--:-- Host: In a crude laboratory in the basement of his home... Well, everyone, and welcome back to the show. Today we have an absolutely tremendous episode for you with a conversation with Derek Hayden, insurance advisor at Dansig Insurance Risk Advisors out of Shelbyville, Illinois. He's a Certified Risk Architect according to his LinkedIn profile, which I love when we fancy up that producer title. I'm just giving Derek a hard time.
--:-- Host: Derek's an amazing dude. I think he's an incredible producer. I love the way he thinks about the business. As I kind of say at the very end of our conversation, which you'll hear—so I'm kind of not bearing the lead here—I think Derek marries a respect and understanding for how the business was done and should be done from a traditional standpoint with where the puck is going, with that new kind of digital age, that human-optimized age. I think Derek is very much a human-optimized producer, and I absolutely love that we had a chance to talk with him and get his insights.
--:-- Host: He is also the winner of the very first Protege, David Carruthers' Insurance Reality Show, The Protege. Derek was a participant and ultimately the winner. He did an absolutely tremendous job. It kind of catapulted him into the national insurance spotlight and showed exactly what is possible when you set your sights on a goal and you take care of business. I think the world of Derek and the work he does. I'm kind of mad at myself for not having him on the show earlier. That's my fault. I apologize to all of you for keeping Derek from you, even though you most likely have heard him on other podcasts. This is a tremendous episode that you're going to love.
--:-- Host: Before we get there, two quick housekeeping items. One is if you love this show, share it with a friend. The more people that hear the show, the more people that get involved in this kind of human-optimized concept, the more people that believe in what we're doing, that understand what we understand, who believe what we believe, who share good concepts, share insights, share this human-optimized methodology of traditional caring, compassion, experience, expertise, and insurance with the fast-moving ease of business, digital producer style. Share the show if you love it. That's the best way to support the show.
--:-- Host: And if you love the audio, if you love the podcast, I'm also writing blog posts on findingpeak.com. Go to FindingPeak.com. It's all about peak performance in business and life, how we put our mental and our physical selves in position to be successful. How do we get our mental right? How do we get our physical right? How do we get our relationships right? How do we get our various business qualities, leadership, all that kind of stuff? How do we put ourselves in a position to reach peak performance? I think you'll love it. Go to FindingPeak.com. Enter your email in. It's free. I think you'll dig it.
--:-- Host: Also, last but not least, big shout out to Tivly, T-I-V-L-Y.com. Guys, if you write commercial insurance and you're not using Tivly to generate leads for your business, you are missing the mark. I don't care if you're some badass, ego-driven middle market producer or you're just crushing small commercial and you want to keep writing more business and get a steady flow of business in the door every month, every week, every day. Tivly is the best way to do it. We've been clients of Tivly's for a year and a half and I was very honored when they asked if they could sponsor the show and get their brand and what they're doing in front of all of you. And because we use Tivly and I love Tivly, big fan of Mark and Kim and Sam and Michaela and Patty, all the people over there, great people. We've had a wonderful experience. Highly recommend T-I-V-L-Y.com.
--:-- Host: Alright, with that guys, let's get on to the absolutely tremendous Derek Hayden. There he is. What's going on, broski?
--:-- Derek Hayden: What's up, man? Not a whole lot. Just trying to make it happen, you know. Just out here dominating another day. Is that the deal?
--:-- Host: That's right. You better believe it. Yeah, I love it. So what's it like out there? What's the climate? I haven't been boots on the ground in a while. What's going on?
--:-- Derek Hayden: Oh, man, it's going. I will say the activity is flowing. The hard market has a lot of people worried, so it's good and bad. Got a lot of new opportunities, and I'm fighting to keep some clients out there. And I will tell you that some of our carriers are keeping me on my toes. We're getting the 30% renewal notices left and right, it seems like, on certain accounts. We just had a sales meeting yesterday. One of our carriers that we have a lot of our small church business with, they are backing out, so that's going to be fun. It's just another day in the insurance world, man.
--:-- Host: Yeah, so I want to talk about the hard market. At Rogue, we deal with mostly small business. We haven't really seen at the small business level the major, major increases. I see a little incremental increases and stuff, and it is what it is. It's definitely a volume game. But when you're dealing with larger accounts, or even smaller accounts that you have a closer relationship with—at Rogue, there's an arm's distance for a lot of our business. These people come to us and they're not looking for a local person who's going to go to their church and their ball game and see them all over town. So I know it's different when you're living a little more of that life.
--:-- Host: I hear both sides of the story with a hard market. You get a lot of opportunity because the shitty agents that aren't on their game, those accounts become available and all of a sudden their 10 is up. But the same goes for your clients too. Talk to me a little bit about your feelings on a hard market and how you're handling it. For a lot of people listening, this is probably the first time they've ever experienced a hard market. What does it mean? How are you doing with it? Are you sweating bullets every day? You feeling good? How does it impact you?
--:-- Derek Hayden: Yeah. Well, we got our kind of our first taste about mid-summer 2022. And it was a bad, bad situation. The client found out about their increase they're receiving before we did. That kind of jumpstarted our process of like, hey, we've got to know. We had a meeting with all of our carrier reps and said, hey, we need to know that this is happening before our clients get something in the mail. They said, yeah, we messed up for some reason. It was supposed to be emailed to you. It wasn't.
--:-- Derek Hayden: For me, I am in a small rural area where our people are going to church with us and the local diner with us. So surprises are not good, because surprises are heard about by everybody before it gets to me sometimes. What it's like in a smaller town is we are basically trying to prepare our clients. Like, hey, just expect this. We're doing more pre-renewal meetings. So you're looking more at like the 120 to 180 day out saying, hey, here's what we're seeing. We're sending market outlooks like, hey, just so you know, this is what's happening in the marketplace. We are on top of it. Don't get too panicked. It may be okay. But just want to let you know what we're seeing in the marketplace.
--:-- Derek Hayden: We're trying to do a little more preparation than we would have in the past, just because we don't want that to be a surprise and then they just jump ship before we even get a chance to talk to them. So we're sending out more email campaigns, more pre-renewal meetings on our larger accounts, just game planning for what's going to happen in the next 180 days or so. It's taking more time, but at the same time, I feel like it is growing the relationships with our clients because it's stuff they've never had—these pre-renewal meetings so far out where they're game planning, putting more risk management items in place to reduce the exposures that they have. So it's good and bad, but we had a very rude awakening when it first started to affect our agency because we were not ready for it.
--:-- Host: Do you find that if you do communicate earlier in the process, if you do set the meetings up, if you do prepare your clients for what to expect, that it kind of solves the issue? Or do you find that they'll still buck and threaten or consider shopping? Do you think for the most part, if you can get out ahead of it and be that good steward, it locks them in?
--:-- Derek Hayden: In our experience, if we're ahead of it, they are more appreciative rather than alerting them to go shopping. I can see where that could be a concern. It's the way that you put it to them. Say, hey, this is what we're experiencing. This is why you're in the right spot with our agency because we're doing X, Y, and Z to prepare for it. Here's some things we recommend for you to do as we prepare so we can present your account in a more professional manner underwriting negotiating time. In our experience, it's a positive, but I can definitely see where it could be looked at as a negative and put up red flags to a client and make them think, all right, that scared us, let's go ahead and contact somebody else.
--:-- Host: It almost feels to me like it's very dependent on how you position this. If you can get out ahead of it and say, look, we're all over this. We know that something's coming. We don't know what it's going to be yet. It could be 5%, it could be 50%. We don't know. This is what we're seeing with some of our other clients just to give you an idea. And here's how we get... If you kind of lay that groundwork out and set those expectations, people are just so much more amenable to what you want them to do. I feel like too often in our industry, we either assume they just trust us and are going to do what we say, or we assume they actually know what the hell is going on. In both those cases, we tend to be wrong. They trust us, but they're still paying us a lot of money, so there's always that. And they certainly—most of them—have absolutely no clue what is happening day to day. So it feels like that expectation setting is huge.
--:-- Derek Hayden: For sure. We just had this talk this morning, me and another guy in my agency. Everybody seems like on the surface they look like they know what they're doing. No one knows what they're doing. Everybody's just making it up as we go. But if you can be a little more prepared than the next guy or next gal, it goes a long way. Everybody's just flying by the seat of their pants. We don't know what's going to happen until you do get that renewal by email. No one knows exactly what they're doing. They're just kind of making it up. So if you're going in a little more prepared, you have the ability to put things in place and make the client feel like you're able to handle it. Whatever happens, whatever comes your way, we're going to handle it. It makes them sleep a little bit better and not talk as bad about you at the local coffee shop.
--:-- Host: Have you seen opportunities to get into accounts that you maybe otherwise haven't had an opportunity to get into? Have you seen people who are with agencies that are a little lazy or complacent, or maybe just don't know how to handle a hard market—those opportunities starting to pop up? Even though you have to work a little harder on what you have, are you also seeing it on the back end?
--:-- Derek Hayden: Yep. I'm seeing a lot of the small business, probably the size that you play in, the $5,000 to $15,000 premium total. We're seeing a lot of call-ins. People are contacting us on those accounts. Even accounts I've never even called on. They're either watching our content or something and they're saying, I think it's time we give it a look with you guys.
--:-- Derek Hayden: We had a carrier meeting recently where they have their annual dinner and their awards. Watching the agents who were accepting the awards walking up on stage, the average age for these dudes and a few gals had to have been like 69 years old. There's no way that those are the people who are going that extra mile to have the pre-renewal meetings. They're just getting the renewal and passing it on to the client saying, hey, if you make changes, let us know. I think there's a ton of opportunity out there. I think a lot of clients are scared to make the first move sometimes, but it has now got to the point where they're like, okay, I've got to talk to someone else because Billy Bob Smith is just... I'm getting an email from the carrier every year with a seven, eight, nine, 10% increase, and I'm not getting anything from it. It just keeps going up and up. I think now that maybe those increases are a little bit more than typical, it's pushing them over the edge to say, all right, I saw Derek do that video or he talked to me about this one issue. It's time to open the box and see what he can do.
--:-- Host: I always take the carrier awards with a grain of salt because I'm always interested—are they growing, or are they just big? Because if you're big, you probably deserved the award 15 years ago, but are you still growing? Or are you just big?
--:-- Host: I had a carrier, one of my favorite carriers—I'm not going to name them in this particular case—but they're one of my favorite carriers. When I was getting the appointment two years ago with them, we were just talking about how they appoint people. They're kind of a middle-of-the-road carrier. They don't appoint everybody, but it's not like the hardest appointment to get. At the same time, they're not in every shop. You gotta have a business plan and whatever. I actually like those ones. I think the carriers that make you jump through 17 hoops, I don't appreciate that because I found that even when you do that, you don't get that back. You don't get the loyalty back. It's not like you're getting anything special even though you had to work harder to get the appointment. I could be wrong, but at least I've found that to be the case.
--:-- Host: Long story short, I'm talking to these guys and I'm saying, what does the agency plant look like locally? And they're like, we have an agent who is down in Troy who's had an appointment with us for 10 years. Built up a book of $250,000 in premium and has not sold an account with us in five years, but they're just above the threshold for losing their appointment. It just sits there every year and does nothing. He's like, I don't even go there anymore. I haven't talked to the guy in two years. But the guy just sits there.
--:-- Host: That is such an odd thing in our industry. Carriers will... and I'm not knocking carriers because they have their own struggles. It's just an interesting piece of our industry where you'll have young guys like the interview that will come out right before this one—Stephen Turnbull who just started T5. He right now is mostly purse lines or whatever. You take a guy like that who's just got to scrape and scratch and lie through his teeth to get every freaking appointment. He's got to beat himself up to get an appointment. He's growing and all he wants to do is put premium on the books, and they'll beat him up and smack him around. But then they'll let some schmuck with $250,000 in premium just sit on that thing for five years and not even question it. It's just an odd thing. But I get it. If you take his appointment away, what happens to that premium? Where does it go? It's just an odd thing in our industry that you could do that and then just sit on it. And if you sit on a big enough book, you'll just get an award every year and earn a trip.
--:-- Derek Hayden: Yeah. It's funny because I have a few clients who used to own insurance agencies—not even my insurance agency, just used to own agencies—and their wives will come in. This tells you our small town. They still come in to pay their premiums sometimes. They'll be sitting out there paying their premiums. If I hear their voice and I know who it is, I'll walk out of my office and say hey and do the song and dance. I'll say, well, how was that XYZ company trip this year? Boy, we used to love those trips. That's the reason we never sold the agency, because we liked to take those trips. They didn't go out there and beat the streets and try to win new business. They are just in it to take a trip to San Diego over a year, whatever it happened to be. So it's the lifestyle agency, man.
--:-- Host: There's nothing wrong with that. My only gripe ever is the bit of hypocrisy that comes with that. I want to get out here. I want to kill myself. I want to go grow. And you're just going to beat the crap out of me and make it as hard as possible and question everything I do. But you hit a certain amount of premium volume, even if you're slowly fading away or slowly seeding business, they'll send you to the fun place every year. I guess that's the game. It's all economics. If you have enough revenue coming in and everybody's making money, then I guess you should. Until you've earned that, I guess it is that way.
--:-- Host: The reason that I've heard is that there are costs associated with it. I had one carrier say, we don't want to turn you on in all 50 states because it costs us $250 a year to do that. I'm like, oh my God, if my relationship to you isn't worth $200 a year, like, holy crap. I get some of it. I get that there's some costs. But at the same time, the growth is going to come. But I don't know, when you're talking about the size of the numbers in our industry, really all the growth comes from book rolls, from large M&A transactions. Rogue Risk or you, they just don't care. They look at it and they're like, eh, whatever. I get it. It's just hard when you're on the other side. I don't think it should deter you if you're a scratch agent or trying to become a scratch agent, but it definitely is a frustrating thing to deal with.
--:-- Derek Hayden: For me, it's a little bit of jealousy too, man. I'm just a little piddly agent. I was like, man, I'd like to be the guy who can just go golfing every day and take a trip to the Bahamas on XYZ company's bill. That'd be fun. But I guess if I wanted to do it, I could go do it. I'll just keep bitching until then. I guess at the end of the day, it's just jealousy.
--:-- Host: You see people at like Travelers, whatever their thing is—Travelers has got their thing, I always forget the name of it. I got buddies that go on this Travelers trip every year and it just looks amazing. They got these great speakers and all the muckety mucks from Travelers go and glad hand and the drinks and the gorgeous thing. I'm just like, God, I just wish one time one fucking carrier... I've been killing myself for three years writing premium. I haven't been on one trip. Who's gonna invite me? I want to go one time. I want to go someplace fun. I'm killing myself.
--:-- Host: That speaks to the relationship side of it and the relationship with carriers. I do have a very specific question that I want to ask you in your experience. One mistake that we made at Rogue was spreading our carrier premium out too wide. I do consider this a mistake. If I could do it again, I probably would take half the carrier appointments and just really dial in writing business with those carriers. That seems to be how you get things done.
--:-- Host: I made both a ton of friends and a ton of enemies when I did this video on LinkedIn that was basically like, maybe we should all become Hartford captives. I don't know if you saw that video.
--:-- Derek Hayden: I'm sure I did.
--:-- Host: I was sitting here and this carrier rep was seemingly out to lunch. The fact that their user experience for quoting was absolutely horrendous. He's like, oh, I've never had anyone complain. I'm like, you were either lying or you are completely naive. One or the other. So I was frustrated by that. I went for this walk and I was like, you could basically run your entire agency without an agency management system with just Hartford's Spectrum thing, just the back end of Hartford. If that's the only carrier you had, they have ENV, they have this full, really nice portfolio. Obviously there'd be a lot of niche stuff you couldn't write, but if you just wrote Hartford Spectrum business, you could have a really nice agency. It would never need an agency management system. You could basically do whatever you wanted just with that system. Obviously Hartford loved it and it kind of went viral. And then a lot of other carriers didn't like it.
--:-- Host: My point in all that was, I think that it makes sense to really dedicate to one, two, maybe three carriers. I almost wish that I had left more business on the table but focused in on a couple of carriers and really built up a huge book. Say Hartford, Hanover, and Cincinnati. With those three carriers, just only write what I can write with them. Anything else? I'm sorry. I can't help you. This is who I have. This is who I write with. Bam. And just done that. I think we'd probably be a lot farther along in certain ways.
--:-- Host: So here's my question to you after that huge contextual diatribe. Mike Asilis, who's Max Revenue and all that kind of stuff on LinkedIn—I don't know if you've seen all that.
--:-- Host: He did this thing the other day where he took a screen capture of a conversation he had with an underwriter. I can't even pull it up. I'm going to ask him about this. He's going to come on the show here in a couple of weeks, so I'm not blowing up his spot. I just want to get your take on this because I had a take and I'll share his take and then mine, and then you tell me what you think being who you are.
--:-- Host: Micah says—and I love Micah, this is not to blow him up, this is just honest conversation—"Quoting my insurance is bad" is like the title of the thing. He's gotten really good at the copywriting and all the clickbait shit. Basically it's this conversation with an underwriter which basically says, "Speaking from the carrier side, the minute I saw that this account had multiple agents, even over the last several years, I ran from the account as quick as possible." And then obviously this looks like someone responding had never thought of that that way before. That's an interesting viewpoint. And then the underwriter responded, "We have accounts that people knew by name and were automatic declines. The only question was, which agency this year? We track these things."
--:-- Host: My response was, I said, "Okay, I understand that viewpoint. I think it's complete and utter horseshit, but I get it." My response was, "There is also an enormous amount of hypocrisy in this take. Every carrier wants the insured to commit or partner, but the road goes both ways. How many carriers will dump a long-term client just because they had one bad year?" At the end, I said, "I call bullshit on this." And I wasn't calling bullshit on Mike. I'm calling bullshit on the underwriter's perspective.
--:-- Host: So this is where I want to actually present you with a question after 10 minutes of fucking talking. Being that we're in a hard market and we are starting to see scenarios where carriers who want to say, "Commit to us, commit to us, commit to us. You should dedicate your life as an insured to us because we're willing to give you insurance," are now in this hard market putting 50% renewal increases, dumping accounts that have seemingly been decent or at least marginally profitable. They're just dumping. So how do you, in your experience, manage that? How do you think through that? And what is your perspective on what I just shared?
--:-- Derek Hayden: Sure. Getting the... should the customer commit? Should the underwriter commit? How do we get it all working together? Perfect timing for this. So myself and another agent in our office—this would have been at the time I was in The Protege, so it had been 2021, like spring 2021. I was hitting it hard because A, I want to win The Protege, but B, I was using those new tools and I was killing it. I was just going after everything I could.
--:-- Derek Hayden: This particular account, the reason I went after it was they had a high mod. It was like a one point... I don't know, two, three, something. And I could see that they had it for year after year after year and hadn't really solved anything. So we approached them with that in mind and got a first meeting. We actually won the account by BOR on a carrier we did not represent. So it was a generic BOR. We didn't actually present it to a carrier. We just said, hey, this is a symbol of you hiring us. We'll find a fit for you. But just so you know, you are hiring us to represent you in the marketplace. They said, yep, we want to work with you. We've got these tools you presented. We want to move forward. Awesome.
--:-- Derek Hayden: So we submit it to market. Same thing happened. We got decline, decline, decline, decline, decline. We've seen this account for 20 years. Every year, we never win it. Don't win it. Don't win it. Don't win it. We have a very good carrier that does a lot of restaurants. They had declined it as well. Said we've seen this for XYZ years. We don't want to work with it because we just continue to spend time on it and don't get it. So we said, well, can we explain what we've done with this account and why it's now an opportunity? Someone's getting it, and this is the opportunity. Now they're not just quoting it. They've hired us. We've got to find a home for it.
--:-- Derek Hayden: So we had a man show them what we did on the mod. You know, return to work program, new safety program, hooked him up with a local physician. What do you call it? A work doctor. I can't remember the name of it. Occupational medicine. That's it. I'm from Shelbyville, Illinois. You got to hang with me for a second. But we did all this stuff. They came in and wrote the account.
--:-- Derek Hayden: Anyway, we get about six months into the policy period and we get an email from the writer saying, hey, we're getting off this account at renewal. Like, what's the reasoning?
--:-- Host: Like, the carrier had like a celebration that they had landed this account. This particular restaurant is the biggest non-franchise restaurant in Central Illinois, basically. And everybody wanted it. If they had a chance to get it, they would take it, other than they were tired of quoting it. They sent a higher-up than our territory rep for this carrier and met with us, like, "How did you win this account? We want to know. We've been seeing this account for 20 years. We've never had an opportunity to win it. What'd you do different? Tell us all this stuff." It was just one of those things where we felt we had conquered the world, like we cracked the code. So we showed them a lot of it was from The Protege, and they were like, "Man, this is great."
--:-- Host: Well, like a few months later, we get this email saying, "Yep, we're getting off the account." It just like, okay. What? So it was just one of those things where there's no give and take. We won this big battle that the carrier had been having for 15, 20 years. And now all of a sudden, "Well, the property value is too high for us." I understand that, but why'd you just write it six months ago? "Well, we just got bigger than what we expected." It's just one of those frustrating things.
--:-- Host: So we took it back to market, same thing. And everybody's like, "We're going to pass on this because we've worked on it for however many years and we haven't got it." It's like, okay, well, I don't know. I get frustrated as an agent because you do all these things to make the account less risky. You improve the risk profile, do all these things, you get the carrier on board, and then they're done with it. It's very frustrating. And then I know they say they don't want to quote it year after year after year, but then how do you win it? I mean.
--:-- [Host pauses for a direct address to the audience]
--:-- Host: 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. Let's get back to the episode.
--:-- [Discussion resumes]
--:-- Host: I am of the opinion that carriers are not our partners. I think that we look at them wrong. They are vendors. It doesn't mean you can't have a great relationship with a vendor, but they're not our partners.
--:-- Derek Hayden: Sure. They're not.
--:-- Host: If Marsh came in and quoted that with that limit, they would write it all day. They wouldn't say shit. They would. "Yes, Marsh. Thank you, Marsh. We appreciate you, Marsh. Please write more business with us, Marsh." But Derek Hayden, small agency, local guy, gets his hands on this thing. "That's a little too big for us, Derek. We're a star." They're not our partners. Agents have to stop thinking of carriers as their partners. They don't like you. They don't care. They're vendors. It doesn't mean I shouldn't say they don't like you. You are just a mechanism for that underwriter and that carrier to make money. That being said, it doesn't mean we can't have a great relationship with them.
--:-- Host: This is just my perspective. Because what happens is, to me, I would lose my mind. I'm like, I bend over backwards, I work my freaking ass off, I got this to you. This is how we make money. This is the business. This is what we do for a living. And now you're doing this to me. You took up my time, you sent this rep here. They are not our partners. We have to stop thinking about carriers as partners. They're not partners, they're vendors. They are vendors that we use to do our business. Now, that being said, you can have a great relationship with a vendor. I talk about it all the time. They're actually a sponsor, but I have a great relationship with the people at Tivoli. Mark McClure, Kim Reid, our direct rep, Sam. They're awesome to us. We do a lot of weird, funky things with them because of our nature of our business. And they're awesome. But they're vendors. We do something shitty, we fuck up, or they fuck up, the relationship is severed. That's the way that it works. We make them money, they make us money. But it's not like we're family.
--:-- Host: I think that agents get sucked into this. I get why carriers do it. I'm not knocking carriers. I'm just saying as agents, we have to properly set our own mental expectations. It is in the carrier's best interest to make it seem like they love us and they care about us, and we're these dedicated partners. From a marketing perspective, it is in their best interest to do that. However, there is this other side of the business that is the business side, which is like, "Yeah, he's just a small agent, really. Did Marsh send it? No, okay, cut it." They have no problem, and they will be stone cold about it. They'll look at you and they'll shrug their shoulders and they'll go, "Sorry, Derek," but hey, still need that $500,000 premium commitment to us.
--:-- Host: By properly setting our expectations for the relationships, we can actually go into them with eyes wide open. It's so freaking difficult, and then you're trying to navigate a hard market, which means more discussions, deeper, richer submission quality. Think about the submission you just explained. Holy shit. The amount of work and effort that went into that thing.
--:-- Derek Hayden: Right.
--:-- Derek Hayden: No, I'm glad you said it because I have felt that more and more. I'm in my 11th year now in the industry. The more I grow, the more I see it's just like, I'm just a pawn and it doesn't matter as much. Like you said, they say they want to be your partner and we want to win this account together. They'll chew you up and spit you out faster than you can snap your fingers. I feel like it's almost like you're working with puppets. I guess we're in sales too, you and I can probably spit a pretty good game in front of a prospect. But I don't feel like the carrier in most cases can back it up. I feel like I do with my clients. I at least follow through with what I say I'm going to do. I feel like that rarely happens on the carrier side.
--:-- Derek Hayden: I do think there are rare relationships where that isn't the case, and I do think there are certain companies that are set up different. I'll take a company like Cincinnati. I love Cincinnati as a company. They're very difficult in some ways. They're a little more old school. Submission quality really matters. I'm actually doing an internal master class for my team on how to submit business to non-portal-based companies. Cincinnati is a non-portal-based company. We really have two main non-portal-based companies, which is Acadia and Cincinnati. Submitting business to them is different. You need to put a true submission together. Here's all the pieces and here's what you need and how to sell it in a narrative. I'm putting this masterclass together for the team because they were bitching at me about so-and-so at Cincinnati not getting back to us. I'm like, "I know him. He's pretty good at what he does. My gut told me this was an awesome issue and not a him issue."
--:-- Derek Hayden: So I said, "Hey, when you submit business to him, just put me in CC." I made it seem like I was gonna put pressure on him, but really I wanted to see how they were submitting business. I was like, "Hey, can you quote this?" Dot, dot, dot. That was like the whole submission with an ACORD form. I was like, "Oh God." So in this case, it actually wasn't the carrier's fault at all. This is where we're not doing our job.
--:-- Host: Do you focus on submission quality? I don't want you to give away your secret sauce, but to me, things like submission quality — I'm not talking about your ability to punch numbers into a portal. I'm talking about when you're actually submitting business for larger small stuff, middle market stuff. Do you spend a lot of time on it? Do you have a template that you use? Do you have a format? That to me feels like a secret weapon. If you can really dial in a good submission. How they refer to it at Cincinnati, I love this concept: top of pile. You're either a bottom of pile agent or you're top of pile agent. I was like, "I get that we're bottom of pile today, but I want to be top of pile."
--:-- Derek Hayden: Yeah. So I changed my mentality on this. I used to do the written narrative. I swear no one read it because I would put information in that narrative and I'd get questions back asking exactly what I'd spelled out in the narrative. So what I did, I changed to doing a video narrative, like a video submission.
--:-- Derek Hayden: Yeah. It's good, but some carriers will say they can't open it because of their privacy practices, which is irritating. But the carriers that do watch it, I can tell. I can track. They'll watch it 10, 12 times, and I'll be like, "They're writing this account." Because they're following along. I can do a screen share and show, "Hey, this is the brand new return to work program we just put in. Here's what we identified as what they didn't have going on. Here's how we're fixing it. Here's why you, Mr. or Mrs. Underwriter, are getting a better risk than you would have had prior to us coming in." On those key accounts, those bigger prospects, I do the video submission. I feel like that changes it. They feel more a part of the account versus just reading something on paper. They feel like they can see the building through video, see what we're doing.
--:-- Derek Hayden: Plus, you get to track it. I was using Vidyard, but I moved back to Loom. I like Loom a lot. With Loom, I can see when they forward it to somebody or when someone else other than the person I sent it to watches it. I'll be like, "XYZ at insert carrier," and then also "Anonymous at insert carrier." You can see that they've sent it to other people.
--:-- Host: Yeah. Like you said, it gets you all excited because you're like, "Oh, they're serious about this one."
--:-- Derek Hayden: Oh yeah, exactly.
--:-- Host: I use Vidyard. I started with Loom and I went to Vidyard because I used it for prospecting purposes too. I can't really track if they forwarded it, but I try to do a separate intro and then edit it to say "Cincinnati Insurance" or "Auto-Owners" to make it for them. I edit it in so it sounds like I just sent it to them. That's just a little trick. Don't want to give away all my secret sauce. If it's for that underwriter, if I say the underwriter's name and the company they represent, they feel like, "Oh, he just sent this to me," even though I'm just editing in every carrier we send it to.
--:-- Host: Don't worry about giving away your secret sauce. No one will ever do it.
--:-- Derek Hayden: Right.
--:-- Host: The 15 agents that will actually take this ridiculously amazing idea that you just shared and actually use it — you'll never compete against them.
--:-- Derek Hayden: Sure.
--:-- Host: The one thing I've realized that's amazing about our industry is that everyone listens to these great ideas and then never does anything different. I couldn't agree with you more. Do you also use video for your proposals? I know you work on larger stuff in general, not just $2,500 pops. Are you using video for your proposals, or are all your proposals still going face to face in person? How are you managing that?
--:-- Derek Hayden: I would say 80% of my small commercial and personal lines proposals are video proposals. My larger accounts, the middle market, or at least what I consider middle market, I'm going in person. One of my claims to fame during the pandemic was that Vidyard nominated me for an award based off my close ratio with video proposals. I hit a 91% close ratio in 2020 using video proposals. Obviously, you couldn't meet in person at that time. I was just knocking them out of the park. Being from a small area, there was no other agent even familiar with how to do that. People would come to me and we'd win it. I've stuck with that. It's such a time saver too.
--:-- Host: Oh, dude. Yeah. I've been preaching this. I did a whole thing. My presentation that I've been doing — I have a bunch of keynotes coming up — a big part of it is how to close. My close ratio on video proposals was 89%.
--:-- Derek Hayden: Fuck, right now I got to increase mine. I can tell you, I've not hit 91% since 2020, but it's been in the 80s.
--:-- Host: Even if it was 80, think about that. Eight out of every 10 video proposals are closing. I tracked it for over a year. We used Neoteric Agent then, it's now Better Proposal. I love that software, just the way it presents it. I'm not making any money off them. That's just what we use and I really like it. But yeah, 89% close ratio. People still ask me these questions, and I'm like, "Guys, it's right there."
--:-- Host: The person — I'd be interested if you saw it too. Most people who got the video proposal wouldn't open it till the evening. They would watch it multiple times. One out of every five would forward it to somebody, or you'd see someone else watching it. They'd say, "Hey, come look at this," to a spouse or a business partner. My metric beyond even that was one-call closes. What I meant by that is not that I close you on the phone — that's the misnomer. What I meant is I only want to speak to you on the phone one time. With the video proposal, I go through my process, bam, I send the video proposal out, and they wouldn't need another phone call. They watch it three or four times, they do whatever, and then I just get an email back: "This looks great. Let's do it. What do we need to do now?" I'd send them the e-docs, they'd send me back the e-docs, account closed. I never had to speak to them again. For the smaller stuff, $25,000 in premium or below, that works incredibly well. You're at 91%, now in the 80s. When I was tracking it myself for over a year, it was 89%. This shit works. There's no doubt.
--:-- Derek Hayden: A hundred percent. Yeah. That's one thing I would say if anybody — there's two things that I feel have been able to improve the close ratio. Not that 91% is bad, but just to give you a better chance to win it with the video, like the one-call close. The two things that will help you close it: one, do not attach the quote with the video when you email it. If that PDF is attached, they're going to click on that and look at the price, and then they're not going to watch the video. Just send the video. Make them actually view what you're recommending. The second one is just give them the instructions for binding. How do they hire you? A lot of people forget that. They'll just send the video, and then the people call back like, "Okay, where do I go? How do I do it?" It streamlines it if you put at the end of the video: "If you want to move forward with this, all we need is signed applications and a payment, and we'll get it going. Here's how we can do that. Just send me an email saying 'I want to move forward,' and I'll send you the e-docs." Boom. Just explain how they can hire you. Those two things increased my close ratio using video proposals in 2020 and beyond.
--:-- Host: See, what's interesting is I always attach the carrier proposal. Different experiences make this stuff interesting. How I set it up was, when I would get to the point that I decided this was a qualified lead, I would basically set up the video proposal at that point before I gathered information. I would say, "Here's what's going to happen next. I have a few hyper-tactical questions that I have to ask in order to get what I need to rate you up. I'm going to ask you those next. Once I do that, the next thing that's going to happen is I'm going to go do my job. Once I get the best coverage at the most competitive rate that I can find for our 50 carriers, I'm only going to present you one quote because it's going to be my recommendation. The best coverage at the most competitive, right? Great. I'm going to send you a video proposal. It comes in three parts. Part number one is going to be a brief narrative, a brief overview of what it is, usually in the body of the email. There's then going to be a video — it'll be under five minutes, most of them are under three minutes — where I break down why I picked that carrier, the coverages, et cetera. And then I'm going to attach the carrier proposal in a PDF because I want you, Derek, to know everything that I know."
--:-- Host: I go, "You ever buy a car? It sucks because you don't know if it's had water damage. Now there's Carfax and shit, so that argument doesn't work as well today. But no one wants to try to buy something that they feel like they don't know all the information. So you now have everything I have. If we talk again, you're coming from a position of power. How's that sound?" "That sounds amazing." I never really had them just look at the proposal, tell me it's expensive, and come back to me because I set it up as part of it, like another step, not just another thing. I always attach the carrier proposal because the psychology was they are getting the inside baseball. They're getting the inside look. When I see an agency proposal, I get the ego behind it, but I'm also like, "Yeah, but you could have made up all those numbers." If I were getting that proposal from someone, I'd be like, "Are these real? I don't know. I could have written anything in a Word doc." I know that's illegal and all that, but to me, it's like, "Here, you have everything I have. Make your decision. I don't really give a fuck."
--:-- Derek Hayden: It sounds like you're doing a good job of setting it up. I think that's the difference. I don't set it up to that extent. I just say, "Hey, the way I'm going to present this is through a video proposal. You're going to get a link." I try to text it. Our agency has the ability to text, so I will text it if I can just because you get the open rate on email versus text. I send a PDF through text sometimes, but usually not. If it's a current client or somebody I know well, I'll attach it because they're going to take the time to watch it. For example, I know a lot of people probably listen and say, "Does that open you up to..." I review the entire proposal on screen share, so they're seeing it anyway. They just don't have the hard document. I just recently got a new commercial account that was an attorney, so I attached everything I could because I know attorneys are pretty thorough, at least their team is. I attached it in that case and then explained why I recommend certain coverages there on the video. Each situation is going to be different. If it's someone I don't know well and I want them to watch the video, I won't attach it because I don't want them to click the attachment. I've spent 10 minutes doing a video. I don't want them to just open it and say, "Oh, $5,000, that's more expensive than what I'm paying. I'm out."
--:-- Host: Yeah. To be fair to the process, we deal with a lot of people who this is their first policy they're ever having. They tend to come to us. It's, "Hey, I'm just starting a business," or "I've had a business and now I need a COI because I just got a big contract," or "Hey, we're hiring our first employee. We're growing." We get a lot of newer businesses. A lot of our clients are newer. We don't get a lot of people who are like, "Hey, I've been in business for 10 years with a local agent, and I'm looking to shop my insurance." People don't come to us for that right now. That type of customer is staying in the local independent market. Our premier team is meant to disrupt that, to come in and be that. But our select team, which does the majority of the PIF volume — not necessarily the premium volume, but certainly the policies in force volume — it's a lot of five years and under. Been in business five years and under.
--:-- Host: I was actually working on an account today because I like technology businesses. That's probably the one area that I get really interested in. Every once in a while, when an interesting technology business comes in, I'll take that. I was working on one this morning before our call. This is a guy that's been in business for 10 years. He always just had a GL policy, but he just got a big contract that's going to be an ongoing thing for him. Now he has all these requirements. That'll end up being like a $10,000 account. I talked through them and set expectations. But it's his first policy he's ever had, so it's different. What I like about that — some people don't like new accounts — but what I like about it is I get to hopefully build it and set him up in a way that he is doing it the right way from the beginning. How many times do you find someone who's been in business for five years and they have insurance, but it's a mess because they pieced it together and nothing was ever really explained to them? I always think, newer businesses can be tough. They have a lower retention rate and fail rate and all that kind of stuff. But at the same time, you get to kind of steward them to doing it the right way the first time and hopefully set them up properly. That's the goal.
--:-- Derek Hayden: Yeah.
--:-- Host: Doesn't always work out that way, but that's the vision, I guess.
--:-- Derek Hayden: Oh yeah. No, that's great.
--:-- Host: Cool, man. So where do you — we got a few minutes here left. Before we wrap up, where do you see the biggest opportunities today? Either for yourself or just looking out over the market. When you're thinking to yourself, "I want to put another million premium on the books," I just pick a number. Is it, "The process I have is great and it's just continuing to grind and staying focused and finding ways to continue to grow"? Or are there new opportunities? Is it expanding your geographic footprint and using things like video proposals to continue to deliver that in-person feel? Where do you see, particularly to your expertise, this local, more local agent kind of model, where do you see the opportunities for people? Where do you see opportunities for yourself to continue to grow?
--:-- Derek Hayden: I would say, and this is not just me, but smaller, hometown agents in general — just do something that's different. I recently had the opportunity to teach a class. The moral of the entire class, it was a seven-hour bootcamp sales training based off of Protege tactics that I learned during the reality show. The moral of the story is do something different. Most agencies, especially in a small town, operate in this box. They're the ones that are on the radio saying, "We're going to get you the best coverage at the best price. Come see us to get a free quote." People are so sick of hearing it. Just do something different. Most of the time, all you got to do is develop a value proposition that's unique compared to any other agent, whether it's a captive or independent agent. Develop a value proposition that you can consistently deliver and follow through on. I would recommend that not being an insurance-based value proposition. Don't solve their problems with insurance because they don't want their problems solved with insurance. They know they're spending a lot of money on this product that they hope they never use. Give them something that's going to improve their business, improve their income. We all know the state of the economy right now, especially for business owners. It's very, very tough. They can't find employees, can't keep employees. What are you going to do to solve those problems?
--:-- Host: And it's not an insurance quote, I can tell you, that's not going to solve a single problem that they have. So do something that is going to help you stand out and provide legit value to those business owners, whether that's work comp or safety or whatever your agency has access to — use that to leverage your value.
--:-- Derek Hayden: I know in that class, a lot of people were like, "Well, my agency doesn't really have access to anything." And the one thing when we meet with these carrier reps that they always say is no one takes advantage of the tools that they're offering to agents. So you have free tools at your fingertips, typically through the risk management department of every carrier that your agency represents. Just call them and say, "Hey, what are some of the unique tools you've invested in that me as an agent can use to attract and retain accounts?" They're going to give you a freaking video library of everything that they have access to. Take a day or two days or three days and learn what material is there. Figure out how you can deliver that in a unique package to your prospect and client and present that instead of presenting insurance coverage at a certain price. That alone is going to — in a hard market, soft market, it doesn't matter — you're going to be more valuable than the guy next to you or gal next to you because you're delivering a unique proposition that they've never heard of before.
--:-- Host: Dude, that's the perfect way to end the show. You are the man. I love it. I'm so happy for your success that you've had both in The Protege and in your career. I'm so glad that you're out on the circuit now a little bit, starting to talk. So if anyone's listening to this and has conferences, Derek knows what he's talking about. I can't recommend you highly enough. I think the way you think about the business is exactly the right way. I love that you both understand and respect the traditional way of doing business as well as what we need to do moving forward. Bro, I just can't believe it's taken this long to have you on the show. I'm just happy that we finally had a chance to connect here and do this. I wish you nothing but success. Where can people connect with you, learn more? And if someone does want to hire you to come in and do a speaking gig, where can they do that?
--:-- Derek Hayden: Absolutely. The best way for the general public would be LinkedIn. LinkedIn is my favorite platform. I try to produce as much content for LinkedIn, usually at least daily, sometimes a little less than that. LinkedIn is number one. I'll also give my cell phone number: it's 217-246-7523. You can text, call, whatever. I'm happy to answer any questions you have. And likewise, Hanley, I appreciate everything that you do for the industry. Appreciate you having me on. It's been a pleasure, man.
--:-- Host: You're the man, bro. We're out of here. All right, take care.
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