The Yellow Book Road: Recent Episodes
Nick Lamparelli
Making Insurance Better! In every way. This podcast is about bringing best practices, insights, ideas and execution from outside of insurance to those executing inside.
I recently spoke with Chris Peabody, head of Strategic Partnerships at Ascend, an insurance payments technology company. Payments is a very unsexy aspect of the insurance process. In all my years in business, both in industry, as a startup founder, and an advisor to many other startups, I have NEVER heard any mention or concern about how payments were going to be handled. Not once! And yet, payments is the single biggest source of friction in the insurance experience. You heard me right. Not the application! Not the claims experience! Payments. So you’d think we’d put thoughtfulness into this, but we don’t.
Read the full blog article here: https://www.getrevue.co/profile/nick_lamparelli/issues/making-payments-sexy-how-a-great-payments-system-reduces-frictions-increasing-both-sales-retention-1147496
Question: who knows more about the risks of their business, the owners or their insurance company?
Part of the job of a good underwriting leader is to develop a strategy to overcome this challenge. When I co-founded my MGA, reThought Insurance, I sensed that when quantifying exposure and risk to a property against natural catastrophes, I could create a decision tree where we could not only create an asymmetrical information imbalance in our favor to overcome adverse selection, but also any competitors in the market. We would sit on a perch, peering down at the market and we would dictate the when-and-how of the engagement. This was a rare opportunity where the market turned over information expertise to the government (FEMA & the NFIP) and ignored the convergence of forces coming together that could displace the prevailing paradigm here. Right place, right time. For the most part though, we operate on an ultra-competitive playing ground, where asymmetrical information imbalances ebbs and flows between insurance buyers and sellers (and their competitors) and any edge is usually fleeting between any of the parties.
Which is why, I spent sometime with one of the SME’s in the space, Matthew Queen. Matthew is CRO of Goldner Capital Management. Matthew lives and breathes captives. As an attorney, he has advised captives, he is the author on the subject and now, he runs a captive for Goldner. In this episode we discussed the advantages and disadvantages (every tool has a place and purpose) of captive insurance. We are likely at an inflection point when it comes to the impact that captives will play in solving some major issues around risk. As insurers and reinsurers retrench on traditional capacity, many organizations will need to introduce a captive element to pick up the gap. And as insurers and reinsurers drag their feet on emerging risks, waiting for the coast to be clear, organizations faced with dealing with those emerging exposures today will look to captive insurance to manage that risk. Captives has been around for a long time, but there is likely to be a convergence of forces precipitating more engagement with captives and if you want to know what’s going on, Matthew Queen has his finger on the pulse.
LINKS
Matthew Queen LinkedIn https://www.linkedin.com/in/queenmatthew/
| | Twitter | https://twitter.com/matthewqueen84
| | | https://twitter.com/matthewqueen84/status/1476248324009250824
What is a Bordereaux?
The Bordereau is one of the most underappreciated aspects of an insurance relationship between two parties. Most of you reading this have probably heard of the word, but may not know precisely what it means (or does). (IRMI provides a good background here: https://www.irmi.com/articles/expert-commentary/reinsurance-terminology-explained-bordereau ). In summary – a bordereau is just a status notification summary of the amount of insurance sold by an entity (and the amount of losses paid or reserved by the same entity) to its backer. This could be an MGA to its insurer or the insurer to its reinsurer. Regardless of the relationship, the bordereau is meant to summarize the most recent activity.
Having now been a party to multiple MGA/insurer/reinsurer transactions, I can confirm, that the bordereau transaction is 100% an afterthought in any of the insurance relationships where capacity is being provided. In the build-up to a new program to be managed by an MGA, for instance, pretty much 0% of the negotiations discuss the bordereau. Program guidelines could be tens of pages long describing all sorts of complicated agreements, but almost nothing is discussed about how the status of the business is to be reported between parties. Somehow, a spreadsheet, pdf, word doc (or worse) is to be made available between parties and from this the parties will know if the guidelines are being followed and whether the program is making progress…OR NOT!
This is one of the legacy issues from within insurance that can easily be solved with technology. Yet, this is still a major issue. In this latest episode of The Yellow Book Road Podcast, I discuss the headache that is bordereaux and how to solve it with Wendy Aarons-Corman of OWIT Global and Barry Bablin of American National. The bordereau can actually be a tool of credibility for an up and coming MGA. It is where credibility and trust can be enhanced between two parties. It is a topic that we need to take more seriously.
𝐂𝐨𝐧𝐧𝐞𝐜𝐭 𝐖𝐢𝐭𝐡:
Wendy Aarons-Corman | https://www.linkedin.com/in/wendy-aarons-corman-mba-msop-0a36569/
OWIT Global | https://www.owitglobal.com/
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Barry Bablin | https://www.linkedin.com/in/barry-bablin-b5710458/
American National Insurance | https://www.americannational.com/wps/portal/an/menu/about/about-us
Claims is the product!
I've heard that a million times in my career. It is where the rubber meets the road when it comes to making good on the promises that were made in the insurance policy that was bought or sold. It is the only reason that policy is bought and sold, so we should expect that at claims time, the customer is happy right?
Rarely!
In this episode of The Yellow Book Road Podcast, I spoke with Tim Christ, forsensic engineer and VP of Growth at Claimatic. We discussed the role of claims in an insurance organization, specifically how the siloed nature of claims leads to issues in other departments. Not enough positive claims stories make it back to marketing and not enough claims data makes its way back to underwriting. The siloes should be torn down, and claims should have a direct link to marketing, underwriting and other departments.
CONNECT WITH TIM:
LinkedIn - https://www.linkedin.com/in/timothyda...
Claimatic Homepage - http://www.claimatic.com/
This is episode 1 of The Yellow Book Road Podcast. The Yellow Book Road seeks to bring insights, best practices and just well-timed advice to insurers so that their future yellow books will lead them and society to a more prosperous and better-protected future!
In this inaugural episode, I spoke with 2 Insurtech founders who have a big mission. Return insurance to its roots - its mission to serve and protect. Steve Lekas and Joe Emison are on a mission to make insurance better, more widely available and in order to do that, they are using technology and community commitment to make the overall price less expensive and thus more attractive.
We discussed the mission, how they think about technology (contrary to what you might think, they view code as a liability), and their aggressive mission to return the community to the discussion. Whether you are a startup or a 100-year-old farm bureau or mutual, there are big-time lessons here are about how to create integrity of mission and technology.
This podcast was kindly sponsored by Galecki Search Associates - Better Recruiters, Better Results
CONNECT WITH:
Joe Emison (LinkedIn) - https://www.linkedin.com/in/joemastersemison/
Steve Lekas (LinkedIn) - https://www.linkedin.com/in/steve-lekas-35456b69/
Branch Insurance (Homepage) - https://ourbranch.com/