InsureTech For The Independent Agent

INTRO

On episode 23 of the InsurTech Geek Podcast, talking about InsureTech for the Independent Agent with Raghav Tanna from Tarmika.

The InsurTech Geek Podcast powered by JBKnowledge is all about technology that is transforming and disrupting the insurance world. We will be interviewing guests and doing deep dives into specific technologies we see changing the industry. We are taking you on a journey through insurance tech. So, enjoy the ride and geek out!

INTERVIEW

JAMES: Tell you what, it was a busy week. It was a good week. We had a lot of stuff going on in the last week. As we record this, it is Friday, July 10th. Meaning we are just rolling off of one of the strangest July 4th weekends in modern history. Lots of fireworks! So, this has got to be driving some a property carrier’s nuts because you got to think with the sheer, incredible volume of fireworks sold this last week, there had to be a higher incident rate. There had to be right? Rob, I mean, it had to happen. 

ROB: Yeah. You would think, some wild-fires and all sorts of whatever. Yeah. 

JAMES: Yeah. Injuries, you got to think there are some people’s umbrella policies that are going to be tapped into after people get things blown up in their hands. So, word is that fireworks sales set an all-time record this July 4th. And not by a little bit. And considering that many cities, in fact, most, decided to cancel their July 4th celebrations instead of doing the logical thing and just telling people to space out a little bit, not group up, not holding the event, they just canceled the whole thing. People took it on their own. And I can tell you here in South Haven Michigan, the summer studio for the InsurTech Geek Podcast, I jokingly called it, like a combat air force base, you know what I mean? Like the sheer number of explosions going on at all times. And it was like five days of rolling explosions. It was intense but it has been a busy week. A good one. Raghav you are over in Boston. Was it wicked awesome or was everything canceled?  

RAGHAV: Boston’s always wicked awesome. We got the Red Sox. We got the Patriots. Lost Tom Brady, but besides that, it is wicked awesome.  

JAMES: Yeah you did lose Tom Brady. 

ROB: You picked up Cam Newton  

JAMES: Yeah. All Scam Newton as we call him.  

RAGHAV: Oh, come on! 

JAMES: Yeah. Well, he had quite a few scandals following him around for a while. But Belichick has proven to be a good selector and kind of guy who would take talent and really do great things with it. So, we will see what he does.  

RAGHAV: He did have the greatest quarterback of all time to back him up, so, yeah. 

JAMES: Yeah. You always wonder about that, right? Like in all scam Newton, he had a college football coach. They made look really good and then when Newton left, things kind of went downhill real fast. So, sometimes quarterbacks make the coach looks good, sometimes the coach makes quarterbacks look good, we will see what is going on, but Boston is generally wicked awesome. I am not going to agree with you on the baseball front, cause I am a Rabbit Cubs fan, but other than that, we are not division rivals, so it is okay. 

RAGHAV: No, not at all.  

JAMES: I know it is different.  

RAGHAV: We did win the world series first. And then again, and then again, again, again, again and again. 

JAMES: And again, and again and again. Yeah, yeah, it was good. So, it has been a busy week. It was also my birthday this week. So, that was fun.  

ROB: Happy birthday! 

JAMES: Thank you! I went down to Tampa. Where all the baseball is going to be played. Down in Florida, right, or is it out in Arizona? No Florida. 

ROB: I do not know how they are doing baseball. I have been following basketball. They are all going to play in Orlando. 

JAMES: Yeah. Florida is going to be up a hopping place for pro sports. It is going to be crazy. So, we are going to be talking about InsureTech today, not sports. This is not a sports show, but I always do like an opening with a little bit of that since I am in sports withdrawal right now. I am having to suffer through summer with no baseball, which is pretty tough for me. But that being said, we are going to talk about Raghav, and we are going to talk about Tarmika. We are going to talk about agency models. We are going to talk about technology for agencies and the role of agents in general, right? We have to talk about that.  

So, before we get into all that, let us just chat about you, Raghav Tanna, you are a born and raised Bostonian. You went to Bentley university, and you still live there, I mean, you have endured the winters and you are like, you know what, I am going to stick around. You did not go South. I was just in Tampa all week, hanging out with a bunch of folks from Boston who moved down to Florida because of the winters, but you are like, no, I am staying.  

RAGHAV: Yeah. I mean, you do not want to leave the greatest city on earth, do you? So, I have decided I grew up here. I went to school here. I worked here after college and now, I mean, I got married here. Every everything happens in Boston. So, I think this is it. I am here for the long haul.  

JAMES: Yeah, I got it. I have deep ties to Boston. I am a genealogy nut. I love ancestry.com and I did two different DNA tests and it verified all the stuff I already had in my family tree. So, the Benham’s, another JB, John Benham, he landed in Boston. 1631. So, we came there a while ago. They used to be Red Sox fans but then moved on you know. It was before baseball. So, I love going to Boston because I get to visit places that my family was at. Like there is a very high likelihood, cause he was my 11th great grandfather straight up the line of that Benham’s and then his two sons were there, and they lived in Salem for a little while. And, we had all kinds of fun stuff happened.  

My 10th–great grandmother, the last witch trial down in Connecticut, they moved to Connecticut to get away from all the mass holes, then she got tried and antiquated might I add, she was acquitted for this. So, I got a little personal background in Boston. Lived there for a summer in 2000 and loved it. And what I found interesting about Boston that I think is neat for a tech company to be there, is what 18 major universities. Is that right?  

RAGHAV: Yup. 

JAMES: Yeah. Incredible knowledge base, incredible people, incredible research labs. I mean, some of the premier institutions for research in the world, I mean, not to mention just Harvard and MIT. You are talking about a lot of really great universities, a lot of great talent. Some of the coolest VC‘s and private equity groups I have met are also in Boston. And I can tell you this, Raghav, that I jive with them a lot better than the ones I meet from Silicon Valley. There is a practicality to the money groups I meet from Boston. They are focused on profitability and growth and building real businesses. They have products that make money that generate profit, that you just do not see in Silicon Valley. 

RAGHAV: And I think that is one of the biggest things with VC firms in general. And you would have noticed it across all tech companies, right? I mean, not even just tech companies, if you look at, WeWork, even look at Lemonade, I mean, those companies are not profitable. And yeah, they are backed by Softbank, but that is a little bit different. I think Boston’s big thing is trying to build a profitable strong companies and you do not see that too much in the InsureTech space either.  

JAMES: Yeah. But I am an old school guy. I have been in business for almost 20 years. We bootstrapped JBKnowledge and self-funded built four products, sold two of them, started two more, and I like building sustainable businesses where you do not have to depend on another round. And now well look, the Lemonade IPO did not go poorly. That being said, the reality is that it is better if you can make a profit, right? Like in general. And so, I have appreciated that attitude Boston seems to have. So, I started at the end and the end is, you are the founder and CEO of an InsureTech in Boston. Let us go back to the beginning. When you were growing up in Boston, what did you envision doing as an adult? And you studied finance, like how did would you wind up here? 

RAGHAV: Yeah, so it was not insurance. My dad owned an insurance agency the whole time I was growing up as well, which is, I mean, it is one of the reasons why I am here, and I feel like that is the story with everybody. You fall into insurance because someone in your family was doing it. But the whole time, I mean, growing up my plan was to do something business–related, but I went to Bentley and I thought, I love finance. I love seeing how companies grow. I love discussing how they can acquire and merge with other companies, see how they are financially stable. So that is really what I was into. I was into, looking at a company as deep as humanly possible and understanding how we can grow and get better. And that’s kind of what drove me to start my own company too. But I mean, I played tennis growing up and I played tennis in college. So, my plan growing up was to play tennis and that did not pan out very well. 

JAMES: Yeah. Did you play for Bentley?  

RAGHAV: I did. I played for Bentley for two years. And then I got a couple of knee surgeries and decided that it is time to hang it up. I was not going anywhere. 

JAMES: You were not playing on enough clay, where are you?  

RAGHAV: Apparently not. Yeah, I have had my fair share of knee injuries, so I think, tennis is behind me. I am more of a golfer now. 

JAMES: I found that, when you have problematic knees, clay courts, they help out a little bit. They are a little more forgiving than that concrete. 

RAGHAV: A little bit. Yeah. 

JAMES: Yeah. I like tennis. Here is the problem. I suck at anything involving, just involving aim, right? Like, so I am just terrible. I am an endurance athlete, so I used to do endurance competitions in college. And, if it involved a lot of work over a long period, I was down, but if it involved a skilled shot, it was not going to happen with me. No matter how hard I tried, I wanted to be a good tennis player. Very badly! 

RAGHAV: Well, once I got the knee surgery, I decided I was going to start running more. Which does not add up too well, but it worked, I mean, I started running a couple of half marathons and made my knee feel a little bit better. And then I went back into playing tennis and everything got worse again, so… 

JAMES: Yeah, for me, it was the ankles. 

RAGHAV: Yup. 

JAMES: Yup. So, I have to baby my ankles. So, like most of us had insurance, you did not dream of being an insurance person when you were growing up. When I was 13, I did not say, dad, I want to be in insurance. I mean, I did not. And in fact, I do not know any kid that says that. My kids do not say that, but it is such an amazing place and I think it takes some maturity to understand how important it is. And that is probably one of the reasons that children do not fantasize about that as a career path because it takes a little bit of understanding. So, when did the light bulb go off for you?  

RAGHAV: Yeah, so I think right when I was going into my senior year of college, I interned with my dad, for junior college, so I interned with my dad’s agency, and I kind of enjoyed what he was doing. So, I decided I wanted to go to work at Travelers. And my next year, I interned at Travelers and I started working there full time after college, just to get a better understanding of insurance. Insurance has a lot of finance–related to it. So, I figured that was my path into finance, was to work kind of combine the two entities that I knew so well. One thing led to another, I had this idea for the company at Travelers, wanting to learn more about the agency side first, so I switched over to my dad’s company. And then started a company a few months later or a few years later, I guess.  

JAMES: Yeah. So, were you an account executive at Travelers? 

RAGHAV: Yeah. 

JAMES: So, did you deal with large accounts? What lines were you dealing with?  

RAGHAV: Yeah, so it was a small commercial. I dealt with all the select business. Anything under a hundred thousand in premium was mostly what I handled. Some accounts got a little bit bigger than that, but there was nothing over, your $200,000, $300,000 mid-market account. I was not working on any of those. 

JAMES: Awesome. First off, what does Tarmika do? And secondly, what was the pain point that you saw that led you to start it? 

RAGHAV: Yeah. So, Tarmika is a small commercial comparative radar, essentially. And the whole focus of the company was, we noticed, even when I was at Travelers, I noticed that a lot of companies would log in to 20 carrier systems, quote it, and then call their underwriter and say, hey, I put this into Travelers, I need a response, like in five minutes. That is not logical. So then when I went to the agency side, I realized I was the one doing that all the time. I was the one that was constantly saying, hey, I need a response immediately. So, the whole point of the company is to get data into as many insurance carriers as possible that you work with and that you want to quote with, for anything under a hundred thousand in premium. So then you can go into each carrier, review it, and decide which quote fits you best. 

JAMES:  And how is this any different than any other data aggregation or, ratings? Obviously this type of site has been built before. 

RAGHAV: Yeah. So, we are a hundred percent on the commercial side today. We are moving into personal lines, but the big differentiator for us is the data dashboards that we provide to the carriers and the agencies on the backend. So, we can essentially look at any quote that you have submitted, any NAICS code, any location, any agent, any user within your company and tell you how you’re performing with each one of your carriers, and then tell the carrier how they’re performing with each one of their agencies and users. So, everything is done through API integration, so we can aggregate this data in real–time and provide it back to all of our users, all of our carriers in real–time. 

JAMES: But who pays the freight for it? If you are giving both of them intel on each other, who is paying you? 

RAGHAV: Both of them.  

JAMES: Okay. 

RAGHAV: I mean, everyone is got to pay for data, right? That is like a big-ticket item nowadays. So, we do not overcharge for anything. We say you are providing us the data, so we are going to provide you something in return. But to get high–quality data, it costs money.  

JAMES: So, it is a per–transaction fee, or are you charging per seat? 

RAGHAV: It is a seat license fee. 

JAMES: For both sides? 

RAGHAV: For both sides. 

JAMES: And the big part and the hard part of these kinds of models is getting started. Like literally wiring all the integrations and so you can run it. I mean, there is a massive amount of work. I mean, how did you convince all these carriers to even let you into their systems to integrate with them in the first place? That alone can be a monumental feat?  

RAGHAV: Yeah. So, the first year of my life of this company was trying to convince carriers to integrate with us and I was probably 3 for 55. And over time you eventually develop a good relationship with them. It was a lot of me waking up at 4:00 AM and preparing financial documents on how they could improve their quote structure, quote ratio, hit ratio, and submissions by partnering with us. And that is essentially how it worked. I just kept providing data analytics back to them, agency feedback, and eventually, it worked.  

JAMES: Yeah, you just said to them you are going to get better data and you are going to get a better hit rate, right? 

RAGHAV: Eventually they are going to get a better hit rate and they are always going to get better data because it is aggregated among agencies from every County, every state, and now we are in 31 States, right? So, it is aggregating everything into one place. 

JAMES: Rob? 

ROB: Yeah Raghav, so great to meet and connect in person. I am thrilled to have you on. Maybe you can go just one layer deeper. I know you have got two main products, Tarmika Bridge, and Tarmika X. So maybe you can talk about the difference between the two and just kind of go a little deeper. 

RAGHAV: Yeah, so nice to meet you as well. Rob, Tarmika Bridge is an agency product where essentially, they log into our system and they quote only their appointed carriers. And they can quote all of their points of carriers using their producer code, their credentials, and it ties into their systems essentially. So, they are the name on the deck page. Tarmika X is a little bit different. It is a white label solution that they can pass off to the end consumer to fill out the entire application on their behalf, and it passes through to the carrier as well through the Tarmika X platform. It is branded towards the agency. The customer only sees the agency focused stuff, but they can get an end quote directly from our system. And then the agency goes in and binds coverage on their behalf. 

ROB: So, it does not go all the way to bind. Basically, they will submit, you don’t get a quote, but then it’s sitting in that agency system and they have that opportunity to kind of review the risk, make sure it’s something they want to take on their books, answering any clarifying questions, etcetera? 

RAGHAV: Well, yeah, when you think about it, I mean, we always say this, but insurance companies spend millions of dollars on their systems to upsell certain coverages to push agencies into their system. So, we do not want to have the bind on our end. It would not be beneficial to the carriers. The carriers would not want to partner with us if we did that. So, our goal is to push them into that end screen, the quote summary screen of the carrier, so they can add additional coverages, provide that value add to their client, and show what the carrier has to offer as well. And that is why we do not have any bind on our pages. 

ROB: And then what lines do you have? You kind of mentioned you are commercial now. You are going into personal, but what lines are active now on the commercial side? 

RAGHAV: Yes, so we have a Bop Workers’ Comp commercial auto. We added in management lines with two carriers, and we do have MedMal with one carrier. 

JAMES: But if you do not have the bind option, does the agent have to rekey all the data when they want to go and bind? 

RAGHAV: No. So that is the whole bridge component. So, the reason we called it Bridge, was it bridges the data over to the carrier system. So, all of the data is prefilled in every one of our carrier systems, which is essentially the greatest part of an API, is we can push data and pull data back and forth within the carrier systems. 

JAMES: Who are you freaking out? Who sees this? You do not have to give specifics, but who sees this and goes, oh, crap. This really screws us up! 

RAGHAV: I hope nobody. I mean, carriers spend all this money on their systems. We are just trying to enhance their systems by providing them another avenue to get quotes into their systems. 

JAMES: Have any carriers been working on something like this already or do they see it and they go, oh man, this is an existential threat to my department? 

RAGHAV: I think most carriers saw it coming. I have not had anyone come out and say, this is going to end my career. We had one carrier… This has only happened to me once. I had one carrier who I had a call with, and I will not name the carrier because that is bad on me, but 30 seconds into the call, I started introducing myself. I do not even think I got to what we did. I just said hi. And he hung up on me, said I am not interested in and he hung up the phone. And he scheduled the call! 

JAMES: I was going to say, that is not an abnormal sales experience until you said that he scheduled the call. It was a zoom call. I was looking at him. And he scheduled it on my demo link after we emailed back and forth three or four times, I probably got to, my name is Raghav, here is what I do. And he hung up on me. 

JAMES: That is awkward as hell.  

RAGHAV: Yeah. 

JAMES: So, none of the agents are getting freaked out by this? Because someone has got to look at this and go, well, if they allow this, if they allow the inclined to do this, then what are we here for? What if you just allowed the end insured like me, to log in and use your system to price it to everybody? 

RAGHAV: Yeah. So, we are a hundred percent agency focused. 

JAMES: You say that, but the real play has got to be a consumer play, right? 

RAGHAV: Oh, no, definitely not. I mean, think about this. I, so I own a company, right? So, I would never go direct to consumers to get my coverages, even as an insurance person. I do not know what I need. Every contract I get is different and requires different coverages.  

JAMES: There you go. 

RAGHAV: You need that agency focus. 

JAMES: Yeah. Yeah. It was a loaded question. So, look, the reality is, if you have a good broker and I have had some really bad brokers and I have had some really good ones, right. I have had both. They are helping you navigate the waters. I mean, and to me, as much as anything else, they help you read the contracts. I mean, I had yet another two situations in the last week where I was buying insurance, that my broker helped me navigate something that a previous broker had really screwed up on. One was in aviation where there was a market that was particularly lower than everybody else, but they are in a market that everybody would know, but I am not going to mention who they are, but they exclude stuff flying in the engines, which by the way, is like one of the number one causes of losses. Like it is one of the most likely things that will happen to you is that something will fly in your engine and it is explicitly excluded, deep down in like a subsection C of paragraph 25, I mean, it is buried in there, man. And it is excluded, which is a big problem. And previous brokers missed it. New ones caught it. 

The same thing happened with my ENO tied to my cyber. It was too limited. I mean, a good broker, a good agency earns their keep. I mean, end of story. So, but as I have visited a lot of agencies over the years now, so tangentially we do some work for insurance brokers and agents and stuff. We mainly work for carriers and TPA’s. But as I visited brokers, I have been astounded at the sheer amount of PDF form filling and Excel spreadsheet manipulation, and just menial, tedious BS that I see going on in these big multibillion-dollar companies.  

RAGHAV: That is a good segue into why I started this company. 

JAMES: Yeah. But it is crazy because they will have these agency management systems and they will still be doing this. Why have not the agency management system has done what you have done? 

RAGHAV: I mean, at the end of the day, you are built on legacy technology, right? It is really hard to shift from outdated technology, spend all that money on new technology if people are paying you already to use your outdated technology. Why start from scratch and spend all this money when you are going to make the same amount of money, keeping your current system and no one’s competing with you. 

JAMES: Yes, but you would think that they would be aware enough. I mean we are talking about two companies, right. Those are the big two in agency management software. And I am even describing one of them right now. I mean it is shocking to me. There was a real specialty lines broker and I met with them a few weeks ago. And they are in a narrow niche and they built an entire access database just to do a fraction of what your system does. Just to prepare the submission and generate the custom forms that each market wants to see. So, they did not connect with those market systems. They just found their application form, and they created a PDF form pillar based on an access database, so they could aggregate their client’s data, and then just auto-generate the forms and email them.  

RAGHAV: And you can take all those forms and just make them e-forms to make them on the web, right?  

JAMES: Yeah.  

RAGHAV: That is essentially what the platform did. I mean, other companies are doing it too, but I think that is one of the issues is everyone is still following that trend where you have to do things with pdfs because that’s how agencies do it. Instead of trying to change their behavior. And most agents are switching their behavior to be a little more efficient, to be more optimized. At least that is what we are saying. 

JAMES: Yeah. 

RAGHAV: So why not shift to that e-form kind of application. I am happy that a lot of agency management systems do not care about that because it helps us grow.  

JAMES: Yeah, absolutely. It creates the demand that you need for sure. Rob? 

ROB: So Raghav, I am curious like, so there is this concept, right, that people call SEMCI, which is a single-entry multiple carrier interface. And a lot of people are trying to do it. And I was telling someone the other day, it is more like MEMCI right. There are multiple entries, multiple carrier interfaces out there. So, there is a lot of competition in this space, particularly for that small commercial book that you guys have targeted. And I do not know that there is a lot in the mid-market, certain for large accounts, right? But definitely the small commercial space.  

And it makes sense from an agency perspective because the cost of acquisition is one of your highest costs. If you can bring that down, improve your hit rate, etcetera, and then have that opportunity to kind of cross–sell the account, right. Create that stickiness and increase your revenue. And it makes total sense. So maybe you can explain for the audience, like, this is a bit like the Holy Grail, I guess, this fall commercial and lots of people have attempted, so, maybe just walk us through, what are some of the obstacles or what are some of the challenges and then, how are you positioning Tarmika to kind of overcome that?  

RAGHAV: Yeah, that is also a loaded question. A little better is what are the obstacles and why have other people failed? One of the biggest reasons is technology was not quite there a couple of years ago. I mean, some companies tried this in the early 2000s and my dad was part of a company that tried this in the early 2000s. And he has been in the insurance industry for a long time. One of the biggest issues was carrier technology, not being there. The second kind of reason that companies today are not doing as well is, for the most part, a lot of companies are still trying to bank on old, outdated, robotic processing technology screen scraping and stuff like that to do these integrations.  

And it does not work. I mean, you will get semi results and you will get quotes back in an hour or 45 minutes or whatever you want. But if you want ten–second quote responses, it has to be an API. So, the way we’ve kind of went around these obstacles is, we have built APIs for carriers. And that is what our team is well versed in. So, we have built 10 or 11 carrier API’s over the last year, year and a half. And that is really what set us apart at the beginning. And I hope that sets us apart in the future. There are not many people trying to do that, for their carrier partners.  

JAMES: But can other people use those APIs too? Or is it exclusive to you? 

RAGHAV: Yeah. Absolutely not. We do not make it exclusive at all because we want other people to use them. We always feel like our technology, and maybe this is a bad move on our part, but we feel like we are doing a disservice to the carrier by saying, no you cannot partner with anybody else. If we show that collaboration and we show that willingness to work with them, they are going to show us the same respect. And it is proven true for the first couple of years that we have been around.  

JAMES: So, you are saying that they actually, you turn over intellectual property, you turn over ownership of the API to them. So, you build it and then they host it, or do you build it and you host it for them? 

RAGHAV: We have both relationships. So, either we build it and we host it, or we build it and they take it over. And if they take it over, even if we host it, they are free to pass it off to any of the other, compare commercial lines, comparative rating platforms out there. And it is fine with us. It is just, it has not been all that common yet. 

JAMES: Yeah. Cause you are such an early mover in this space.  

RAGHAV: We would like to think so. 

JAMES: What is your ultimate target? Do you want to write all lines? I mean, all personal lines, all commercial lines, I mean, that is a mountain, right?  

RAGHAV: It is a mountain. It means I have a lot of work to do, but I am 27, so I can work for the next 30 years trying to figure it out. 

JAMES: Yeah. Or more. I mean, the average life expectancy for your demographic is over 90. So, come on. Let us do this, you know! 

RAGHAV: I do not think I sleep enough to live till 90, but we will see what happens.  

JAMES: Early stages of a company. I remember I did not sleep for the first eight years of JBKnowledge if it makes you feel any better. 

RAGHAV: It does. I mean, I have not slept since College. I am just an early burden. Lately, I have been going to bed later and later. So, it is getting worse. 

JAMES: Yeah. It just keeps happening. Just FYI. I hate to break it to you. I remember when we passed a hundred employees and I woke up like at three in the morning and I realized I had to make payroll for a hundred people every two weeks. And I was like, oh my gosh, it was suffocating, and I did not sleep for a while.  

RAGHAV: So yeah, I call it the Monday morning freak out. I wake up at like three o’clock before I work out and I am like, I forgot something. I did not pay someone, or someone probably quit. And I do not remember. 

JAMES: It was like in college, I used to be convinced I had a class that I had forgotten to attend all semester. It was like a perpetual fear I had. It never went away. So, all lines are a mountain. I mean, you talk about aviation, marine, transportation. I mean, just trucking alone is a massive amount of work. I mean, all of these have these highly specialized applications. 

RAGHAV: And if you can build enough API’s and enough e–forms, eventually you can get to a point where you are covering most of your basis. Trucking is a mountain in itself, but if you can cover enough carriers and if you can partner with the right carriers and create a single application for them, that combines everything, it makes their lives easier too. So, if we can help them develop that cadence essentially to say, all right, this is how we are going to structure it, it makes everyone is lives easier. The agent, the carrier, and ours. 

JAMES: Cause you also have to look at all the sig’s and sifts out there. All the self-insured groups. I mean, there are tons of those too. 

RAGHAV: So, there is a mountain and when we say we want to cover everything; we want to cover everything that we are well versed in. So, we have people at the company that has been writing insurance on the agency or carrier side for a long time.  

JAMES: Yeah. 

RAGHAV: Our COO has been insurance for 30 years. So, we have a lot of people here that understand insurance. So, everything that we understand, I mean, we talk about coastal homes last week, we talked about trucking a couple of weeks back. We talked about aviation and boating and any commercial lines policy. So, we are going all out here. We just opened a DNL last month, so it is expanding as quickly as we can. 

JAMES: The real opportunity for me is not just in what you are doing but expanding it to data collection on the front end for the population of the actual forms itself. And I will use aviation as an example since I am a pilot and I love flying. And generally, it is one of my favorite topics to talk about. I use a digital logbook product called Foreflight, which is now owned by Boeing. It is the number one logbook application for pilots. The number one thing that carriers ask pilots for in their coverage, is their logbook data. But nobody, and I mean nobody, will accept the standard export format that Foreflight, even though they have over half the market. So, there is got to be opportunities like that to target the data collection endpoints. So, you can go further because you are already saving time. Cause you are facilitating the transmission of all this data, all these markets, but it is collecting the data from the insured that is often the biggest pain in the butt, isn’t it?  

RAGHAV: That is, I mean, that is huge. And then it is not only collecting the data from the insured because that is a massive component to this but what about the data that comes out of everything? So, after you have pressed submit, and you get your quotes back. No one has access to that back-end data. Carriers think they have a pretty good handle on it, but they get their data from going into agencies and saying, hey, who else did you quote with? Who did you put that consultant with last week? And they are going to say, all right, I put it with carrier XYZ instead of you because there were $200 cheaper. There is no way that is the reason they put it with carrier XYZ. So, we have the behavioral and statistical data on the backend to help them understand that better. But it also covers exactly what you just talked about. How do we pull data back into a format that is suitable for all their carrier partners, for all the agencies and make it one standard format? 

JAMES: That is a big bite, is not it? Rob? 

ROB: So, this is kind of a two-part question, I guess. So, number one, and I mentioned it to you off the air before we started recording, but Tarmika has been like blazing hot. I see that name kind of everywhere, the last three to six months. So, congrats on that. Maybe you can talk a little bit about your marketing effort and kind of, what you have been doing particularly on the agent side, and then two, you talked about kind of expansion. You want to add more agencies, more carriers, get more lines. Where do you see yourselves in five years? Kind of what is that roadmap look like? 

RAGHAV: Yeah, I appreciate that. We have a really good marketing team, so I always tell people I am the least important person at this company. And I do not say that to be humble or be fake. I mean that. I feel like I do not do anything compared to anyone else. But our marketing team’s awesome. And they do a tremendous job with inbound leads, getting in front of agencies and carriers and making sure that people understand what we do, and how we can help them, hopefully. So that has been amazing for the last three, three, six months. Our marketing lead Alex has crushed it.  

But I mean, five-year plan, we are in a mass hire right now. So, we are bringing on four people in the next two months. And then again, we brought in four people in the last two months. So, we are expanding here. And the goal is, at the end of this year, we want to have 5 million in quoted premium every month through the system, throughout all of our agencies on commercial lines. And then obviously the personal lines is a little bit separate, but long-term, we want almost 10% to 15% of all agencies to start their quote in the Tarmika system. So that is my goal. I want 10% to 15% of all agencies to start their quoting process in the Tarmika system for all the lines that they write. And if we can get to that point, then I will finally consider this a success. 

JAMES: Not profitability? That is not your measure of success? 

RAGHAV: Hey, we did not raise money. We are already profitable. 

ROB: Nice. 

JAMES: So, if you are already profitable, then you have already done it. So, you bootstrapped this whole thing? 

RAGHAV: So, it was a joke. We bootstrapped up until March of this year, and then we raised money for our agency partners. Not much, but it was enough to get our data analytics dashboard up and running. 

JAMES: Yeah. 

RAGHAV: Yeah, I mean, my dad was the first guy to fund it, me, and him. And then our co-founder and one other founder. So, it was the four of us that started the company.  

JAMES: Nice. 

RAGHAV: And yeah, ever since then, we have been cruising. 

JAMES: Same thing here. My dad stepped in with me, so, yeah.  

RAGHAV: Yeah.  

JAMES: It gets interesting after 20 years with your dad, just FYI. We can have a beer sometime and talk about working with your dad for two decades. I love my dad, but it gets really interesting.  

RAGHAV: There are not many people I spend more time with than my dad and talking to him, drinking with him. So, I am closer to him than I am with most people, but every time we have a new carrier announcement, he shows up to my office for the bottle of scotch and expects to finish it right there. So, I feel like he is just as invested as I am.  

JAMES: That is intense. Yeah. My dad does not drink, so we did not do that. But I would always offer a beer and he is like, no, no, no, no. He is a very serious guy, but a good guy. And that is a great way to build a business though, in particular, to have your customers engaged so much like that. Well, that is great. Well, look, we appreciate you coming on and talking today. This has been a really interesting conversation. I want to wrap up this question. We have talked a lot about kind of where you been and what the problem was, what the problem statement was, and what you have done to solve it. And, you have driven revenue and profitability and you built a real business in a real city with real people. I mean, that is one thing I love about Boston is everybody is super real, sometimes excessively real with you. But, in a great way. 

What is next? I mean, give me the long vision, like, are you trying to do something bigger? Is there a blockchain play for customer data? Are you going to revolutionize, proof of insurance of what they have, I mean, when you aggregate as much data as you’re going to aggregate, there has to be something bigger on the horizon? 

RAGHAV: I mean data is the biggest boy there is for us. And we work with other InsureTech companies too, to make sure that this data is structured the right way, sold the right way, and collected the right way, everything. Our long-term goal, since we started this company was data aggregation, anonymization, and then providing the best dashboards we possibly could with the best data we could to carriers and agencies clusters and everybody alike, so that is the big play. And that is going to take years and millions and millions and millions of data points to finally get right, but hopefully, we are on our way.  

JAMES: Yeah. It is interesting. You know of all the people we have interviewed on the show and all the folks I have met. Of course, I am heavy on the claims side of the business. We have built claims software for 16 years and we have our own claims product and our own certificate of insurance product. And I could talk to you for a week straight, over three bottles of bourbon about how inefficient the COI process is. It is insane. There is a lot of room to improve every little corner of the business, right. And, and if you are in that nexus point, the interesting thing for me is looking at what the digital MGA model, we are seeing a lot of InsureTechs become digital MGA’s, right?  

And then eventually they will either buy their carrier partner out or they will go and create one. I mean, they will get there, they will get licensed themselves. We are seeing some really interesting movement, which means that you could be staring in the face of a lot more fragmentation as you have a lot more of these digital MGA’s come up and a lot more carriers enter the market. You could end up with fragmentation, which means a lot more integration points. So, do you end up playing the role of being the standard–bearer for XML and Jason standards for data exchange on this? I mean, nobody is serving in that, right? Accord’s not coming out with anything that is helping us integrate data between different providers. 

RAGHAV: Yeah. That is probably the first time I have ever been asked that question, which means it is the first time I have ever thought about it. So, I will say that that question should have been asked to me like six months ago. So, I had a really good idea of what we could be doing in the future. And make the revenue even more than what it could be. So now that you mentioned it, I will probably start thinking about it.  

JAMES: Yeah. It is just something to wrap your brain around. I keep looking at data standardization, and leadership is absent there because of this highly fragmented state-based model we have for insurance in the United States and it just really no one’s stepping into that void. And of course, it can just create an incredible amount of work for everybody to exchange data with each other.  

RAGHAV: A lot of carriers do not want that though. They do not want to the standardization of their data or their code or their XML, their platforms, none of that stuff. 

JAMES: Yeah, of course not. 

RAGHAV: So, it is hard.  

JAMES: Yeah. You are fighting self-preservation as well.  

RAGHAV: Yeah. You are essentially trying to turn the Titanic after it is already sunk.  

JAMES: Yeah. That is the quote of the show. Right there. Rob, anything to wrap up with? 

ROB: No, it is so great to have your own Raghav. Where can people find you and find out more about Tarmika? 

RAGHAV: Yeah. So, Tarmika.com. That is the best place to find out more about us. I do want to add, I mentioned this to Rob before the show started. Required reading for our company is to read his book. So, I think everyone should know that when you start at my company, you have to read his book.  

JAMES: Same, same. So just FYI. He gives people in insurance education in a single book that used to take multiple different reading sources and time. And I agree. It is pretty awesome. And that is T A R M I K A. For those of you who do not want to know how to spell Tarmika. T A R M I K A.com. You can go there and check it out whenever you want and reach out and ask them for a little bit of help if you want to streamline your process and, not just streamline your process, man, change your process. Stop filling out all those pdfs. My gosh, every day. I just cannot imagine having to do that. 

RAGHAV: I appreciate it. I appreciate having me on here. It was awesome.  

JAMES: Yeah. It was awesome.  

All right, well, thanks to everybody out there. This has been the InsurTech Geek Podcast powered by JBKnowledge, it is all about technology that is transforming and disrupting the insurance world. I have been your host, James Benham. This is my co–host, Rob Galbraith, endofinsurance.com. A big thanks to Jim Greenly, our podcast producer & Kara Dalton-Arro, our creative producer. And thank you for joining us today. Look forward to talking to you soon.  

We are taking you on a journey through insurance tech. So, enjoy the ride and geek out. See you next time!