A Talk with RightSure Agency Group and O’Connor Insurance

Speaker 1:

Welcome to the vipHome Podcast, where we talk about all the things homeowners need to know.

Caroline Brenneis:

Today, we are speaking with two insurance experts from different parts of the country. We have Michelle O'Connor from Michelle O'Connor Insurance in Charlotte, North Carolina. And Jeff Arnold from RightSure based in Arizona. So, welcome both. And thank you so much for joining us today.

Jeff Arnold:

Thank you. Happy to be here, and a pleasure to meet Michelle on camera, in-person.

Michelle O'Connor:

Thank you so much for having me. I look forward to our discussion today.

Caroline Brenneis:

Michelle, why don't you kick us off a little bit? Tell us a little about you and your company. And then, Jeff, when she wraps up, share a little bit about RightSure.

Michelle O'Connor:

Sure. So, I have been in the insurance business for a long time. I started off as a district sales manager with Erie Insurance Group. And was lucky enough to get transferred to beautiful North Carolina, where I was able to expand their footprint by putting independent agents on in North Carolina. In 2000, my husband and I started O'Connor Insurance together. So, we've been in business for 20 years in January.

Paul Chadowski:

Congratulations. And just for that, Michelle and I, we met. We would serve on ... Because I was the former agency owner, and we had task forces at Erie Insurance. And Michelle was the chair of the IT task force when I was chair of the personal lines task force. And that's where we just got to meet initially. And what an outreach. That's why it's just great to connect after all these years. Because it has been probably at least 10 years since we have connected. So, we're very welcome to have you.

Michelle O'Connor:

Very true. Thanks Paul. And it's a pleasure to reconnect with you as well.

Paul Chadowski:

And as I get to Jeff, Jeff and I have been able to chat a little bit earlier. And I don't want to take away some of your thunder, but I just love that you describe yourself as a human, a dad, a author, and a thinker. And I also wanted to pass on congratulations to your agency, RightSure, which is listed from the Insurance Business to America, 2020 Top Insurance Workplace. So, congratulations to that, Jeff. I didn't want to take away some of your thunder, but I did want to put that out. And just the quality of agencies that we have here with both Michelle and Jeff. So, with that, Jeff, please take over the introduction of [inaudible 00:02:21].

Jeff Arnold:

Yeah, thanks, Paul. First of all, glad you brought that up, but the credit isn't here. There are five senior people at RightSure that deserve all the credit, right? So, they're the ones doing all the hard work behind the scenes to get us lifted to that point. But indeed it was an honor, right? It's a great accolade to have to be able to hang on our wall Insurance Industry Workplace of the Year. So, happy and excited. Like Michelle, I've been in this industry for a little bit, 31 years. I know I don't look that old, it's okay.

Jeff Arnold:

Every day is fun, right? I wish this industry on everyone because it truly is a place to make any dreams come true. Not just lip service. It's been wonderful for my family and fed everything that I need as a person, just wonderful. Agency is rideshare. We're four different entities in one. We're part tech because everyone wants to be an Insurtech tech space. We have our own proprietary technology in play. And then we're part aggregator. We acquire a lot of firms over the years, about 16 different firms over the years. Part independent agent place where people just hang their shingle with us, and then part a mom and pop. Old-fashioned, mainstream, retail location. So, that's the summary of what RightSure is, but happy to be on the show.

Paul Chadowski:

Right. And Jeff, what is your outreach? Can you tell me how many states you're in, where you do Right?

Jeff Arnold:

Yeah. Thanks for asking. We conduct business in 42 states, but we generate decent or significant revenue in 16, mostly the Southwest, where I live in Arizona, and then the middle America as they call it.

Paul Chadowski:

Great. Okay. Thank you so much for those introductions. And it only confirms why we have the quality of agents on here. So, thank you. We'd like to start off this podcast kicking off what we call homeowner horror stories. And these are stories about things that could go wrong in the home that you just wouldn't believe. And do either of you, I'd like to start with maybe Michelle, do you have some horror stories that you can share with us?

Michelle O'Connor:

I do. So, I shared this one with Carol before. So, I'll actually share two short ones with you all. But we had a homeowner who had a toilet overflow that was above a finished basement. And so, the water was running down into the finished basement, and the ceiling fan was going. So, it literally hit the fan and went all over the finished basement. It was a nightmare of a claim. A lot of cleanup for our poor homeowners. It was ugly. It was very ugly stuff. And then we've also had some scary ones as well. We had a fish tank that was on a surge catch on fire. The surge strip actually caught on fire.

Michelle O'Connor:

And luckily, someone was home at the time, but the fire was going up the family room wall when they caught it, and were able to put it out. So, luckily, the damage was contained to that room, but those surge protectors can be troublesome as well as protecting us sometimes. So, it was a good reminder to make sure that they don't get wet, and that they are new as well.

Caroline Brenneis:

Michelle hearing that first story for the second time, I cringe just as much. That is still such a crazy story.

Michelle O'Connor:

It was definitely an ugly claim. There's no doubt about it. I felt so sorry for those folks.

Caroline Brenneis:

I could really only imagine. What about you, Jeff?

Jeff Arnold:

Oh yeah, similar horror stories of that. Michelle and I can trade stories for quite some time. Two that come to mind really quick is one that you'll just shake your head out and wonder why. But so one of our policyholders is part of our private client division, so, it's a large home, decided to eradicate all the desert behind his house, about three by 10 foot swath, right? Because it was really just attracting rattlesnakes, and pack rats, and all kinds of nefarious animals. Right? So, as he was replanting his yard, he had [inaudible 00:06:10] back hole, a pretty good space outside the back of his yard. I think it was under 10 foot on the other side. Turns out unbeknownst to him that these were special cactus, special dead cactus that he was removing, right?

Jeff Arnold:

And the person who owned the property, which wasn't him sued our homeowner, our policy owner ... This is the kicker ... $70,000 worth of special dead cactus, and rattlesnakes, and what have you. And so, luckily, company paid for it, paid for the defense cost, and paid for it too. And part of the settlement was he had agreed that after replanting it all, irrigate it off for two to three years or something too at his own expense. So, just a claims horror story, right? Stop at your property line. Don't try to help your neighbor out by clearing out dead cactus. It's not worth it.

Paul Chadowski:

Did he have to replace the rattlesnakes too?

Jeff Arnold:

[inaudible 00:07:00] on their own. I'm sure. But yeah, just crazy. And then, another one similar to Michelle's, water. Claims follow water. That's just proof. But this one was just the homeowner lived above a homeowner [inaudible 00:07:15] them on a hill. And their irrigation system had been dripping for some time unbeknownst to them. And the neighbor below put in a brand new concrete driveway while this was dripping. And it just destroyed the concrete driveway overnight. Because it was more than a drip, I guess, it was a pretty good water stream. Policy owner didn't know about it until he was served in a lawsuit.

Jeff Arnold:

It literally took them a month to file the claim and serve him to replace it. But the neighbor didn't even come up to tell him, right? He waited four and a half weeks later to serve him, to sue them. So, yeah, just all kinds of horror stories. Buyer beware, caveat emptor, right? Know what's in your home insurance policy, what's covered. So ...

Paul Chadowski:

And you bring up a good point that I think a lot of homeowners don't know. They think of property, and theft and fire, and vandalism. They don't understand that there's things called legal costs that are involved and covered in the home policy. We don't always talk about that, but I knew when I was an agent, sometimes we have to spend money legally just to pay nothing because it may not have been that person's fault, but there was that. So, it's interesting that both your stories, and you bring that up. But I think that's a really good point for homeowners to have a takeaway that they don't realize that not only do they have legal fees, but they have attorneys for them. They don't have to search them out.

Jeff Arnold:

Sure. Good point.

Caroline Brenneis:

Well, both very horrific horror stories I have to say. So, thank you so much for sharing. Let's dive a little bit into the nitty gritty of insurance. Can you both share ... I guess, we'll keep going with Michelle first and then Jeff, but can you both share a little bit about the catastrophic claims that you see in each of your regions, like wildfires, or flooding, or, specifically ... I know Jeff you're sparing a large space, and Michelle, I know you're a little bit closer to North Carolina. But I think having you both on and seeing more specific to your region would be so helpful for listeners.

Michelle O'Connor:

Sure, absolutely. So, we live in an interesting place where there's a hurricane that threatens us just about every other week in North Carolina. Typically, it's just our coastal areas, but we're a little bit inland. But inland, we also have a lot of flooding risks. So, unbeknownst to a lot of our policy holders, flood, even if they're not in a flood plain is a big risk for them. But of course, the wind and the hail are probably some of our biggest claims, especially, in the spring. And then, in the fall, when we get into hurricane season. Rarely enough, we actually had an earthquake on August 9th in North Carolina. It was above five on the Richter scale. I was camping in far Western North Carolina and did not feel it, but my husband said he did. So, I guess, I wasn't in the right spot to feel it that day. But so that's interesting. We've not really had that as a threat to our area. And so, it's definitely something we're having conversations with our clients about now.

Paul Chadowski:

I'm sorry, are you on a fault line, Michelle? Or is that earthquake, is there any explanation for it, or can you give us a little more the detail? Because we all think about it. And we get to Jeff, about the West and the Californias.

Michelle O'Connor:

So, my understanding is we are not on a fault line. I tried to do some research on it, and to go back into history. And really there have been only, I believe, like 20-ish since the 1700s in North Carolina. So, it is still very unusual for it to have happened. And I believe that it was a specific ... And I don't know enough about earthquakes to give you all the details, but there was a specific reason this one happened that was unusual. With that being said, though, the homeowners that were in the immediate area still did suffer damage. And typically, it's foundation damage. And so, it's expensive, and makes the home unlivable until it's repaired. And so, that's scary to me just to think about that, and try to figure out whether or not that's something that our clients need to take more seriously.

Caroline Brenneis:

So, just to piggyback off of that a little bit, I know you had mentioned that earthquakes aren't common in North Carolina. So, is this something that falls within a standard policy, or would this be something that a policy holder would have had to add on or however the real terms are [crosstalk 00:11:17]?

Michelle O'Connor:

That's a great question. And we put a blog out about it because we've had so many questions about it. It is not covered on our standard policy, home policy in North Carolina. So, it is an endorsement that you have to add on to your policy. But we have had a lot of folks that have gone ahead and added it because they felt like for the amount of premium that it was worth it. It's a low exposure, but again, if it happens to you, the damage would be a lot. So ...

Paul Chadowski:

So, you don't need to get a separate policy, you get an endorsement. And if I recall from back there, it's a different deductible. And does it apply to the house and the content separately? I mean, how does that earthquake coverage work?

Michelle O'Connor:

So, in North Carolina, I believe it's going to work much differently than it will when Jeff starts to talk because it is a low risk in our area. And every company is doing it a little bit differently. So, I don't have a broad stroke answer. Matter of fact, one of our home carriers is actually adding it to their policy at no additional charge. Most of ours are not though. So, it's a conversation that we'd like to have with every person individually, so, we can guide them for their particular insurance company that they're insured with. But for most of ours, the deductible is being chosen to be the same as the home. But again, it's different for every insurance company.

Paul Chadowski:

Jeff, I'd like to get some of yours, and some of what you see out in your part of the country. Some of the specific types catastrophic claims [inaudible 00:12:45].

Jeff Arnold:

Sure. Yeah. So, when you think about the West, you think in terms of this just wide open space. And so, wildfires is the first, right? And so, wildfires, yes, like such as Michelle, earthquakes, right? Especially, in California and then over the San Andreas Fault. And then flooding like in all areas of the country, flooding. But wildfires being one of the biggest. They spread rapidly, and quickly destroying wide swaths of land in a rapid fashion. Oddly enough, after the fires beat everything down and gone through, suddenly, the rain will come in. And that is equally as bad because there's nothing to catch the rain anymore. So, you have massive mudslides, massive amounts of flooding.

Jeff Arnold:

And as Michelle alluded to earlier, many things aren't covered in a normal policy. The buzzword that she used, our industry word is endorsed, right? You have to add that on, endorse it onto a home insurance policy. Not every carrier will add a earthquake as an endorsement. Some it's a separate policy. Most use a write your own or federal program for the flood insurance. That's separate too. So, depends on the exposure: wildfire, flood, or earthquake. If it can be added to policy or bought separate.

Paul Chadowski:

That's really helpful with that. We have people that have told us, "I don't need flood insurance. I have this endorsement called sewer and drain backup." And so, you have these sump pumps, whatever. I mean, do they have a false sense of security, Michelle, with this? If they have a sewer and drain backup, and flood, are they different types of ... They address different things?

Michelle O'Connor:

They sure do. Yes. And I do think sometimes homeowners feel like that they do have everything that they need without having that extra conversation. But definitely, sewer and drain just addresses things that overflow into your home basically. So, that toilet that overflowed was covered under the sewer and drain coverage, that it's not going to address flood. And I always simplify the flood definition, and it's rising or standing water. So, mudslide as well as Jeff said. But I always simplify it so that people get that illusion that when it rains too much, as Jeff said, and that the water can't soak into the ground, which we've had happen a lot in the Southeast lately, that's not covered either if it comes into your house from the outside.

Paul Chadowski:

And Jeff, if you can comment, some people have said, "Boy, my house got flooded and it was covered. But then we use the word flood and it's not covered." I mean, do we simplify the words? Are there types of floods that are covered when we use that word? And then explaining it then the other type of flood that you would have to get a separate policy for?

Jeff Arnold:

Yeah. It's confusing for many people who don't understand the legal contracts that we sell called insurance policies. Right? And so, making terms to simplify it because people don't want to remember the words indoors or sewage and water back up a lot of times. Tiles of moving pools of water, right? If it's moving, do you know when you think of it in terms of a flood, it's moving because rains come down, a large water's moving down the street, or moving through your yard or whatever, that's going to be subject to flood insurance. That's going to need flood insurance. As she was alluding to the sewage and water backup, they may call that a flood. Oh, it flooded my bathroom. Yeah. That part is covered. And so, it's really how the word flood is interchanged there. It's semantics, but that's our business. Right?

Paul Chadowski:

Exactly. I've also read, getting back to wildfires, that some carriers may consider treating that as a separate type of risk and not under fire because of how much the fires are and wildfires are different than fires. Can you comment on any of that with the wildfires, or any of your carriers saying, "We're thinking about giving a separate deductible, purchasing a separate coverage for wildfires versus just standard fires." Have you seen anything like that?

Jeff Arnold:

Yeah. I think what you're alluding to is the word peril in our industry, right? What's a covered peril? And so, there is talk, discussion about it in the industry as they suffer more and more losses to maybe offer a hybrid policy that might, A, require additional coverage for that or limit the coverage that they would pay. And there isn't one in Arizona, Colorado, or California that I'm aware of that excludes that, but there's certainly talk of that. So, it'd be tough in those states. Remember there's still a little bit of John Wayne in everybody in the West. They still [inaudible 00:17:04] as a cowboy. So, even if they live in the city. So, be tough to push that through.

Caroline Brenneis:

Michelle, I know we touched on hurricanes a little bit, but can you share a little bit about how ... Because in North Carolina, I feel like, as you said, they're very, very common. So, where that fits in a typical policy, or if it's an add-on, or explain a little bit of that process for us.

Michelle O'Connor:

Sure. So, that one's going to really be dependent on where you live. Where we live in Charlotte, it's inland. And so, wind and hail is covered as part of our standard homeowners policy. But on the coastal areas of both North Carolina and South Carolina, you have to add on wind and hail to your policy. And typically, it does have a separate deductible. It's the bulk of the cost for most of the policy to add those coverages on. And your proximity to the coast is going to depend on just how much you're going to pay for that extra coverage, which you desperately need if you live in either one of those areas.

Caroline Brenneis:

Funny, if I was on like Million ... One of those like game shows, I would have really thought it was the exact opposite that it would be definitely included if you were closer to the shore, like an add-on, if you were. Is there any particular reason or just because it's so just more common, it's a way to make more money?

Michelle O'Connor:

Absolutely. It's the risk factor, right? So, how likely is it to happen to the house on the coast? It's very likely. How likely is it to happen to my house in the more interior parts of North Carolina? Not as likely. So, the things that are not as likely are typically going to be things the insurance companies are going to be willing to cover at no additional costs.

Caroline Brenneis:

Oh, see, that makes a lot of sense. Thank you. See, now I know. I'll get that question wrong if I'm ever on a game show.

Michelle O'Connor:

Glad to help out.

Jeff Arnold:

That's the value of an agent right there. Right? That's the dollar, the bang you get for your buck when you use an agent who has that knowledge to transfer it. So good stuff.

Michelle O'Connor:

Yeah. My husband and I, we're currently in an apartment, but we're looking for houses, trying to find the right town, yada, yada, yada. And when I was working with Michelle now, a few months ago, I was like, "Can you help me out?" And she's like, "No, I don't work in New Jersey." And I was like, "That's just devastating." But yeah. I mean, I think after working in this world for a little over a year now, I think I'd be so silly not to work with an agent. So, thank you all.

Paul Chadowski:

When we have these storms, you talk about this, here comes the hurricane. And okay, the winds blowing [inaudible 00:19:28]. And this is where sometimes we say, "Okay, is it hurricane? Or is it flood?" Just going back to that. And just can you walk us through some of what the insurance companies how they look at it, and wind-driven rain, or what this is, and just address that. Just how that can be. Is it more clear cut, or is there some question?

Michelle O'Connor:

There's definitely some questions. And I've definitely heard some stories on the East Coast. We had a number of flooding issues right in a row with several different, big name storms over a couple of years, which is unusual to have that many in a short span. And there was a lot of issues that it comes down to trying to determine where the water came from. Especially, because it takes some times to get those claims settled that usually there's a time lapse as well. So, it makes it more difficult. Again, in the interior areas it's going to be a little bit easier, because if the roof blew off in it, that's how the water got in.

Michelle O'Connor:

It's going to be pretty clear cut versus rising, standing water is not as common where we're at as it would be in some of those other areas. So, there was a lot of issues with that though. It's not clear cut. It's definitely difficult to figure out. And the adjusters had their work cut out for them when they go in there to make sure that they've got those determinations. Thankfully, a lot of the policy holders have both policies. And so, it's really just a matter of figuring out which one's going to cover it at that point.

Jeff Arnold:

Couldn't put it more eloquently than that, so, nothing to add there. One thing that came to mind is what you'll see, if you watch the news, you scratch your head at why this would happen. But sometimes in large flood areas, you see all these fires pop up, and you're like, "What in the world? No gas leaks fires. Well, guess what? There is fraud involved. Consumers know, "I don't have flood insurance. I have fire insurance." And so, fires start popping up. Right? All kinds of fraud in these places. And so, "My house burned down in the middle of the flood, that's covered, right?" Yeah. Okay. That's covered.

Jeff Arnold:

But what Michelle ... I was reading between the lines there too, what she was saying is, yeah, the adjuster has to be part investigator, right? To say, "Okay, what happened?" Especially, in times of flood when there's fire. Is this a gas leak that sparked this, or did this person not have flood insurance and decided torching it may be the only alternative? So, it's an ugly side of the business, but worth having dialogue about.

Caroline Brenneis:

Wait, Jeff, how do you know that they're lying? Committing fraud. That's crazy. I can't believe that my brain would literally never even go there. Like I-

Jeff Arnold:

I don't think any of our brains would but years and years of exposure to it. And this is why insurance companies hire these arson investigators, and ex-fire chiefs to study this stuff. So, unfortunately it exists, but part of the industry.

Caroline Brenneis:

My mind is blown by that statement. I really did not know that was a real thing.

Paul Chadowski:

All the more reason why you say. And I'm sure each of you have rapports with your adjusters. It is. And the adjusters that settle these claims, if you can comment to that with homeowners, that they really do want to help you. Sometimes you hear, "Hey, you're going to find ways to deny the claim." But I would think in most cases you really are trying to work with that. I don't know where that stigma is but, Jeff, if you can comment on that. Just what you're saying that there's a lot more that are covered than denied, and how that process works.

Jeff Arnold:

Yeah. Thanks. Agreed. I would submit to you and our listeners that our goal in the insurance companies that we represent is not to deny a claim, it's to pay it as quick as possible, right? To make that policyholder whole, and get them back on with their lives. But during the term of their investigation, or while they're looking at the loss, if they find something that just doesn't seem right, then they got to start pulling all these fraud levers, and validating it. Right? So, that's why some might submit back to say, "Well, my flame wasn't covered." Or, "The insurance company is trying to deny me." That's not normal, it's abnormal. And certainly the cures that we have in our mix don't participate in that behavior, is a primary function of getting the claim paid.

Caroline Brenneis:

Wonderful. Thank you. So, I know we talked a little bit about flooding in the beginning. But just, I guess, want to make it a little bit more clear for the listeners. So, flooding is covered in most insurance policies if it comes from inside the house, but if it's external it's not covered, or am I wrong?

Jeff Arnold:

Yeah.

Michelle O'Connor:

No, you got it exactly right. The clarification I would make is that I wouldn't use the term flood in the house. From our agencies, we're going to use the terms sewer and drain in the house. And that is when the sewers and/or drains backup and come back into the house. The resulting water, again, Jeff said it was semantics. It is. But I won't call it flood inside. Outside is the flooding. And that's the rising standing. And I really like Jeff's explanation, the moving water as well. We don't typically think of it that way because of our topography where we're at. But that's a great explanation as to really separating the differences. Do you have anything else you can add to that, Jeff?

Jeff Arnold:

Yeah. Thank you so much. Caroline, what I would add is now your user would take away, "Oh, if it's inside the house to have sewage and water is fine." That's also an endorsement. Not every homeowner's policy includes sewage and water backup. So, that is something that, if you're just trying to save money, an agent might not add on. Or certainly if you buy it online, you didn't check the box you want it. Because my sewage would never back up. I'm on public or I'm on septic. So, you don't check it. And the only way you find out it's not covered is when you're standing in your own backup, for lack of a better word. But yes, inside too you want to back up, if you have the endorsements covered. External moving water, flood.

Paul Chadowski:

Is flood insurance required in some places, and other places it's optional? So, can everyone get it if they want insurance, or are there restrictions? Are there times you have to get flood insurance?

Michelle O'Connor:

So, yeah, that's an excellent question. If you're by a body of water, typically, flood insurance is going to be required. There's flood plains that have been established that allow the mortgage companies to know that you're at higher risk, your home's at higher risk. And so, if they're going to lend you money, which most folks do have a mortgage, then they're going to require the flood insurance be added onto it. But with that being said, if you don't have a mortgage, if you're in a flood plain, you're still at higher risk. So, it's still something that you want to consider adding, or having that additional policy be put onto it.

Michelle O'Connor:

But there's lots of folks that are not in flood Plains that are at risk of flooding. And so, that's been a hot topic in North Carolina because, again, of the additional rain that we've had in recent years, and the lack of flood policies, and some of the middle of the state, and some of the mountainous areas as well. Where they can still flood and in a hour or two's time span have torrential rains that create that.

Jeff Arnold:

What I would just add onto what Michelle said is ... Everything exactly perfect the way she stated, but these maps are five, 10, 15, 20, 50, 100-year flood plains. So, we have an idea of when a flood is going to happen, right? Looking at history, and projecting forward. And that topography map that she referred to is laid out over places that are built or where people live. And then that helps drive the pricing, but also the proximity or projected of when another flood might occur.

Paul Chadowski:

That's really helpful on all that too, because again, I am sure there's going to be more questions with this too. And that's why you need an independent agent to talk it through, and have these discussions. But you mentioned topography, which is a nice word. And I'd like to pivot to that, Jeff. And then I'll get to Michelle on the same thing. What are some of the challenges or issues with home insurance based on the climate that you ride out there out West, the topography, how things are built. What are some of the things that you see that you need to talk about that homeowners need to be aware of?

Jeff Arnold:

So, in the desert Southwest, where I live, it's just heat, right? It was 118 for three days in a row here. Stuff just stopped working, right? Air conditioners stop working. Our water heaters get overheated because in some places they're exposed to the elements. And so, the number one thing is a lot of times equipment breakdown. And just, if you have a wood roof, it deteriorates much quicker in 115, 118, 120 degree weather than it would maybe at 70, 80, 90 degrees. So, roofs take a beating. And then equipment break down is a very prevalent thing in our area. But you have to add on indoors to your home insurance policy.

Paul Chadowski:

Michelle, can you [inaudible 00:28:06] about what's some of the same issues?

Michelle O'Connor:

I don't know that we have the topography issues that Jeff has. We have heat, certainly. It's not been 118. Thank heavens. We have a lot of humidity. Certainly, air conditioning units break down, but most of our carriers aren't offering that endorsement yet. There's a lot of talk about it, but it hasn't rolled out, at least in North Carolina. We're a unique state. So, it's rolled out in other states around us, but just not in ours. I don't know that we have quite those topography issues. I mean, we are fortunate not to suffer hard winters. We rarely have cold temperatures. So, we're in a sweet spot. So, if you're looking for a great place to live, definitely, Charlotte.

Caroline Brenneis:

[crosstalk 00:28:46] so much to move out of New Jersey. I hear like the 4:00 PM like nighttime is coming, and it's brutal. And it's like negative two degrees.

Michelle O'Connor:

Well, come on down. January and February are fabulous months in the Carolina.

Caroline Brenneis:

I'll be there.

Speaker 1:

Also, between the two places, and if you can each talk about this. Jeff, I don't know if a lot of the houses out West they have basements. In the East, where I'm at too, we do have basements. And just what type of exposure or what homeowners should be aware of that if you can just maybe comment on the types of homes, and just some of the considerations people have to look at.

Jeff Arnold:

Yeah. Great. So, not a lot of basements, very few. I'm thinking of a few old missile silos that people have turned into homes. But yeah, not a lot of basements in the area. But in our area, it's a flat roof. And so, if you're not used to flat roofs, you're like, "Why would a roof be flat?" Right? It's a pitched or very flat roof. And so, those can collect a lot of dust. We have these haboobs, if you've ever seen them on TV. Massive dust storms. They can collect a lot of dust, and just a lot of debris gets stuck up there. So, you have to be aware of what's on your roof, right? And clean it a little more than maybe in other parts of the country where you have to clean out your gutter, occasionally, from leaves and limbs, right? You have to be on your roof, quarterly, which your app can remind people to do, right? If you're in the Southwest, get up there and clean off your roof. So ...

Paul Chadowski:

I don't know if you have ... I believe basements are a little more common out in North Carolina, that particular area. And what type of different exposure does that open up a homeowner to having basements?

Michelle O'Connor:

Sure. So, actually, where I'm at in Charlotte, they're not very common. We have red clay. And it's very difficult to dig in. So, if you have a basement, it's typically a walkout because that's the only one to dig so many ... And so, you also have an elevated lot to go along with that because it has to be a walkout. So, it's a unique situation. There's not a ton of different things except for making sure that an agent knows that you actually do have a basement because of the increase in the home value. And it does add quite a bit of value because of how expensive it is to dig those basements out. So, that's unique. Other than that, folks are either on a slab or a crawlspace. And there is some maintenance that goes along with those as well.

Michelle O'Connor:

Similar to the roofs, on the slab probably the hardest thing is just the temperature changes. If we do have a cold snap and it goes into freezing temperatures, there's sometimes some exposed piping that has burst. We've had that happen to clients, and even some of our own staff because of where it was located. And then the crawlspaces can gather water. So, keeping those dry is definitely a maintenance issue in North Carolina. Just making sure that it's sealed off properly so that it doesn't mold.

Michelle O'Connor:

And that you know what's going on down there, because if you have plumbing, which most folks do down there that leaks, and you don't know it, because of where it's located, giving those a check every now and then is not a popular thing to do because of the things that might live under there. But necessary.

Paul Chadowski:

Definitely what I'm hearing, oh, is of course, why you need to talk to your agent about a lot of things, because some people feel if it happens to the house, my homeowners covers it. And I know, Jeff, you alluded to equipment breakdown. They go, "Hey, my furnace just went, or air conditioning just went. Why isn't it there?" Or, "Hey, I have ants in the house, vermin or whatever." If it happens in the home, it's got to be home insurance. And just some of those discussions. And just how you look to address some of that, that we're finding that there are things that can't be addressed. You just need to talk to your agent about that. But I just didn't know if you have clients that have come up and say, "Well, gosh, if it happened to my home, that's what I have home insurance for. Why is it not covered?"

Jeff Arnold:

There is a blurred line and a confusion surrounding is it warranty? Is it home insurance? Is it under my deductible? Right? What part does coverage come in? Right? And so many times, so often, people are so strapped. They just want it to be covered under insurance, or warranty, or something. If it's not under either is where anger enters in or frustration enters into the process. But typically, try to counsel homeowners to think of this as large losses only. Don't think of your homeowners as a maintenance policy, or a maintenance product. You're only going to make yourself uninsurable in the future if you keep filing these very small claims or treat it like a warranty, you're pricing yourself out of coverage is what you're doing.

Paul Chadowski:

So, do you use the same rationale to come up with deductibles too? I mean, what can someone take so that they're not, and how do you maybe address that? I don't want to get too far off track, but to your point, I think you probably find out what their risk tolerance is also in that discussion.

Jeff Arnold:

Yeah, absolutely. For high net worth clients, it's going to start at a $10,000 to 15 to $20,000 deductible. Eat all the rest under that to keep your premium low. And for most home policies, 1,500, 2,500, 3000. Got to be comfortable with that. Some lenders have issues. Those are getting few and far between now. A lot of them don't care. But you have that conversation, reduce the premium by increasing deductible. Which means you're on the hook for these smaller items, which is good.

Caroline Brenneis:

Wonderful. While we're on preventative maintenance, a little bit, vipHomeLink, part of one of our features in the app is really keeping up-to-date with your maintenance, and then the app sends you tailored reminders based off the maintenance updates that you input in your app. Excuse me. So, can we just talk a little bit about the importance of maintaining your home in terms of insurance policies and how that affects what insurance a policy holder would buy?

Michelle O'Connor:

I think Jeff alluded to this already, but the maintenance of your home, if you think about the home policy as being for catastrophic things, the other issues are things that you should be taking care of on a regular basis. So, that includes being able to budget for those items, and scheduling those items, which the app does a beautiful job of reminding you of, because life is so busy. It's hectic to remember that your AC unit needs to be serviced or, "Oh, it's fall coming. So, we need to have the heat serviced." Those types of things. Or our roof's 15 years old. There's a good probability that we need to start thinking about replacing the roof.

Michelle O'Connor:

So, I think that those are all important maintenance issues that customers need to think of. But there's also lots of little things too, even things like ... We're big with changing the batteries on our smoke detectors in October, and really pushing that message out. And even though that's not a home maintenance issue, it's certainly an insurance issue from folks dying in house fires. So, that's something that we push out to our clients at that time too.

Caroline Brenneis:

Well, we should definitely partner in October because that's when we do a big check your smoke detector batteries too. So, I feel like we can do something there.

Michelle O'Connor:

That would be great because we pushed so much social media out that month. And typically, we get to do a lot of fun things in our community during that time too. And of course, this year we're doing nothing. So ...

Caroline Brenneis:

What a weird time this year. Truly has been. So, again, vipHomeLink is an app that helps simplify home ownership as well through the use of technology. Can you share a little bit of how technology has changed both of your businesses?

Michelle O'Connor:

I'm sure you'll echo these sentiments, but technology has been such a welcome thing in, especially, the last six months, knowing that our agency was already prepared for something like this to happen. And by that, I mean that we've been electronic forever. And so, we've already been able to sign applications electronically. We are able to video chat with our clients. We have voiceover IP phones. So, during hurricane season, we push out to our clients all the ways that we're prepared for the unexpected to happen. Little did I know that the disaster preparation was going to prepare us for COVID as well, because it was seamless to use the same plan, and same operation. The good news is we had power, which I never anticipate in a hurricane. So, that's always a good thing.

Michelle O'Connor:

And there's a few less details that way. But technology has really changed our business because it makes things so much easier. You don't have to drive to my office to make a payment nor to sign anything. And we're still able to have the personal connection with things like video chats, which we've used a lot with our clients in the last six months.

Jeff Arnold:

Yeah. Great. All of those, agree completely, right? To be able to remote your entire workforce of 70 plus people came easy to us because we had a disaster preparedness plan, right? The time you spend now working on those things pays big dividends in the future. And it paid off for us all big or bigly, as the kids would say, during this COVID experience. And then, one other, in addition to [inaudible 00:37:31] webinars that everyone is really adopted to, the big pivot for us, which I was slow to adopt that just blew up for us during this is texting.

Jeff Arnold:

I mean, we went from very little to three different text platforms just for endorsements, for payments, for communication. And I'm not talking about web chat, I mean, just flat texting. There's a certain segment of the population just prefers to text. And so, that's been a real game changer for us. How to manage the avalanche of it coming in. And how to prioritize, and how to get it attached to the client file. But it has made easier for the consumer because that's how they want to do business. And so, just a simple sign off on that is I can't believe how much texting has accelerated just during COVID for us.

Caroline Brenneis:

Definitely. Yeah. I mean, I feel like even with us, we were virtually ... No offense ... Other than Paul, all in the office. And I think we honestly have worked so well together with Zoom, and Skype, and email, all of that. But it's really been oddly enough like something that I think we as a team have really excelled at. And I could only imagine that that too works with you to your clients, especially, in a time of panic, and stress, and all of that. So, Paul, do you want to take the last question? It has your name written all over it.

Paul Chadowski:

Before I get to that though, the other part is it's great to have all those plans. And I think I heard it from you, your teams embraced it too. Because so often you can have the best laid plans, but it sounds like everyone embraced the technology, and there may have been some adjustments for them. But can you briefly comment on that before I get to the last question? Just has it been an adjustment for everybody or has it been pretty smooth from that standpoint?

Michelle O'Connor:

Well, I have a much smaller team, so Jeff probably has a lot more to share. My little team of six did pretty well. Ironically enough, there were two girls on my team that did not do as well at home. And one asked me to go back to the office. The other one was our receptionist, and we never really intended it for her to be at home because of her job functions. Still having to deal with some logistical things like mail, and checks, and things like that. But our office is set up so that it was very easy to put them back in there with social distancing, and they're good to go. And they're actually quite happy that way.

Michelle O'Connor:

So, I think we could still pivot back, and put everybody remote if need be. But right now we don't need to do that. So, we're operating that way. Now, we have kept all the rest of us separate. And that was mainly because of how small we are, we can't afford to share anything with each other either. So, it's just given us that flexibility. But Jeff, I'm sure you have a lot to share since you had a lot more folks that had to embrace it.

Jeff Arnold:

Yeah. Well, it's so similar though, right? No matter the size, my experience is that people really react to change in one of three ways. Right? And so, in our organization, your organization, there's going to be those that are early adopters, and just with great enthusiasm, and excitement go, "Yes, I'm for this. Let's do it." There's those that just want to cross their arms, dig their heels in, and say, "All right, let me find out what's going to go. And then I'm going to be on the sidelines and figure out which side I'm joining. Am I joining the eager, enthusiastic side, or am I joining the side over here that's saying it won't work. It'll never work. We can never serve these customers. We can't do that. I have to get checks. I have to do this."

Jeff Arnold:

And so, organizations large and small deal with one of these three scenarios. And the tough part is to convince everyone that this is the right thing. Change scares all of us. Right? Change scares my wife. She doesn't want to be working with me 18 hours a day in the next room, right? [inaudible 00:41:03] but she's used to the house all on her own. And so, that's changed. Yeah. It's really just being aware that changing affects everyone differently, listening and working through that.

Paul Chadowski:

If you could tell your policy owners one thing, what would it be other than use vipHomeLink? Which we'd love you to say. But other than that, what'd you want to tell your policyholders?

Michelle O'Connor:

So, the one thing I want to tell my policyholders is not to be afraid to call us. That there's lots of things that happen that if they would just give us a call first, we could talk through with them. Everything from maybe a potential claim they're not really sure. Don't be afraid to call us. We don't have to turn it into the insurance company to have a conversation, and decide what the best course for them personally is. And there's also lots of things that happen to their home as well. They're putting an addition on, maybe they've decided to hire a nanny. Go ahead and give us a call on the front end of that, so, we can talk it through, and talk about all your options. We may think of something that you hadn't and be able to share that with you in advance that can change the course of your decision.

Paul Chadowski:

And Jeff?

Jeff Arnold:

Yeah. Thank you so much. Three different messages if I can tie them together. One is buyer beware, right? You heard all these conversations here about endorsements, and different coverages. Know this, in our industry you get exactly what you pay for, right? And so, if you just buy a policy yourself online, good for you, but understand what you're buying. Our best counsel, because this is what we do is to find an independent agent near you or online, then get that advice and counsel. It's not any more expensive. It doesn't cost anymore. These people are passionate about what they do.

Jeff Arnold:

And so, then I would pivot from that to say, you get what you pay for, use an agent. And then what companies are spending billions of dollars today to get you to do is bundle. So, absolutely bundle, right? Bundle, bundle, bundle works because it saves you that. And the other jingle discount double-check. Yes, go ahead and do that. And then, if you can complement a great insurance program with a home maintenance piece like vipHomeLink, right?

Jeff Arnold:

To make sure that you understand the way insurance is used, to use it the way it's supposed to be used as a catastrophic loss piece, not as a maintenance plan. Maintenance on you. And if a maintenance problem use your warranty. But combine those three. Combine a good agent with vipHomeLink, and a quality carrier that allows you bundle, then you will beat the insurance companies. And so, my last message is that's my last book is How to Beat Your Insurance Company. You don't beat your insurance company by filing claims, you beat it by doing all the things I just said before. So, thanks.

Caroline Brenneis:

Wonderful. Well, thank you both so much for joining us. I just wanted to give you each a few seconds to share where people, our listeners can find you. Social, or agen ... I know we talked about it, but agency name. Whatever you would love our listeners to hear. So, Michelle, why don't you kick us off?

Michelle O'Connor:

Sure. So, I'm Michelle O'Connor. I own O'Connor Insurance in Charlotte, North Carolina. And we are a boutique insurance agency that likes to have a consultative approach. And so, we are going to ask you lots of questions that you had never heard before to make sure that we can tailor an insurance policy and program to match your needs. So, you can find us on the web at oianc.com, and Facebook, Twitter, Instagram, and LinkedIn.

Jeff Arnold:

Perfect. So, again, my name's Jeff Arnold with RightSure. RightSure Insurance Group out of Tucson. We do business in 42 states. We fancy ourselves as a technology company, right? Integrating technology in everything we do. The website is RightSure.com, R-I-G-H-T-S-U-R-E. And then for my personal website, because I write and speak on Insurtech, and this wonderful industry that's been so wonderfully blessing to my family. That's at jeffarnold.com, J-E-F-F-A-R-N-O-L-D.com. Also, have to plug my books, and my publications are on those as well. So, thanks so much.

Caroline Brenneis:

Wonderful. Well, both thank you so much for joining us. And we hope to have another session soon, and we could discuss other fun insurance items.

Michelle O'Connor:

That sounds great. It was so nice to see both of you, and to meet you, Jeff.

Jeff Arnold:

It's a pleasure meeting you, Michelle. Thank you so much. I'm going to find you on LinkedIn.

Michelle O'Connor:

That sounds great.

Caroline Brenneis:

Have a lovely night guys. Thank you both.

Michelle O'Connor:

Thank you.

Jeff Arnold:

Caroline, Paul, thank you.

Paul Chadowski:

Take care.

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