. It's taking us 24 more hours to get a quote back and we could be losing business.
Okay.

Speaker 7 But

Speaker 7 when we're actually looking at this data at scale and we do have it, and it is, I'm going to do an air quote so no one can see me, clean, you know, then we can dive down and really start to dissect.

Speaker 7 Well, the reason it's five days is because John is actually the one who's submitting the business to that carrier. And John's submissions in general are twice as long as

Speaker 7 as any other

Speaker 7 agency personnel. And

Speaker 7 if we can, now we can focus on what the real core issues are that are keeping our efficiency down.

Speaker 7 Now, I know some of what I just said made smoke come out of agency owners' ears, but I think the idea here is for these agencies that really want to grow and that understand how important internal efficiency is to that growth, not just on renewals or retention, but on new business, this clean data and then having the right system that can help you look at the second and third level,

Speaker 7 it is wild. I mean, you can see how

Speaker 7 powerful these systems can be over time.

Speaker 4 Yeah, I don't even know you have to have a system.

Speaker 4 We've proven to a lot of different clients just within their own organization that there's an easy 20% operational efficiency to be gained from that kind of analysis.

Speaker 8 Yeah.

Speaker 4 And even on a simplistic level, so that means one out out of five people on a payroll is

Speaker 4 superfluous.

Speaker 8 Yeah.

Speaker 4 That's a big savings, right?

Speaker 8 Yeah.

Speaker 4 The catch, one of the catches to it is that people that run agencies are salespeople by and large. They're not operational people.

Speaker 4 So even if you come up with all the solutions, which I, and I totally agree with you how important operations is,

Speaker 4 you have to have an agreement that there'll be emphasis placed on operations by the person who mostly is focused on sales.

Speaker 8 Yeah.

Speaker 4 Our industry never really achieved that.

Speaker 4 Very few agency owners

Speaker 4 of any size, big, small, medium, whatever,

Speaker 4 have that appreciation of

Speaker 4 efficiencies in operations.

Speaker 7 So, one of the byproducts, I've

Speaker 7 this question and one more. I want to be respectful of your time.

Speaker 7 One of the byproducts of looking into, so I,

Speaker 7 in trying to figure out

Speaker 7 what the

Speaker 7 personality of this agency was going to be, where we were going to go. I obviously have ideas, but I also am a firm believer that you follow your strength.
You don't try to force it. So I've

Speaker 7 tried to both operate in the areas that I think there'll be opportunity, but also kept an open mind. Okay.
So one of the places that I

Speaker 7 will say explored was like high-volume personalized leads business and getting to know some of those agency owners who are very successful in that game.

Speaker 4 If I had to kind of pull out one of the core

Speaker 7 similarities, it is that they have removed themselves from sales altogether and removed their overemphasis on sales as the primary thing they focus on and took more of a holistic approach to the agency.

Speaker 7 They've really taken the time to dive into even simple things like onboarding new clients, setting expectations, working on carrier contracts. I mean, these types of

Speaker 7 operational and second level thinking that I think a lot of us who get stuck at plateaus get stuck there because we never want to leave the sales function and we only ever think about the sales function, you know, first, second, third in our business.

Speaker 7 And not that sales is important, don't get me wrong, but at a certain point, I think we have to replace ourselves as the head of sales and start thinking holistically, or we have to pay somebody to do that because it has to be done.

Speaker 4 Right. Absolutely.
You're right. I think one of the

Speaker 4 advantages,

Speaker 4 it's kind of interesting, the intersection of data and having and accepting the reality reality of better operational management they very closely connected right

Speaker 4 i would argue that there's a couple of the of the networks

Speaker 4 just a couple maybe three maybe four

Speaker 4 of these networks where you know everybody signs on and gets access to the carriers that's what i mean by networks yep

Speaker 4 The people running those particular networks have more insight specific to that than maybe anybody else I've seen in the industry.

Speaker 4 I think that they have something that maybe is pretty unique in that fashion.

Speaker 4 The network for network sake, I'm not so sure about, but scale and operational efficiency, and because they have the scale already, they can bring both of those things if they have the right mindsets and address what you're talking about.

Speaker 4 I think there's something there for a few in a few instances.

Speaker 8 Yeah.

Speaker 7 Yeah, I've talked about them before on the show.

Speaker 7 I'm part of Indium, and the reason I joined was not necessarily because they're the biggest or had the most bells and whistles, but because Chad and his team, this is where they're moving.

Speaker 7 Like, this is their mantra. You know, they may not be to, you know, fully up, you know, fully dispersed.
Everything's functioning exactly the way it should, but they are moving in this direction.

Speaker 7 They're using, I think, tools that allow them to be flexible and maneuver. And that's not just to pump them, but just in general.
I agree with you. i do think and and again when you can look at

Speaker 7 when you can look at data as widespread and in a certain once you hit a certain um

Speaker 7 uh uh bar once you get over a certain amount of data you can really start to see trends and impact and how and how changes uh have a widespread effect. I think there's a lot there.

Speaker 7 So the last question I want to leave you with, and this could be shallow, you can go as deep or as not as you want. I just, it's something that

Speaker 7 is on the minds of a lot of mainstreet agents today. And that is the idea of using VAs in your business and outsourcing

Speaker 7 in general. And I'm just interested from your perspective, agency valuation, ENO, operations, you know, like when you think about this trend towards VAs, what

Speaker 7 Where's your mind going? Is it something you see as a very positive? Do you see it as a net neutral? You know, where are you coming down on vas in general

Speaker 4 so outsourcing is pretty interesting um there's definitely some areas in which outsourcing is incredibly valuable but it has to be very surgical in its use and in choosing which outsourcing firm to use um

Speaker 4 you know the new there's some quite a bit of new technology coming down the pike probably sooner rather than later, that's pretty much going to eliminate the need for mass outsourcing.

Speaker 4 There's just, it replaces them. The technology just flat replaces that whole duty.

Speaker 4 The other thing that I've noticed in doing agency valuations and efficiency studies is that it's really hard to find true cost savings with most mass outsourcing.

Speaker 4 It's hard to judge in a smaller agency. but in a larger agency,

Speaker 4 it's really hard to find the savings. We've done some detailed studies on it for large clients who use outsourcing on a large scale.
And

Speaker 4 one would think the savings would be there. One would think it'd be pretty easy to find.

Speaker 4 But

Speaker 4 it's pretty hard to discover.

Speaker 4 I don't really like revenue per person as any kind of a metric. I think it's a pretty lousy metric.
except for if it's if somebody's way less than normal revenue per person, that's a problem.

Speaker 4 But the connection, the correlation beyond that is

Speaker 4 pretty much zero.

Speaker 4 If you do regression analysis, the R-squared value is nearly zero.

Speaker 4 So

Speaker 4 when we've tested revenue per person and whether it's affected by outsourcing, it doesn't seem to have much of an effect, especially if you build back the cost of the outsources.

Speaker 4 Sometimes revenue per person actually decreases.

Speaker 4 So

Speaker 4 I don't think it's usually used well.

Speaker 4 And I think new technology is going to replace it.

Speaker 7 That's interesting. You know, I have a client who used to work for Facebook.
And

Speaker 7 we were, I, I wrote, we wrote it. I wrote his insurance.

Speaker 7 He moved to New York. And then we got into this geeky tech conversation.
And, you know, he was telling me all his ideas for disrupting the insurance space, and

Speaker 7 which

Speaker 7 were interesting.

Speaker 7 And then he basically said,

Speaker 7 there's a lot of, you know, I know the trend in insurance is VAs. He said, and I don't understand why.
He said, I think the technology can replace them.

Speaker 7 I'm of two minds on it. I have, I just have brought in my first VA a couple of weeks ago into the agency.

Speaker 7 I can say unequivocally, the advantages, the cost versus the time that it is freed up in my day to do things that are allow me to produce more revenue and focus on the bigger longer-term projects that before i just could not get through that i also could not hire an american to do that i could not take the time to bring in technology to do i i i couldn't i mean to me it's uh uh a hundred out of a hundred times that being said

Speaker 7 i there may be a point at which

Speaker 7 you are of a size where you have the time, resources, capacity to backfill and replace those processes. But setting up the technology is oftentimes just as much work or more than onboarding the VA,

Speaker 7 which is an interesting dilemma. Not right or wrong.
I think it's an interesting dilemma.

Speaker 4 I think for smaller agencies,

Speaker 4 the VA

Speaker 4 can be a godsend. I really do.
And I recommend it to a lot of my clients, one way or another.

Speaker 4 But for larger ones,

Speaker 4 it's really a mixed bag.

Speaker 4 It truly, truly is. And

Speaker 4 the technology is going to replace it.

Speaker 8 Yeah.

Speaker 4 There's no two ways about it. Chris.

Speaker 4 Large scale. It's especially on the large scale.
The technology is inevitably going to replace it. And it's going to replace it sooner rather than later.

Speaker 4 And furthermore, the better the data is that an agency has, the more quickly the technology is going to be able to replace the human at a far lower cost.

Speaker 7 Well,

Speaker 7 I just want to share this with you. This is I just to this point.
So I'm testing a tool right now called Canopy Connect.

Speaker 7 What this tool does, and you may be aware of the audience at home, and I want to give a shout out to Heath Sharon. He's the one that turned me on to this.

Speaker 7 Your prospect logs into their current online platform and Canopy Connect pulls all the data out. clean, exactly as it should be.

Speaker 7 No, oh, did you say seven or four or you know what, you know what I mean? Like none of that. It just log in, boom.
Now, again, we're not quite there. You know, there's also some cultural things.

Speaker 7 Do people want to do it? Do they trust? You know, there's some, but man, it zaps that data out. 90 seconds later, you're staring at all the information you need to quote them.

Speaker 7 And all that person had to do was put their username and password into the system.

Speaker 7 And

Speaker 7 I look at that and I said, okay. you know that's step one of four that gets us to where we never have to ask them any of the underwriting questions ever again but

Speaker 4 that's really interesting i mean to the client who's willing to use that it's very very powerful there's another a number of those systems in place that are one step away from a light switch being turned on and made active yeah

Speaker 4 um they're game changers i've tested i've i've tested them i've gone through the demos um

Speaker 4 and they're total game changers. And then there's another set of systems that come in and do another aspect of

Speaker 4 the policy work. And you put those two together,

Speaker 4 frankly, honestly, pretty much about 40%, 50% of all human processing is eliminated.

Speaker 8 Yeah.

Speaker 4 It's just gone and it's automated. And it's the tests that I've seen show that it's far more accurate than the humans.

Speaker 7 Well, you have, you know, and the other thing I'll say is you have these API-driven systems like Tarmica that are going to be three-question quote to binds because

Speaker 7 they're so dialed, because they're so dialed into all the systems, name, birthday, address, foom, VIN numbers, all the information is pulled right in. It's all there.

Speaker 7 And now you're just, now, here's, here's what I hope everyone, and again, I want to be respectful of your time.

Speaker 7 Here's what I actually believe these things do is it frees you up to actually be an advisor, actually think about sick code-specific business interruption coverage, right?

Speaker 4 That's your goal. Yeah.
So that's the way it should work. That's my goal yeah that's what i want to see happen

Speaker 7 people become better advisors exactly hey i we're over i i apologize for that but i appreciate your time so much man this has been absolutely tremendous and uh i'll have all the links up for everyone uh check out go to um go to chris's website i'll have everything set up there but if you see Chris's name on a on a podcast or a document or something that he's written somewhere, slow down, read it.

Speaker 7 I promise you, you will not be be disappointed. Chris, it's my great pleasure, my friend.

Speaker 4 Thank you, Ryan. Appreciate it.

Speaker 4 Be good, brother. All right.
Take care, bye-bye.

Speaker 4 You go fuck yourself in your fat fucking ass.

Speaker 4 body, come and drive it.

Speaker 4 Thank you,

Speaker 4 Moody. Oh,

Speaker 4 take it in my brother Charlie.

Speaker 4 Take it in

Speaker 4 your

Speaker 4 body, come and drive it.

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