Insurtech startup CEO declares, “The agency channel is NOT broken… but here’s how we need to make it better.”
Ryan Mathisen should know how the modern insurance customer feels about insurance – before he was CEO of Glovebox, he was a principal at one of the fastest-growing personal lines agencies in North America.
When you measure your customers in the tens of thousands, you can’t help but hear what they say and how they feel. In this fast-paced conversation, Ryan reveals:
- The three most important criteria he uses when choosing which technologies to test and adapt… and which ones to leave alone.
- A simple but powerful observation about millennials. They don’t think it’s broken – but he made it very clear what they want you to do to make it work for them.
- His simple formula that helped fuel thirty percent higher organic growth for the last six years. (Hint: be more like a marketing firm than insurance agency).
Please don’t miss this conversation with one of the insurance industry’s most respected agent-marketers, fast-growth specialists, and now, insurtech CEOs.
What are other agents & brokers doing to thrive? What are the biggest trends affecting the retail insurance agent & broker? What are the most important strategies and tactics you need to grow faster? Find out here in the Connected Insurance Podcast, where our hosts discuss the biggest issues affecting the independent insurance agent & broker with the industry’s leading figures.
Transcript
Michael Jans: Ryan Mathisen, how are you?
Ryan Mathisen: I’m doing great, Michael, how are you?
Michael: I’m doing fantastic, thank you. So I’m excited about this conversation in part because you got so much going on and I’m going to pick your brain on a number of things. Before we get started, if you’d be kind enough, maybe a short bio about how you got to be where you are?
Ryan: Yes, I would love to tell you a little bit about me. I actually got into the insurance business here about nine and a half years ago, my family has been in it for a very long time, my dad has owned an independent agency here for about 25 years.
Michael: Yes, I know a thing or two about it.
Ryan: Yes, the trials and tribulations and, we’ve had the fortunate situation of being able to take an agency from, a mom and pop stage and really grow it into a machine. Especially on the PMC side, personalized in particular and it’s really– it’s afforded us the opportunity to be able to market in unique ways, hire and train in unique ways and really put a new spin on insurance in our opinion.
Michael: Just to put this in perspective for our listeners and I think to some extent this alone gives Ryan the credibility to be on this platform, which may not be that high of a bar, but I try to keep it fairly high is that-
Ryan: You’re very regarded, it’s okay.
Michael: Your agency has grown 30 plus percent per year for six years or more and prior to that, it was a pretty decent pace as well. I know that because your dad and the agency has been a client of mine for, I don’t know, 10, 12, 15 years. Obviously we’re going to dive into a little bit of that, but you have a lot going on, you’ve got a really interesting perspective. So again, I didn’t mean to interrupt you, so yes, you’ve been at the agency for a little bit under 10 years and your role there is what?
Ryan: My gosh, I’ve changed roles so many times. I call myself a project guy. I’m always starting new projects, creating the roadmap, getting the plane off the ground per se and then handing it off and then it’s on to the next project. In the beginning, I started out as an agent, started at the bottom. Knew nothing about insurance, my dad brought me in to help grow the business but threw me a desk and a phone and said start selling insurance. So I spent two years selling personalized insurance, my second year I did about a million dollars in personalized premium by myself and do business.
From there, I decided or we decided collectively it was time to grow the sales team. So I took on that role of recruiting, training, mentoring, new agents and we grew about a 15 person sales team, on what we call our outside model and within three years our team was doing about half a million in new business premium a month at least, so we were able-
Michael: Yes, okay. We’re way beyond that now, as I recall, I think pretty consistently beating a million?
Ryan: Yes, right now we’re pushing actually 2 million.
Michael: 2 million yes.
Ryan: We’re doing about 2 million.
Michael: Last year I think it was good when we sell like a million, like month after month and now this year $2 million, so good months.
Ryan: [cross-talk]
Michael: Yes, okay. So for the listeners, I want to share a few of the things that I want to talk to Ryan about. One is, there’s an interesting dynamic in the industry right now, in that the millennial generation is assuming in many quarters of the industry more power. The boomer generation, in some ways is willing to hand it off in some cases, maybe not willing to hand it off, but in any case, there’s a little bit of a challenge for some of the millennials finding their way through the authority structure of the industry.
That’s one, your perspective because your agency has grown quite a bit, you interface with a lot of producers, your perspective on what’s happening in the retail space. And then I know that you were at the insure tech conference just the other day and you guys are doing something unique with it.
I’m going to also dive into a little bit about the why and the wherefore on that, all right. Then, of course, you’ve got some unique insights on marketing. I know that you listened to my conversation with Chuck Blondino and you wanted to share a few things there. Let’s start with the retail side, okay, Ryan?
Ryan: Yes.
Michael: In general, a big picture and then we’ll narrow it down a little bit, what do you see happening in this space right now from the perspective of a millennial, who is second generation in a fast-growing agency, what do you see? What would you share about your observations about what’s happening in the industry right now?
Ryan: Yes. So as most people know and are aware of, insurance is a very traditional business. It can be fairly antiquated depending on the model that you’re in and it wasn’t until fairly recently, and you know that firsthand Michael because I know you’re involved in the Insurtech push as well. There’s been a large influx of technology to help these traditional agencies run their operations more effectively, to sell more business, to retain at a higher clip. So it’s been hard for traditional agencies to understand what technologies are important and which ones are maybe not so important at this point.
We see a large divide between your John Smith agency owner who’s been in the business 30 years, has a very specific way of doing business. Then on the whole other side of the spectrum, you’ve got these technology firms and a lot of money being pumped into capital to create products that they’re hoping the John Smith agency will adopt and that was-
Michael: Geez I may have started and founded one of those, insurance-tech that I wanted John Smith to use.
Ryan: There you go.
Michael: What’s your perspective on– what are the John Smith’s doing?
Ryan: We are able to introduce these technologies to maybe our first-generation founders and show them how we can integrate this technology slowly, in order to provide value to our customers and so I think it’s a slow process. It’s a methodical process, it’s not going to happen overnight but our job as millennials in insurance is to really make educated decisions on which technologies are needed now and which ones are maybe not so important.
Michael: Okay, so let me ask you to deliver a message, to deliver a message to two generations, okay. One, what would you say to baby boomers who might be struggling with determining which technologies to adopt and which ones to leave? Talk to them first?
Ryan: Yes, absolutely. Look at the highest priorities of an agency, right, which is cutting down on service costs, service costs are higher than they ever are right now with employee, the rising cost of employees and the demand from clients. So servicing costs is a big one, retention is a big one and the point of sale process. Those are really the big three that baby boomer owner need to be looking at and how can you streamline these three processes using technology and that would be my message.
Michael: Creating more efficiencies in the service cost arena, I assume with retention, it has to do with creating deeper and stronger relationships and the point of sale process. Talk to us a little bit about how your agency facilitates point of sale using technology?
Ryan: Yes, so there’s a lot of innovative things that we’re doing that are quite different. What we see normally is you’ve got agents that are still taking the application and then running a quote, and then they’re typing out a long email to the client saying, “Hey, here’s what I did, here’s what I quoted, here’s the coverage that I added, blah, blah, blah.” What we know is and I don’t know if you’re anything like me, I always reference my wife.
My wife is not going to read that email, she’s not even going to read a third of it. So separating yourselves at the point of sale by doing things like shooting videos showing the endorsements that you added. You can even shoot a video personalized to that prospect telling them about the quote that you just put together for them. Because now that video is so readily available at our desk. It takes us a minute to a minute and a half to film a video. Send it along with a quote for the prospect and it actually took you less time than it does to type out that email and now the prospect is more likely to look at it.
Michael: Okay, all right, very good. I think more and more agencies are using videos an almost standard forms of communication. Then the next question is to millennials who like may not have conceived of their role as what you just described? What would you say to millennials who are whatever that may be, maybe they run the agency or maybe they’re that second-generation that’s working their way through the agency, what would you say to them?
Ryan: My biggest message to them is don’t disregard what got you here. I see that a lot. This business is not a fire drill right now. The insurance business is not broken. I hear things, I will listen to podcasts, I read articles of people really treating the insurance business as a fire drill and they’re millennial. That’s just not the case.
Michael: Do you mean as if there were an actual fire, as if there was a problem right now, a catastrophic problem?
Ryan: Yes, we need to totally recreate the insurance business because it’s on fire. That is just not the case. What we need to realize and understand is what got us here in the beginning. Again, the message is to slowly evolve with the technologies that relate to the three core needs that I referenced to the baby boomers and really slowly integrate technologies. It’s not going to happen overnight, but we need to do it delicately if that makes sense.
Michael: What do you think are the elements that DDP preserved in this industry so we don’t disrupt it to death?
Ryan: Absolutely. I think one of the biggest misconceptions with a millennial is that people don’t want to talk to a person. That is not the case. Especially if you’re dealing with people who are buying a home, for instance, millennials, they’re making a three, four, five, $600,000 investment.
Michael: Biggest decision they’ve made so far in their life. Biggest investment they’ve made so far.
Ryan: Exactly. They may not be fully trusting this new artificial intelligent quoting system that may be offering them or not offering them products that they may or may not need. Those people are still wanting to talk to a person and get specific advice on the coverages and policies that they need to protect that investment.
Michael: Got it.
Ryan: That’s a big piece.
Michael: That’s a good segway to the next part of the conversation. Technology. You were at the Insurtech conference, I think it was the one in New York, they’re a lot of them [laughs].
Ryan: They’re everywhere.
Michael: One every month and they’re all over the world. Perhaps the Insurtech conference in Las Vegas, it might be the largest conference in the industry right now. I think it’s in its fourth or fifth year.
Ryan: In September.
Michael: Share with me some of your insights from your perspective, millennial in the industry presumably now committed to this for the long term, what is it about Insurtech that’s attracting your interest?
Ryan: Insurtech is interesting. It’s because of what I mentioned earlier. That large divide between the John Smith 30 year agency owner and then these tech people who may have never sold an insurance policy in their life or ever talked to a client before. The interest level that I have is how these technologies are going to be bridging the gap to actually get in the hands of the policyholders. That’s what’s most interesting about the Insurtech event.
Michael: What was the buzz when you were at the conference in New York?
Ryan: There was a lot of different really amazing technologies coming out of all over the country. A lot of different things.
[crosstalk]
Michael: All right. Talk to me a little bit about this, some people look at Insurtech and think that it is here to disrupt the retail agency force. That certainly was a strong message a few years ago when Insurtech was emerging as a sub-industry. Some see it, like agency revolution, I would say was an early Insurtech tool. Some see it as clearly having some commitment to the agency force. What do you see happening there?
Ryan: You’re right. Two years ago, people were thinking, “Insurtech is going to put everybody out of business.” That may have been the thinking of some of these founders of these companies. What they’re finding is almost every single company there is chasing the White Rabbit. The White Rabbit is the incumbent insurance carrier. What they realize is, “Yes, I have an excellent technology but how am I going to get it in the hands of the policyholders?” The way they’re going to do it is they have to partner with the incumbent carriers in order to have a rollout strategy. That was the common theme of the conference, is everybody’s chasing that white rabbit.
Michael: And partnering with the legacy carriers?
Ryan: Trying to, yes.
Michael: Did you see many technologies there that were, let’s say marketing directly to the agency force?
Ryan: Not really.
Michael: Okay.
Ryan: Not really.
Michael: Not a lot.
Ryan: Yes.
Michael: All right.
Ryan: Not really. It’s interesting. Maybe they don’t think that agency owners are going to spend money on the type of technology that they’re creating, or maybe agency owners don’t have enough control over the policyholder in order to offer that technology. There’s no point in their sale where they would need it, but the answer is no.
Michael: Or maybe agency owners really worked predominant in the audience at the conference is a possibility.
Ryan: It could have been.
Michael: All right. When I was in Las Vegas, I saw that there were more agent-focused Insurtech technologies than I had seen before.
Ryan: Good. What kind of stuff did you see?
Michael: Well [laughs]. There were just lots of people offering little tools that would be available and useful to agents. I also think that we’re beginning to see agents and brokers showing up at Insurtech conferences a little bit. They’re certainly the ones that I saw, there were those Vanguard agents who are always on the cutting edge, right? It’s not like the everyday conference. I saw more and more of that. I think we’re seeing more and more technologies, Insurtech technologies at trade shows that are really agency trade shows.
Ryan: Because it’s probably needed.
Michael: All right. That being said, anything else in the Insurtech world that’s catching your buzz or gives you an indication of what the future of this industry looks like?
Ryan: There’s going to be a lot of things that are coming out, especially in the AI space. There’s a company out of Kansas City called RiskGenius. A guy named Chris Chatham flew into KU to go workshop. I had a chance to catch up with him at the conference. He’s doing some really unique things with reading policy language and really putting it in layman’s terms for the consumer. That makes a lot of sense, because let’s be real most people don’t spend time nerding out.
[crosstalk]
Michael: By the way, I think he’s a future guest on this podcast series so stay tuned. Tell us more about that. Is it interpreting language?
Ryan: Yes. It is commercially focused, but it’s interpreting the policy forms for the client and also the agent to help them understand, “Hey, if you’re quoting one carrier to another, and you got two to competing quotes, let’s throw them into RiskGenius.” And it’ll spit out and tell you the differences between the policies in a very layman’s way to really educate the consumer on which one makes more sense.
Michael: That’s interesting. Okay, got it. All right. From your perspective. I suspect you’ve thought about this. When you roll the clock forward, let’s say three years. What do you think the independent insurance agency channel looks like? How does it look differently than it does today?
Ryan: That’s an interesting question. Honestly, I don’t think it’s going to change that much. Again, I think this influx of technology is going to be a slow adjustment. I don’t think we need to flood the agencies with tech and completely revamped the way we’re doing business. I think you’ll see, again, small pieces of the process from the sales to the service and retention that are going to be enhanced by technology. As a whole, I still again think that that person to person communication, live communication is still going to be there.
Michael: Let me put it in this perspective. I think Bill Gates said something like, “We tend to overestimate the amount of change that going to happen in two years and underestimate the amount of change that’s going to happen in 10 years.” I think it’s safe to say that 10 years from now, we have a future that we need to prepare for, and we can’t wait till the ninth year to prepare for it. I think we’re seeing even now, agencies who are embracing the future are getting the benefits now. I’ll repeat the question with a 10-year horizon, what do you think the industry looks like then? The follow-up question is what do agents need to do now to begin preparing?
Ryan: Sure. That’s was great question. We look 10 years down the road, you really wonder if the independent space is going to need actual agents selling policies. When you have technologies coming out, like what Chris is putting out that are really automating the process, not relying on a person to disseminate a policy to a client. I think that’s a big concern in the industry if we look 10 years down the road, the actual need for foreign agents. That will be-
Michael: Okay. Circling back to what you said earlier, that people still want talk to people. Don’t you think that there’s some psychological comfort, confidence that a consumer gets when they at least know that in spite of everything I’ve read, I got a guy who’s going to watch out for me, right?
Ryan: I’d say 1000%, but we’re looking over a 10 year thing and I think consumers get trained and they get educated, slowly. I think that evolution is inevitable.
Michael: All right. That said it seems to me that there are other skills that an agent needs besides insurance skills?
Ryan: Yes.
Michael: That they need to be vigilant about the environment, vigilant about change, scanning the landscape for trends, that we need to be strategic and that we need to learn to function in a fast moving environment. A little bit different than it was in 1985 to 1995.
Ryan: [cross-talk]
Michael: Actually, I should be careful, I don’t want to minimize the amount of pain and suffering that agents had then. There were technologies that were being introduced then that were difficult for people to grasp but a lot of agents chose not to and merged, acquired or chose that this was the time for their exit plan.
Ryan: My dad was talking to the other day about how he used to mail out quotes-
Michael: Right.
Ryan: -and he’d wait three or four days. So that concept in itself is interesting.
Michael: That’s pretty fascinating, got it. All right. You had mentioned to me in our earlier conversation that you listened to my conversation with Chuck Blondino from Safeco and obviously the thing that we primarily talked about there was organic growth and marketing. I think you had an insight or two on something you wanted to share.
Ryan: Yes. I loved what he was saying. Obviously he’s talking to a lot of the Safeco agencies and really getting good feedback on the way they’re marketing. The way I like to market and the way I’ve helped grow our marketing approach here in the states that we operate in, I always like to look at where is the need for our products for a consumer. I’m not just saying like, they’re thinking about getting a quote, I’m thinking when do they need my product at the perfect time.
Michael: Right.
Ryan: For me as a sales person, I know if I’m hitting someone at the exact point of need, my close ratio goes way up and the process or the sales cycle is going to be a lot smaller than it would if I’m just chasing people that are kicking tires all the time. I really wanted to hone in on the mortgage broker strategy for marketing. I mean that’s how we’ve built our agency-
Michael: I know.
Ryan: -being so good at it. If I had some advice for any insurance agent on the retail side that are selling personal lines, you need to go out and generate your mortgage referral partners as soon as possible.
Michael: That was one of the items that Chuck identified as a behavior or a strategy of their top performers. Of course, naturally I thought of you and your dad’s agency because I think it’s probably, if not the, it’s certainly one of the best in the country in that strategy.
Ryan: Thank you.
Michael: I noticed, you had conversations with one of the founders of Lemonade the other day?
Ryan: Yes.
Michael: Any interesting insights?
Ryan: Ty Sagalow
Michael: What’s that?
Ryan: Ty Sagalow, super nice guy.
Michael: Any insights from that one?
Ryan: It’s interesting talking to him and I don’t know if you read his book, it just came out. It was interesting the concept of Lemonade. I wanted to talk to him about the segmentation of products in insurance because it’s happening more and more. What I mean by that is companies coming into the market only offering single products. “So we’re only going to offer home insurance, we’re only going to offer auto insurance, we’re just going to sell pet insurance that’s all we’re going to do.” So I wanted to get his opinions on what he thought about that and why they set Lemonade up the way they did.
Michael: All right. What did he say?
Ryan: His insights were interesting. They didn’t want to go after the auto side of things because the underwriting is so unbelievably complicated and they saw a huge niche on the renter’s insurance side in urban areas like New York. And they knew that they could create a really smooth and easy operating AI underwriting system that could really appease these renter insurance clients, that was their thought. The one thing that I thought was interesting is why they’re not going the brokerage model, why they decided to be a captive home carrier. That was interesting to me.
Michael: Okay.
Ryan: He didn’t have too much insight on that. He mentioned in his book that they just really wanted to be that captive carrier. I would find it very unique for a company like Lemonade to enter the brokerage side and making the quoting and binding process for the agents so unbelievably simple and they would win business just on that. That’s my thoughts.
Michael: All right. Speaking of technology, I know that you are involved in a technology and this is separate from the agency itself, right?
Ryan: Yes sir.
Michael: Okay. First tell us what it is and then I’m going to ask you what inspired you to be involved in that?
Ryan: Yes. We have created a company called GloveBox. Essentially GloveBox is a centralized mobile app combining all carriers into one centralized place for clients to pull their insurance documents. Instead of having to go to the GEICO app, the State Farm app, the Nationwide app, the Travellers app, they can use one centralized app to do the tier one service requests, is what we call them. Pull policy documents, pay a bill, submit a simple claim and conversate with your agent that wrote the policies. It’s really that centralized hub for the policyholder.
Michael: Now, has this been released into the wild yet?
Ryan: We actually have a launch date of July 6th, we are about a week and a half away from launching on Apple.
Michael: Okay. All right. That dates the recording of this podcast, the release date and what– Anything else agents should know about it?
Ryan: Yes. We came up with this due to the fact that the large amount of phone calls that we get on a regular basis from clients, not knowing who their carrier is, not knowing where to find their ID cards, not knowing the coverage is on their policies or where their documents are. In talking to the carriers, we found out that only 20% of the independent insurance client utilizes the portals of the carriers they represent.
Michael: Right.
Ryan: That leaves 80% of the market using nothing. So we wanted to fill that void.
Michael: Got it. All right. Have you– Does your agency have a beta version of this now or how are you testing this in the real world?
Ryan: We’ve been testing it back and forth with our developers, with a group of policy holders that we put together and formed a focus group. We’ve been able to test the basic functionalities of the APIs that we built.
Michael: Okay. The data that it aggregates are policies that come through one agency presumably, right?
Ryan: Correct. But we’re pulling directly from the carriers themselves.
Michael: Got it. It’s not from the agency management system,-
Ryan: No.
Michael: -your API is with carriers?
Ryan: Yes. That’s the difference, is we are directly connected to carriers portals and we are pulling the actual policy documents, actual PDF. We’re working deeper with our carrier partners now to be able to push and pull information itself.
Michael: Got it. Okay. In a moment, I’m going to ask you to share how people can reach out to you or find out more about GloveBox. Before I do that, I’m going to ask you a question that I ask a lot. If you are going to deliver a message to the industry now, I don’t care how old they are, Boomers, Millennials, X’ers, Z’ers, but if you’re going to deliver a message to the people who run the retail insurance agencies of today, what would you say? To listeners, I would say listen to Ryan because you know that most agencies are not showing the long track record of successes that this agency has had. You’ve been exposed to a very fast-moving agency, what would you say?
Ryan: Yes, my biggest piece of advice to any agency owners is, stop thinking of yourself as an insurance agent and start considering yourself and your organization as a marketing firm. When you do that you’re completely switching your mindset from “Oh I got to go make sales” to “I need it to generate business.” With any good longevity in a marketing strategy, the success is going to be there, the sales will be there. That’s my biggest piece is, think of yourself as a marketing firm and think of different ways to market and that’s how you’re going to last in this business if you don’t let your marketing get stale.
Michael: Got it. Okay, that starts to get to level four on my five-level model-
Ryan: There you go.
Michael: -it’s when an insurance agency really looks like a marketing agency that has one client which happens to be itself, and is positioned to attract the appropriate strategic market into the funnel and then move them through a customer journey that makes them raving fans. All right, so, Ryan, if anybody listening wanted to find out more about GloveBox or just reach out to you with a question, how should they do that?
Ryan: Absolutely. For GloveBox, you can go to our website, check out our landing page, it is gloveboxapp.com You can also check us out on all the social LinkedIn, Instagram, Facebook and Twitter. Then to reach out to me directly, my email is [email protected] I’m always on my email so you can get me there anytime.
Michael: All right, Ryan, [email protected]
Ryan: Yes, A-P-P.com
Michael: All right. Very good. Ryan, this has been enlightening. I really appreciate you sharing your perspective.
Ryan: Yes, I appreciate you having me on Michael. Thank you so much.
Michael: You bet.
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