Our 5 Most Popular Episodes in the Last 6 Months Presented By Rob Galbraith

Rob GalbraithI'm your host, Rob Galbraith, flying solo today. And let me tell you, we've had some great conversations on the podcast this year. Opening our most popular episode countdown where Mark Goodstein shares more about his journey in founding Street Scope and how they're benefiting the auto industry. Mark highlights the role of insurance and driving innovation, emphasizing that future advancements in automotive technology will enhance safety and provide tailored data analytics for both self driving and manually operated vehicles.

Mark GoodsteinWe invented a measure of collision hazard that could be used by all these different constituent industries to evaluate and to demonstrate publicly and aberratively that their systems are safe or that their streets are safe or whatever else. And we have been, going to market ever since.

Rob GalbraithRob? Yeah, Mark. It's really fascinating, and and, I've been following the journey of of Streetscope for a little bit of time. Even remember the the AI pod days. So I I'm really fascinated by this. Right? When is the system you know, we've all heard about AVs for years. We're all excited about them. Right? We kinda definitely have fallen into the the Gartner hype cycle or the hype and then this trough of it. You know, you asked the key question. Right? When is this safe to to to deploy?

So I'm just curious, like, how do you do that? Who are your clients? Are they they cities, municipalities? Right? Are they they, private customers? Are they people thinking about operating these fleets? Like, maybe you can talk just a little bit more about, you know, what is the product? Who is it for? Maybe you have a range of products.

Mark GoodsteinWell, we we add we actually have one product, which generates a a data stream, if you will, or a set of information products that can be useful to all these downstream industries. So we have customers in the, let's call it the infrastructure space or the evaluation of and mitigation of dangerous intersections and garages and things like that. Or should we, as a city or municipality, deploy an autonomous system on a given stretch of road? How can we evaluate that? Our product is uniquely useful for that kind of endeavor.

We measure the hazard posed between all pairs of objects on a continuous basis. So sort of like temperature, we have a continuous measure of hazard and it's objective and it's not making any assumptions or anything like that. So it can be useful in different contexts, but it's the same data everywhere. So I'll give you a few examples. Although the the quick answer is it turns out insurance, not self serving because I'm on this podcast, but insurance ends up being one of the primary drivers for this because at the end of the day, it's insurance that's left hole in the bag.

They have to provide coverage, for, property and casualty type insurance, for infrastructure, for operating insurance, for autonomous fleets or semi autonomous or even the vehicles driven by us, humans. And by the way, our measure doesn't distinguish between a computer driving a vehicle and you or or me driving a vehicle. To to us, vehicles are black boxes. So whatever control decisions they make, we are measuring, and we're measuring the hazard they pose. But it's you know, if you're a if you're an insurance company, right now, you're using trailing indicators to make assessments about the the safety of a of a given system or of a fleet or of a of an individual.

How many times do they had an accident? What kind of accidents? Trailing indicators are, like we said, sort of ethically challenged if we have the ability to understand and evaluate safety in a way that is not does not require collisions. Those developing autonomous systems. Right? They need objective functions to to to understand how well they have progressed, how version one is not as good as version two, etcetera, and why. So objective functions in that context. So we have a a partner, a very prominent engineering consulting firm, an engineering services firm that does work for every OEM on the planet, those building cars that are integrating our measure of hazard into their early stage vehicle development services.

So when companies come to them and want to develop a vehicle, they have to follow standards of safety and so forth. In this world, it's called ISO 26,262, which is the last time I'm going say that, but our measure fits quite well into the context of that kind of engineering project. And of course, in insurance, the problem with trailing indicators or the use of things like harsh events, which are useful, but not that useful and don't correlate very effectively to loss. But they're there, and they're they're better than than nothing, if you will, but our measure provides context.

So it's not just that someone slammed on the brakes a few extra times. It's that we know that they slammed on the brakes not around anyone in a dangerous manner, but because they forgot their keys at home. Or, you know, the swerve that they did was not because they were driving unsafely, but because they were avoiding some hazard in the road that would have caused damage to their vehicle or caused damage to somebody else. So that's that's the basic picture, if you will.

Rob GalbraithAt number four, we have episode one thirty two with Peter O'Brien from Procore Risk Advisors. In this episode, Peter shares how Procore is leveraging digitization to transform traditional pen and paper methods, enabling better project management and risk assessment through comprehensive data analytics. He also emphasizes the critical role of brokers in construction insurance.

Peter O'BrienYou know Tui. Tui is the founder of Procore. It started twenty years ago or twenty two years ago at this point. The catalyst for him starting the business is he was living in the Bay Area, and he was building a house in Santa Barbara. And he needed and wanted visibility into what was happening on his project. So the catalyst for starting out his buildings was he was trying to reduce risk of building a project that he wasn't close to. So the entire sort of build of Procore has been focused on how do you actually reduce risk across the construction industry?

And we really focused in project management initially, then we got into quality and safety, and then we've expanded into financials. But every action that happens within the Procore platform is to reduce risk along the project delivery life cycle. So really when I joined Procore, I got the I was lucky enough to join Polly Andress, the CFO, and Danny Siegel's partnership team. And they mandated that I go start investigating partnerships with the largest partners. Right? We had built this contact marketplace, as JB knows really well, but most of our I would say all of our partners were much smaller than Procore.

And that's great because they're great solutions, they're great technologies, but we're trying to figure out who were the people that actually had a huge impact on construction that we were not partnered with. So I spent a lot of time talking to banks like JPMorgan, all these people that were lending in the construction space, and they said, We love your technology. We love when our clients are on it, but we're never gonna mandate it. And we don't understand partnership because that's just not the business we're in.

The other big partner was insurance. Right? And so I met started meeting with insurance carriers, and they'd say, this is interesting. Let me connect you to my boss. And I kept on just higher and higher in the sort of levels of people I'm meeting with. And I go, I still have no idea what I'm talking about, but these people really think there's something here, so we should continue to explore it. That ultimately led to a partnership with Travelers, which was great. Travelers has been a great partner of ours.

They put up this partnership in place that subsidized the cost of Procore up to a certain percentage for their clients that are utilizing the software. And the entire thesis behind that partnership is contractors that adopt best in class technology like Procore are at better risk. Better risk means they have less incidents. Less incidents mean they have less claims. Less claims mean a better combined ratio. So that played out, and that initial partnership was really well received by the market. People got really excited. It drove millions of dollars in revenue for Procore adoption or revenue itself, and it just showed us that there was a huge amount of signal in the market.

So that's really what got us in this place. And then, after we took Procore public, we started looking at what are these other opportunities in the industry where we can add value to our customer base? Procore has always been a massively customer centric business, and we started exploring all these options within the fintech umbrella. And, you know, when you think about all the financial services that we could build and supply to our customer base, it's everything from payroll to financing to lending to payments and then insurance.

And insurance is very hard to figure out how you are gonna enter the value chain. There are so many different people in that value chain, so we had to decide how we're gonna enter it. That ultimately led us to becoming a retail broker with some underwriting in house, and that's what I'm GM of today. And, you know, I'm happy to go into different details and how we ended up on the retail path versus other paths, but

Rob Galbraithit's been an interesting art, but really excited to be building what we're building. Has it how has the market responded to this? Right? Like it's a you're a software company getting into risk advisory is not, you know, really none of your competitors are doing it. Right? Like, I know you know your competitors pretty well. Yeah. And and they're not jumping into the space. So how what's been the market reception? When you say market, do you mean, like, our customer base Clients. Restructuring? No. It's what's been the customer reception?

Yeah. So everyone's been really excited about what we're doing,

Peter O'Brienand the data story is really resonating. And I think that's what's unique to what our opportunity is. Because of companies like Procore and our competitors, what we've done in the construction industry over the past twenty years is digitize the construction industry. This is an industry that was primarily pen and paper until, you know, ten years ago. That digitization effort has unlocked this massive data asset that can now be applied for better risk control from just a holistic risk management standpoint. And then you can apply it to sort of developing better risk profiles.

And then that leads into how do you improve underwriting? So the folks that are making investment in technology understand that they're a preferred risk. They understand that they're doing the right things every day on the job site. However, have felt like that's not being rewarded by their carrier partners because no one's in between telling that story about why the data matters, how the data matters. So from a market standpoint, people have been super excited about what we're doing. Of course, we're a technology company moving in the insurance space.

It's not gonna happen overnight, but there's been a massive, you know, sort of positive response from the customers that we've been engaging with. Coming in at our third most popular episode is number 130,

Rob Galbraithwhere Brian Gabe from CSAA Insurance Group shares his expertise on making insurance simple, proactive, and personal. He introduces Mobilitas, a product designed for the subscription vehicle market, reflecting a move towards customer centric insurance policies. Yeah. Absolutely.

Brian GaabSo as as I mentioned, I I prior to to kind of joining AAA, I was in management consulting role. My my last my last client was actually AAA. I I I did a number of projects for, at the time, the the club, the member club that serves our California, Northern California, and Utah members. So after a handful of engagements at at AAA, started I to realize what a what a great place it was and how focused sort of everybody was on in the organization on on the on the ultimate customer, our member.

So I really wanted be part of that, and I joined back in 2014 to help create at the time what was a relatively new corporate strategy group. So alongside some amazing colleagues, we were tasked with sort of helping a 100 plus year old insurance company navigate some of these really interesting times that we've been speaking about today. So I worked alongside with our business partners to to draft how we, envisioned CSAA evolving to meet the needs of our members, not just today, but in the future.

And it wasn't really, I would say, long before, that team was advocating for a group that would seek to bring in some of these amazing technologies that we discussed. And over, you know, over the years, we we partnered with a lot of great companies from sort of early stage, startups in the InsurTech space or, you know, ultimately mature players as well. And I'm happy, you know, I'm happy to kinda get into a few examples of how our teams kind of supported that effort over the years.

You know, I I would say that that you know, there's one example that is a little bit older now, but it's one of one of the examples I'll I'll share started with a challenge of kind of the rental car process within insurance companies. At the time, and in some cases still, it's a rather cumbersome process. You know, I would say within our own kind of NPS surveys and things like that, we came up with, we kind of had this realization that this was a real challenge within our business, and customers necessarily didn't, at the end of the day, you know, want a rental car per se.

They just simply wanted to get from point a to point b and multiple times. As an idea to solve for that problem, our team, we piloted a program with Lyft where we partnered to offer credits as an alternative to traditional rental vehicles as part of the claims process. So our team, you know, this is this is a ways back, and and we had actually worked we began working with Lyft before they were probably a household name. And, you know, because we ultimately knew our customers didn't necessarily need that rental car in all cases, right?

So we piloted this in partnership with our claims team and we were kind of the first to offer this type of offering to insurance customers. I didn't go into a bunch of other examples whether it's kind of, you know, maybe I'll share one more in the interest of time here, but also a little ways back, we have longstanding partnership with Insurtech, Kape Analytics. We began working with Cheap when they were substantially smaller than they are today. There's a handful of data scientists really trying to determine if they could figure out if houses in Florida have pool coverage or not, right?

That's a very important thing for Florida insurers. I I I don't doubt that. We don't we don't rate it Florida. And so while that is an important challenge, we were facing a really big challenge with regards to kind of roof quality in windpale states. Right? So we partnered with them pretty early on to, you know, help better understand how to underwrite roofs and subsequently, you know, invest in the company and and have leveraged that technology ever since. So I I those are a couple examples of of kind of how we've partnered with both mature players and, you know, early startups to kind of bring new technologies to to our members.

Rob GalbraithOur second most popular episode so far this year is episode one twenty nine, where guest David Maklow from MSIG North America shares his insights in leading transformation with a startup mindset and advocating for a data driven approach to improve submission quality and underwriting efficiency. David highlights the potential for technology to enhance insurance processes making them more profitable and user friendly.

SpeakerYou know, I'm like you, I get a lot of people pitch me on a lot of stuff, right? I hear it all the time and I'm constantly blown away by the fact that if I believe there's a massive amount of low hanging fruit in doing some basic things well, right? And when I think about basic technology I sort of think about our industry at its two bookends, how we write premium and how we manage claims. Everything else in the middle is sort of a workflow, right?

It takes you from the premium that you wrote to when you've closed the account either by booking a profit or paying a claim. And so I think about the bookends. Historically, the underwriters have all been doing stuff sort of on their yellow pads and waiting for the brokers to bring the business to them. And so it's not an efficient process nor is it one where we capture value. And what do I mean by that? Well, we get lots of submissions and we spend a lot of time trying to read through them and then going, all right, these are the three I'm gonna underwrite.

And so we've wasted time sort of pulling all that information together to start thinking about it. And then we've lost all the data for the other stuff. So to me, one of the big innovations which I think is very, very powerful And I see a lot of companies doing this and it was a core foundation for how we started attacking the build of our company was we said, what's the thing that will give us the biggest edge? It was data, right? We don't have systems. So let's find data.

Well, where do we start getting some data? In our submission flow. So what we did was we are putting software along the desks of our underwriters that ingest all the submissions they get. It then triages all of those submissions by whatever rules our underwriters want their inflowing business to look like. And so we're trying to order their submission flow into the one at the top is the one they're most likely to want to write. Whatever that target zone is. It could be the submission is complete, or it could be that the software has read the submission file and has generated a electronic version of the submission, extracted all the data and said, Hey, this one has no losses.

So that goes to the top of the queue, right? It's essentially an ingestion and extraction tool that makes the underwriting underwriter focus on the accounts he wants to write and not necessarily ignore the ones he doesn't wanna write. Just prioritize them. Prioritize it because I find a lot of waste goes on in things like prioritization. Then we have a lot of administration once we prioritize stuff that I wanna automate as part of the same process, clearance, checking the broker record letter, right? Shrinking all the admin work and the support that goes into him or her making a decision.

And so the software will do some clearance for us. Then what we are doing is on that pane of glass, we're throwing lots of other data that we don't have but we can get from third parties. We throw that onto that screen to enrich the source of information the underwriter makes. So I could go on for hours about that but that's if you will, the first bookend. We get lots of data and we help our underwriters be smarter and attack the business they want initially but we capture everything.

And obviously there's a lot of stuff going on behind the scenes with all that information but I'll save that for chapter two of the story. About the backend? About the backend? Once I have that business on the books, what technology do I need in order to improve our business? And this is the thing that sort of you've heard all three of us have talked about throughout this podcast which is claims, right? The industry is not very good at claims data. Now, let me give you my context.

I believe the industry is a price taker in general, not a price maker, right? There's so much transparency and the brokers are so strong. It's very hard and it can be done but it's hard in general for me to dictate the price of the risk that I want and still clear the market because I've got competitors and etcetera, etcetera. So if I can't get the kind of maximum price I want I've got to do other things to shape my return, my outcome on that business. Got to give the customer lots of great service.

So they repeat, they become a repeat customer. I don't have the cost of renewing new business, right? That's a plus. I gotta be able to make sure that I manage and sell them products that they want so they become a repeat customer. I've gotta manage my capital dynamically. Those are all things I can do around the edges but what's the big thing I can do? Manage whatever experience I have in a much better way. And this is the part that really, as I think the low hanging fruit.

I can ask a 100 people, what is the cost of providing EULAE, unallocated loss adjustment expense and allocated loss adjustment expense for an average claim? And I'll get 100 separate answers because no one really figures that out. It's a plug. When I did the total return reinsurer in Bermuda, I called 10 buddies and asked them for what's the plug for loss in LAE. Everyone just plugs that number. And I think there's a lot of innovation around how you manage claims, particularly bad ones. So if I'm a price taker, what destroys my business?

A bad claim outcome. Average claims are fine, right? Average claims experience are fine because the market prices to the average. What destroys me is a bad outcome. So I have to have really good process to manage the risk of a bad outcome. What's a bad outcome in our industry? I get whacked in court, right? I get a really, really bad claim. I go to court to defend it because I think I'm right and I meet a jury that doesn't agree with me and awards 10 times my limit.

That destroys my business. And by the way, there's technology that helps manage that risk. Neither of these technologies are expensive. They're not hard to put in place. They provide massive amounts of data. I don't need to install an enterprise software system like Majesco or Guidewire. I don't need to rip up stuff that's already in place and replace it with stuff. I can put these in my operations without having to disrupt anything and they immediately enrich my business. So you asked for how I think about innovation to me, those are the two low hanging fruits at the front end with my underwriting tools.

I'm better at risk selecting and hopefully not selecting the bad one that at the back end when I have a claim is the one that cleans me out in court. But I've got technology should that arise.

Rob GalbraithLanding in first place as our most popular episode of 2024 so far is episode one twenty seven, where Bill Cassidy from New York Life shares his tips on the top level priorities for insurance CIOs in 2024. Bill emphasizes the importance of collaborating with business partners to drive innovation and modernize systems, focusing on three key pillars, data protection, data driven decision making,

Bill Cassidyand secure data management. He also discusses the role of generative AI in disrupting the industry and New York Life's approach to creating their own predictive models. Yeah. I'm sure folks listening to this podcast would probably agree with me that it's a it's really exciting time to be a technologist these days. It's just an explosion of innovation that's happening around us. But to be a technologist at New York Life is even more special because we are attempting and very successfully embracing this explosion of technology to modernize the company.

We're doing this really in a very healthy way in lockstep with our business partners and with the support of our executive management team down to really drive transformation at the company. When I mentioned those comments in another forum about those three areas of our strategy, what I was really referencing is this concept of having a healthy digital core. If you're aspiring as a company to provide best of breed experiences for your customers, for your prospects, for your agents, It's almost akin to building the walls on a house, but if you don't have a good foundation, the walls aren't going to stand very well.

In our view, having modern infrastructure, meaning out of our locally maintained data centers and into the cloud in a modern way, embracing data as an asset and seeking ways to not only cleanse it and rationalize it, but to unlock the value of it, and then protecting the company from cybersecurity threats. Without that digital core, everything else starts, the house of cards proverbially starts falling. Even in the cybersecurity space where we focus on it, once you start moving your compute into the cloud and your edge moves outside, the historical comfort you would get with a robust firewall, it goes away.

Now your frontline of defense are things like identity and access management. So there's this very interesting convergence of, as we're looking to modernize the company, the ways that we've protected the company and the ways that we've managed data has to evolve along with it. We're trying to do that while simultaneously working with our business partners. This is a really exciting part of the job. There's probably many examples where companies have technology organizations and they're deemed as a necessary evil. There are other companies that have technology organizations and they're viewed as necessary enabler for the business strategy.

At New York Life, we're the latter. So we're trying to thread the needle, Rob, to quickly establish this foundation, this digital core, while at the same time working on business partners to figure out ways to leapfrog the competition and create best of breed customer and agent experiences that all of us can be very proud for. As you probably can imagine, it's a difficult balancing act, but you think we have it under control. That's what I was referencing when I talked about those three areas of our modernization journey.

Well, there you have it folks, our five most popular episodes of the last six months.

Rob GalbraithThank you all for joining us to geek out on Insurtech.