Direct, Captive, or Independent Agent. How you buy insurance makes a BIG difference! with Nadeen Vella, CIC of NaVELLA Insurance

Personal Risk Advisor at Ericson Insurance Advisors and CEO of RiskRevu, Kurt Thoennessen, CAPI, and Nadeen Vella, CIC, LIA, CRM of Navella Insurance connected a short time ago to discuss RiskRevu  for her scratch agency and enjoyed talking about insurance so much they decided to do a podcast. This conversation covers many aspects of the independent insurance agent model. In this discussion, Nadeen brings clarity to each of the different sales models that insurance companies use to sell their product. The direct model, the captive agent model and the independent agent model.  This conversation will be helpful to anyone who is looking to better understand the differences among these sales models and help them see why the the independent agent channel is the superior model. Enjoy!

https://www.navellains.com/

Transcript

Kurt Thoennessen: 0:02

There are more wealthy people today than ever before in the history of the world. The risks they are exposed to through the assets they acquire and their unique lifestyles are significant. The bigger the asset, the bigger the potential loss. The bigger the potential loss, the more complicated the mechanisms for protecting those assets becomes. This show seeks to uncover the risks that successful people face. So we can provide some guidance towards minimizing, mitigating and transferring them. From Coverage contracts and carriers to client experience, technology and claims, we will cover it all. Whether you're an agent looking to hone your skills, or someone with significant wealth to protect. I hope this show becomes a valuable resource you can come to rely on to help you protect yourself, your family, and your clients. Hello, and welcome to the private client risk and resilience podcast. My name is Kurt Thoennessen. And in addition to being the host of this amazing show, I am also a personal risk advisor at Erickson insurance advisors, and the founder and CEO of risk review, which is an insurance technology platform where we build smart forms to help insurance agents gather information from clients and prospects online in a modern way. So welcome to the show everybody. super glad that you tuned in today. And I am super excited about a conversation today with Nadine Vela from novella insurance. And I've spoken with the dean several times in the past, and we've had some amazing conversations talking about coverage, talking about her startup. And you know, some of you may have listened to those as well. But I'll let Nadine tell you again, you know what her story is? And give you a little brief history and tell you what she's doing with her startup up in Boston or Massachusetts. That's right, Boston. You're You're right. You got the right cities. Oh, good. Thank God. Yeah. Thank you for having me on. Again. It's been. It's been great talking with you. So I'm looking forward to continuing with the series. But yep, my name is Nadine Vela and I am the founder and CEO of novella insurance.

Nadeen Vella: 2:16

novella is a insurance agency and consulting firm and we are located in Boston, Massachusetts. So you got both of those, right? Personally, I'm an insurance agent, a licensed insurance advisor, and insurance coach and consultant. And I love to speak all day long about insurance and the complexities around insurance. So my business has two parts to it. I'm an insurance agent. So I'm placing personal lines, insurance policies for women or anyone that's in the women plus community, I want to educate, teach, teach, and then also partner with. And so for anyone who's not in the insurance world, what does personal lines mean? It just means anything with your name on it. So your homes, your autos, your, your data collection of some sort, boats access, and life insurance. So that's what that means any rental properties. And then I also have a consulting part of the business and that is, if you are someone who wants to have an independent review of your policy, I have a service for that. And I also partner with COI. So circle of influences and provide them with education and insurance, basic tools, and knowledge so they can incorporate the themes of insurance, important themes and have a call to action to elevate their business and their business proposition. So how can they make their value add and, and use insurance into the fold when they're talking about if it's a wealth management or if it's real estate, and so that that's the business. So I've got about 16 years of insurance experience, that range from the carrier side to the agency side, have dabbled in claims. on the insurance side, it was an account manager and a producer. And then for the past 10 years, I worked in business development for a couple of fortune 500 companies, both handling personal and commercial. So it's been a great ride and I'm here now talking with you and I'm ready to start this new chapter and, and make insurance as fun as fun as possible. That is a big mission. The education and the fun.

Kurt Thoennessen: 4:38

Absolutely. That's great and such a great story that you've been in the business 16 years both on the broker and the carrier side. And now you're starting your own agency. You why now what what made you want to jump and jump ship and start your own agency? I mean, obviously it's a great idea, a great time to do it. So much opportunity in the market. Good place. But, you know, do you have a mission or vision that you're thinking that you want to bring to the marketplace that's different than others?

Nadeen Vella: 5:07

Yeah, I've always had this entrepreneurial spirit about me, I think I was born with that as some flair. And this one, and maybe this desire to be an independent in some way. Not really capturing, like, what that might look like until really, really recently. So I tragically lost my dad this past year, but it was, it was a call to action for me because I realized that if I were to get to this endpoint in my in my life, what would I regret? I tapped tapped into that and, and so it was almost all of a sudden, in my mind, I'm very dedicated my work I, I was working with marquel, up until the very end, and they were such a great company. And they gave me the ability to be entrepreneurial, and kind of take the reins on a lot of things and be as creative as possible, which is where my brain is that and I pivoted and now I'm doing this. So I, the real the mission is when I my whole time, right and in, in this insurance career has been, you know, insurance is a very unsexy product and an unsexy industry, how can we change the conversation? And who are we talking to, right, who is the client. And that's a debate like we can get into that, like, who is who is the client. But I feel like the demographic of women and the women community has been a little bit disregarded in the past, and I want to be able to engage with them. So they know what they're talking about, I believe that there's a segment of the population out there that really might care about insurance beyond the commercials that we see. And I really want to engage with them, because I could and I do think about insurance all day long. So

Kurt Thoennessen: 6:58

that's great. Well, first, I'm sorry to hear about your dad died, it's always a tough thing to go through, and I lost my dad a couple of years ago now. And it was a very difficult time. And so I can, I can certainly empathize with that. So but certainly you are doing some great things, starting this agency bringing, bringing your creativity and your passion that you've had for the business for the last 16 years, into an a new baby, a new baby, that's going to be amazing. And, you know, we've had several conversations, obviously, on this podcast. And in every single one of them, there's, there's several themes that that shine through. Number one is fun. Number two is education. And number three is this idea of an insurance coach, which I really love that terminology. And I think we need more insurance coaches today. Because, you know, it's less of a sales game. Yes, we are selling a product. But we're just really helping people better understand this product that's so complex, nebulous, confusing, difficult, boring, all of these things. So, you know, great job to all of that now. And today's conversation, you know, we're on this kind of kick of let's talk about covers, let's talk about these topics that there's so much thought going on inside insurance agents brains about them, but very rarely do you hear much about them? And so today, you know, we were spitballing, kind of thinking about what we want to talk about. And today we want to talk about the differences between the insurance carrier and your insurance agent, and kind of bring some bring some voice to that, that theme. So you know, what is the difference? You know, what's the difference between the carrier and the agent?

Nadeen Vella: 8:47

Yeah, that's a that's, it says one I often like to to use when I talk to friends, family and clients, right? is, you know, who is your insurance agent? Do you know who that is? Like, how often have you heard from them? Do you hear from them? And a lot of times, they'll tell me the carrier. Like, oh, you know, it's I'm just gonna use a carrier out there. And we'll just use chat. Right. Ciao Chubs my mic now and and you, you and I both know, because we're in the business that that's not really correct. And that there is someone that is is managing it should be managing that policy. So who is that right? And trying to even down to the, to the Okay, like I am pretending on them, and I'm telling them, right, you are going to an agency shop to buy it. What is that agents name, right. And there's a lot of question marks around it. And so it's kind of makes me laugh in a way like a giggle in the sense of like, we got to do a better job than independent agency, because there's a lot of value adds that we bring to the table. If the end user if that client doesn't know who their agent is. Then, is that agent really doing a good job? Right? And then also, like, what else is missing from that conversation in that relationship? So? Yeah, so there's,

Kurt Thoennessen: 10:10

there's a lot of times I get involved in new, new, new cases, new accounts. And I talked to the client or the family office, and I asked who the carrier is, because knowing who the carrier is on certain types of business is helpful to the overall analysis of an account. And so they'll come back and they'll say, you know, a name, and I know, when they say it, it's not a carrier. It's the broker, you know, they're giving me the name of the broker, I'm like, no, no, no, what's the name of the insurance company? And they're like, I'm confused. Let me You know, I don't I don't know who that is I deal with so and so from XYZ insurance brokerage, I'm like, okay, so eventually we figure it out or whatever. But there is that confusion initially, of, you know, people don't talk to the insurance company every day. If they're in the independent agent channel, if they're insured in the independent agent channel, they are talking to their agent or broker advisor. So, you know, I can understand where the confusion comes, because they just, you know, the only time they see the carrier, the insurance company name is once a year when they get the mail. So, you know, obviously, there's, there's less communication there.

Nadeen Vella: 11:18

Yeah, absolutely. Also the bill.

Kurt Thoennessen: 11:21

Right, in the bill, you know, depending if they're paying monthly, quarterly annually. So, you know, it gets confusing, but, you know, and so that, that also leads to the question about which channel, you know, people are in so consumers are confused by weather, and you know, who their carrier is, they think it's the broker, they don't know, it's, you know, the difference. And then there's this extra layer of complexity of the different channels that you can go through the different models for purchasing insurance. And that, in and of itself, is very confusing as well to someone who's not in it every day.

Nadeen Vella: 12:00

Very confusing, because the mass market just sees the commercials on TV, which is a channel in itself, right? So I like to bring it back to food I love I think food, it might be safe to say, is a universal love language. I think personally, I love doing it, I feel like you can always make a connection when you talk about it, especially when you're comparing it to something that is complex. So I've actually really thought about this and hear me out when let me know what you think about this. So. So I feel like the independent agency channel is your insurance agency. It's a shop, right? But they have access to multiple different types of flavors of ice cream and toppings. So you can go in there. And basically, you can talk to someone at the counter. They can put something together for you. And you're done. There's there's so you're able to kind of mix and match. But you're you're relying on someone to kind of help you put it together right. I would say the captive channel is more or less so for those listening in. So think about your state farms. Right? Who else like all state? All states kind of gone? Independent?

Kurt Thoennessen: 13:15

Yep. All State nationwide, which is also had some changes. Geico.

Nadeen Vella: 13:21

Yeah. So I mean, you can go to a shop there, right. So it's state farms, notorious, they have agency but they only represent State Farm, you can't. So you're going to have that ice cream shop. And you're just getting vanilla with and with one topping. Like, that's it. And so the variety of like, the ability to mix and match or get creative is very limited, you might have that relationship with that person putting the ice cream together, right? But but at the end of the day, just like that's it that can only help you if it StateFarm and then the third one is the direct channel, right? So this is like, this is not sold in any place. You can't just you got that craving for that ice cream that night, at that minute, you know how those cravings happen, right just like all of a sudden or after dinner, or whenever you can't just go to a place to get it you have to order it from them directly. So you have to actually place the order and you have to have them ship it to you and that's all you're gonna get. And so that is the entertaining commercials that we see on TV that is your guy goes right that's your progresses which is my personal favorite. I crack up at those but that's kind of what you're you're doing now the allure there is right they got a mass market and so then in 10 seconds, they're making you laugh and then you're you're kind of going there because of price. Right? And you and I know that I it's it's really not at all about price. And so I don't know what do you think about that,

Kurt Thoennessen: 15:00

right? No, I think it's very, I think it's spot on. And you know, giving people the choice with the independent channel, and having different flavors of ice cream, you know, and, you know, I guess years ago, I would go into the ice cream store, and I'd want to get one scoop of Cherry Garcia and one scoop of cookies and cream or pistachio, I'd want to have like two or three different flavors. And, you know, so I liked that variety. And so I definitely, you know, veered towards that into independent channel. You know, but today, you know, more, so I like to have just one flavor. And be, you know, very, not vanilla, but I'd like to have just one flavor. So, you know, I think it depends, but I like the analogy, I think it makes a lot of sense. And, you know, definitely, as a consumer, when you're thinking about going to buy insurance, you're not thinking should I go to a shop that gives me multiple flavors, should I go to a shop that gives me only one flavor, but has, you know, an agent that I work with? Or should I go to a shop that I just go direct to? And there's no agent in between? Those options? Don't you know, they don't register in that purchase process? Although they should, you know, because if you if you give me those three options, when I'm going to buy an insurance policy, I would choose the one where there's an advisor, and where I have choice like that, that makes perfect sense to me.

Nadeen Vella: 16:21

Yeah. And they do more than just that, too. So yeah, and things change carriers change appetite, when you're working with a direct so the guy goes and the help me out. guy goes in progressive progressives. Yes, thanks. Um, they're like they're a national carrier. And so their expertise in specific markets is very can be limited. Like when, when Massachusetts kind of opened up and and started having GEICO right in the state, like they were still they were, they were learning the laws of the state in terms of what they could and couldn't do at the time of loss at the time of a claim how to defend. And so with these specialty markets in the independent channel, they, they depending on who the market is, they really have that expertise of the space. Because what's right, and what's happening up here in the Northeast is going to be completely different than what's happening in like down south. And so it's really nice to have like kind of a smaller, more like intimate relationship with an independent market that carried this business through the independent market, that independent market agent would have access to versus say, a supernatural, a super a Na Na national that will just without any real care, just kind of hand you off, you know, and kind of call it a day. So

Kurt Thoennessen: 17:57

yeah, and, you know, we've been talking all along. And this is obviously a podcast targeted towards the private client segment of the market, the high net worth individuals. And so when you're talking about these types of accounts, where you have clients that potentially have multiple homes, in different states, working with an independent agent who specializes in serving this niche, like you and I, they would be licensed in multiple different states, and so could provide that insurance. Whereas another thing to be aware of is if is if you're with a captive or directors is if those agents and those carriers can write in multiple different states where you need them to, and if they have the capacity to write on the coast or in an unprotected area, you know, several over five miles from the fire department, you know, what their capacity limits are? So again, you know, this type of understanding is so important at the beginning of the shopping process, quote, unquote, shopping process, that if if they were known, decisions would be made differently, I think.

Nadeen Vella: 19:05

Yeah. And I would also add to understanding profitability and an am best rating or any rating is important as a consumer. So an ask this question, right? Like what, you know, if you're able to figure out the difference between your agent and the in the carrier, right? What is the am best of that carrier you're being placed with? Because if it's, you know, less, I would say less than an A minus, like, I would be very nervous about the ability for that carrier, if there was a circumstance where it was a catastrophe for them to play a payout on their claims. And that changes all the time. So carriers are, are moving in and out of markets. They are changing their recipes, right for this insurance stuff, like all the time, and so profitability, it pays to be with a carrier that has have a high a high rating just for the purpose of ensuring like, you know, making sure that they're gonna be around if that that thing comes through whatever that is, right.

Kurt Thoennessen: 20:09

Yeah, exactly. Yeah. So obviously, the financial stability of the company is absolutely critical. And, you know, lately we've seen many companies go into receivership down in Florida, where they they have gotten their their shirts handed to them, because the market down there is so dynamic as far as claims are concerned and catastrophe. So yes, I am best rating is very important. It's a it's a big aspect of looking at these companies. And again, people don't know how to find that, like, how do they understand what the rating of a company is, a lot of times on the websites, they have them listed, but it's not always prominent, right. And so, especially if they're not in a minus or better am best rating, they're probably not going to put it front and center on the website. So obviously, you can go to a and best your website and look up those carriers, which is, you know, a good process to do. But there are in terms of ratings, there's other solutions to that look at other aspects, besides financial stability of insurance companies, that that are helpful, like, there's this company called Val choice, and Val choice looks at, they take all the data from the insurance commissioner's office, and analyze it and put it together in a pretty report so people can digest it. And they look at three things, the rates, the claims, experience of people with that company, and the service experience of people at that company. And then they rate each company based on those three things, based on this data from insurance Commissioner's Office. So you know, again, if people know about these things, it'll help them in that in that process of choosing the right carrier for them. But, you know, as you and I both know, as agents, those are the analysis we're doing on our carriers, you know, as we look to bring on new relationships.

Nadeen Vella: 22:02

Yeah, absolutely. And we have experience with those carriers, right. So can advise which market? Well, market might be less premium versus another market, but might provide better service or have a better rate, or my might be not new to the space might be a veteran of the space? So there's a lot of different factors.

Kurt Thoennessen: 22:25

No, absolutely. And, you know, as a consumer going through this process, obviously, they want simple they want quick, you know, that's why those marketing messages resonate so well with them. And so, I, you know, what we're trying to do, obviously, on this podcast is to boil down, you know, the process for people help them understand it better, so they can make better decisions for their protection. So, you know, when you think about this, what are some of the things that agents in the independent agent channel are doing for their clients that just add tremendous amount of value that people should know about? You know, before they make that decision, of where to where to place their business?

Nadeen Vella: 23:07

Yeah, I call it decision fatigue. And this is like, not an insurance concept. But it's anytime you're faced with a lot of options. And your path could go a number of different ways. And my brain shuts down. I don't know about other people's might have different experiences. But literally, I just say, Oh, my gosh, well, what do you think? Right? Like, what would you recommend? Right? But like, especially in the insurance world, if we're comparing apples to apples, which is coverage, what you have now versus comparison, and you're getting three or four different scenarios, quickly, like, you know, you want to go to bed, you know, so like, it just gets overwhelming real quick. Right? So I think that the one of the, one of the, on the top five, right, that is definitely like managing that decision fatigue, and if you know, you're stuck, and you have the right relationship, to say to someone candidly to say, you know, this might be costing you more, but this is why I think you and if you really dial it back, right, how much is that really costing in the grand scheme of thing, right?

Kurt Thoennessen: 24:22

Yeah, like I talked to clients all the time about, you know, automatic water shutoff valves, and like, you know, it's gonna cost you $600, to buy one $500 or $300 to install it. But at the end of it, you're gonna have this peace of mind, knowing that you're going to be alerted if there's going to be a major leak in your home. You know, it's like, totally worth the expense. Oh, and by the way, you're gonna get a discount for it, you know, that kind of, which is really peanuts compared to the value that that type of device is going to provide to them. So it's just it's just all about being able to explain the value of something and you know what it means to them?

Nadeen Vella: 24:59

Sure. You're absolutely.

Kurt Thoennessen: 25:02

And what else? So I mean, other things that you do as a consultant, and coach to your clients? What are the other, you know, some of the other value added services, if you will, that you think really, you know, people need to be aware of, you know, when they're working on their insurance. And whether it's, you know, at the beginning of the process in the purchasing of the insurance or in the manage the ongoing management of the insurance. At renewal.

Nadeen Vella: 25:30

Yeah, I think it comes down to the client and what they are expecting and what they need and what they want. Oftentimes, I don't want to say insurance is transactional, are we headed in the transactional, I want to say we're kind of headed that way with the use of technology. And it's kind of easy to hide behind that. But but it comes down to setting the expectation and asking, like, why, you know, what's, what's your setup, like, right, having those conversations, and there are no easier ways to have that conversation. But if you really think about it, like, your insurance agent, if you got a real quality relationship with that person, they might know a lot about your life. And like, instead of like, kind of having that piecemeal, and saying your story 100 times right, to, you know, someone who's just gonna, especially if you're a direct market, you know, doesn't know, right? That's important. So that relationship piece by like, really like, and then circling back, like, how often do you want to hear? Are you okay with, you know, how often is this check in, right? And what does that look like and plan it ahead of time. Oftentimes, the first thing that you get is renewal or a policy, if I'm thinking if like, you're, you're getting something and you don't know the name of your agent, as you get this, maybe it might be worth the opportunity to think twice about getting a relationship or having a wanting a relationship, because there's, there's value there. Especially when you've got like, so many things going on, like your life, the life is life is crazy. And insurance is going to be a constant. And so, yeah,

Kurt Thoennessen: 27:14

yeah, I, you know, I think when you have a relationship, you send an email to somebody, they, especially as an agent, I get an email from clients saying, Oh, hey, how are you? You know, so, you know, sorry, I've been busy, we're planning a trip to Europe, we're going to be away for two months. But you know, wanted to make sure I got back to you first. And so right there, I'm like, Okay, so I'm going to take care of whatever they need. But then they also mentioned, they're doing a two month trip to Europe. So oh, by the way, you know, nice to hear about your trip, you know, let me know, if you need any help with understanding the risks associated with that, and so on so forth, you know, not not because I want to sell them an additional policy, but because I want to make sure that they're properly protected, in whatever they're doing. And so they write back like, Oh, my God, yes, totally. We already have travel insurance. But you know, what is your thoughts on this question? You know, so there's really that open dialogue, because you've created that relationship. And you mentioned, all this stuff you're mentioning. And I love how you just said, It depends, you know, the services that we give to our clients, it depends on the client. And because not everybody wants to be reached out to every year, not everybody wants you whatever they want, you know, they want what they want. And so the ability of us as independent advisors, is to personalize the service to and tailor the service to that client.

Nadeen Vella: 28:36

Yeah, absolutely. It's interesting, because I know you're advising your client on their trip to Italy, but I would be inviting myself on myself on that trip to go to them with them, Italy, we're asking a lot of questions about you know, what they're going to be doing, but out of out of just fun. You know,

Kurt Thoennessen: 28:58

I if I invited myself on every trip, I probably wouldn't work a day in my life.

Nadeen Vella: 29:04

There's always like wishing, right, so

Kurt Thoennessen: 29:07

not not a bad thing. But anyway, I you know, just as we wrap up this conversation, I just think it's so important for us to explain these things. And this is this is part of that conversation. Like we said the beginning. agents need to do a better job explaining the value that they bring the differences about working with someone in an independent agent channel, and that's exactly what we're trying to do here is just educate, you know, people who are listening to this podcast, about the differences between the independent agent channel, the captive channel, the direct channel, and so on. As we wrap up this conversation, Nadine, is there any final thoughts that you have are and also I want to make sure that you provide your contact information for anybody who wants to get in touch with you as well. But anything you want to kind of wrap up the conversation with As we close out this discussion,

Nadeen Vella: 30:03

yeah, if, if anything, if you are receiving your policy, which is a yearly event, or you have a solid change come through audit, the agent information is listed on the policy if you if you have an agent, and maybe if there is pause and whatever you're doing this the next time around where you don't know, maybe take a look and see, see who that is. And then ask yourself the question, you know, do I have a relationship? Do I want a relationship and kind of go from there? So, but yeah, so I can be reached, especially if anyone wants to go to Italy? I'll go to Italy. My website? Yeah, right. My website is novella, insurance. I'm sorry. It's novella, Na, vi E, ll a ins, not insurance, but I ns.com. And all my contact information is on there. And so if there's any interest or you want to tap my brain or have a continuing conversation, please reach out to me.

Kurt Thoennessen: 31:13

Awesome. Thank you so much. Thank you. This is a great conversation. I really appreciate your time today. And to everybody who's listening in to this episode. Thank you for checking it out. If you're enjoying the show, and you enjoyed this episode, please give us a like and even better if you if you could leave us a review. That would be awesome. So thanks again for checking out private client risk and resilience and have a wonderful day. Take care