A More Complete Beast
Strategies for driving the needle forward on your life.
A More Complete Beast
Policy and Power | Nick Tropiano's Guide to Insurance Entrepreneurship
Are you ready to embark on an enlightening journey through the world of entrepreneurship and insurance? Buckle up as Nick Tropiano, a seasoned insurance entrepreneur, walks us through his journey from starting his own business to selling it to a global force. Nick's decision to tread the path of independence, pitting him against insurance behemoths like State Farm and GEICO, is a story packed with invaluable lessons for aspiring entrepreneurs.
Nick vividly recounts his trials and triumphs, from the inception of his business with just 4,000 dollars in revenue to a phenomenal top line and eventual sale to the largest private insurance firm on the planet. He opens up about his experiences with the Iroquois Group, a vital partnership that allowed his business to build connections with larger insurance companies. Crucial to any business, Nick emphasizes the role of data in decision-making, the importance of a powerhouse team, and how ego can often cloud judgment. Listen closely as he shares the ins and outs of creating a business model that benefits customers with recurring payments - a strategy that brought success to his doorstep.
Insurance is a game every adult plays, yet many neglect the importance of understanding policy changes and maintaining a healthy relationship with their insurance agent. Nick stresses the necessity of regular insurance policy reviews and outlines the potential pitfalls when this is overlooked. He also offers a comprehensive overview of insurance considerations for varying income levels and the myriad life insurance options available. This episode is a treasure trove of insights for anyone willing to navigate the complex landscape of insurance. Whether you're a small business owner, contemplating starting a business, or just someone keen on understanding your insurance better, this episode promises to empower you with knowledge. Tune in now!
This is a more complete beast podcast where we discover and distill strategies to drive the needle forward on your life. Today we're sitting across from my buddy, nick Tropicano. Nick grew his business from scratch to being sold to one of the biggest private insurance agencies in the world. If you're a small business owner, if you're somebody thinking about starting a small business, make sure you listen to this podcast all the way to the end. There's also some good information for people who have insurance. They're thinking about switching their insurance or analyzing their policy. So really, I think everybody can get something from this podcast. If you do, do me a favor Leave a five-star review wherever you're listening to this podcast and make sure you share this podcast. That's the only way it continues to grow. Now let's get into this.
Speaker 2:So we're part of Hub 3 Rivers, but we're the Irwin office. So I started working there in 2006, right out of college. It's called the HDH Group. I stayed there for four years. It felt like a lot longer than four years. So, four years, 2010,. I decided to leave, partnered up with my brother, started the business, and then that company, the HDH Group, got bought by Hub International in 2015, I think, which is the world's largest privately held broker. So then 2023, we're now back full circle.
Speaker 2:Kind of funny, the full circle here but, back full circle with Hub 3 Rivers, which is formerly the HDH Group.
Speaker 1:So you started off with them, took a hiatus, built your business and then they bought you guys out. Yes, what made you leave initially?
Speaker 2:I was young and dumb enough and crazy enough to think that I could do it all by myself. I think, too, the big thing that happened to me is that I was 22, right out of college, and I had to build a book of business. But I was calling on people that I think were looking at me like this kid doesn't know what he's doing. I was 22 years old, so I think part of it, too, was that I wanted to get more into the personal line side of things home and auto, smaller businesses because that was kind of more my playground of what I was used to, because growing up, my dad owned a construction company, so I knew a lot of people like him, and I think that probably is the reason I left. Probably my dad was like, hey, you should do this on your own, and you were like let's do it.
Speaker 1:Yeah, dumb enough to try it, and then it worked out.
Speaker 2:And I think I left. I don't think when I initially left I don't think I knew that that's 100% what I was going to do, but I knew I wanted to do something on my own. At the time my dad owned a construction company. He owned some real estate, so I was going to help out there, get into real estate construction. And then shortly after that I was, hey, let's do the insurance thing, let's stick to something I've been working after the last four years.
Speaker 1:So you had experience and you're like all right, I can really scale this thing in a different direction. You wanted to focus more on the personal side instead of, like it seems like this HDA, it was the HDA group. Okay, HDA group was more bigger business.
Speaker 2:You wanted a more smaller business, yeah, at the time. And then we had to be able to do home and auto insurance at the time, which was kind of like the cash flow that really you could do it. Day one, write somebody's home and auto insurance policy, start getting commissions right away. Commercial insurance takes a little longer. You got to plant the seed, you got to go out and hunt, you got to build relationships. Again the same thing. People are like who's this 22 year old kid? I'm not going to buy insurance off him. He just started his business now. So it's kind of like starting all over again.
Speaker 1:So I didn't know what made you go independent instead of doing with like a state farm or a GEICO agency like that, yeah, I mean independent is where I came from when it was the HDA group.
Speaker 2:So I can't imagine being only able to offer one insurance company because they change so often, like what they are looking for, their appetite, their capacity, what their right writing this year, what their rates are this year, what their coverages are like. Things are constantly changing. So I mean I'll give it to state farm. They have built up a ton of brand loyalty and not being able to offer other products.
Speaker 1:Because I see them everywhere, like I see the state farms everywhere. Yeah, they're everywhere.
Speaker 2:And I shouldn't say other products, but with us. If you come to me and I have one carrier that carrier, you might be a great risk, but they're thinking nope, this doesn't fit our model. We don't want to write Alex.
Speaker 1:So you have more. Basically, you have a wider net that you can cast as an independent agency over something like a state farm.
Speaker 2:Yes, Okay, 100% A lot more yeah.
Speaker 1:So if you're a consumer and you're looking at, you know, shopping around for insurance, is it generally true that I mean if you have more to offer? Is it generally true that an independent agency can offer something better than, like, a state farm or a GEICO or one of these branded?
Speaker 2:Yeah, I mean, I hate to drag them into this, you know, because you know.
Speaker 1:Drag them bro. Yeah, Drag them.
Speaker 2:They're. I mean they're good and they serve the needs of a lot of customers. But typically I'd say nine times out of 10, if you come to me and you've been with state farm and you're thinking, hey, I've been with state farm for 10 years, they've always been good to me. We're usually hammering them on coverage and price.
Speaker 1:So what's making people like what's making 80%? Do agents go with state farm? Is it just the recognizable branded nature of state farm? Are they offering something to agents that an independent agency either has to do on their own, or something that Like what's the advantage, I guess? Why do people continue to go to state farm?
Speaker 2:When you start at state farm, they, they I'm pretty sure you start off with a guaranteed salary in that first two years, got it and they're giving you a model. So a lot of people that get into state farm don't even come from an insurance background. They're kind of, maybe they were in a sales background, maybe they were working for a payroll company, financial planning company, and they think, hey, I want to get into insurance. State farm has a good model for that and you know, it took me four years to really get my feet under me. So hindsight, yeah, I see how that would be attractive to somebody. Hey, I can get. You know, I've got this big, all these resources around me. I've got a lot of training. We, when we started the agency, we were I didn't know what I was doing really. I really didn't. But it's just, it wasn't for me.
Speaker 1:It sounds like you and I have a similarity there, where it's it took me years to build up to the point where it was like, okay, I have reliable income and a decent lifestyle. But I often wonder it's like well, what if I had a franchise? Same idea Like there's a certain recognizable nature to a franchise. They give you a lot of opportunity and like systems that when you're just when you're starting your business, you have to create the systems, whereas a franchise will kind of I don't want to say give you the systems because they're making money. You typically have to pay a franchise fee, but I often wonder it's like could I be even further along if I bought like a snap fitness or something like that, or like at any time? Because it's like they have those systems in place. Where it's like I screwed up so long to get to the point where it's like, okay, now I have tight systems, I'm always improving it, but it's like you don't have that. That I guess wealth of experience and resources that you can gain and garner through a franchise.
Speaker 2:I think that's what they're gaining 100% Like, like I said, the first four years of us being in business my brother and I I was really spinning my wheels. I think the first year in business my revenue was around 4,000.
Speaker 1:That's top line, that's bad bro, that's even worse than mine. That's bad I thought mine was bad. That's bad homie.
Speaker 2:That's real bad. Second year was around 30. You ate.
Speaker 1:X yeah 8X bro 800%.
Speaker 2:Yeah.
Speaker 1:Big time.
Speaker 2:Third was 60. And then it did, it started to compound. But those first few years I was thinking like what did I do? Because I left a really good company and a really good job and I had a ton of resources and I was like, what did I do?
Speaker 1:What are some of the things that you wish you knew when you started out, Like if you could go back and talk to 26 year old Nick? What?
Speaker 2:would you tell him? It's going to be a lot harder than you think. Number one. Number two we discovered something three or four years into the business. It was called the Iroquois Group and it was basically a cluster of agencies, like an agency network, that it's hard, when you start out from scratching the insurance business, to get the insurance companies to come give you an appointment and basically say hey, you can go and sell our product, because without the volume they don't really want you. So it's like chicken and egg hey, you don't have enough volume, so we're not going to give you a traveler's contract or a nationwide insurance contract.
Speaker 1:And without the insurance contracts, how are you going to build a book of business?
Speaker 2:So even in the very beginning that was kind of. The problem is, I think I started with two or three insurance companies, so people would come to us and we'd have three to shop out to and a lot of times they'd be like, nope, we don't want to write this or we're too expensive or whatever it is. So we found the Iroquois Group, which is an agency resource, a cluster of agencies that a company pulls together and they pulled everybody's premium together, all the agents under them, and now they go to travelers and say, hey, give assured risk advisors an appointment because they're under our sub producer code. Essentially, got it? Yeah. So we did that. It's a game changer, game changer, and we became one of my best friends through that. His name was Kurt Keller and he really kind of from that number year number three or four. We started really we probably picked up five new insurance companies from there and then you know two more every year from that and then we became, you know, a really good powerhouse of being able to offer like 20 different insurance companies. We started specializing in property and real estate and construction because we had all the resources behind us. So that was a big one.
Speaker 2:The other thing I would tell myself is that you're not that important. Like so many business owners me too like you have to be at everything, you have to control everything. You got to get into the weeds so much at like such a granular level of the business that you start to think that you're so important to the business that you have to be in the office 24 seven. You know you have to be a part of every decision that's going on. You got you have to talk to every single customer. Like that.
Speaker 2:That way of thinking gets you in trouble and really holds you back. Number three, four just finding the right people and really vetting them as much as you possibly can. And we found a really good group of core team members that have been with us kind of the whole way through. But along the ways you find some people and you get kind of enamored by having a body in the office and telling people like hey, I've got seven employees, I've got eight employees. So I got obsessed with kind of like that big, bigger feeling like we're growing, we've got 10 now, but focus on the quality or quantity in terms of employees.
Speaker 1:There's a.
Speaker 1:There's definitely a balance that you need to strike there where it's like your hands off enough in the business that you're empowering your people to help you grow, but you're not so hands off that you're hiring people just to fill roles that you yourself are best to fit.
Speaker 1:It's true, it's definitely a balance and I feel like I kind of tipped in one direction at one point, the opposite direction at another point, and it's kind of trying when you're in a small business. I noticed for me I'm trying to navigate and walk that tightrope where it's like I'm empowering people enough that the business I can work on the business instead of always in the business, but I'm in the business enough that I can make sure anything that there's no holes, there's nothing leaking out, there's nothing that I can. If I'm so removed, I don't know if, like hey, this client isn't really getting what they want out of it, or this person's about to drop off, or this machine's been broke for two weeks. I got to be there enough that I can take care of it like it's my own, because it is, but not so much that people are like I'm not going to do this because Al is going to do this.
Speaker 2:Yeah, there is a fine line there. You also don't want to be an absent owner, you don't want to be totally removed. Like you said, you've got to kind of have your nose of the ground there a little bit, so you know what's going on.
Speaker 1:I think Chris and I talked about that a lot. That was a couple of guests ago. He's a dude. He owns a gym, he owns real estate agent. He's like a taller version of me or I'm a shorter version of him one of the two. But he was basically saying, like it's not bad to sometimes have to work in the business, but you also want to work on the business.
Speaker 1:The mistake I think I made at the beginning is like I always was working in the business. I was taking like 70 something hours of training hours. It's like that's great, but I'll never scale past that, because what do I have a couple hours every week to focus on? Like creating systems, marketing things like that. It was only when I could hire more people to train that I could work on perfecting the systems. Okay, this is how we bill. Let me negotiate the credit card processing thing so we don't not pay in 3.5% on every single sale. Right, and kind of distance myself, not to work less, but to work Not. I was very efficient at training a lot of people, but I wasn't effective in my business, if that makes sense. Efficiency is how quickly and for lack I hate to use the word to explain the word how efficiently you can complete tasks. Effectiveness to me is like the tasks that you create that you have to knock down. So that's, I think, the fine line that I'm still trying to find. I think everybody has.
Speaker 2:I think to a certain degree too, in the early stages of your business. That's kind of the fun part too to get into that, because you come from a place a lot of people come from a place, where you didn't have any control over those things. You didn't have a say in whatever it is that you were kind of fine tuning. You didn't have a say in any of these things when you're kind of working for somebody else, depending on what your role is. So it's fun to do that. Like I did have fun figuring out okay, which agency management system are we gonna use, which phone system are we gonna use, what computers are we gonna do. So that part is kind of fun. It's just not spending too much time in that which you talked about.
Speaker 2:Costs and somebody told me early on too, is like grow the top line. So I just we all got super focused on growing the top line as much as we can because you can cut all the costs you want. But if you don't have your top line growing at the pace that you really need it to because of things that happen, you write up a piece of business, it's a great account, but they sell their business to somebody else and then you lose that account. You can't start relying on certain accounts to always be there. So if you're not growing the top line fast enough, you'll start eroding and you can cut. You gotta keep your costs in check for sure, but I just got to be a big fan of that saying just grow the top line and new revenue solves so many problems.
Speaker 1:Yeah, if you can get a bigger contract, sometimes it can wash out. Ideally, it washes out any additional cost it took to get that contract. Or it becomes problematic, though, is when the cost is higher than the generated revenue, like that's what happened to me last year, actually, like I had a stellar year in 2021. 2022, my top line went up, but not as much as my bottom line went up, or not as, like my bottom line went down even though my top line went up. Yeah. So when it came time to kind of restructure things you already know what I'm talking about when it came time to restructure things with certain, like, employees, and stuff.
Speaker 1:Yeah, it didn't make sense. You know what I mean. I couldn't continue to increase my payroll cost when it wasn't showing the proportionate benefit to the increase in top line. And I think a lot of people like a lot of small business owners. I agree with you 100%. Focus on first things. First big picture stuff. Grow the top line but at the same time like one thing that has tremendously helped my business is, my wife is a CPA she's a controller at a company.
Speaker 1:Now, every single month we do a balance sheet profit and loss and we do a cash flow statement. So every single month I can look and over the past year I can be like, okay, look, the top line grew 13% year over year, but the bottom line shrunk by 6%. Where is that 20% that we're not. It's not actually making up for you know what I mean? And I think like sometimes small business owners get so caught up in that day to day that they can't take the step back to analyze and be like, okay, what's working and what isn't.
Speaker 1:And I kind of had to have that same idea. Dude, oh my, we have 10 employees, we have 10 employees, we have 10 employees, we have eight. Now top line's bigger and the bottom line is way, way better. Like we're actually still growing at the same pace and the bottom line is proportionately even better still. You know what I mean? Cause it is cool to have like that number in your head and it feels like shit to go backwards Like, oh, now I and I had 10, now I have eight. It's like, well, yeah, but if the eight is what your business needs, then why have 10? That's an ego thing.
Speaker 2:It is an ego thing Cause I found myself being out at different networking events and other like agency owners and insurance company higher ups and like how many employees you have now, that's always seems to be the question that people want to know, like how many employees do you have?
Speaker 1:You know, and-.
Speaker 2:People always ask me that. Yeah. So I got like, and then, as it started to go back down, you started to feel a certain way. But then, when you go back and you look at the numbers, you're like, no, this is what it's supposed to be.
Speaker 1:Yeah, you're making data-driven decisions and not ego-driven decisions, absolutely.
Speaker 2:Which another good point too early on. We were fortunate enough to have somebody that had a CPA background as well. That would basically every month, you know, put our reports together, put our P&L together, put everything kind of in a nice format for me to look at at the end of each month, and she would also help me with a budget, you know, for the year, and we would always you know as much as I was growing, you know focus on growing the top line and trying not to get too much into the weeds. The numbers are. I mean, you do have to set those goals and set your budget and try and stick to it as best you can. And that was the other really fun part about it is putting the budget together at the beginning of the year, and at the end of the year you see where you're at and you're like man, we're on track, like what do we have to do to get to the budget?
Speaker 1:It feels so good when it works, it does, and it feels like shit when you miss. Yeah, it does, and I wonder if that's why some people just don't do it. They're almost like hiding from it. They're hiding from the reality of the situation that maybe what they're doing isn't working.
Speaker 2:I absolutely agree with that. I think it's easy to hide from the numbers too, to not look at it, because you know in the back of your mind that something you're doing isn't working, but you don't want to take the next steps to figure out what it is and to change, because it's hard to change. It's hard to change what you're doing. It's tough because yeah, it is.
Speaker 1:There's so much of this is ego, and what I mean by that isn't, like the. I think there's a difference between the confidence to do something in the machismo or the ego associated with, like, how it looks on the exterior. You know what I mean. It might look cool on the exterior to have a bunch of employees and a brand new you know storefront or whatever all this new shit, but it's like, if that isn't really, if all that is is a polished turd, it's still a fucking turd. You know what I mean? Whereas if it's like you actually have a solid foundation and a solid business, that's where it's like, that's real, where it's like, oh, I have this, I have this, I have this. It's like, well, that might just be a drag on your business instead of an actual cash producing asset to your business.
Speaker 1:And I think, like you said, people get afraid of that. And you kind of know, like I kind of knew the entire 2022, I knew what I was doing wasn't really working and I think I rationalized it in my head that, well, you know, this is just temporary. Eventually all this is gonna catch up and I still believe that, given enough time, everything I did would have paid off. But at the same time it's like, yeah, but if I had so much more liquid over the course of that entire year, what could I have done with that? Right, the opportunity cost there is real and it's very simple.
Speaker 1:Like those feelings that you get in business, there's a reason you have them. Sometimes you gotta analyze and be like is this just anxiety? Is this just me feeling a type of way because this is new? Or do I feel this way because there is something amiss? And it's like it's as simple as if the previous year I would check and the bank account would be this high at the end of the month and then it was this high the same time, year over year. It's like, well, that's not just a feeling. I might not have the hard data Now I do with stuff doing my books, but that's real.
Speaker 2:And then when we finally like broke down the numbers and went over the year and like went through with the account and did the balance, she did the profit and loss and I'm like, fuck dude, like I'm an idiot, yeah yeah, I can't tell you how many times there would be certain times of the year where things in the insurance industry kind of slow down or pick up where and I don't know if this is kind of what you're getting at, but where I would look at what's in the bank account or what came in that month and literally just go to the worst case scenario.
Speaker 1:Oh, shit, what has happened? Everything that is going away.
Speaker 2:Everything that just built for the last 10 years, that's it, like we're not gonna be able to make payroll and it couldn't have been the furthest thing from the truth.
Speaker 2:But sometimes but if you don't have the data to look back to, you could get lost in the weeds there.
Speaker 2:But I think ego is huge.
Speaker 2:I think ego actually for where I just came from too, and me and my brother, like ego almost got in the way of kind of what we just did in selling our business. And I realized when I looked at everything on paper, when I looked at my employees, when I looked at my clients, the only thing that was in the way between me and getting the deal done was my ego of like I'm not gonna own my own business anymore, I'm not gonna be the owner, and that was a totally ego driven thing. But when I looked at everything, it all made sense in every other aspect and I know I'm kind of jumping ahead here, but just kind of the concept of ego, cause I think ego gets in the way a lot of small business ownership and I'm not saying that you know every small business owner needs to, you know, prepare their business to sell, but there's a lot of things that go on with owning a small business where ego takes over and isn't always helped to kind of prohibit you from making the right decision.
Speaker 1:And I do think that, even if the small business owner never wants to sell, I do think it's a good headspace to be in to think, if you had to sell.
Speaker 2:I love that and I was actually gonna say the same thing, even if you're never going to sell. And at you know, a year ago, two years ago, I was never thinking I'm gonna sell this business. But at some point I got that thought in my head of we need to build this out as if we are going to sell it. So if somebody comes in tomorrow and looks at everything, this is a great business for them to buy and I think that's a great way to operate your business.
Speaker 1:How did you do that? How did you go from? How did you go from? I'm just working here and this is my business too. I'm gonna build this thing that if I wanted to sell it, I could. What steps did you have to make? What changes did you have to make over the course of the two years to get the business to that point?
Speaker 2:A really good question, I think, leaning out to a certain degree of you know hey, I've got two extra salespeople that are just I'm selling extra on my end so that I could pay for a salesperson.
Speaker 1:You're subsidizing them with your own production.
Speaker 2:Yeah. So I'm stressing out, I'm going nuts, you know, and they were great people. It's just they weren't right for my business, you know. And to some degree too, I didn't have the infrastructure to be able to train them because I was still in such a growth mode of wanting to get the revenue up that I never wanted to take a step back and say, okay, I'm gonna work with you for the next six months, just you and I, and I'm gonna develop you. I just could never do that because I wanted to just grow so much. So put back to your question how did I do that? That was number one. So it's like leaning out and paying attention to I know I just talked about not getting into the weeds, but paying attention to what we were doing.
Speaker 1:It's a balance.
Speaker 2:yeah, definitely, yeah, paying attention to what we were doing from a financial perspective, from a you know what kind of business we're going after we. Another thing that's big in the insurance business is, you know, when you focus on different niches, that's more desirable to somebody. So, if you have an expertise in like for us for instance, we have an expertise in construction, we have an expertise in real estate when we really focused on that, that really turned our business in the right direction and I don't know if that was probably like 2017, 2016,. But that really took us to the next level. So focusing on a niche that we were really good at really helped us get there.
Speaker 2:And just having a really good team of employees that I consider my family, they're like my friend, they're like they're my family, basically but we grew up with these guys and they just they treat the business like it's their own. So having the right people in place that if you do go to sell that, your book of business, your clients aren't gonna vanish. You know that whole team, the whole family environment, just kind of transfers to the next group.
Speaker 1:So being able to provide the I guess white glove service and maintain that, Regardless of who technically owns the business, right, we?
Speaker 2:were at an appointment yesterday and you know I told the customer that we sold and one of the four we're at our renewal meeting. One of the first questions they asked was you know, are we just gonna get transferred to a customer service line? Now, you know, one of the biggest things that were important to them was are we getting the same team? And so that's, that's everything. So having that team in place and having the right team in place, it does numbers for us and for our customers, because I know that they're being taken care of and they're gonna continue working with us. So it's not like, you know, when we kind of when we told our employees that we were selling, I think their first instinct is to think you know something you see on TV. When a business gets sold, like, oh, we're losing our jobs, like that couldn't be the furthest thing from the truth, because they need this team to perpetuate the business.
Speaker 1:So what did they? They came to you once before, right like the, the people who bought your business.
Speaker 2:We. We got approached by somebody else and I think that's kind of what put this in motion. We got approached by someone else maybe a year and a half ago and I Knew that that you know the numbers all made sense. But I knew that that particular company was like what people think of when you think of an acquisition by a billion dollar plus company we're gonna come in, we're gonna buy your business, we don't really care what happens to you, we just want your revenue.
Speaker 1:So you were trying to look after the team and your clients? Yeah, absolutely.
Speaker 2:Absolutely and I'm not just saying that, I mean it's true. I was like I can't go to them and tell them this with this company, because I know that Four or five years from now we're all gonna be gone like we're, we might still be here at that company, but so they're not gonna get fired, but they're gonna be looking for another job, whereas so that put the idea in my head because I was like, no, this is. You know, I think we've taken it to a pretty good level from our own, on our own, and this is an interesting concept. And the insurance industry is just it's. There's a lot of that going on right now People buying insurance agencies, buying insurance agency, a lot of the bigger, like Acra shore, you know. You see, acra shore came into Pittsburgh. They put their name up, you know, at Heinz field. Acra shore is also one of the largest Insurance agencies in the country, so they're doing the same thing.
Speaker 1:Why do you think they're? Why do you think it's hot right now? Why do you think that's an asset of these big I?
Speaker 2:think. I think private equity everywhere is has become very popular, but it's also private equity is after they really like and the banks really like. So like subscription based model, subscription based business yeah, residual business. So I mean that's just huge. If I was starting a new business, I would the subscription based Residual, where you got a contract, you have somebody in place, you know Like you talked even from the gym standpoint snap fitness, your business, yep, people sign a contract, you know whether it's month to month or not. There's a like high likelihood that a lot of them are going to stay on With a high level of certainty so they can predict out what their numbers are gonna look like that cashflow.
Speaker 1:That Recurring monthly payment that I have for gyms for the gym is like a total game-changer. When I first started my business it was all about like just selling a package, mm-hmm, because I started out just with personal training and I would just sell a package and it was like at the end I would have to try to close that sale again, and close that sale again, and close that sale again, and that became Not only exhausting, it also became, I Guess it didn't allow me to focus on serving the customer as much. I always had to think about like okay, I got a, they got two sessions left. I got to try to close the sale.
Speaker 1:Yeah now it's like it's as simple. As somebody comes in, hey, these are your sessions. At the end of it it just recurs. No big deal. If you ever don't want it to recur, you just got to let us know. That's the training section and then the open gym. It's like a recurring monthly payment. You could do it for 12 months. You could do it month to month, it doesn't matter, but there's more predictability there. Yeah, and like Not only do I not like to have a conversation about people all the time about, like you know, you owe money.
Speaker 1:Yeah yeah, anyway, you can get squared up. I don't like that conversation. The customer doesn't like it either. Right, you know what I mean? They just want to do I don't know the last. Like I just know, my home insurance comes out, my car insurance comes out. It just comes out and it's like all right. Yeah, it's just coming out. It makes it more convenient for me too, Sure.
Speaker 2:Well, and we really worked hard when we were starting out and as we continued through the business to make you know insurance same thing it renews once a year. You know your price changes, you know things can change. We focused on really making that a non-event. You know this, your insurance renews. It's part of the business. But we're kind of doing the work that we need to do throughout the policy period before it renews so that you kind of Don't have to worry about it, you know, and so that takes that, that subscription based model and makes it even more attractive to you. Know these larger companies, the banks and people who are lending money and private equity.
Speaker 1:So definitely, and it smooths out a lot of the cyclical nature of it. Not Try to think about the best way to say it, not because it's like you want to get one over on a customer.
Speaker 2:That's not it. No, no, no, it's just it's just, it just simplifies the process.
Speaker 1:Yeah, where it's like, hey, it just comes out. You know what I mean. It's like, well, somebody really pushes me on it. They're like, oh, you know, I'm not gonna put a bad taste in their mouth, but yeah, bro, let's just cancel it. Yeah, refund you what you have left.
Speaker 2:Like.
Speaker 1:I'm not gonna crush somebody, but at the same time I Find way more success. The customers don't even. I've rarely ever have a complaint of all the, the, the payments that we take every month. Nobody really complains, it just happens, you know. Yeah.
Speaker 2:And I think too, if you have a good relationship with your customers, they they're getting what they want. There's not a big reason for them to change you know, so that's, that's the whole idea there.
Speaker 2:So if you you're doing right by them all the time, then yeah, people are gonna call on them and say, hey, we can save you $150. They're getting at all these things in the mail, you know, from the state farms and the Geico's. But you know who do they want to deal with? Who do you want to deal with? Do you want to deal with the team that you're used to, the guys that you know that you know where they're at and if something does go wrong, you know cuz claims happen. You know, even you know in your business certain things happen. They have somebody they can talk to. It's gonna make it right.
Speaker 1:Yeah, that makes it, because even if somebody was like, hey, I'll, I can save you 150 bucks, it's like, honestly, the time it's Like it's not. I had to say it's almost sounds arrogant to say this, but it's not worth my time. No, it's, it's, it's literally. I would rather it just recur, yeah, and just continue to get the service that I'm happy with, yeah, instead of always worried about like Well, maybe I got to look at this and then you spend a whole day looking at it. Yeah, and it's like, when you actually look at what your time is valued at, yeah, probably wasn't worth it, right?
Speaker 2:At least for me. Well, conversely, though so I will agree with you a lot on that, but conversely, it is something that People should be checking up on, because there are a lot of changes in the insurance industry to people's policies rates. The market has Hardened up dramatically. Where carriers don't want it like we talked earlier with capacity, they don't want to write the same policies they want to anymore. Rates are higher. You're seeing a lot of companies that Will just send out something in the mail you probably won't see, and they've said hey, by the way, we're changing a deductible to a 2% wind inhaled deductible or a 2% deductible on Any losses that you have. Well, if your house is worth $500,000, your deductible just went from a thousand to ten thousand dollars, and you have no idea.
Speaker 1:So perfect, let's segue into that. Yeah, how often should people be looking at their policies Like is this something that people should keep a close eye on?
Speaker 2:yeah, I think so. I mean, if you haven't reviewed, if we're talking home and auto on the personal line side, if you've been with the same company for five, ten years, like you should really Be wanting to sit down with whoever your agent is. You know you doesn't need to be in person but on the phone or just hey, can you, can we review this, can we check into this? Because I'll tell you a lot of other things that happen. People buy stuff that they don't realize isn't covered by insurance. It's covered by insurance but you have to maybe schedule it, whether it's jewelry or we got a lot of people that go out and buy trailers and you know, don't put it on the policy and there's a potential that the trailer side swipes somebody because not listed on the policy, there's no coverage for it. So maybe you got a swimming pool and you didn't think to call your insurance agent. Maybe you got a pit bull and you didn't think about it.
Speaker 2:You know there's a lot of stuff that happens, that you should, and you know you should want to take a look at what you have scheduled, what you have that's valuable to you, what the value of your home is. Cost of construction has gone up tremendously and and there's a lot of things built into policies, like there's an inflation guard. You know that just automatically increases your coverage every year. So for the most part you're probably okay. But that's another thing that's happened is carriers just have arbitrarily said cost of construction is up, inflation is up. We're adding on 10% to every single policy in our book of business in terms of what it's the house is insured for, which makes the cost go up. So just having a discussion is probably a good idea, like you should have a decent relationship with your agent. You should be somebody that you can call and you know that you can have a conversation with. So if you don't know your agent, you're the guy. Yeah.
Speaker 1:Perfect, no man, that's. That makes a lot of sense, because so basically don't ignore those letters when they come in.
Speaker 2:You should not ignore the letters because you know we all do it. But yeah, sometimes there's some pretty important information there. Right now, another one that's happening. Roofs have historically been covered on a replacement cost basis. So you know, this happened a lot in like 2008, 2010. Everybody had, like, their 25 year roofs. Storm comes through, hail storm, oh you're even though you're about to replace your roof in two years because it's too old, insurance companies replacing the whole thing at the replacement cost.
Speaker 2:Well, insurance companies are like you know what. This is not a good model anymore. So if your roof is over 20 years old, it's an actual cash value Provision on the policy. So if your roof was 20 years old and you have a claim, we're not giving you the five or ten thousand replace it. We're gonna give you like three thousand minus your deductible. So that's happening a lot like. I bet a lot of people listening, a lot of people with homeowners policies Probably got that letter in the mail somewhere in the last six months and if it hasn't come yet, it's, it's coming, it's on the twig.
Speaker 2:Yeah and you know that's a, that's a surprise and, like in insurance, we hate surprising clients with anything like that. So having a conversation, is a good idea.
Speaker 1:So basically, like, don't ignore that stuff. I just want to go on again.
Speaker 2:Yeah, yeah, you should definitely be reaching out to your agent to talk about what's covered, what's not covered. What kind of provisions are in the policy right now, because it's getting bad.
Speaker 1:So let's talk, let's let's start breaking this down based off of, I guess, what people have. Okay, so I just I was looking this up before you and I started talking about 30. Some percent of America Exists in the income level of 35,000 to 75 thousand dollars a year. Okay, let's say you have somebody that they own a car, they have a small house to integrand and no dependence. What are some of the things that? What are some insurance policies that they should have? What are some insurance policies that they might not need, that somebody will try to sell them and take them for a ride? I think it's pretty much your standard.
Speaker 2:You're. You know your auto insurance policy making sure you've got, I'll tell you. I'll just take a quick second on that. We see a lot of people with auto insurance policies that don't have adequate limits. They might have 50,000 of liability coverage. That's just not enough. That means if you get into an accident you hit somebody else at your fault the most. That policies paying out to the other party that you, you know, destroyed their cars 50,000 dollars or from a liability perspective there you know, need medical, all that stuff, 50,000 dollars is just not enough. So coverage limits very important. On that a A standard homeowners policy very important.
Speaker 2:We're seeing a lot of coverages that got added over the past couple years, within the past five years or so. The service line coverages. That covers them. If your outdoor utilities rupture and you need to call a plumber to come in and pay the five or ten grand to excavate and and replace it, that's, you can get that coverage added. I don't, we don't just trying to think what else on that on the homeowner side. So life insurance I mean that's not historically we were not a big life insurance agency. We now have access to some of the best professionals in that space of life insurance and like estate planning, things like that. I do think if well, you said if you have dependents or not dependents, you should probably still get some term life insurance, at least cover your liabilities. But I'm not an expert in that field. Yeah, but still something to think about.
Speaker 1:So if you're going to buy, let's say the people that are. You know that's the working class, slash middle class America. Take a look at your actual I mean honestly fifty thousand dollars. I'm thinking about it like that's not even to cover most people's cars.
Speaker 2:Those cars yeah.
Speaker 1:Like you can't even buy like a used forerunner. I was looking at them. They're like forty six thousand dollars, no.
Speaker 2:And yeah, you just don't want to get into that mess where somebody's trying to come after you to what would be a good coverage level. I mean, we typically won't do anything less than a hundred thousand dollars of liability. I think two hundred fifty thousand dollars of liability there's not much of a price difference between the two. So really, two fifty.
Speaker 1:So they'll give you peace of mind. Just to bump it up a little bit, we should probably look at yours. Yeah, I'm sure Now let's talk so. So basic homeowners insurance, vehicle insurance, check the liability. And then you were bringing up something with the homeowners insurance that I kind of want to emphasize. You were saying exterior lines, like that's part of the homeowner insurance that you could add that maybe some people don't have.
Speaker 2:Right. Add that on. A lot of people were seeing a lot of policies that don't have the water backup of sewer drain to cover their basement. For you know Western PA, it happens a lot. Sewer drain backs up, destroys the basement. When I first got into the business we were slapping them all on there. It was like five thousand dollars was the coverage, five thousand dollars for water backup of sewer drain, that is just not enough anymore, you know. So if you've got a finished basement, even if you don't have a finished basement, you got to get sewage pumped out. Yeah, you know it's probably going to be twenty five hundred bucks. So look at that. Scheduled jewelry, scheduled valuables. A lot of people don't do that or remember to do that. We've had somebody call once and you know they just bought a watch at the from the jeweler and the guy at the jewelry store told him the call is agent and then he didn't.
Speaker 1:And you know so how does that work with jewelry, like if you lose?
Speaker 2:your ring. If you have it scheduled on there, mysterious disappearance is covered. So you lose your ring, you lose your earrings. It's valuable. You have it scheduled on the policy that's going to be covered.
Speaker 1:See, that's tough. I don't know how, how would? How do you verify that? You know what I mean. Like if somebody is like oh, I have this fifteen thousand dollar engagement ring and I lost it, so yeah how do you have a good point?
Speaker 2:How do you do?
Speaker 1:that Do diligence? Does somebody have to like come in and like sweep the house and like?
Speaker 2:there's no ring here. Yeah, I mean, we turn that into the claim, the insurance company, the claims, just gets involved and they take it from there.
Speaker 1:OK, yeah, cool, you can add all that. Yeah, I'm trying to think I'm sure we added lines on to mine. Yeah, policy, yeah, maybe we should get some of the jewelry stuff.
Speaker 2:All your toys and things like that, people with like side by sides. A lot of people don't think to get that covered on there. Little you know, the little Polaris is motor motorcycles, things like that, so that like street bikes, I'm saying like the dirt bikes, things like that. You can all add that for very little cost.
Speaker 1:You hear that calling yeah, you got to get that, you got to get that dirt bike insured man.
Speaker 2:I mean, I know that the particulars of insurance aren't super exciting, but you know.
Speaker 1:I think it's important.
Speaker 2:It's like one of those things that are really important that for the price that it costs to do that, it's well worth it. The other thing is the values on homes right now making sure that you have the guaranteed replacement cost. You have extra coverage for that to make sure, if something does happen with the way cost is right now that you can rebuild and not have to come out of pocket.
Speaker 1:Right, so just check that. It's a nominal amount. You just add a little bit to get way more peace of mind. Right, right, how does that change? So we went to like the working class kind of entering the middle class America. I think once you buy a house you're in the middle class. Yeah, that's, that's the way I look at it. You're a homeowner, you're a middle class person. What about people that have a little more money in the bank, let's say the I don't know 75 to $200,000 income range? They got some assets, they have a bigger house, they have some toys. Now they have some actual cash producing assets. Let's say they do have a business. Let's say they may have some rental properties. Maybe they have like a large pool of liquid assets, whether that's stocks, bonds, mutual funds. How does their insurance kind of look compared to that? I guess? Working class entering middle class individual.
Speaker 2:I think you're seeing more of a financial planner getting involved and making sure and you know, a lot of times financial planners refer us in, so they're kind of doing all the due diligence with the client to make sure everything that they have is properly covered, making sure they have the right amount of life insurance. So we really go and put that onto the financial planning, the estate planning people to determine how much value they have, what insurance they need from a life insurance standpoint. You know we do the due diligence on the home to figure out, hey, how big is the home, we put it into our system, how many beds, how many baths, what's the construction, and that our systems tell us how much it should be insured for. But when it comes to somebody with more assets, we typically get a whole another team involved, which now we have resources for we have a high and ultra high net worth team for personal lines insurance that we bring in and kind of go through the due diligence process.
Speaker 1:So you're working with financial planners once you start getting into people that have some change in the bank, absolutely. What about? So let's let's talk about. You know my situation in particular, rental properties. You know I have 10 doors now. We have a policy like a like a policy for each property, but then there is another policy that you and I had talked about before, which I'm thinking about adding is an umbrella policy. You've seen a lot of those with people that have like different assets.
Speaker 2:Good thought, and I wasn't thinking of that when you were asking the other question. But that's exactly what. Yeah, we want to make sure that we've got umbrella policies to sit over top of all of your underlying liability. So that will sit over top of your auto. So if you get into a bad auto accident and that $250,000 we talked about before isn't enough, that million dollar umbrella policy is going to sit down and drop down over top of that and be there in case there's a really bad accident. And same with the rental property. So we always add those on or at least present them to the clients. For, you know, maybe for your rental property, if it's a single family, multifamily home and you want an extra million dollars of coverage, it might be $300 a year.
Speaker 1:So well worth it, yeah small change to help you sleep at night. Yes, so do you. When you have an umbrella policy that you said that sits over top of other policies. Let's say I could put let's okay, here's an example. Could I put an umbrella policy over this home? So, for instance, let's say God forbid, ruger breaks out mall some lady. You know what I mean. I mean, I don't mean to laugh.
Speaker 2:But it does happen. It happens, so will that, will that. It's bad when it happens.
Speaker 1:Ribs are hand off. It happens Crazy. It doesn't take much.
Speaker 2:For that to happen and for that to turn into like a $500,000 claim is very easy because you get scarring. You get somebody who can't do their job the same, their appearance is different, attorney gets involved. You're talking yeah, this is a couple hundred thousand dollars, maybe a million dollar claim.
Speaker 1:Okay, so you can get a policy on top of your home, then the rest of your assets are safe. So like, let's say, ruger bites some lady's leg off, please. He's a mix. Okay, yeah, mix, yeah, yeah, yeah. You know what?
Speaker 2:that means yeah, because a lot of insurance companies, yeah, they don't like to write if you've got a pit bull, if you've got an Akita, yeah, aggressive Rotweiler, and I know people don't like to hear it because they all you know your dog is so nice.
Speaker 1:Oh, my baby is so sweet. He'll never do that yesterday, it's just the numbers.
Speaker 2:It's just the numbers. This is what it is. But yeah, we would suggest an umbrella there as well.
Speaker 1:I mean, would that protect the other assets?
Speaker 2:Yeah, yeah.
Speaker 1:Okay, so like, let's say, they can't get to my business then, because they would have to pierce through the homeowners, pierce through the umbrella and then get to my business.
Speaker 2:Well, you would want. So your personal, your personal homeowner's carrier would not want to typically sit over the businesses Some of them will but we would typically have an umbrella on the business policy and then an umbrella over the homeowner. So this is more your personal assets. That that's protecting, got it? Yeah, so your corporate, your, your businesses, should essentially be protected by the nature of the LLC. Just the corporate structure. Yeah, just the corporate structure. But we would always suggest an umbrella on the homeowners as well. Even if you don't have a, an aggressive dog breed, or just any dog, there's things that you know that just can happen at your home that require you to get an umbrella.
Speaker 1:Yeah, like there's a friend of mine who just got his steps rebuilt and he went and measured the steps and like one of them was like a couple inches off or something, so he made him redo it yeah they'll get you on that.
Speaker 2:Yeah, he's like, I don't want a mailman coming up here, they'll get you Dropping off mail, slips and falls?
Speaker 1:Yeah, and then they some you know attorney or some adjuster comes out and measure up. Well, this is your fault, because it was two inches.
Speaker 2:Well, and even even if he, just somebody, slips and falls on your property, even if it's not any negligence of your own, there are coverages in the policy the medical policy, the medical expenses, just the kind of good faith, take care of their medical bills because it happened on your property. But then if attorney does get involved and you know they try and sue you.
Speaker 1:They could get ugly. They could get ugly. So umbrella policies are something that, once you start getting some wealth, you want to start thinking about how to protect that wealth.
Speaker 2:Yeah, and they're relatively inexpensive on a homeowner's policy Another $150, $200, $250 a year. So nothing should definitely consider that, yeah, okay, I think people tend to get really like put their costs of insurance under a microscope and we always recommend these things and and really try and push them, because everybody always forgets the conversation that we have when we're going on a spring meet to another thought to of what coverages or what certain endorsements they have. You're going to forget about the $150 versus. You know, five years from now, you decided not to take something and something bad happens and it's going to get ugly.
Speaker 2:And another one of those which I'm thinking about right now is on your auto insurance very important limited versus full tort. A lot of people will save the $150, $250 to go limited tort, which basically restricts your ability to sue for pain and suffering, versus the full tort, which allows, if you're injured in an auto accident from somebody else, to go after somebody. For you know your lost wages, your pain, your suffering and a lot of people will say, well, I'm not, I'm not the one to sue for things like that, but you're going to want to be able to be made whole by having that extra coverage and that's one that people do forget, even though they sign the applications. We're going over it in detail. We've had situations where, two years go by, somebody gets into an auto accident and they want to sue the other party for pain and suffering and they can't because of the limited tort. So that's really important. Makes sense.
Speaker 1:That's on the personal side of things personal auto, yeah, and I know that you said you're not an expert on this, but you you say term life insurance.
Speaker 2:Term life insurance. Yeah, yeah, I mean there's, there's, I think there's Definitely space for whole life insurance. When it comes to estate planning, there's different, definitely, reasons where that would make sense, I think once you start to get to that like high net worth.
Speaker 1:Yeah, I think so, yeah, and you're trying to figure out hey, where can I have some return at a tax preferential basis? Mm-hmm, I agree with you, but I will say this there there are people I know that will take somebody that's making 40 grand a year and try to sell them the Whole life insurance policy. Yeah, it's like I don't think that makes sense for a lot of people that are just, you know, paying their bills and don't really have assets. Yeah, you know what I mean.
Speaker 2:If you had a whole life guy on here, he probably Strongly disagree. Yeah, you know we would but like. But I tend to agree with you, I think, that whole life there's probably a yeah, there's a spot for it in terms of estate planning. You know it's tax-free at the time of death, so there's probably. If you're ultra high net worth individual, there's definitely space for that. But I tend to stay more on the term life side.
Speaker 1:And I think most people should stick with the term life size. Like. There's a guy that one of my mentors he was telling me that he's like, oh, I just bought a whole life insurance policy and I was like, why would you do that? Why wouldn't you just buy a term and then you can just take that difference, invest it in the market and you'll be way better off? But for him it was like well, no, I can overfund this policy. Yeah, I can take a loan then against this policy. I could then buy real estate with that loan at a rate that is lower than if I went to an open market. Yeah, he's like so I'm getting basically a loan where I don't really have to pay taxes on liquidating the, the asset. I don't have to pay capital gains tax. Instead, I take a loan against it, put it into another cash producing asset and that cash producing asset then pays me. So it's like he's getting, he's moving his money in a way that I don't think you're.
Speaker 1:You know most. I mean, it's just the truth. Most Americans are hand-to-mouth, they are yeah, and they don't really have to worry about that. And so I get the term that you need to cover your loved ones, your expenses, all of that where that whole policy Maybe makes sense with. You know, that was the next question. I had people that are super, you know. I mean they're making $300,000 plus in Western PA, california's, like half a million plus right like you're making 300,000 plus a year.
Speaker 1:You got you know a million dollars in real estate. You got you know $500,000 in liquid asset. You got a hundred and fifty thousand dollars in the bank. So that's when I think like those kind of creative financial instruments make sense there. It's like partially insurance, partially an investment, where it's like I don't know if a lot of people I think a lot of people get taken for a ride by like slick salesman that might be financial advisors, that Quas, I sell this life insurance that I think a lot of people fall victim to.
Speaker 1:I'm one of them, bro. I'm one of them like when I first started my business, I didn't make a lot of money. And then by year three Before I did okay, I didn't make a ton of money. But I went back and I looked at a policy I bought on year two in my business I think I made like 60 grand or something like that. And then I was doing the math over COVID and I was like, okay, I've put $500 a month in this every month for X amount of years and there was a cash value to it. But I looked at the cash value. I was like I've put I don't know what it was like. $18,000 into this policy. The cash value is five grand. It's like now. Yeah, at some point in the future there is an inflection point. Oh well, it's guaranteed three and a half percent. You don't have to worry about that. But it's like I was at the stage then where I should have just been playing offense Because I didn't have to worry about all these like tax, this, do that.
Speaker 2:It's like yeah not a good guy. I was kind of sold. I was set up. Yeah, no, that's my fault, that's my fault.
Speaker 1:I'm not blaming him. He's got to make his nut too.
Speaker 2:Well, that's the way they were trained, so they fully believe that that is they best investment vehicle for you at the time.
Speaker 1:I, I, definitely, I, I think and I'm just gonna put the the invite out there I would love to have a whole life insurance.
Speaker 2:I think, I think that would be a really good invite, because and I'll give you a different perspective.
Speaker 1:Definitely, and like I'm not gonna try to be like. What I'm not gonna do to anybody here's is try to get gotcha moments, yeah, but I am gonna be honest here, dude, like I feel like I was taken for a ride on that policy should bring them in.
Speaker 2:Yeah, I'll bring it, dude, I'll bring it.
Speaker 1:Feel like I was taken for a ride and I feel like a lot of people are taken for a ride, like my you know family member. I don't want to get too specific, but a family of member of mine's girlfriend has a whole life insurance policy and it's like it's better than nothing. But it's like you have no kids, you don't really pay that much taxes, you don't have a 401k, you don't have a retirement. There's so many more financial instruments or insurance that's gonna give you a better peace of mind. Well, this whole life insurance policy.
Speaker 2:Exactly. I think the peace of mind thing you just talked about is, you know it might cost me $700 a month for $300,000 of whole life, where it might cost me $150 a month or less for a million, which is really the like purpose for me right now about a life insurance policy. I want to make sure that my family's perspective protected right now. You know so, if something were to happen, yeah, it's there.
Speaker 1:It's so.
Speaker 2:But like you said, I think there's different Instances where whole life makes sense from a financial planning perspective, long-term estate planning, you know, kind of.
Speaker 1:Resource. But for the most part, that's when we're starting to talk about that. Yeah, super high net worth. Yeah, high high income. Yeah, high skill. Yeah, pan, a shitpoll of taxes, top to marginal tax rate. That's when you start to play the game a little bit more. And if people hate the game, well, yeah, I mean, I don't know what to tell you, that's just the way that the the cookie crumbles, right, try to change it at the voting booth, but that's how it currently exists. Now, yeah, I agree, people try to do what they can. Yeah, not to of, not to avoid taxes, but to play the game Appropriately so you pay less of them, right? You know what I mean. Like these people that are that that's the funniest thing that people oh, we need to hire 75,000 new IRS agents. It's like there is already a division in the IRS that that monitors the super high net worth individuals exclusively. They're not. They can't get away with this illegal stuff. People like Trump didn't pay any taxes. He's like that's cuz, I'm smart.
Speaker 1:Well, the reason is because it's like there's these instruments in place for these super high net worth worth individuals, where they're using the whole life insurance there, they're using depreciation on their rental properties, they're doing all these different things to try to again not avoid taxes but play the game that was put in place by Congress, by the president. Everybody knows it exists and the super high net worth individuals hire professionals to help them play the game. Yeah, not to hide from taxes, but to follow the tax law as it's written. Yeah, it's a wild thing. Besides that whole life insurance policy, which may have a Place in somebody that's, like I said, that high net worth, is there anything else that, like you know, the the super high, top 5% income earners, maybe top 1% asset individuals, is there anything that they should be looking at from a insurance perspective? Or is you just scale it up from, like, middle-class to upper-class? I?
Speaker 2:think you just scale it up for the most part and make sure that you're working with a really good financial advisor, that's in a good estate planning attorney and a tax attorney. That's got it all wrapped up, and then that will usually bring us in on the insurance side of things. But no, I can't think of Anything else. I hope I'm not missing anything else on that front, but no, I don't think so Okay, I don't just scale it up to the scale it up, yeah yeah, perfect.
Speaker 1:Yeah, man, we definitely got a look at mine, cuz you know I start to. I'm not getting nervous, but you know you get tenants in there and you're like, hmm, what are they? You know what I mean. What are they gonna pretend to hurt themselves on?
Speaker 2:Yeah, yeah, I think from a business perspective, to make sure you've got the right coverage From an underlying standpoint in terms of you know how much it costs to rebuild the place and then Liability-wise, having the extra umbrella on there is key yeah is there anything that Obviously, my opinion is well out there?
Speaker 1:whole life insurance, I think, for most people, I think, is BS. I'm just gonna say yeah, and I'm totally cool with having somebody.
Speaker 2:I think a lot of people would agree with you.
Speaker 1:And that's fine. If somebody wants to come on, this is a. This is a rolling invite to anybody that sells a whole life insurance policy. You can come on my show and we can talk about it. Doesn't have to be adversarial. I'm open to being corrected, but as it currently stands, it doesn't make sense for most people. Is there any type of insurance that people are buying that might not, they might not need? I know that you're. You know you're an insurance guy, so obviously you're like, oh, but I mean, is there anything that you're like? Okay, you know what? There's a lot of people buying this that might not need it. Or Insurance, because you kind of touched on this insurance that people should have, but don't. Here's a, not here's a. The reason I asked this Somebody hacked into my Instagram, right, and like.
Speaker 1:They went on and they're like hey, congratulations to myself, I bought a Tesla. I did all this Bitcoin shit. Reach out to my coach, she'll tell you about Bitcoin. Couldn't get into my Instagram for days. Yeah, finally, get in. This motherfucker is literally messaging DM and my friends, like this girl from high school was like hey, al, you know I was thinking about getting into Bitcoin money. He's like yeah, totally get into it like this guy. So I'm yeah, he was pretending to be me. I messaged him from my other Instagram account. I was like hey, bro, glad to see we're doing well. He's like yeah, bro, we're doing real well.
Speaker 2:I was like are we rich.
Speaker 1:He's like yeah, bro, real rich. I was like sweet, I'm, at least we're rich here. Is there like so, is there a? The reason I asked is because I'm like is there a fraud insurance that I can have?
Speaker 2:or something like that. Liability yeah, I'm gonna need that. You're gonna get some cyber protection. They're on the personal side. It's available. On the business side. We're still seeing a ton of businesses that don't have cyber liability, that don't have employment practices liability insurance. So on the cyber side, you know, like you said, they get hacked. They've got to notify their customers. There was a, you know, a data breach. There's so much, so many costs that get that build up so quickly on the cyber side. So cyber liability is huge right now and also the employment practices liability. So you've got employees, you wrongfully terminate somebody, you know age, sex, discrimination that's happening a lot and a lot of companies do not have the right protection there. So that Employment practices liability, cyber liability, directors and officers, management liability, kind of the whole usually comes as a big package. That's really important. So but we can also add it on the personal line side, for a lot of companies or a lot of Insurance companies will offer that as well.
Speaker 1:That's something that I think I need to start looking at it's really on the personal line side, it's very cost effective.
Speaker 2:It's very affordable, yeah.
Speaker 1:I mean, that's what I was thinking. I was like man, what if somebody were to sue me for this? Because, like, conceivably, this dude took some of my friends for a ride? Yeah, you never know how you get wrapped into that. And they, they hooked the right guy because, like, everything I put up is like hey, business this like invest in this. They're like this is the dude and it worked. Yeah, now Luckily like yeah.
Speaker 2:Nobody's. They're not really getting into anybody's shit, but right. But if it does happen, then it's like damn.
Speaker 1:I want to make sure that I'm protected from that perspective. Is there anything that that People will add on to a policy that maybe somebody just doesn't pay attention to, that they might not need and they should start looking into?
Speaker 2:That's a tough question question because I don't really think so, because we typically are not Getting into or seeing a lot of things where we're removing coverage. You know it's usually we're adding coverage, yeah we're not seeing a lot of things that, oh, you don't need this, this shouldn't be on here, so now I don't think so, got it, I'm not missing anything, but I really don't think so.
Speaker 1:Here's. Here's another question. This is a selfish question, but it's my podcast so I'm gonna ask it. It's good podcast if I, if I were to. Is this just a math equation? Like I have my rental properties and let's say I have a million dollars of coverage, would it be more cost-effective for me to just bump that up to three million or add an umbrella policy, or is there a difference between the two? Does that make sense? Like, will the umbrella policy be better for a reason other than total coverage? Then me just bumping up the coverage of that addition, of that actual policy?
Speaker 2:typically no, and a lot of times the Insurance company will not have the ability to add on more to the underlying liability on rentals. Now there are Some business owner coverage forms where the it starts at two million single currents, four million aggregate. So yes, then you don't need an umbrella because they just do it all cost effectively on the underlying policy. But most of the property habitational, the next thing you know, single family, multifamily, rental type insurance companies will not have a higher limit than that million. So you can. You have to use it an umbrella. That way got it.
Speaker 2:Yeah.
Speaker 1:That answered pretty much all my questions from an insurance perspective. Just another question about the business. So you sold the business. How did you know it was time To sell? I know we're jumping around, but we're gonna wrap it up here soon Like what made you? Because ultimately, my goal I Want whether or not I sell is beside the point. I want it to live past me. Yeah, if that makes sense, whether that means I pass it to you, know a kid, or I do sell, there is gonna come a time when I have to make that decision. What was it that made you make that decision where it was like this is the time to sell? I understood you know who to sell to right like. These people are gonna preserve the culture, yeah, they're gonna keep my employees, they're gonna keep my customers happy. When did you, when did you know it was time to sell, not who to sell to right, when to sell it.
Speaker 2:I think it was a perfect storm that kind of came upon us recently. So number one the insurance market has become very difficult to navigate through from a capacity standpoint, meaning what we were easily able to do four years ago. A customer comes to us and says, hey, here's my risk, I needed it covered. There might have been ten insurance companies that line up, you know, at the door saying we want to take that policy. Here's the pricing, it's very cost effective. Here's the coverage. We went from that to that same customer comes to us and maybe out of those ten, one of them is coming to the table with Terms and conditions that are less than favorable than they were five years ago. So the capacity there from an insurance company standpoint started to get in the way of. We weren't feeling it yet, but I kind of saw the writing on the wall where the the industry is headed. That's number one. Number two our ability to go upstream for Different customers that maybe have out-of-state exposures.
Speaker 2:Their businesses are growing. Maybe they're out in the UK now with one of their facilities, or they're in Canada and they're adding tons and tons of employees and they're coming to us and saying, hey, can you ensure this. Well, we've got a feels like reinvent the wheel and make a million phone calls to try and figure out how to do it. We're now surrounded with the best, smartest people in the insurance industry and on top of that, you know, somebody would come to us with those that same company and say, hey, can you do our health insurance? And we're turning it away and outsourcing it to somebody else At a fraction of the commission that we could do it for, and we're not bringing that like total approach to our customers. So from that perspective, that was a big one for us, being able to Serve a lot more needs of our customers through different channels. That was that was a big one for us. The other one was we were grown. We've grown a lot.
Speaker 2:So it was how are we gonna take it from where we're at to the next level?
Speaker 2:It was either through acquisition or I was gonna go out and have to hire a lot more people Sales people, service people to take it to the next level at a time when Labor costs are skyrocketing through the roof.
Speaker 2:My competitors, that are, you know, these billion dollar organizations can afford to Pay them a lot more and just the resources that they have, and it just I Didn't feel like I was growing anymore either from an intellectual standpoint, a knowledge standpoint of the industry and what was happening. So now I'm surrounded by literally the best people in the insurance industry that have been doing this for 2030, 40 years, that literally the smartest people in the room it's not me, you know. So I'm not having to come up with all the ideas. I don't know how, if there, for anything that comes up, there's a person for that that specifically Focuses on that for the last 20 years, whether it's captive insurance and alternative risk Strategies for clients, whether it's health insurance, whether it's human resources, just anything that comes up I literally am surrounded by the best people in the industry. So it was. It was just being able to Offer that where I couldn't anymore.
Speaker 1:So you took it. It was time to sell when you took it, as far as you could I took it as far as I could.
Speaker 2:I I mean, I could have kept going, but not at the cost of, you know, maybe not being able to provide my employees and my customers with the best possible scenario. And I felt that a lot with my employees they, my guys are, I feel, the best, and Obviously I'm saying that because I've worked with them all these years. But I truly believe that and I felt like they could take their career to grow Exponentially by doing it this way, versus me having to figure it out for them. That's.
Speaker 1:Exactly when I want to sell mine, when I take it as far as I can. It's time to pass the torch?
Speaker 2:Yeah and yeah and that's. That's a great Position to be in. You know, when you feel like you're there and everybody everybody's better off because of it.
Speaker 1:Yeah, you're not just like cash, which is nice, I mean, you get paid, which is sweet.
Speaker 2:Yeah, right, I mean of course that's like that's a really cool part of it. The dollars and cents have to line up to a certain point and the dollars and cents make sense. Right, I can't like leave that out of the equation. When you get to a certain mass as a business, the dollars and cents do make sense there too. Yeah, but not at the expense of your employees and your customers. So I think that is a big part of the decision. Yep, it's the biggest part of the decision. I.
Speaker 1:I Hopefully one day I'll get there. Well, you will. So, nick, that was great. We've been going for almost an hour and a half now. How do we get a hold of your agency if we want to have somebody look over our policy? What's the best way to get a hold of it? What's it called? How do we get a hold of you? What's the next steps if we want to contact your agency?
Speaker 2:So our agency is called a short risk advisors, a hub international company. Now phone number seven, two, four, three, nine, two, four, five, eight, six, my cell phone number, put it out there for two seven, seven, nine, five, five, nine, seven.
Speaker 2:So basically reach out to me or any of our team team members. We do 99% of our business on referral basis. We're not cold-calling, we're not really pounding the streets in that way. We're working through referrals. So If you hear about us, you know through your friends or family or fellow business owners we can definitely help.
Speaker 1:All right, nick, I appreciate you being a guest man.
Speaker 2:I think that way. Thank you very much, I appreciate it.
Speaker 1:So let's wrap this thing up on three, one, two, three Again, guys, this is a more complete beast podcast. If you got something from this podcast, make sure you leave us a five-star review and share this podcast, because that's the only way we continue to grow again. Guys, we'll see in the next episode and thanks for listening.