Placing You First Insurance Podcast by CRC Group
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Placing You First Insurance Podcast by CRC Group
The Rising Impact of Convective Storms
Severe convective storms are reshaping America's insurance landscape, hitting communities harder and more frequently than ever before. What used to be a defined spring storm season has expanded into a year-round threat, leaving homeowners, businesses, and insurers scrambling to adapt.
Join hosts Amanda Knight and Scott Gordon as they dive into the growing crisis with guests Ben Tschepikow from CRC Group's Arkansas office and Rob Porter from Vave MGA. Their frontline experiences reveal how these intensifying weather patterns are creating unprecedented challenges across the country. The conversation tackles the painful reality of rising premiums and deductibles while exploring innovative solutions emerging to help property owners. Learn about deductible buyback products that can dramatically reduce out-of-pocket costs during catastrophic events.
Whether you're an insurance professional navigating these turbulent waters or a property owner seeking to understand your changing policy, this episode offers valuable insights into the future of property insurance. Education, communication, and partnership between insurers and insureds will be essential as we weather these storms together. Subscribe to the Placing You First podcast to stay ahead of the trends reshaping the insurance landscape and discover practical strategies for protecting what matters most.
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Welcome back to the Placing you First podcast, where we explore the trends, topics and tools shaping the insurance industry. I'm Amanda Knight.
Scott Gordon:And I'm Scott Gordon, and today we're talking about the increasing frequency, intensity and cost of convective storms and what that means for clients. Joining us are Ben Shepakow, a broker with CRC Group's Argenia office in Little Rock, arkansas. Cow, a broker with CRC Group's Argenia office in Little Rock, arkansas. And Rob Porter, product director at Vave MGA, who's working on solutions to better manage this evolving risk. This is the Placing you First podcast from CRC Group. This podcast features news and insights from a vast knowledge base of over 5,100 associates who write more than $35 billion in premium annually.
Amanda Knight:Plus, we give you the latest information on what's happening at CRC this, this, this is the Placing you First podcast. And now the hosts of the podcast, Amanda Knight and Scott.
Scott Gordon:Gordon, it's great to have you both with us today.
Rob Porter:Thank you, thanks for having us.
Ben Tschepikow:It's great to be here. And, scott, I do just want to mention one thing real quick, just in case nobody is familiar with Arkansas or where Arkansas is. We're right above Louisiana and right below Missouri and right next to Oklahoma, just in case nobody knew where Arkansas was. And, rob, before we get started, you actually, and first of all, I do want to say it's just a real treat to have you on the podcast with us, rob, it's a really great honor. Rob's actually coming from, or he's in London, england, right now. It's not London Arkansas, and he was actually here in Arkansas about a month ago. So you know, before we jump into it, can Rob, do you mind to just kind of tell everybody how fantastic your visit was to Arkansas?
Rob Porter:It was amazing. What was the highlights Visiting the office? Obviously, the barbecue Amazing. We'd heard all about it and we were really looking forward to it. Ben and Bobby and the gang were kind enough to take us out to some great barbecue places. So yeah, it was fantastic. Way to be a good host, ben, good job to some great barbecue places.
Amanda Knight:So yeah it was fantastic Way to be a good host, Ben Good job.
Rob Porter:Yeah, well, now you live in Arkansas barbecue.
Scott Gordon:It's the only state where you can eat hog and say go hogs. In the same sentence. In the same sentence.
Amanda Knight:Well, ben, let's start with you. As you mentioned, you are based in Arkansas and, if I'm not mistaken, arkansas is one state that has absolutely seen the impact of tornadoes and other convective storms up close in recent history. Can you paint us a picture of what you have seen in the recent months and years in Arkansas and how clients are responding?
Ben Tschepikow:Yeah, absolutely. And before I kind of get into it, you know the terminology of convective storms or severe convective storms. Really, what that is is where you've got wind and hell and then the wind and hell is producing tornadoes, so it's kind of a severe thunderstorms leading toward leading towards tornadoes. And you know, in the insurance industry you've kind of got a couple labeled losses or events that are kind of more attritional losses, and now it's the you know the popular terminology is convective storms and you've got your cat losses and what's really affecting the insurance industry now is just a frequency of these convective storms that are coming through year to year. And then just specifically Arkansas yeah, if I were to paint a picture, the canvas, unfortunately, would be really dark. I feel like Arkansas has kind of had a tough go at it over the past few years. And you know, just in my area alone, which I'm in northwest Arkansas, just a couple years ago in 2023, springdale, arkansas, which is about five minutes north of me, there was a big tornado that came through and really affected kind of in the city area that's really never been impacted before. And then in that same year in Little Rock, arkansas, where Rob just came through, there was a tornado that came, a big tornado that came through Little Rock and impacted a lot of areas kind of in the city that haven't been impacted before. And then just last year, in 2024, there was a tornado that came through just about 10 minutes north of me, in Rogers and Bentonville, and I actually think there were a tornado that came through just about 10 minutes north of me in Rogers and Bentonville and I actually think there were two tornadoes that touched down there and again really affected areas that have never been affected before. But as I was thinking about that event, I do remember driving around the area, you know, after all of that happened, and what I kind of remember, thinking to myself, is is because I grew up in this area and a lot of these areas that got hit significantly, you know, 10 years ago, 10, 12 years ago these subdivisions, these buildings, these, you know, these houses they weren't there houses, they weren't there. So I do think there's a correlation between just the new construction and the building and the development, you know, across these areas and you know the impact that these storms are having, and so it's been a tough few years for Arkansas and then also in Oklahoma that just sits to the west of Arkansas. I think one of the largest hell events that happened in 2024 was in Oklahoma. I think it impacted maybe three plus thousand houses in one hell event. So we're living in a. It's a pretty tough, pretty tough territory right now.
Ben Tschepikow:And then it's kind of the second part of that question about how clients are responding. I just think that overall, more and more people are kind of understanding and realizing what's going on in the industry and the impact that these storms are really having across the country. And I've had countless conversations with folks that that are in the business and outside the business and really the ones that have kind of stood out to me are the ones that are outside the insurance industry, because they're saying things like geez, these insurance carriers, they're getting hammered and hit hard right now. It's got to be tough on them and I don't think in the past you would really have comments like that being made in favor of the insurance carriers. So that's just kind of been an interesting conversation. So that's kind kind of been an interesting conversation. So that's kind of what's been going on over the past few years.
Scott Gordon:Yeah, arkansas and where I live in Alabama also always hit by storms, but they have been. I mean, convective storms aren't new, but they're clearly getting worse. Rob, I'm going to ask you this from your perspective, what's changed most significantly about the nature of these storms, and why are they so bad and how are they affecting the insurance industry?
Rob Porter:Yeah, thanks, scott. Yeah, so I mean, 2023 and 2024 were really kind of historically bad years for the insurance industry and I think kind of Ben's kind of given the on the ground view. But I think over here on the other side of the pond pond, 23 and 24 were a real struggle for insurance carriers. Um, 25 started off slowly but it started to kind of pick up as well. So I think we're kind of seeing seeing potentially another kind of bad year here as well. Um, I think there are a few things at play.
Rob Porter:I mean, I think one interesting thing I think is that you know, going back kind of 10 or 20, there was really quite a defined kind of convective storm season. You kind of see, march to June was when you got your events, and outside of that it was, you know, fairly kind of quiet and benign. But certainly over the last few years we're really seeing that kind of season stretching out and I think you know I really kind of feel for the people on the ground, like you guys over in Arkansas and Alabama, because you don't really get any respite now. Right, there's always the potential for kind of these storms to occur, and certainly from an insurer's point of view as well. It used to be you kind of you get through your convective storm season, you'd have your hurricane season, then you kind of relax after that. But we're seeing events like kind of the central Texas hail event from September 23 occurring really outside of the window of when we normally expect these events, and that's that's kind of, I think, troubling, I guess not just for people on the ground who don't really get that respite, but also for insurance companies as well.
Rob Porter:I think also just kind of picking up on one of Ben's points as well about um, about the change in population, change in exposure and population growth as well, and kind of thinking about where some of the most exposed regions in the US are, places like kind of North Texas also happen to be where people are moving to and where where we're getting this kind of huge growth in exposure as well, and so obviously there's more properties that are there that can be damaged by events, and I think insurers are kind of struggling to get their arms around that a little bit, because we're seeing this kind of huge colossal growth in in in exposure there and insurers have to manage their exposure because they don't want to, they don't want to be too exposed to any particular one event and they want to make sure that you know their exposure is spread out and I think you know we're seeing that in terms of kind of premium changes and deductible changes as a result of that as well.
Rob Porter:So, um, I think those are kind of kind of some of the some of the key themes. It guess remains to see what remains to be seen what happens to the rest of the 2025 season. But yeah, it's definitely been a tough few years and it feels like the kind of environment is changing, not just in kind of terms of the atmosphere, but also kind of what's there on the ground to be affected.
Amanda Knight:Well, Rob, you just mentioned, you know, premiums and deductibles and we've seen, you know, sharp rises in deductibles and premiums over the last few years, especially in higher risk areas. Ben, how are retail agents and clients reacting to those higher deductibles and premiums and what tools do you have as a broker to help sort of soften the blow or maybe help lower some of those costs?
Ben Tschepikow:Yeah, well, I'd say a couple of ways they're reacting is one, they're just getting out of the business and joining real estate, and two, with the phone call screaming at us about how high everything is. No, I'm just kidding, you know. I think that this change in the market over the past couple of years I kind of alluded to the fact that you know everybody's kind of realizing, understanding the effect that the insurance industry is taking, I think the playing field is kind of leveling out a little bit with the carriers. I think maybe seven, eight years ago you had some events come through and there were still quite a few carriers that were still kind of had low rates, low deductibles, um, still kind of coming into the market, trying to be really aggressive with what they're doing. Fast forward, you know, five, six, seven years to where we're at now. Uh, there's been a big change in that, just that aggressiveness. Um, a lot of carriers I know in my territories and surrounding States have have left the state due to losses, you know non-annuals, big rate increases, big deductible changes, and I think it's affecting everybody that's in the business right now. And so I think that agents are, you know, more and more getting more patient with what's going on in the market and kind of understanding that, hey, if a customer's coming in and they're trying to get a quote and the days are just going down the road, somebody is a lot cheaper, lower deductibles. I don't really think that's the case anymore. I think everybody's kind of getting into the same boat with what they're being able to do and in a lot of ways I think agents are thankful that there are as many carriers that there are, especially in some of these higher areas, that they are still being able to write business and things like that.
Ben Tschepikow:So and then, just as far as kind of resources and things that agents are doing, you know, with their customers as these deductibles are coming into play, higher rates is, you know. Obviously one thing is we're seeing a lot more increases on AOP deductibles, that's all of the payroll deductibles. So kind of that typical maybe $1,000 deductible. Agents are offering and writing more maybe $5,000, $10,000 deductibles just to kind of lower the cost a little bit. And then, even if some wind deductibles have gone up, I've seen quite a bit of take up and even increasing the wind held deductible even more, just to lower the cost and just knowing, hey, we're really not going to be filing a claim unless something big comes through. So those are some things that are offsetting some costs that we feel like are getting utilized more frequently now.
Ben Tschepikow:And then you've got some products out there such as a wind deductible, wind-held deductible buyback, which is going to be really an industry-leading product, and personal lines as we move forward over the next couple of years.
Ben Tschepikow:And, for example, how that works is, let's just say, a customer's got a $750,000 home getting moved to a 2% wind-held deductible. That's a $15,000 home getting moved to a 2% wind-held deductible. That's a $15,000 wind-held deductible. You can actually take out a separate policy and buy that wind-held deductible from a $15,000 wind deductible down to as low as $2,500 just for a few hundred extra dollars. So it's really a big benefit to the customer. You know, over the course of the next few years in doing that, and so you know, I do wanna kind of put a quick plug in there to CRC is I feel like CRC is always trying to be a leader in that space with these unique products and, you know, and having products such as a wind-held deductible buyback in the residential space, that I think is going to just become more and more popular over the next couple of years.
Scott Gordon:Yeah, I think that the Wayans brothers said it best when they said mo' money, mo' money, mo' money, it's all about-.
Ben Tschepikow:And actually Scott Notorious BIG said it really well, I think in 1996 or 7, no money, no problems.
Scott Gordon:That is also 100% true. Wow, yes, it is Convective storms. What are you going to do? So, rob, they are looking at introducing some products that can help people manage these costs. Can you walk us through what these will look like and you know who they will benefit?
Rob Porter:Yeah, absolutely so. I guess, like Vave's, approach has always been from the start to kind of give the insured, give the consumer, options. And so we often see that our competitors of ours will kind of be pushing deductibles to try and kind of restrict coverage. You know, due to kind of what's going on. And our approach has always been well, you know, in Ben's case where he talked about moving from a 1k AAP deductible, $1,000 AAP deductible, to a 10,000 AAP deductible, we're still offering 1,000 AAP deductibles US wide to allow the consumer choice. We also offer them 10,000 deductibles because we want to see if the different price point is kind of appealing to them. Really, our kind of concept is that we want to offer people deductibles so that they can go away and see, buy the product which is most appealing to them, rather than just forcing them to kind of have to go for something which they don't necessarily want to do. So that's kind of been baby's philosophy and that's our philosophy on the aop side and on the wind side as well. Um, you know, we're still offering two percent wind deductibles in texas and arkansas and oklahoma. We're not pushing to five percent in any of those areas. We'll, we'll offer you a five percent deductible and you can get a sense of kind of what that, what the differential in prices is there. But we really like kind of the, the sound of kind of what ben's talking about there in terms of kind of um, these really innovative solutions around deductible buy downs and offering them in spaces where they've not been offered before and historically kind of it's.
Rob Porter:It's a kind of product which has been more on the commercial side and I think being able to kind of deploy that on the personal line sizes is, is is a really kind of powerful kind of um move to give the insureds and the consumers kind of powerful kind of move to give the insureds and the consumers kind of different options.
Rob Porter:And that's certainly something that we're looking at as well, alongside kind of giving the insured choice on the Avave products as well, because we want people to kind of have, you know, be able to kind of we don't want insurers to have to go away and buy loads and loads of different products. If they can buy one product, that's obviously much more straightforward. But we do know that other carriers are kind of increasing their deductibles and so if we can offer a deductible buy down as well, that we can kind of fill in some of those gaps that insureds are seeing elsewhere as well. So really, you know, whenever we see that the market is starting to tighten and people are starting to kind of pull capacity back, we will see that as an opportunity to kind of offer something which which can kind of plug some of these gaps for the insureds ben?
Amanda Knight:do you have anything you want to?
Ben Tschepikow:add to that. Yeah, I'd love to actually and rob, you know, uh, as we're looking, you know, crc looking more and more to partner with such great underwriters and carriers like they. I do just want to mention arkansas and oklahoma te, texas. It's really not as bad as what we're making it sound and I'm kind of I didn't mean to say Arkansas, oklahoma, texas, I was really meaning Alaska and Hawaii. Those are the states that you really need to stay away from Other states in the South Central. They're just fantastic states with hardly any losses, please note.
Amanda Knight:Asterisk right there.
Scott Gordon:Let's zoom out a bit, okay. What role do education and communication play in preparing insureds and even some brokers for this changing environment?
Ben Tschepikow:I would say education and communication are probably two of the biggest factors right now as we're going through this change in the market and it's kind of to the point of what we're saying earlier about just the playing field kind of getting leveled out.
Ben Tschepikow:So I think that just because I'm a customer, I'm a policyholder myself and as you see these events that just keep taking place, and you kind of realize it is tough out there on these insurance carriers and just with the inflation and just the cost of doing business in general, the frequency, you know, everybody talks about inflation but you kind of forget.
Ben Tschepikow:Well, inflation happens in insurance as well.
Ben Tschepikow:It's not just the rest of things that are going on, you know, in business, so it does affect insurance.
Ben Tschepikow:And so I just think that Ways that you can really kind of flourish during this time as a broker like myself or insurance agent, you know, is really taking time to educate the customer in ways that they can maybe have some credits or save some costs on their policy, but also just kind of taking time to communicate with them what is going on in the market, why these changes are happening, and just kind of, you know, zooming out a little bit and giving them an idea of what's going on, so that you can kind of just understand that, hey, we're all kind of in the same boat here, not really a case where it's just happening to you or to the carriers I'm representing. It's really a widespread change in the market right now and I just think that more, if more and more policyholders have a good understanding of what is going on. That I just think that it's going to help prepare everybody for, you know, over the next two or three years, as the industry just kind of continues to work through just another phase of insurance.
Amanda Knight:Then you know from the broker's position, from the broker's chair, what advice if you could give. You know one piece of advice to the retail agents sort of depending on people like you and Rob to help their clients. What's that one piece of advice you would give them if they are starting to see clients living in areas with more frequent wind and hail events?
Ben Tschepikow:Yeah, that's a great question. Is that what you?
Amanda Knight:tell them, call Ben no.
Ben Tschepikow:Well, actually, what I would say is I would say go rent a forklift and go pick up your office, your agency office and your home and just move it to another place that doesn't have wind and hail events. Good luck. Oh wait a minute. That's really nowhere in the US anymore.
Ben Tschepikow:Yeah, yeah, and I'm hesitant to say the word advise, because I've never been an insurance agent before and I don't ever want to put myself in their shoes at all because I've never been there and I know how just tirelessly and how hard they work and I also know, just working hand in hand with other CRC offices and brokers out there, just how great they are at their job and how hardworking they are as a whole, these brokers and insurance agents, and they just do such a fantastic job overall.
Ben Tschepikow:But what I would kind of say from my perspective just because I do deal with a lot of different agencies and a lot of different agent groups and in a lot of different territories just to continue to be patient with what's going on, because you're not in the in the boat alone, you know I've kind of alluded to it several times it's the playing field is getting leveled out with what's going on with the carriers and carriers that insurance agents are utilizing, and then again you know, just really kind of go back to that service and that communication and that education of what's going on out there and just kind of hang in there and just know that you're not alone with it.
Amanda Knight:Good advice.
Rob Porter:I think there's a huge role as well from just thinking about our side of the pond as well, of kind of communicating with you guys, the wholes wholesalers, so you can kind of get it out there to the retailers, the insureds, about. You know what? What is it that we're looking for in a property? To kind of get that better rate and get those credits as well. So, um, there's definitely something that we want to do more of is is kind of reach out and aware that this is a partnership between kind of insured and agents and carriers to make sure that ultimately, we just want to try and minimize and reduce the amount of damage that's done from these events. And so if we can get out there what it is that we will credit in terms of mitigations and stuff like that, and then if the insured is able to take those actions, then that's obviously a really powerful thing, because the events are still going to happen. But if we can try and minimize the actual damage and losses from them, then that benefits everyone, right.
Rob Porter:It benefits us benefits, insured benefits carriers, the agents as well. So that's certainly something that I think you know there's more of a role for education kind of piece being pushed down the chain, I think.
Scott Gordon:Yeah, and this is one of those areas that touches everybody. Everyone lives under the sky, everyone experiences storms.
Rob Porter:Even here in London we get them sometimes.
Scott Gordon:Right, I mean, only certain people are going to be subject to cyber crimes, but we're all going to be hit in the head by a hailstone, right? Well, this was great and, as usual, we learned a lot. But also, as usual, we are reaching the fun portion of our show, which Amanda and I like to call rapid fire. And it is just you answer right off the top of your head, and uh, let's start with our friend from across the pond, rob, with the first question. If you were coming up onto a stage, what would your entrance song be?
Rob Porter:wow, good question. Um, probably, I think, we question.
Scott Gordon:I think we're talking like hype, you know, like the wrestling yeah what's your hype song? You can't come out to Simon and Garfunkel.
Rob Porter:Oh, damn it.
Scott Gordon:I mean, you could, you could. We don't recommend it.
Rob Porter:Do you guys know Oasis? Do you have Oasis in the States?
Amanda Knight:Yes, we do.
Rob Porter:They're so huge here and they're just, they've reformed and they're back on tour this summer, so I'd probably go for Live Forever by Oasis. I think it just kind of gets you going.
Amanda Knight:Yeah, good choice, All right Ben.
Ben Tschepikow:And the insurance industry in itself is an Oasis, anyways. So it's kind of embarrassing because I don't know that it's really a song that's gonna get me jacked up, but I just went and saw them in concert about a month ago, so they're on the top of my mind. Yeah well, I'm gonna have to go with boys to men and I'm gonna have to go with a song one sweet day featuring mariah carey. It's not going to get you jacked up, but it is a fantastic song to just kind of slow the world down, make you think a little bit. But gosh, they were good in concert. I'm going to have to admit that. So that's what I'm going with.
Scott Gordon:I remember seeing that they were getting back together or getting ready to tour and I was like can they change their name to Men, to older men? Now I don't exactly exactly, but that's exciting. I'm glad, I'm excited that you got to see them.
Ben Tschepikow:I bet that was awesome it was, it was, it was great. And they still sound the same as they did, you know, 20 year, 30 years ago nice, all right question, Rob.
Scott Gordon:If you could bring back a fashion trend, what would it be and why?
Rob Porter:I think probably skinny jeans. I'm absolutely appalled that they're not fashionable anymore, because skinny jeans were all the rage when I was at university and at college. Apparently, they're just not very cool.
Amanda Knight:Now, same Rob, same. I'm not letting go of mine. Let me be clear they are still in my closet right now.
Rob Porter:Yeah, same, yeah, yeah. To be honest, I just don't want to go shopping again and buy some new jeans. Is the thing, ben All right Ben.
Amanda Knight:What about you?
Ben Tschepikow:Yeah, I don't know if this is getting into eighth and ninth grade, so it had been, you know, I guess 14, 15 years old. I don't know if y'all remember Abercrombie and Fitch. So Abercrombie and Fitch came out at that time and just kind of blew the doors off of the. It seemed like there was a. You know, we have a pretty big mall in our area and they had a huge store, but they were so expensive. Everything in there were so expensive, and I just remember I had several friends that would get new pants and shirts and of course my parents couldn't afford any of that stuff. So we never were able to get any Abercrombie and Fitch. You know we were going old Navy, um. So what I'd like to bring back for a week is just that style during that time, and I just would like to see why it was so expensive and why it was so popular you want to time travel, that's what you want to time travel?
Rob Porter:yeah, I want to time travel, yeah, yeah hop in the delorean.
Scott Gordon:when you said, wow, it was really expensive, I almost said, almost said, were you an old Navy boy? And you said it, yeah, I was an old.
Ben Tschepikow:Navy boy, absolutely. I think the prices were a third than what those were, Absolutely they were Solid, solid bargains at the old Navy y'all.
Scott Gordon:We're not paid space. We should be Well, ben and Rob, thank you so much for joining us today.
Amanda Knight:Well, Ben and Rob, thank you so much for joining us today.
Ben Tschepikow:Absolutely. Thank you so much for having us and, rob, thank you so much for being a part of this.
Rob Porter:Yeah, thank you, it's been an absolute pleasure. Really appreciate that. No, you're welcome, my pleasure.
Amanda Knight:And thank you to all of our listeners for joining us today. Be sure to subscribe to the Placing you First podcast wherever you get your podcasts, and we'll see you next time.
