HousingWire spoke with Ross Diedrich, co-founder and CEO of Covered Insurance, about the challenges servicers face during high forbearance numbers, how Covered works to support its servicer partners and what the transition out of the COVID-19 environment might look like.
HousingWire: What are some of Covered’s biggest accomplishments since we last spoke in June 2019?
Ross Diedrich: Covered has gained significant market traction since our last conversation. We like to say we’ve moved from “startup” to “scale-up,” and it has been a fun, rewarding ride.
We now have “anchor” partners in real estate, mortgage origination, mortgage servicing and home services. Our partner leads, conversions to policy sales and revenue growth are on target. We’ve won multiple deals in a competitive environment.
Additionally, we secured a strategic investment from Radian Group, Inc., the leading mortgage insurance company, which provides Covered with industry sponsorship.
It’s worth mentioning that as a digital company we’ve successfully navigated the COVID-19 crisis with remote employee work and customer management while continuing to post record growth.
HW: How are digital agencies evolving and positioned to support the mortgage industry in this period of rapid change?
RD: As the COVID-19 pandemic accelerated digital mortgage adoption, Covered was well-positioned to bring home insurance into the eClosing process. Our lending partners are presenting their customers multiple quotes from Covered’s panel of 20+ insurance carriers directly within the workflow of their consumer portal.
The efficiencies are driving shorter cycle times and the seamless consumer experience appears to be increasing customer satisfaction scores and adoption rates. Covered has seen our quote requests producing record volumes, with 306% growth from March to May and 452% from February to May.
HW: How is Covered supporting servicers during this time of record numbers of mortgages in forbearance due to COVID-19?
RD: As the agency forbearance programs unfolded, we recognized the challenges facing servicers to manage surging customer inquiries but also the unique position they hold as a trusted adviser. Our goal was to support our mortgage partners by being a part of the solution for troubled borrowers.
With speed paramount and additional technology integrations not an option, we implemented a process to connect servicing customers to Covered licensed insurance advisers to review insurance policy options that could put money back into the borrower’s pocket.
Within minutes, we present multiple policy options, educate customers and provide a binding policy that saves our servicing customers $473/year on average. This active engagement raises the profile of the servicer and leaves their customer in a more advantageous financial position.
HW: What role do you see Covered playing in the transition to a post-COVID-19 environment?
RD: Covered was well-positioned for the business shift that occurred as a result of COVID-19. As a digital company, our business is aligned with consumers’ shopping preferences and our technology framework allowed us to seamlessly adjust to the new operating norms.
Because of our technology advancements and operating principles, we have been able to continue to move forward with our partner initiatives and make real-time adjustments in program development and implementations.
Supporting our partners and their customers in this fluid environment was mission one, and we worked with their teams knowing there were elements of uncertainty and the need to be flexible in developing programs related to refinancing and forbearance, as examples.
COVID-19 has not altered our vision but has accelerated our implementation. We can work with our partners in seamlessly providing value-added services for their customers and we have demonstrated that ability under unprecedented times.
How do you exercise self-care during COVID-19?
RD: We’ve all had to change our routines and adapt. Recognize that we are all in this together – and that this event has impacted us beyond the business.
For example, many of us had to quickly manage new personal dynamics, like daycare solutions, how to become a teacher for our children or provide care for our parents, among many other things. Given these changes, self-care can easily become a low priority but to best serve others, we have to make sure our cup is full.
Observing social distancing protocols, it has been difficult to find activities to decompress. Fortunately, we have the Rockies in our backyard. Lately, I’ve found hiking and fishing to be great activities to find peace, get fresh air and give myself time to think about what is next for Covered.
HW: As a 2020 Tech100 winner, how has Covered evolved to stay on top of emerging trends in the insurtech space?
RD: We are fortunate to have a great vantage point in the market supplemented by key company advisors. There are three primary trends Covered tracks and leverages.
The first is related to the housing industry and the overall shift to digital transactions in the mortgage ecosystem, whether executing on the many steps in purchasing a home, arranging for moving and home-related services, or shopping for insurance.
Covered is a digital solution right when customers need a smart, simpler solution for insurance, eliminating at least one challenge and step.
A second trend is toward multi-line insurance sales, aka bundling, driven by large insurance carrier consumer marketing that has created awareness and intent to bundle and save from insurance shoppers.
With Covered’s panel of 25 name-brand carriers, we can quickly find and bind the right bundles on home, auto, umbrella, RV, pet and more, saving customers time and hassle. We’ve improved our capabilities around bundling to deliver a faster and more comprehensive customer experience.
The third trend is the rise of startups as subject matter experts to which large banks and servicers prefer to outsource digital transactions and innovation.
Covered has carefully thought through the digital customer journey and how to provide positive engagements to our partners, boosting loyalty and driving new revenue opportunities without the significant investment needed to build that competency in-house.
