The Wild and Crazy World of Insurance

Matt Cundill  0:01  
You may also like a show about the things you may also like things like the wild and crazy world of insurance. Here's everything I know about insurance, you need to buy it, if you need to make a claim something bad happened. And there's no one who grows up saying, I want to sell insurance. Yet it is one of the most thriving sectors with 1000s of people making a living in it. My friend Pete is one of those people. And I've asked him here today to explain insurance to me,

Pete Tessier  0:38  
what the fundamental issue of insurance is, is you're buying two things, you're buying a product, and the product is not a policy, the product is a guarantee of access to capital, you insure your home or your car, but you're not. Actually, if you have a complete loss, like your right, your car off, or you your home burns down to a whole bunch of black cinders, you're not getting your home again, like you're not just having a home dumped on you, you're accessing capital to get that possession property, whatever it is back. That's what you're doing. But you're also buying trust, and you're buying trust, because you have to trust that that capital is going to be there. And that the person who is selling you that capital and all are the access to capital, and all the conditions that come with it is going to work the way they say it is.

Matt Cundill  1:35  
So when it comes to marketing insurance, I mean, it's wide open. And if I look back over the years, it could be something like oh, you know, like a good neighbor State Farm is there. Yeah, it could be Mutual of Omaha, which for whatever reason, decided to sponsor Wild Kingdom. So how do we market our insurance?

Pete Tessier  1:53  
How do you market insurance? You mark it with great difficulty. Because the fundamental thing about insurance, I've been saying this for years, and some believe me, some don't, no one has ever woken up on a Saturday morning, the sun coming in the windows, you know, you pull the white, beautifully iron drapes back, and you stretch and you go, Oh, do I feel like buying insurance? No one's ever said that. So how do you market something that no one wants to do? You buy insurance out of trigger points that are a necessity to your life. Your bank says get insurance, the new car or used car that you bought? Well, you're not taken off the lot until it's insured. At least they should say that you buy a passion product like a motorcycle, a boat, an RV? Oh, you better get that insured, you get an engagement ring. If I had $1 for every engagement ring horror stories, I'd be I'd be a wealthy guy. You know, that's why you get it. So there's the trigger points in life are what make you buy insurance. So how do you market to that? So really, you know, and the problem with insurance marketing is, is boring. It's just no one's creative about it. It's hard to market something that is not a product, it's not even an experience

Matt Cundill  3:17  
is a gambling, it feels like gambling. Well, look, I

Pete Tessier  3:21  
don't know which came first the insurance underwriter or the insurance actuary or the bookie, but there's got to be a joke there. Because they do the same things. They basically figure out what the probabilities of the event of paying out are, and how much money they have to take in to cover the expected losses. So the same thing, right.

Matt Cundill  3:38  
And a good example of that would be at a golf tournament, say when there's like a hole in one, if you were to get a hole in one, we're gonna give you say, this car or $20,000

Pete Tessier  3:49  
I have a great hole in one story. So hold on one, insurance golf tournaments, you know, happen all the time. Oh, let's let's have a whole one contest. So this is a combination between a person who runs a car dealership, and an insurance broker they used to do business with and said, Hey, let's co sponsor this whole. Oh, yeah, totally. So they ended up as a nice car. It was a the car was valued at $120,000. So the broker takes out the hole in one policy. So when you do a hole in one policy, they want to know, well, where's the golf course? What hole is it? What's the distance? So they get all that information? It's whole six. It's a par three, and it's 148 yards. So they figure out the premium. They probably take a look through some geospatial technology that is like Google Maps on steroids, Google Earth on steroids. They look down and say okay, it's over water. The green looks like this. Boom. Here's your premium $386 So they go and perfect. Drive the car out, put it by the hole. And lo and Bill Hold, someone gets a hole in one. What didn't happen was a specific measurement. So they went out pay for the car $120,000 Boom, denied. So you have to you say the hole is 148 yards to the center of the green. You better make sure you know where your your tips are and where your marker is. So no one had talked to the person who was in charge of all the the tee boxes and made sure that where everyone was teeing off from measured 148 yards because it was a tournament they changed it. So it was sort of not caught by either party. So they ended up splitting $60,000 Each on that car. Why do you want to get new insurance? Because I got talked into it. So here's a joke. Have you met anyone who grew up going man I want to work in insurance because they know that person doesn't exist. I've heard they do. I've heard there is one person who's like in high school is like, Oh, I'd love to get an insurance I have yet to actually physically meet them like or even like, like, you know, social media meet them. I didn't want to have a fine arts degree. And you know, all the all the fine arts companies are paying so well in university or after I left university and I had this BFA BFA stands for all the Big Mac fries. And so I had to figure out what I was going to do to support a young family and I got talked into it. BFA isn't that big? Fuck all. Yeah. Yeah. There's other jokes. I was just keeping it clean. But yeah, Bachelor fuck all. So that's exactly it. But now people that now people think it's a bachelor financial and financial analysis. I've convinced people that I know what I'm talking about, I

Matt Cundill  6:48  
think back to the 90s, when those golf holes became standard at golf tournaments. Yeah. And around that time the internet begins to take over. So looking back, how did the internet change the business of insurance? From the sales side?

Pete Tessier  7:04  
How did it change? Its it's taken forever, and it still hasn't done it. I think even though the internet's been mainstream, since say, What, say 1994? Let's, let's use that. So we're coming up to essentially the 30th anniversary of mainstream internet usage. We're barely scratching the surface of efficiencies with a 30 year old technology. And the problem is, it goes back to trust, access to capital and the conditions that come with it. When you're sitting there about to buy something, how do you trust that your when you hit click Buy, or bind or whatever term you want to use, that you're getting what you want, because you're getting a guarantee, you're getting a piece of paper, and the majority of society is just starting to get comfortable doing that. The other problem is insurance companies and the distribution side, haven't figured out how to prevent significant unconscious fraud when it comes to buying insurance online. So the insurance brokers I used to work for and CO own the name, start with a W. So you and I remember the Yellow Pages, and it was a key marketing ploy. Or you better be in the yellow pages. And lo and behold, we always knew if someone couldn't get insurance. Well, where else have you called? Because you didn't start at the back of the Yellow Pages for insurance. Right? So you knew you'd been denied? And that was sort of your your way of Sir asking other questions. Oh, well, I haven't been able to find the right insurance or have you gone? You know, so use your tell tale. So when you go online, everyone's spending money on marketing. How do you make sure you're writing profitable, good business is what it says it is. And we're just starting to be able to do that. Well, in my opinion, others would disagree. But if we'd have done it, well, 10 years ago, ever, we wouldn't need insurance agents and brokers.

Matt Cundill  9:08  
If we'd gotten together 20 years ago to start our insurance company Pete, we would be called a 1111111. Insurance. Exactly. Exactly. My best Yellow Pages joke.

Pete Tessier  9:20  
Yeah, exactly. Triple A, this that or the other thing, triple A insurance.

Matt Cundill  9:27  
Do I have to buy my insurance domestically? Or is there a market where I can get insurance from any country on the planet, you usually have to buy

Pete Tessier  9:35  
domestically? There are exceptions to that rule. But in our globalist capitalist society, there's dropping a political bomb, depending on your stripe there. All insurance ends up International. Eventually, there's a portion of your insurance premium that will end up in a company offshore. And

Matt Cundill  9:57  
I guess that sort of dovetails into let's say, there's a Big giant disaster and we'll say a flood in a region. And there's mass payouts eventually that's where that gets that offshore money. Is that right? Can you draw that line for me? Yeah. So

Pete Tessier  10:11  
what happens is, is you have a domestic market, large scale we call a cat event happens, catastrophic event happens. You pick any of them. They seem to happen seasonally now, and it's just a different type of cat loss depending on the season you're in. Eventually, it all comes back and you have these huge payouts. Well, insurance companies actually buy insurance and they buy from reinsurer. So they may say our retain capital is essentially $20 million. So anything we insure and exposures above $20 million, we buy insurance for that from another company. And then the actuarial bookie part just goes up the food chain, and reinsurers even potentially buy insurance from others to or buy capital from others. So it's a diverse global society of money that flows everywhere.

Matt Cundill  11:06  
Why is the insurance industry so slow? To move on the internet to move on social media? And I'm not going to touch on AI yet. But I have a feeling they might be slow into that, too. So why is the industry slow to react to new technology?

Pete Tessier  11:22  
Because the the fundamental irony about insurance is you are there to take risks, like you're there to protect risks like most insurance, company insurance, people refer to your house as a risk, there's a risk of it sustaining a loss, yet, it is the worst industry for taking risks itself. Insurance people are inherently risk adverse. They don't want to they don't want to have things blow up in their face. They want to avoid it at all costs. So when it comes to their business models when it comes to change? Well, no, no. It's the ultimate Well, we've always done it that way industry. And the technology in general hasn't kept up. So because it's so slow, you have a companies that have what we call legacy systems. And you know, they they built these things in computers and mainframes back in the 90s and early 2000s, to change them cost hundreds of millions of dollars. And so they have to do it and the software costs hundreds of millions of dollars. And it all just exponentially adds up. So they try to avoid that or plan for it. And then they have to do it in stages because it can't be down, they can't build a system parallel to the one they have. And then just flip over, it just takes a long time. And you got to remember to they have I don't even know what's bigger than a terabyte. But whatever is bigger than a terabyte, they have terabytes of those a data that goes back, you know, in some cases hundreds of years.

Matt Cundill  12:51  
So to buy insurance means you might be a little bit on the safe side because I'm buying insurance. Therefore you will go to insurance people who are selling you safety and safe and boring, safe and boring wins the day. Does that sound about right? Safe and boring will win the day?

Pete Tessier  13:07  
Yeah, so even boring will win the day you'll never have a problem getting insurance like you know, you. You know, if you're a skydiver? Yeah, we're gonna, it's gonna be a little harder to get insurance. If you are a big wave surfer, it might be a little harder to get insurance. If you are someone who has a lot of speeding tickets, it might be harder to get insurance, although that's getting disapproved. What's

Matt Cundill  13:34  
been your biggest insurance claim in your lifetime, biggest

Pete Tessier  13:38  
insurance claim in my lifetime has been prior to a company just joined like prior in terms of like three months. And I was then helping dealing with around the fallout of it was a $30 million dollar complete loss of a large agricultural operation,

Matt Cundill  13:56  
which was due to grasshoppers fire fire.

Pete Tessier  14:01  
And you know, in all honesty, that's kind of not a big loss. But it's just it was one thing. So fairly big. You don't like having those. No one was happy about that one.

Matt Cundill  14:13  
Why did you start a podcast?

Pete Tessier  14:15  
Because someone talked me into it? Because I had nothing to do and someone will say this is my fault. It's your fault. Yeah, so So a fine gentleman who I'm staring out on the screen says you should do a podcast about insurance. And I remember looking at you going, well, who the hell would ever listen to that? And you're like insurance people because I'm not gonna listen to it or something to that effect. So yeah, we talk about insurance and we talk about it's the podcast for insurance people right so they can learn about other things in the industry, hear from people and discuss ideas, strategies, innovation, disruption, technology, and just share stories and perspectives. on how to evolve because it is a slowly evolving industry, that is probably going to be like that snowball, right? That picks, you know, it's small, now it's starting to roll a little faster, and then it's going to get huge. It'll it'll explode and take out a whole bunch of people, and then someone will make a new snowball, but we're, it's gaining speed. And so it's great to talk about it. Because there's never been a more transformative time in the industry. What's

Matt Cundill  15:27  
been your biggest surprise with the show so far?

Pete Tessier  15:30  
That somehow people think I should have been in broadcasting? I swear to God, I don't know why. But it's, it's a funny thing. Like, I get a lot of feedback from people says, Oh, I just like you just have a fun way of talking to people about insurance. I'm like, even I get bored talking about insurance. And, and that's been the biggest surprise, I don't know, it sort of caught me off guard, I wasn't sure what it would turn into. It's definitely opened a ton of doors, that's for sure. Like, let me go back. Like one of the other reasons I was really receptive to your idea was I was sort of out of work, I had sold the business, I wasn't sure what I was going to do next. But I really liked the industry. And I like the people. So it was like my way of staying connected to the industry. I actually didn't realize it was going to further all my connections and make it that diverse and where I had opportunities I didn't know existed. And that's been a lot of fun.

Mary Anne Ivison (Voiceover)  16:34  
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Matt Cundill  16:46  
you've done 194 episodes so far. So from that what episode stands out the most, what was the subject matter in there that really sort of maybe got some industry people talking that made it pop?

Pete Tessier  17:00  
The one I think that was really interesting that I had no way of knowing it was going to be so big was with a gentleman from a company called cognizant. His name is actually funny enough, we are just messaging on LinkedIn this morning. His name is Mahesh Mater Raj on and he is a insurance data expert for lack of a better term for a company called cognizant and cognizant you would see, because they're plastered all over f1 is a sponsor. And his reach was incredible. And that really kind of catapulted some things. But he also got to the heart of something that no one had really figured out when it came to insurance and data. And obviously, this is is the world's oldest data profession. Lloyd's of London has been doing this for hundreds of years. And they have data and they've always used data. He said, what needs to happen insurance is happening in every other industry is using the data to make a hyper personalized experience. I think when he started talking about that, I certainly had a light bulb go off, and so many others did. And I got a ton of feedback about what he was saying and everything. That's probably the most significant one. I think, what would be the other thing, the other one that really changed things was I was asked to moderate a CEO panel of insurance executives, because of the podcast because I was talking to people. And someone was there in the audience and said, you need to do this for all the different associations because we get people to come up maybe you get someone on the news, media personality, who's very good with a microphone and talking to people. But they know diddly squat about insurance said you actually can talk, at least that's what I've heard. And you can talk about insurance in ways that others can't because no one thinks about it. So it's very hard to get someone to come into your your industry ecosystem. And be intimately knowledgeable about it by just sort of prepping, it's hard. And I've seen media personalities like Evan Solomon, do it and not do it. Well. Although he's an amazing media person, right? He just it's not top of mind. So you don't pick up on the cues. You don't understand what the nuances of the industry are doing. So that changed things. So I've done a ton of panel moderating, and I was really lucky enough to do a big panel down in Vegas at the biggest insurance conference in the world. And it was a ton of fun. So

Matt Cundill  19:36  
was this the only insurance podcast that was out there when you started because you started about five years ago? 2017 ish. 2018 spring

Pete Tessier  19:45  
of 2018 was when I did my first episode. There are other podcasts out there. Some of them are very specific there and there's some great ones out there like there's some really good ones and I think there's such a an opportunity for different angles in the industry because As there's so many different classes of insurance, there's just different distribution. When I launched, I didn't know what I wanted to be. It's kind of like being like you're coming out of high school, right? Like, I don't want to be when I grow up. Well, I still don't know what I want to be when I grew up. I'm just growing up. And I didn't know well, do I want to be the guy who talks about selling insurance? Whereas a lot of people sell insurance? Do we want to be the guy who talks about underwriting insurance? Well, that's one thing. But underwriting is kind of boring, and it's limited. So when when I looked at it, I was like, I think I just want to be the insurance podcast, and just talk about all things insurance, because it lets you go down any road, you're not pigeon holed into sort of focusing on insurer tech, or technology, or being one of these people, some of them who are very good, by the way, sales gurus, right? Well, I can tell you how to become a million dollar producer in six months, or whatever, and hype that up. That's just one part of the entire ecosystem. And the ecosystem is super diverse. So we try to focus on all aspects of it. That's why that's sort of how we came into it.

Matt Cundill  21:06  
So the insurance industry is still having lots of conferences more than ever, and then involves a lot of travel. And it's really perfect for for you know what you're doing. I know, there's a few other industries out there that have cut back on the number of conferences, because conferences are expensive. But insurance, you're doubling down. And this means you're busier than ever.

Pete Tessier  21:26  
Yes. This past fall was an epic run of conferences, podcasting out them creating content, working with the conference, producers, and just being everywhere. It's been unbelievable. It's actually a grind. And I think sometimes people go to conferences, and they can, you know, you can come and go, but when you're working them, and you're interviewing them, and then you'll say, okay, day one ends, oh, what do I get to do, I get to go, have a quick bite to eat and then sit down in my hotel room, and listen, audio and stay up till 1230 at night to get an episode up or some content for someone up. And then you go rinse, wash, you know, wash, rinse, repeat, and you do it again, then you get up. You probably had a fun night in there at one point off the airport home, figure out when then oh, look, there's another one in the four days that I've got to get on a plane for and yes, travels fun. But I've got some friends in other industries who travel an immense amount. And I don't know how they do it, like I like it. But it gets grinding. And you know, because there's been so many conferences, because coming out of the pandemic, you know, there was such a desire to be face to face, people were just making things happen and the pressure to be in front of everyone was so great. And I don't know how others do it full time. It's it's hard. It's hard work. speaking at conferences, here's a little known fact about probably the biggest insurance conference in Canada happens in Toronto every year in the fall. And it's IBO, the insurance brokers association of Ontario, biggest, biggest association in the country. There's only one other conference that happens in Toronto every year that consumes more liquor than that conference. And that is the Conference of the mining industry. So insurance brokers, insurance people like to have fun, you know, you think it's boring, but you know, it's, it's, it's a party. And you know, there's hospitality suites, there's incredible networking. It's a lot of fun. A

Matt Cundill  23:32  
lot of people when they start a podcast within the first month, come back to me and say, How do I monetize my show? Am I ready for advertising? Not necessarily the tact that you took, but you started something, you were approached by people to partner, and you've had an ongoing partnership for many years. Tell me about the monetization structure of the podcast. My

Pete Tessier  23:58  
podcast fits in its own ecosystem, right? Like, you may stumble across it because you want to learn something about insurance. But we're not I'm not teaching anyone about insurance. So it stays in this ecosystem that sort of feeds and supports and grows together. So there's all these different entities that come into the industry. My podcast sponsor, first insurance funding Academy is basically a company that helps does premium financing and works in the insurer tech FinTech ecosystem to make payment systems and everything smoother for all the entities involved, providing financing integrating technology to do it through your what we would call broker management system or agency management system to make a better customer experience, better experience for those in the industry that requires advertising and so they found a new channel and they reached out to me because their CEO is one of my earliest guests ironically and It said we'd love to partner with you, we just kind of came up with a, a fair model collaboratively. And they have growing exponentially because of their lean into marketing, not solely because of the podcast. But you know, I'm friends with the CEO. Now we see each other a lot. He told me since they did their big marketing push and said, we have to invest in a lot of channels and do things differently. They have had year over year. So each year, they've had 10 times growth. And he said, the podcast has been a huge part of it, because you touch industry professionals, that's who we need to influence. So I've had other advertisers who've done runs on it and stuff. And I do my advertising differently than say how you've even told me I can do it, where it's not a run, and then it's gone, I sort of do a perpetuity based thing where it's read in and exist in the podcast forever. So

Matt Cundill  25:58  
integrated is what I was told to call it integrated. There you go, integrated, thank

Pete Tessier  26:02  
you. So if someone goes and says, Oh, look, they're going through the insurance podcast.com Oh, there's an episode that I didn't know existed from four years ago, they hear the same ad, like I don't switch the ads out. And I think the stability of that has made things appealing, partially because it's an industry that is built on legacy ways of doing things, and relationships, and relationships. And that's a legacy way of Abra. It stays there forever kind of thing. And I think they like that. Now, it does mean your content, though, is a little limited and has to be somewhat evergreen. So one of the things that we work out and I had an email today with the person who's in charge of marketing is we're going to set it where he's setting up a meeting for next week. And we're talking kind of a year end review. What do they like in their content? What do they want to do? And we revise it to say, Okay, so we're going to run with this for this year. And that's a year commitment on the content. So you've got to really wordsmith it and focus it on what you're trying to do for this year. So what are your strategies for 2024? And we talked about that, and what we want to do, how can we diversify? Do we want to do something else? And it just goes with that? And you know, the other thing is, I had a meeting yesterday with another company about how do we? How do I bring you in and they want to do some things too. And I said, you know, you want to talk to Stuart, he'll tell you about the growth they had because of a consolidated branded messaging approach that involved the podcast. And he's like, Yeah, I'm all ears hit me up. And again, it's it's smart, Evergreen, consistent content, but it will be there. What was the term used? The integrate, it'll be there integrated it that seems to go over? Well, I don't know why. It's counterintuitive to the way the podcast sort of industry is moving with all the Add opportunities, right. But man does it play? Well,

Matt Cundill  28:01  
it does. And actually, there are clients that are asking for more integrated much though, of course, to my chagrin, because you know, if the check starts coming in, I'm the one who goes back and does all this, peel off the ad, and then move it back to a more, you know, programmatic or inserted, you know, kind of way to do it. But you know, to your point, if you have that relationship that you have, take it run with it. It's awesome.

Pete Tessier  28:26  
What I found, Matt is when I talk to companies or people about this, there's this weird sense that they want to take ownership of something, they want to have it as theirs. So that sort of the way I'm approaching other advertising opportunity. So what do you want? That's yours? And do you want to own it? And how long do you want to own it for? And if you keep it integrated into the podcast, they can always go back and say, Yeah, we own this and blah, blah, blah, and a look. And I've sent people who have advertised back said, Hey, by the way, those 20 episodes you did on that were two years ago. They've actually been listened to X amount of times this year. Oh, yeah. See, there's the value. So somehow, but that sticks with insurance. And I think that's part of the industry, because there's this thinking of, you've got to be consistent. And you've got to be sort of foundational, because everything's built on this layers of support and being there. And they see that and it's already built into their mentality and their ethos of how the business operates. I don't know, it may be counterintuitive to the to the rest of podcasting, but it seems to work for me.

Matt Cundill  29:34  
What's next for the show?

Pete Tessier  29:35  
Holy smokes a lot. We have another advertiser on right now who's coming on board who's got some big company announcements coming out this year. So they're working with us on how to sort of get their brand and value proposition out. We are moving into a video format, like using a system like this that we're doing right now, to sort of find other channels and And one of the interesting things that we have found is that we deal with a lot of publicists and PR people in the booking process, they find us they reach out. So I've got this incredible network of PR people. And they say, Well, what can we do with your podcast? I said, well, and you probably get this with all the people you talk to, right? Well, how do you help someone get the most out of being on a podcast? Well, you got to get it in front of people. You got to let people see it. Wow. Yeah, it's great. But sometimes not everyone wants to listen to 40 minutes or whatever. Yeah, no, I get that. So we're gonna try and do some short form things, edit some things down, and give them the opportunity to use that media. And go for it because they're marketing to their own customers. And again, so go back to I was saying before, right at the beginning, so much of this industry is built on trust. And if you have a great appearance on a podcast, you can see people's faces, you can touch you can you can get a sense for who they are, it helps sell the trust of what your company product or services. I think that's also the reason why there's so many conferences insurance, sometimes you got to look someone square in the eye across the table from you, and see how they are to trust that what they built is going to do what they say it is and that you what you understand from looking at the website and talking reading testimonials and maybe talking to other people. Does this person back it up? And I think that's really going to help market some things for people because they're going to see people and they're and marketers and the PR and publicists are going to have a way to sell their story better by having different format. So we're really excited about moving into into that for

Matt Cundill  31:42  
my thanks to PTCA for joining me on the show. His podcast is called the insurance podcast. Give it a follow. It's everywhere you would expect to find podcasts. The website is the insurance podcast.com Gotta love a guy who keeps it simple. This episode was produced by Evan Stravinsky and edited by Chloe emo lane. It's built for your ears by everyone at the sound off media company.