--:-- Ryan Hanley: You just got to put stuff out there and see what happens. And that's a big part of where people, whether they're using it to bring awareness to a personal brand or to a business or they're selling something, whatever the reason, they'll put stuff out and then they won't go back and look and see what actually happened. Did people actually comment? Did they like it? How much reach did it get? And then think for themselves, okay, why did that happen?
--:-- [Music fades in and out]
--:-- Ryan Hanley: Hello everyone, and welcome back to the show. Today we have a tremendous conversation for you with Curtis Goldsborough, innovative loss control expert, insurtech aficionado, creator of the InsurTech Wraps at ITC. He's also the President of National Insurance Inspection Services and an all-time meme creator on LinkedIn about the insurance industry. Guys, if you're not following Curtis on LinkedIn, I highly recommend you do. His takes and his sarcastic memes that he creates about the insurance industry, I find to be thoughtful and hilarious, and he's just an all-around good guy.
--:-- Ryan Hanley: I really wanted to have Curtis on just for his perspective. We have so many people on this show who in some way, shape, or form are directly creating or working in the retail side of the independent insurance agency space. I wanted to get an outside perspective from someone who is interesting and thoughtful, and Curtis obviously fits the bill, someone who doesn't directly sell to or sell retail insurance. While Curtis has had retail sales experience in the insurance industry before as an agency owner for Farm Bureau, for the last 10-plus years he's worked for National Insurance Inspection Services and has a unique perspective on the way various dynamics, particularly the hard market we're currently operating in, have impacted the insurance industry and insurance carriers.
--:-- Ryan Hanley: We talk a little bit about what that means, what he's seeing across the board, particularly as it relates to homeowners insurance and property loss. And why the hard market and various cat losses we've had in the last half dozen years or so have created a fragility in our industry that most are not aware of. It's an awesome conversation. As I said, I highly recommend you connect with Curtis on LinkedIn. Follow along with what he's doing. We'll have his LinkedIn profile in the show notes, whether you're watching on YouTube or listening on the podcast. You can also just go to LinkedIn and search for Curtis Goldsborough and you'll find him.
--:-- Ryan Hanley: Before we get there, guys, just want to give a quick shout out to you for listening to this show. If you love what we're doing here, if you're not subscribed, subscribe. If you are subscribed and you love what we're doing, we'd love for you to share the show. Just share it out on your socials, text it to a friend, email it to a friend. That's how more people find what we're doing, find these conversations, find this content. And hopefully through the various episodes, the guests we have, the conversations, thoughts, ideas, something resonates that helps you grow, helps you become a better leader, helps you become a better sales professional, or whatever it is that you're doing, helps you better understand this industry and how you can be successful within it.
--:-- Ryan Hanley: If you want to go down that rabbit hole even further, I recommend you visit masterclass.insure. That's masterclass.insure. This is the Insurance Growth Masterclass website where you can join a community of people that are growing their business like no others. This is dynamic. It is interesting. It is pushing the boundaries of what it means to grow your agency, to build scalability, predictability, and sustainability through inbound marketing. Guys, this is the culmination of 18 years of my work in this space. It is such a pleasure to be providing this to you guys. So go to masterclass.insure today. And with that, guys, let's get on to Curtis Goldsborough.
--:-- Ryan Hanley: Well, dude, I'm excited to have you on the show. You are like the insurance LinkedIn meme master. Maybe you've even ascended past just insurance in terms of your meme skills. It's funny. I love your takes. It's so engaging. I probably have interacted with too many of them because now it seems like everything you post comes to the top of my LinkedIn feed.
--:-- Curtis Goldsborough: Mission accomplished.
--:-- Ryan Hanley: Yes. Dude, I give you so much props. It's great. This is not the easiest space to find ways to make it humorous that doesn't just completely offend somebody. I found it to be awesome. Why do you use that type of content? Where did that come from? You have a very distinct style. Where does all that come from?
--:-- Curtis Goldsborough: I wish I had a profound answer for that. It's one of those things where I've always been a creative person and always felt like I had an interesting take on things, but didn't really know what the right outlet was or how to convey that. A couple of years ago, well, gosh, four years ago for InsurTech Connect in Vegas, I had written this InsurTech rap and collaborated with the Insurance Nerds group on that. Those always got a little bit of traction and made some waves, but I had no intentional plan to capitalize on that attention or build upon it. I did one every year for the last four years. This year, I really put a lot of energy and time and effort into it to try to up the production value and all of that. It made a pretty big splash.
--:-- Curtis Goldsborough: This year I was like, you know what, for the past four years I would post this InsurTech rap video at ITC time and then do nothing on LinkedIn after it. So this year I was like, I'm going to grease the wheels a little bit leading up to it and get the algorithm at least recognizing who I am. That really helped engagement on that InsurTech rap video this year, which was called "Hard Market." It just really resonated with a ton of people. I had a ton of fun with it. Beyond that, I've kind of followed up. I don't even know where the first kind of meme idea came from, but I made one and it resonated and got tons of engagement and really hit. I was like, holy cow, this really seems to work. It resonates with people.
--:-- Curtis Goldsborough: Obviously I had heard Gary Vee at ITC this year saying attention is everything, attention is your most valuable asset. I was like, hey, I'm going to try this. I've attracted some attention, but let me see if I can keep the ball rolling. It's just been off to the races from there. I'm still learning as I go, but I'm having a lot of fun with it.
--:-- Ryan Hanley: I think that's the most important part of that too, that you're doing it and some of them are going to work, some of them aren't. You never know. That's the biggest thing when people come to me about the inbound insurance stuff that I've done. I'm like, I can give you a whole bunch of things that you can do. There are some best practices and obstacles you can sidestep. But really, you just got to put stuff out there and see what happens.
--:-- Ryan Hanley: That's a big part of where people, whether they're using it to bring awareness to a personal brand or to a business, or they're selling something, whatever the reason, they'll put stuff out and then they won't go back and look and see what actually happened. Did people actually comment? Did they like it? How much reach did it get? And then think for themselves, okay, why did that happen?
--:-- Ryan Hanley: I've seen, and this is going to sound crazy, but I was testing emojis in the first line of my LinkedIn posts. I found that if you use the green box with the check or if you use more positive-related emojis, you tend to get more reach. Where if you use a red X or the alert siren thing, you get less. I posted this one and I thought I had hit on all the things. I thought it was a good contrarian title. But what I did was I framed it between two red X emojis and it didn't go anywhere. I was so pissed. So I started testing and I found that for whatever reason, those are the kind of things that end up making a difference in the long run that people just don't want to think that deeply on the nuance. But it is important.
--:-- Curtis Goldsborough: No, it absolutely is. I'm sure you're aware of this. If you watch any of the stuff from Mr. Beast, interviews he's done with Rogan or whoever. The most successful and prolific YouTuber in history. If you ask him, he doesn't think that he's a creator. He's like, I'm a data nerd. From the beginning, he has just obsessed over analytics and ABCD, EFG testing. Just absolutely obsessing over that. It matters. You can get results, but it's work. It's a lot of work.
--:-- Curtis Goldsborough: I think this goes into really everything that we do, probably outside of insurance too. It's this ability to test, test, test, test, test and not chair. I had a couple of days ago, I've talked a little bit about this on the podcast, but I had this back and forth with a couple of people. I have this perspective that when you are working with inbound leads in a business, particularly an insurance business, you solve the people's problem. You round out the account later. That is my particular take.
--:-- Curtis Goldsborough: It's not my take because I ideologically believe that's what it is. It's my take because I think I personally have dealt with more and more diverse segments of inbound leads in this industry than maybe anybody that operates in it currently. Multiple different businesses, multiple different formats, listening to hundreds of agents, my own businesses, businesses I'm consulting for. If you have a hard focus on rounding out accounts in the initial call or the initial sale, you're going to lose business. This is the part that everyone pushes back on me on. Just because you solve someone's problem and that's one policy today, that does not mean that's a bad account.
--:-- Curtis Goldsborough: Everyone immediately jumps to, well, if it's not a rounded out account, then the business isn't going to stick. I'm like, I buy clothes from four or five different brands and I go back when I need them. Just because you only have one account today doesn't mean you can't call them back in a couple of weeks and get the rest. But there's this sense, and I think it goes for all of us. I ultimately want to get into where your technical expertise in the industry is. But I feel like when someone calls you for a problem, don't you just want them to solve your problem? Or do you want them to try to figure out all the problems that you have and then try to solve all the problems that you have? You're like, no, no, no, no, no. I just have this one problem I need to solve today so I can get this off my brain.
--:-- Curtis Goldsborough: It's funny how people get so ideologically bent on things. This is the way it is. You have to round out accounts or it's a bad account. It won't be profitable. I'm like, says who?
--:-- Ryan Hanley: I saw your post yesterday about that and saw some of the pushback and enjoyed the thought process. I can see both sides of it. I feel like there is an interesting parallel to some extent. I'm personally not on the agency side, but more on the insurtech side and in a B2B space. My clients are insurance carriers and MGAs. I can totally see parallels. For instance, in the past six months, we had a tier one carrier that came to me and said, hey, we are looking for a new field inspection vendor.
--:-- Ryan Hanley: Well, we do field inspections, but we're shifting really quickly towards self-inspection. We built our proprietary technology on that. We're making a somewhat strategic shift in that direction, although it's happening organically as well. With that carrier, quite frankly, I'm not terribly interested in doing field inspections for them, but I absolutely want to be a self-inspection provider for them. I'm like, yeah, absolutely. If I get that opportunity with them, we're doing field inspections with them and not making any money, quite frankly, but I want that door open. I want to have my foot in the door.
--:-- Ryan Hanley: I feel like there is some bit of parallel there. Like, hey, I want that opportunity. Let me open the door. Let me start to establish a relationship. Even though the solution that I'm providing for them right now is not exactly what I want to be doing for them, I'm going to establish myself as a resource, as a solution provider, and continue to foster that relationship. That was three months ago that we started. Next month, I already have a demo set up with them for self-inspection. There's definitely that fostering process and bringing people along. I can totally see that.
--:-- Curtis Goldsborough: I think that's a tremendous parallel because I completely agree. This is one of my arguments. Why is it that most of those people who are pushing back on me, in almost every other aspect of their life, they would probably agree, solve the original problem. But for some reason in our space, it becomes, no, we have to solve all the problems. I think it's a wonderful parallel because it is exactly how people want to buy. None of us wake up in the morning and go, I need to find someone to solve every problem that I possibly have in X. No, you're like, I need this thing solved. I don't need all the problems solved. I need this one thing solved. If you can solve it for me now, you go into the column of value creator. Now I'm willing to come back to you over and over again because I know you're a value creator.
--:-- Curtis Goldsborough: I think it's kind of an old school methodology. I think you can be successful. Guys, please don't start blasting me again or blowing up my DMs. This is the beauty of America. You get to do it however you want. I just don't believe that it's the future. I don't believe the future is continuing to force people down the path that makes the most sense to you, the provider. I think we have to be like the Bruce Lee philosophy of fitting the solution to what they need. If writing their entire account or pitching them every service you have, if you're an insurtech or whatever, is what makes sense in that moment, great. But you should have the nimbleness or mental dexterity to know when this person just needs me to solve this one problem. It's a shoe in the door to do the rest.
--:-- Ryan Hanley: We can move on from that topic. One of the memes, I think it might even be the one you posted today, you have this meme out there which is awesome. I'll have it linked up in the show notes, guys. It's the one where the guys says "insurance" and the guy runs on the treadmill, but he's attached to all these weights and it says "innovation" is where he's running and "technical debt" is the weight. I wanted to ask you about this because I was talking to Margo Giles, whose episode will come out maybe a couple before this. This topic came up in our conversation with her because she was kind of talking through some of her feelings and thoughts on why her competitors, her legacy competitors in her vertical, haven't made the change.
--:-- Ryan Hanley: She brought up a couple ideas which were 100% legitimate, but she didn't address the technical debt side. I said, how much do you think their unwillingness to move at pace, at least the pace that innovators and early adopters in our space would like them to move at, plays a role? Because I think everybody, even the big guys in the AMS space, would agree that they do not move at the pace that innovators and early adopters would like them to. I think they tend to move at an early majority or late majority pace, depending on which one it is. I don't want to misrepresent her feelings, but in general she thought it was more a philosophical slash profit decision than it was a turning the Titanic in the New York Harbor kind of thing.
--:-- Ryan Hanley: Where do you fall in general? It doesn't have to be about the AMS systems, but just in general, legacy tech and the technical debt associated with it and how that's created opportunities. I think that's a topic that maybe you and I kind of understand, but maybe most of our listeners don't get what technical debt is. Maybe we can start there and then talk about how you see it impacting the industry as a whole.
--:-- Curtis Goldsborough: Definitely. It's a super interesting topic and I'm looking forward to listening to Margo's episode. She's awesome. It's interesting. For my company, National Insurance Inspection Services, we're a decades-old, family-owned business. We started doing these property field inspections for underwriting back on notepads and Polaroid cameras. That was the genesis of our company back in the day. We've had this transition slowly over time. When we moved to inspectors having digital cameras, that was mind-blowing. To move from Polaroid photos in the mail getting sent to carriers to now having a digital workflow, that was just cutting edge.
--:-- Curtis Goldsborough: Fast forward, now instead of using digital cameras, our inspectors have a mobile app that they can use. Now they're all taking photos with their phones. But for our company, no company is immune to this. As technology evolves, if you're not evolving as a business, you're going to develop technical debt. I think that literally every company has some.
--:-- Ryan Hanley: For the audience who may not understand exactly what technical debt is, can you explain that?
--:-- Curtis Goldsborough: I'll take my best shot at it. Essentially, as technology advances and you need and want your business to evolve along with that and take advantage of new technology so that you can be more profitable, drive efficiency, and all of those types of things, if you're not moving your business along that pipeline of technology advancements and you're just relying on infrastructure systems, whether that's hardware or software or whatever the case may be, in some sense it's even just business processes enabled by technology, that literally becomes debt. That is going to hold your company back. It's going to hold you back from reaching the milestones of profitability that you would have been able to reach had you upgraded your systems.
--:-- Curtis Goldsborough: Ultimately, that technical debt kills businesses every day. It can be perpetuated just by an old school mentality. It's the old cliche, "If it ain't broke, don't fix it." Sometimes that can be a big hurdle for people because that cliche basically drives more technical debt. Nothing is going to work forever. Especially today, the speed of technology and advancement is growing every single day. Things are changing so quickly that if you have that "if it ain't broke, don't fix it" mentality, you're going to die. You're just not going to survive. There are absolutely going to be competitors in your space that come in and do not have any of that technical debt holding them back. They're going to get catapulted ahead of you.
--:-- Ryan Hanley: I think it's a perfect way to describe it. With each year removed from when you built your system, it's almost like it's not a linear scale on how much it's going to cost to upgrade that system. It's like a logarithmic scale. Maybe the first couple of years, if you were to update it, no big deal. But you get too far removed from the newest technology and now that upgrade costs exponentially more.
--:-- Ryan Hanley: I heard this described one time, not the technical debt part, but the decision to upgrade an antiquated system. I can't remember who the guy was, some entrepreneur forum I was watching on YouTube. He basically referred to this as "when to kill the golden goose." He said, as a CEO of a mature company, one of the hardest decisions to make is how or when do you kill your golden goose? If you have this system that's 20 years old that is almost impossible to upgrade, but man, there's still people using it and you're making money. But you also know that at some point, those people are going to leave and you're not going to be able to provide them with a product that is up to today's standards. How do you make that decision? What do you do there?
--:-- Ryan Hanley: He didn't necessarily have an answer. It was mostly just, this is a question every CEO of a mature company has to ask or answer. How you answer it could determine success or failure. You turn the page and become a whole new company. It's amazing. Or you crash that plane right inside the mountain. It's something that I think a lot of people, specifically applied inverifor, get yelled at a lot. I'm sure I'm as guilty of that as anybody else. At the same time, I am appreciative of the true struggle that they have with their own internal technical debt and the fact that they have golden geese that pay their bills that companies still operate on. It is a very tough decision on what to do. It doesn't always excuse a lack of innovation, but it is a real legitimate business problem that they're dealing with every day. I think that at least needs to be said to be fair to them.
--:-- Curtis Goldsborough: No, absolutely. I couldn't agree more. I do think that progress is always being made. There are always innovators. There are always people that are trying to push that along. Especially on the carrier side, we've worked with some amazing innovation teams over the last three, four years that are doing incredible work. But at the same time, you cannot get away from the reality that...
--:-- Ryan Hanley: What's up, guys? Sorry to take you away from the episode. But as you know, we do not run ads on this show. In exchange for that, I need your help. If you're loving this episode, if you enjoy this podcast, whether you're watching on YouTube or you're listening on your favorite podcast platform, I would love for you to subscribe, share, comment if you're on YouTube, leave a rating review if you're on Spotify or Apple iTunes. This helps the show grow. It helps me bring more guests in. We have a tremendous lineup of people coming in, men and women who've done incredible things, sharing their stories around peak performance, leadership, growth, sales, the things that are going to help you grow as a person and grow your business. But they all check out comments, ratings, reviews. They check out all this information before they come on. So as I reach out to more and more people and want to bring them in and share their stories with you, I need your help. Share the show, subscribe if you're not subscribed, and I'd love for you to leave a comment about the show because I read all the comments. Or if you're on Apple or Spotify, leave a rating review of this show. I love you for listening to this show and I hope you enjoy listening as much as I do creating the show for you. All right, I'm out of here. Peace.
--:-- Ryan Hanley: Let's get back to the episode.
--:-- Curtis Goldsborough: Pretty much, I can't say this unequivocally, but I think it's fairly accurate to say that certainly the top 10 P&C carriers in the country, the core of these businesses are still running on old AS400. They still have server rooms that are the size of both of our houses combined. A full cloud migration? It's mind-boggling. I get it. I understand the struggle there. I also think, and something that we've seen and experienced a lot as well, there's so much danger in those migrations and those innovations. We've all heard the horror stories of trying to move on to a new policy management system or whatever. Millions of dollars, sometimes tens of millions of dollars get spent on a five or six year migration, and it literally never gets to the end goal. It just becomes a huge money pit. They just couldn't actually get it over the finish line. There's a very real risk of that happening. That can certainly understandably perpetuate that mindset of, hey, things are running right. We're writing business, we're making money. Although today and this year, maybe we're not making money, but the wheels aren't falling off. We're not crashing and burning today, and we don't necessarily see that happening tomorrow. So there's a lot of hesitancy there to make those tough decisions.
--:-- Ryan Hanley: For your business particularly, what other pressures do you see coming from carriers? What are the things you're hearing? When you're talking to a client or a customer and they're walking through the things that are important to them, what's on their brain? I love getting perspectives. So often, just because it's where my area of expertise is, we talk through the framework of the agency space. But I'm really interested in the challenges, the frustrations, the things that people are excited about that aren't necessarily that vantage point. When you're sitting there and you're like, this is going to be a big change, or maybe everyone doesn't see this problem coming, what are some things that are high on your mind?
--:-- Curtis Goldsborough: It's so interesting because the industry is just so fluid. Things change so quickly and there are so many different factors.
--:-- Curtis Goldsborough: Like, I mean, insurance is complex. The ecosystem sometimes feels hopelessly complex. And I certainly, I'm no expert. I, quite frankly, have a pretty narrow scope of expertise in the industry at large. But I am absolutely fascinated by this current hard market cycle that we are in and how that's going to play out. I have these conversations with a lot of our carrier partners, and nobody knows how this cycle is going to play out, but I think everybody agrees that this one is different than anything that we faced in the past. We have this confluence of factors all coming at us at the same time that we've never had in this specific combination before. You can tie that back into COVID or whatever. The word of the day continues to be unprecedented. I think the industry as a whole is in uncharted waters, and we don't really know where it's going to go from here.
--:-- With that in mind, with our clients and folks that we're working with on the innovation side—and again, we are strictly in this little niche of underwriting for property and casualty, and even more specifically, just residential homeowners stuff. That's what my company is laser focused on. That's where our expertise lies. I try not to chase every opportunity that comes our way. I want to be a commercial property? No commercial. We're not doing anything with commercial stuff right now. Maybe we will at some point in the future, but we're mastering what we're best at right now.
--:-- From that perspective, with that uncertainty of how things are going to go moving forward, I know that carriers are absolutely looking for options and opportunities that are going to move the needle for them meaningfully. Any improvement that can come is going to—regardless of how things evolve in the next few years—any improvement is better than no improvement. I think everybody realizes that the status quo is not good enough anymore.
--:-- Especially when you look at some of these really tough markets like California, the West Coast, all the wildfire issues, all of the coastal stuff as well. I think a growing number of people understand the fragility of these markets. Knock on wood, we kind of made it through this year with the wildfire severity being super low. Especially versus last year, where it was like California was on fire the entire year.
--:-- Ryan Hanley: Absolutely.
--:-- Curtis Goldsborough: Even thinking back, 2017 was really the turning point, the come-to-Jesus moment with wildfire. And this year we dodged the bullet with Atlantic hurricane season. We didn't have any major multi-hundred-billion-dollar cat events. But I think everyone understands. If you look at the Florida market specifically and all of the issues and the madness that's going on there, people understand that we really are in a fragile place. If sometime in the next handful of years we end up having a bad year—if we had a 2017 wildfire year and then two or three major cat event coastal exposure years—that could blow things up in a way that no one has ever seen. We're just not prepared for that.
--:-- Ryan Hanley: That's a really interesting perspective, and I would love for you to expand a little bit on that. I don't think most of the people who listen to this show, myself included, are aware of that or have spent the time to think about it. Maybe if they really sit down, they could rationalize it. But the idea that our industry could be that close to true—the world's on fire, we don't know how to pay things, large carriers going out of business, M&A activity, bailouts—that we could be that close to that. Most people probably don't have their head wrapped around that idea. If you could just expand on that, I think it'd be really interesting because I don't know that I've spent any time thinking about that. Like, geez, what would happen if we had Mississippi Delta flooding, some wildfires going on in California, and all of a sudden a hurricane smashes into South Carolina? What happens? Are we able to sustain that?
--:-- Curtis Goldsborough: Yeah, no, absolutely. And then on top of that, the huge surprise this year was what they call SCS—severe convective storms. Through the Midwest, we had multiple billion-dollar-plus SCS events that are not necessarily categorized as cat events, but collectively those added up this year. I looked at the figure the other day—it was over 100 billion dollars of losses from these tornadoes and whatnot. That's unprecedented. We've never seen that.
--:-- Ryan Hanley: Can I ask you one question? I'm sorry to keep interrupting. We keep saying things that I'm interested in. So an SCS—I never heard that term, severe connected storm. This would be something like a swath of tornadoes touching down?
--:-- Curtis Goldsborough: Convective storm, sorry.
--:-- Ryan Hanley: Convective storm. Okay. So when you say we saw 100 billion in losses from that and that's an unprecedented number, does that have to do with the number of storms and the power of the storms? Or is it some combination of that and the fact that everything seems to cost more today? What is the percentage of why it's that high, if that makes sense?
--:-- Curtis Goldsborough: Yeah, no, it absolutely does. The simple answer is all of the above. The number of storms and the severity of those storms was significantly higher this year than we've ever seen before. But then also that's combined with this explosion of loss costs because of inflation and all of these things that are going on. It's a perfect storm in every way.
--:-- I don't like to be the doom and gloom type person.
--:-- Curtis Goldsborough: But at the same time, I think we have to face reality. Sticking your head in the sand is not going to help. None of us has a crystal ball. We don't know what the future is going to bring. However, when you look at just the past decade and you look back at 2017 and see the wildfire season that happened in California and how devastating that was—not just with property, but loss of life—and then you look at some of the worst hurricane years that we've had with coastal exposure, and then this year with these severe convective storms like we've never had before... If you put 2017, 2021, and 2023 with those three specific eras and cat events all together in the same year, that would be catastrophic for a lot of regionals. I'm not saying that top 10 carriers are just going to fold overnight. I certainly don't think that would be the scenario, but it is going to have a massive impact that trickles down and impacts everyone.
--:-- You don't have to do much research at all on the Florida market now to understand what a mess that is for policyholders. Same thing in California. If you're in these high risk places, it's become completely unaffordable. People can't afford insurance. It's more than their mortgage payment. They're seeing premiums increased by 50, 60, 70, 80, sometimes 100-plus percent year over year. Sometimes that can sound like hyperbole, but it's not. That's the reality for a lot of people. Their insurance costs more than their mortgage. The average person can't do that. It's not sustainable.
--:-- In Florida specifically now, the last figure that I saw was over 20% of people who don't have a mortgage that requires insurance are just foregoing it altogether. They're going bare. No homeowner's insurance. That's everyone's individual decision to make, but that's terrifying. That's not good for anyone.
--:-- Ryan Hanley: I wonder, are they also going without liability? Can you get a liability-only policy on a homeowner's? I've never heard of that. But honestly, with some of the premiums that I've heard—I've absolutely heard all these stories too. I've got friends down there, agents, and it's bedlam. You're 100% right. It's interesting to think: would I go drop the property and just carry the liability in case that happened? You'd probably cut your premium. I'm assuming most of the loss comes from the property, not the liability on these places. I don't know that there's a drastically increased liability exposure in Florida. It's all the property stuff. So I wonder if that's a product that comes out, if the industry will adapt and morph to make money off these people who don't have property. Maybe I just threw out a new idea. If there's any carrier people listening, there's an opportunity for you: liability-only homeowners in Florida.
--:-- Curtis Goldsborough: [Laughs] It's sad that we would end up in a scenario like that, but who knows? It could definitely be a thing. You might be onto something there.
--:-- I think what's important on this topic is that the insurance carriers don't have infinite money. All these factors do play a role in what we do. Especially where you sit, you have a unique perspective in that you're the ones out there looking at these properties and coming back and understanding how the valuations increase and change. I remember back when I first started writing insurance—this is 18 years ago—we would just do 142 times square feet and that's how much we'd put on there. Now with the way the homes are and the technology in the homes, it's completely different. You need to do this type of deep analysis to understand what it would cost to replace it. Everything's so expensive.
--:-- Ryan Hanley: Yeah, no, absolutely.
--:-- Curtis Goldsborough: It has become abundantly clear to me just in the last three years that for a lot of carriers, the chickens are kind of coming home to roost. I post a fair amount about this on LinkedIn. There's a parallel to that technical debt. If you have a book of business with hundreds of thousands of properties—for some of these larger carriers, millions of properties—and literally 80% of that book they have not looked at in five years and 50% of it they've not looked at in 10 years, that is a huge liability for them. I think we'd be foolish to think that that fact is not at play. Especially when you look at the way the world has evolved, the ever-increasing litigious society that we're in, all of that plays into this. Macroeconomics as well, where people just don't have the money to take care of their homes and properties the way that maybe they used to. Inflation plays a big factor in that. Maybe eight years ago I could have gotten my roof replaced for seven or eight grand. Now today it's going to cost 25 grand to get my roof replaced. People just can't do that. All of these things snowball and they exacerbate each other.
--:-- When you look at 2023, the final numbers aren't out yet—I posted about it the other day—but just the first six months of 2023, homeowners underwriting losses as a whole were just through the roof. Nobody's making a profit on the underwriting side on the personal lines, homeowner side. Massive losses. I think that's a big part of it. The longer that you go without getting eyeballs on the risks that you're insuring... We see them every day. We're processing 40,000 inspections a month now—self-inspections and field inspections. We look at a boatload of properties. The stuff that we see coming through for carriers that finally are doing more renewal inspections because they understand, "Holy cow, our losses are piling up based on all of this old book that we haven't looked at in forever, and we have no idea what's going on with all of this stuff that we haven't looked at in a decade."
--:-- There are interesting aspects to that as well. Even when you think about the societal issue—these are hard problems. For instance, you do a renewal inspection project. You're going to identify a ton of properties that are not a good risk. You're going to identify those homes that have a roof that is 10 years past its lifespan. These are major claims waiting to happen. Those people are going to get non-renewed, or they're going to get a correction letter that says, "Hey, you've got to replace your roof in the next 60 days or we're not going to extend your coverage." That's tough because that puts those consumers in a hard spot. As carriers are becoming more in tune with this, if you've got a roof that is 10 years past its life expectancy and is falling apart, nobody's going to insure you today. Or if they do, it's going to be a stripped-down policy and it's going to cost you twice as much.
--:-- Ryan Hanley: Yeah, like an HO1 or something, HO2 at the best.
--:-- Curtis Goldsborough: Yeah, exactly. So that's tough. If I were a bold carrier exec right now—which I'm not sure that exists—but if I were, what I would be doing is spinning up a finance company on the side and saying, "Hey, you got 60 days to redo your roof. If you can't pay, we'll help you finance it."
--:-- Ryan Hanley: That's a fucking billion-dollar idea right there. This is the second billion-dollar idea. We've got the liability-only policies in Florida, and now we've got—
--:-- Curtis Goldsborough: Throwing them out there.
--:-- Ryan Hanley: If I say the word "patented," can I get credit for that if it actually happens? I don't know how to create a liability-only homeowners policy, but I'll tell you what: the financing home improvements alongside your insurance policy is brilliant. Since you probably already have all the correct filings to make that a reality, as long as it's a separate company, you could probably spin that up pretty quick if you're an insurance carrier.
--:-- Curtis Goldsborough: There are cool things happening along those lines anyway. I'm not sure if you're familiar with the Fortified program, where you can get a Fortified-certified roof that's fortified to withstand coastal exposure or this kind of SCS stuff in the Midwest. There are a growing number of carriers that will provide significant premium discounts if you have a Fortified-certified roof with proper strap-downs and all this stuff to withstand these larger storms. There are some incentives there. I'm excited about some of the stuff that's happening in California as well on the wildfire front. There's tons of work that needs to be done there, but there are some innovative ideas out there.
--:-- The big picture is that moving forward, the industry as a whole needs to do a much better job of educating the general public, educating the consumer, educating the policyholder. The angle that I'm excited about is when you look at markets like Florida, other coastal exposures, California with wildfire—people that are in these high-risk areas are experiencing these insurance issues firsthand. They're feeling the pain. People are not taking insurance coverage for granted anymore. It's not automatic. You don't just make a phone call, have a conversation, write a check, and you're good to go. It's way more complicated than that now.
--:-- That is beginning to tie in with this concept from the carrier side of the more "predict and prevent" mentality—engaging policyholders in active mitigation for their home and property. Wildfire is kind of the lowest-hanging fruit there and where a lot of activity is focused. But at the end of the day, I think that's a big part of the answer to the big-picture issues that we're facing. People's risk needs to be minimized. Carriers need it at a macro level, but engaging policyholders in that process and educating them on why this is important—the tough part about that is it's a huge change. It's a huge mindset shift.
--:-- At the consumer level, we need to educate consumers and somehow convince them that, "Yeah, you may not like this, but the world has changed. Things have changed significantly." I see this every single day firsthand with our self-inspection initiatives. Our company contracts with the carrier, and guess what? Your policyholder is getting a text message and an email from us saying, "Hey, here's an invitation to do your self-inspection." We see the feedback on a daily basis: "I've been insured with XYZ Company for 26 years, and I've never had to do this." That's absolutely true. You never have, but we're not living 26 years ago. We're living in today, and we have major problems today. This is one of those solutions, and it takes work from everyone.
--:-- I think we're moving towards insurance for the consumer no longer being this "set it and forget it" type thing where it's completely out of sight, out of mind. Especially on the wildfire front, effective wildfire mitigation is not a once-a-year thing. When you look at the highest wildfire risk factors like tree debris on your roof and in your gutters, defensible space—these are very fluid factors. You don't just trim back your trees and handle defensible space once a year and then you're good. All of that stuff grows back. Those risk factors are very fluid. We need to get to a point where education is the key. It's tough to throw these things at the consumer and they're looking at it as additional work. "You're telling me that I have to do this now and I've never had to do it before?" That can be a tough pill to swallow. But I think the education piece as a whole is one of the biggest tasks that we have in front of us.
--:-- Ryan Hanley: I think you're 100% right. There is an enormous opportunity for an insurance carrier to step out front and lead with education that doesn't also come with a right hook. You mentioned Gary Vaynerchuk—famous for "jab, jab, jab, right hook." Our industry tends to be "right hook, right hook, right hook, maybe a jab, right hook, right hook." You could just do a whole series of PSAs and educational things and segment them. The way the internet works now, you can literally create specific pieces of content that are distributed for California homeowners and Florida homeowners. There are entire veins of educational content that these carriers could invest in and really define themselves as market leaders in the education space. They just don't want to do it. A lot of that goes back to it not being culturally what they're used to. Our industry has always been, "If you want the information, you have to come to me." We've been gatekeepers. I remember back in 2012, I was telling people, "Guys, we're no longer the gatekeepers of insurance information. It's out there in the world now." It's still a concept that people have not grabbed onto.
--:-- What you have described is a reality that we don't have to like but is absolutely what the world looks like. While it may not be what we're used to, it certainly only creates new opportunities for the people who want to adjust, adapt, and grab hold of it. For the insurance agents that are listening to this, particularly those that are in the PL space but also in the commercial property space, these are opportunities to set yourself apart. For all those "I'm a trusted advisor" people out there, this is what being a trusted advisor is. Walking through how do you properly trim your trees back for your home? How do you properly make sure that there's drainage in case there's flooding? I know some people do this, but it's very, very rare. There is so much opportunity in the educational space in our area that if every agent was creating educational content, there still wouldn't be enough. I love your point.
--:-- This has been a tremendous conversation. I appreciate what you're doing. I appreciate your perspective. Curtis is a tremendous follow on LinkedIn. I just looked and you only have—I shouldn't say "only"—but you have 2,200 followers. That is freaking crazy because dude is sharing awesome information. I love—one of my favorite followers on LinkedIn. The memes are just hilarious and real and thought-provoking. I highly encourage everybody listening to go and connect with Curtis on LinkedIn. I'll have that in the show notes. Where else can they learn more about it? Or for the carrier people that are listening, if they don't work with you or just want to connect with you, where's the best place for people to learn more about what you do?
--:-- Curtis Goldsborough: Absolutely. Connect on LinkedIn, shoot me a DM. I'm getting those on the daily now. Nationalis.com is our website. My network is kind of exploding here over the last few months and it's super fun. I love meeting new people and having conversations like this. There are a ton of great people out there that are working on a lot of these problems that we discussed here today. I'm excited for the future. Lots of cool stuff happening.
--:-- Ryan Hanley: Awesome, man. Appreciate you. Wishing nothing but the best. So glad we had a chance to connect and have you on the show.
--:-- Curtis Goldsborough: Thanks so much, Ryan. Lots of fun.
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