The Chris Voss Show - The Chris Voss Show Podcast – Robert Feldman, CEO, President, and Founder of WOWS Insurance Services on Fixing California’s Insurance Crisis

Episode Date: September 22, 2024

Robert Feldman, CEO, President, and Founder of WOWS Insurance Services on Fixing California's Insurance Crisis Wowsinsurance.com About the Guest(s): Robert Feldman is the CEO, President, and Founder of WOWS Insurance Services. With over 25 years of experience as an insurance broker, Robert possesses deep industry knowledge, particularly in the Western United States. He is a recognized thought leader in the insurance market and has served as a speaker for the California Association of Realtors. His expertise focuses on innovative insurance solutions for homes, especially in high-risk areas prone to fires. Episode Summary: In this episode of The Chris Voss Show, host Chris Voss interviews Robert Feldman, CEO and Founder of WOWS Insurance Services, about the ongoing crisis in the insurance industry, specifically in California and other Western states. Robert discusses the growing challenges homeowners face in securing insurance policies due to the increasing prevalence of wildfires and legislative changes. This episode dives deep into how WOWS Insurance is using innovative strategies to disrupt and resolve these critical issues. As insurance companies are withdrawing from markets and leaving homeowners in peril, Robert's groundbreaking approach aims to stabilize and revolutionize the industry. From making insurance policies transferable from sellers to buyers, to addressing the oversaturation of markets and skyrocketing rebuild costs, the conversation is a treasure trove of insights. Whether you’re a homeowner, broker, or someone interested in the insurance landscape, this episode delivers valuable information on how to navigate these turbulent times. Key Takeaways: Disruption in the Insurance Market: The withdrawal of major insurers like State Farm, Allstate, and Nationwide from California is creating a crisis for homeowners needing coverage. Innovative Solutions: WOWS Insurance offers transferable policies and spreads risk to bring back stability to the market. Impact of Wildfires: Fire-prone states are grappling with increased costs and non-renewals, making it vital for homeowners to proactively seek reliable insurance. Consumer Awareness: Homeowners must be diligent in examining their policies and rebuild costs to ensure adequate coverage. Legislative Involvement: Government bodies are slowly recognizing and addressing these issues, but innovative market solutions are leading the way. Notable Quotes: "We're fighting the fight, and we're going to change, effect change in California and the Western United States as time goes on to roll." - Robert Feldman "The number one problem, first and foremost, is oversaturation of the market." - Robert Feldman "If you don't have insurance for a house, the only way you can have a buyer come in and buy it is if they're paying all cash." - Robert Feldman "We're fixing insurance. We're gonna bring carriers back into the market and help bring the rates down." - Robert Feldman "It's a question of not just an insurance look; it's getting everybody involved, all hands on deck." - Robert Feldman

You wanted the best. You've got the best podcast. The hottest podcast in the world. The Chris Voss Show. The preeminent podcast with guests so smart you may experience serious brain bleed. The CEOs, authors, thought leaders, visionaries, and motivators. Get ready. Get ready. Strap yourself in. Keep your hands, arms, and legs inside the vehicle at all times, because you're about to go on a monster education roller coaster with your brain. Now, here's your host, Chris Voss. Hi, folks. This is Voss here from the chrisvossshow.com. There you go, ladies and gentlemen. The early six of them makes it official. Welcome to the show.

We certainly appreciate you guys being here. As always, the Chris Voss Show gives you the Chris Voss Show glow. I'm drinking a cup of it right now. It might be coffee, but it might also be the Chris Voss Show glow on top of it. That is the caffeine that gives me that glow. So make sure you get the glow and share it with your friends because sharing the glow is, I don't know, just share the glow, damn it. That's my point.

Sharing is caring. Sharing is caring. Don't be a hater and love your fellow man. I might use that in the future, Robert. So go to goodreads.com, 4chesschristmas, linkedin.com, 4chesschristmas, chrisfast1, the TikTokity, and all those crazy places there are on the internet that you can find the Chris Voss Show. There you go. So today we have Robert Feldman, the CEO, president and founder of WOW's Insurance Services

on the show to talk about what's going on in the insurance industry, getting your home insured, because there's been kind of some flight of some different insurance companies across the nation that are like, we're not doing that anymore, like Florida, California especially. So we're going to get into that and some of the things that are happening. Welcome to the show. How are you, Robert? Good. Thank you so much, Chris, for having me on today. Thanks for coming. Really appreciate it. So give us your.com. Where can people find out more about you on the interwebs? So it's WOWS, W-O-W-S.

Everyone always forgets the S, Chris. W-O-W-S insurance.com. WOWS. I like that. Do you ever walk up to people and just be like, hey, I'm from WOWS? Like, just you punch it? Oh, it's even better when we do different events or different trades. We have these big, loud booths that screams wows.

It's just, you can't miss it. If you're somewhere where I am, you're definitely going to know it. I like, people tell that about me, but it's mostly because I eat a lot of Taco Bell. You know what I mean? I smell Chris Voss coming by. Yeah, exactly. The barbecue, same thing. Smokers.

Oh, yeah. When you go to Austin, Texas too for South by Southwest or any place in Texas, I. The barbecue, same thing. Smokers. All kinds of good stuff. Oh, yeah. When you go to Austin, Texas, too, for South by Southwest or any place in Texas, I think, the barbecue. So tell us about, give us a 30,000 overview of what you guys do there at Wow's. Wow's Insurance was designed and built actually to kind of change the, I used Einstein's theory of insanity, Chris. The insurance market in the western United States, California specifically, has been doing the same thing over and over again and expecting a different result. We built a program to change how insurance works. Very successful, very popular. There's different layers of insurance, and it's got a lot of great features. We're going to affect change.

You know, we are a – one of our entities is an MGA wholesaler. So we bring, help bring insurance carriers in. We launched this new insurance program and we're in with that old story about fighting the fight, right? Chris, we're fighting the fight. Um, and we're going to change effect change in California and in the Western United States as time goes on to roll, because these are not just a California problem. Chris, with homes being non-renewed right now it's the western united states nevada you're seeing problems in arizona you're seeing problems in montana oregon washington i mean places like park city utah are having terrible time with insurance at this point so what park city utah park city utah i mean all the different

fire zone areas across cal about the western united states are really kind of following california's footsteps i'm sorry at this point wow what what prompted this sudden change where everyone's like yeah we're not insuring stuff anymore like what what was the proponent behind well there's two two major reasons two big faults is it that we can blame well exactly it's a little story finger pointing no no finger pointing you're actually believed or not i would jokingly say it's one of those moments chris where everybody's at fault and here's one number one reason that really affects insurance companies in california and really really it sounds counterproductive is oversaturation of market an example state farm right now is going through a horrific non-renewals going across California right now.

Wow. Non-renewing 30,000 homes potentially across California. There's a little city just outside of Malibu called the Pacific Palisades, those that aren't familiar on your podcast. It's just outside the Pacific Palisades. Beautiful area. They're non-renewing 1,626 homes. Wow. That's 69% of the total homes in that zip code, that area.

Holy crap. So what the number one problem, first and foremost, I mean, Chris, if you and I were to pull the definition of insurance, really a definition of insurance is diversification of risk, diversifying risk. So what has happened is we've had insurance companies get oversaturated in different areas in different markets where there's too much of a they've taken on too much capacity in one area that's the number one reason why carriers back second one and big

one is really some internal problems with policies smoke Smoke damage and smoke damage-related things have really hammered the insurance companies with the fires throughout California. Yeah. So has insurance companies just reached a point where it's just not profitable for them? Or wasn't there some regulations from the legislature in Florida that kind of helped start the collapse over there?

Well, and that's kind of the scary thing is we're kind of going down that same road. And so what happens with this is really how we reengineered the insurance, Chris, is really an incredible way. First of all, the policies we built are the first policies in the history of California fully transferable from sellers to buyers. Chris, when you go to sell your house, the buyer knows that they can assume your insurance policy. It just makes sense. If you think about it from an insurance standpoint on homes, the companies have done things for so long. There's a lot of things that don't make sense. I mean, 25-year broker, insurance broker, I would ask the question.

It would drive me crazy, Chris, and it's the worst answer. If being as hyper as I am, and you talk about coffee and you talk about glow, you know, I've got that natural thing, Chris. I kind of bounce off on my own. Really what would get me really upset is I would ask a question like, why are claims following a consumer if it's a house? I understand a car. I understand other things.

But if a pipe breaks in a wall, Chris, why are you responsible if you buy a brand different house? Yeah. That's not your claim. So what we're doing is we're reengineering the insurance first and foremost as the example to make it transferable from seller to buyer, which then shows the insurance companies a pattern of what this house and what the history of this house is

to make the insurability easier. Yeah, so I mean, if you can't, I understand that it's really hard to sell a house now in Florida and stuff. If you can't, if it's, you know, not insured prior, right? If you can't get insurance on the house, it could be, think about this.

If you don't have insurance for a house right now, the only way you can have a buyer come in and buy it is if they're paying all cash. Now, I'm not saying that that doesn't happen. But obviously, if a property, you're talking about forcing down the cost of your house or the sale price of your house. Because if your only buyer for your house is someone who's paying cash and they know that, what's that old supply and demand theory, Chris? If all the demand's down and supply gets heavy, what happens to pricing? It drops. And that's what we're working on to fix. There you go.

Now, do you guys only service California right now? California currently, by the way, shout out. Nevada, I love Nevada, by the way. Nevada is the best. We love Vegas. And they've been a great team to work with. They actually, more so than any state that we've dealt with so far, have been really trying to get on the front of it, Chris.

They see the problems in the northern part of Nevada, and they're trying to have our program expand into the northern Nevada area just for the fact that, because they're starting to see the same problems in California, basically. Tahoe, Incline Village, those areas are all starting to run into the same problems. And it's great to work with them. Okay. village those areas are all starting to run into the same problems and it's it's great to work with them okay now it you bill on your website unable to get a policy dropped by your previous insurance company you guys offer specialized coverage for luxury homes and fire prone uh areas and work with brokers and carriers and homeowners so it's possible to work with you guys through my current you know if i have a agent for, maybe if they reach out to you. Absolutely.

Yeah, Chris, can I finally say that? I'm in the middle of, this is day eight and nine of an 18-day spin where I'm going to be home. I'm home actually in Los Angeles for my two days of 18. So I was in Bermuda. So next, this Wednesday, actually, I'll be heading to Palm Desert to appoint probably another additional 250 to 500 brokerages, insurance brokerages across California. Big trade show. We're really banging the drums. I've been a past speaker for the California Association of Realtors. I'm spreading the word out about this new program because, again, like I mentioned earlier, we've got to affect change.

Yeah. We've got to change. And it's in a crisis point, I think, at this point. Yeah, it is. It is. And what I'm really scared about is I feel like I'm the one running, no pun intended, I'm the one running into the fire while everyone's running out.

This is a joke. I like that. That works. There you go. We're running in. We're running in. We're bringing carriers with us back. So is a couple questions on that billing that you use on your website. There you go. We're running in. We're running in. We're bringing carriers with us back.

So is a couple questions on that billing that you use on your website. Yep. Is it only for luxury homes or is it for all homes? Of course, it's just about everyone. Well, we've been successfully being able to bring in other carriers right now. So we're helping bring companies in across the board. So here's the one. I'm going to get rid of one of the myths right now. Right now.

We're going to get rid of it, Chris. And there's a lot of bad media. I think it goes both ways. So here's the one I'm going to get rid of one of the myths right now, right now, we're going to get real Chris. And this is, there's a lot of bad media. I think it goes both ways. A lot of bad information, not bad media, but bad information. There's a lot of brokers out there currently saying that,

Hey, you're 2,500 square foot house can only be insured with the California fair plan. That's the policy of last resort. That is completely and totally incorrect. We have been able to help multiple carriers come into California. We work with multiple carriers

outside of our program at Wows to help bring in and stabilize the market because there's not going to be any one insurance company that's going to solve this, Chris. What's the story about all hands on deck? Military drum? All hands on deck. We've got to be able to bring everybody back in because if not, I'm going to end up

with 69% of a market. What happens to me? I have to start canceling too. Something happens. Then also, are you a resort carrier in the case that I've been dropped

or unable to get a policy? Would you say you're a normal insurance carrier case that I've been dropped or unable to get a policy? Like, are you, would you say you're a normal insurance carrier for if I'm just, if I've never been dropped and I'm just have insurance and everything's going fine. Am I going for you? Yep, absolutely.

Chris. And I would say, here's the thing, the worst case scenario, we're going to help you get to the right spot is what I would say. You know, with us being a MGA wholesaler, I have a pretty deep knowledge of the market and where characters are right now. So there are some times, you know, we know we win about 83.6% of the time. But we also help people on the other, you know, 16% in change.

We help them get to the right spots. Right now, it's no longer as sad as they say, Chris. It's no longer about competition in California. It's more about who actually can write a policy. And that's pretty scary thing. Yeah. And it's getting harder and harder. What do you see the foreseeable future of what's going on insurance right now in states like California and other places? Right now, obviously it's going into a pretty rough direction right now. You're seeing carriers pulling out. I mean, nationwide private client.

I mean, it's a laundry list of the who's who's that are canceling and are not writing policies. I mean, big names, State Farm, all states shut down. Nationwide is shut down. Travelers is very crippled at this point. Big names across the board are no longer writing insurance policies. And so what's happening is that's, I'd like to say we're bottoming out, but we're going to see a pretty rough time over the next couple of months

as we continue to build in what we're doing with the WOWS program. Chris, here's the craziest thing ever. We're going to get copied. I know we're going to get copied. And to be honest with you, it needs to be copied from what we're doing. Yeah. Because obviously you can't have insurance companies take 15, 20, 30% of a market, a given area. They get knocked out one fire. They're done.

Spreading the risks across California from an actuarial standpoint exponentially brings the rate down. Huh. And that's where we come into play there you go um and yeah it scales I mean this is almost something like like I've been sitting around a lot lately going why doesn't the government get in on this and do something why don't they um you know why don't they isn't there some sort of regulation or something? They could be involved. Chris, to be fair, you're involved.

I've given testimony to the state regulators. I've actually to a consultant for the state assembly for California. I just think that sometimes what happens is, and I use a terrible analogy. I'm a George Patton fan. I watched the movie 8 million times. You need, sometimes you need a field general to be able to get involved and tell you what the talk, you know, really being in the trenches.

That's what we are. Why I've been very successful working with the London reinsurance carriers and really breaking capacity and building for the Wiles program is we're making street adjustments that make sense to them. Where right now the market doesn't make sense. And so by making the adjustments, this is good for not only consumers, but this is good for the insurance companies. It's good for the brokers. It's a win-win. One of those rare times.

You get the win-win-win. It sounds like maybe the insurance companies have just been running for so long, so many decades. It's kind of really time to for innovation and and uh disruption maybe and that's what well disruptions already happen so now the innovation's coming in with what we're doing as an example we're fixing insurance that's what i'm saying when i'm speaking at different association meetings for the realtor associations or different consumer groups or everywhere i speak i was on i was looking to be Good Day LA. I'm talking about that very thing.

I'm talking about disruption, and then this is the solution. We have to have a solution to fix. Yeah. And so, well, necessity breeds innovation or something like that. Oh, absolutely. Absolutely. Sometimes you've got to have that gun to your head. Well, you've got to move. You've got to move. Sometimes you got to have that gun to your head. Well, you got to move.

You got to move. Sometimes necessity brings the best work. Yep. That's the Touch of Evil by Orson Welles. Yep. So what are some factors that we haven't talked about that maybe consumers out there are listening? I do notice on your website you have a homeowner section and a broker section. Yes.

So what else do we need to fill in about that? The brokers are just pretty straightforward. We built that so brokers can get appointed. Homeowners really need to be unlike in the past. And I'm sorry, it's involving consumers to be a little bit more aggressive into what they're looking at for their policies. They have to make sure. Chris, again, myth. There's no such thing. I'll bring a myth up. I see policies all the time at $200 a rebuild cost per square foot. There is nowhere in California you can rebuild a house for $200 a square foot. Wow. And so what happens is we're constantly

helping. We're doing reviews and we're helping even with brokers. When the brokers come to us and we see some of the rates, we're like, hey, this area is more of a 600 or 800 a square foot. I mean, Chris, we had one we couldn't believe because our minimum for our WOS program is a rebuild of 4.5 million. We have other programs that are lower than that we can get consumers to. 4.5 million or larger. It was a house in montecito it was a 3600 square foot house the broker said it should fit our program this is over a thousand square foot we said we don't believe it is they sent us an inspection report showing 1800 a square foot to rebuild. $1,800? Yeah.

Holy crap. So we're running into the problems at the same time. You know, I remember in Vegas when the crash came, just before the crash, everyone was bragging about how, you know, $200 a square foot was the going rate, and it was so high at the time. Yeah, I mean. And that was the peak before the crash. Chris, to your point, it's crazy.

I mean, the cost of rebuilds has exploded. And what's really scary is. Just burn it down and start over. Wait, that's a mob thing. Don't do that, folks. I'm kidding. No, don't do that. Please don't do that.

Please don't do that. So the really crazy part of what we get into, though, Chris we really start talking about this is really you get into you're obviously exploding both costs but really what gets scarier like the malibu fire i use a lot because i live i live through it though i live in city westlake village where the fire blew through what's really crazy about this whole mod is when you lose 600 homes in an area, what ends up happening is the cost is a rebuild. Expense. She spikes.

So on top of seeing rates going up to rebuild, when you have a shock loss, I call it a shock loss. You can see rates even, even get higher. There's a lot of consumers that are just getting stuck at this point, you know, getting stuck without,

you know, it's bad enough to have your house burn. I mean, it's one of the most tragic things besides the death of a really close family member. It's a close second. Chris, if you and I are hanging out and we're having a beer somewhere, okay, and God forbid my house burns to the ground,

I mean, this is the shirt I'm wearing. Yeah. I don't have another pair of shoes. Yeah. Think of all the another pair of shoes. Yeah. It's not, think of all the things that you had that you, I mean, people talk about their memorabilia of their life.

The memorabilia is the big thing. It's all gone. I don't care how great the insurance is. It's gone. And so, you know, it's a, it's what consumers need to do.

You have to get ready. I mean, you know, it used to be, oh, well, unless you're the cliffs of Malibu, you don't have to worry about these things, right?

Now fire zones are throughout California. And not just California, the western United States. Yeah. It's multiplying. It seems a lot of this is tied to global warming and the changes that are coming from global. And if you don't want to call it that, you can say there's something going on with the weather for sure i mean well and there's a whole host of things i mean you know the okay so i'm a study of history right those of us that history are doomed to repeat it so we have in the the indian different indian tribes that lived in california prior to us being here okay you know shumash different times do you know what they did every time they would move from one camp to the next camp,

and they'd go their winter to spring camps. What? They lit everything on fire. They burned everything. Huh. And the reason for this is the fact that there's certain plants, actually, it's kind of a scary study of this, that don't release seeds unless a fire happens.

Huh. And so what happens is in California and in a lot of places in the western United States, we have not been doing the maintaining or really control burns or things that nature to help revitalize the soil or things that nature. I mean, it was the sad byproduct of Malibu after the Malibu fire was, I mean, that next spring, look, there were plants they hadn't seen in 20 years. Oh, wow. That next spring, look, there were plants they hadn't seen in 20 years. Oh, wow. And so, I mean, really what it is, it's more of a whole look. It's not just an insurance look. We're in the process of building a nonprofit right now.

That's part of being in the Wiles program. And where that's going to really step into play is helping communities and areas really get involved in getting into, it's just preparation, protecting. It's not a question of if there's going to be fires. It's just when and where. Ah, there you go. That's it. I know that at one point they used to like do some of that burning and seeding and then I think the fires got out of control and they're like, well, this is dumb. And then, but you know, it's all over the over the place yeah there's definitely something happening with the weather um I mean I've noticed it we just went through like probably the hottest it was

almost like living in Vegas we're visiting Utah yeah and this summer and I could not get my body to change but yeah what are some other aspects we haven't talked about that we need to cover? Really is just getting into the consumer side of getting rid of myths, you know, getting rid of what's going on in the market, you know, being told certainly really for consumers to do their research, but realize though,

it helps coming. Chris, that's what I keep saying to everybody. What we're building and what we're doing, this is not just a California thing. You're in Utah. Is as you just mentioned, correct? You're going to see different areas. You're going to see different states that are going to start mimicking the direction of what we're helping them build.

Because it's all hands on deck, as I mentioned to you earlier. Everyone involved. Yeah. All hands on deck. There you go. I mean, this is something I'm really surprised more politicians and legislators don't seem to be addressing, but maybe the reason they're not doing that is because of what you're talking about.

It's really hard to see solutions at this point, I guess. Yeah, and it's pretty straightforward. I mean, what I'm doing, Chris, it's a great program. It reverse engineers. It builds it based a great program. It reverse engineers. It builds it based on portfolios. It spreads risks. It spreads the insurance companies out. That's what they really need, Chris, is to be able to spread their risks.

And if you do that, that brings insurance carriers back into the market and helps push down and actually build rate to be able to bring rates down. And that's it. That's it. It's just challenging. We were talking before the show, there's a photo of L.A. right now where you can see the city. It's like a city view of the whole valley.

And then you can see the fires behind it. It almost looks like L.A. in hell. There's probably a song for that. I'm sure it's an ACDC song or something. Probably, yeah. You're going to throw it in there? Yeah. they're the right wings gonna have fun with that one yeah see the everything's burning in california well and you know what that means again it's not just it's not just a california thing yeah yeah it's florida and i know it's huge in Florida. Florida is the water, obviously, which is really pretty wild when you get into it

because you look at how structured, how they build insurance. And when I did this and we launched the wild side of it, it was really the idea of a program built. And it was kind of a really interesting thing, Chris, when you build something. Being in the field, being in every major fire in California, to then actually spend the money to verify what your theory is. So we've had actuarial numbers put together for all the processes of what we do, and the numbers are staggering difference. There's a staggering difference to market by spread of risk and how we re-engineer the insurance. That's what's got the reinsurance companies on the hook looking at what we're doing right

now and wanting to participate with our Wiles program. There you go. So final thoughts as we go out, tell people your final pitch. I imagine more people want to shop around more. They want to investigate services like yours. Don't just take the, you know, when you get some sort of massive increase, I guess, in the mail of your insurance company going,

we're going to take and do. Give us the final pitch out as we go. Final pitch is just really to everyone out there listening, you've got to be in the front of looking at your insurance rates and looking at what's going on. There are no guarantees of renewals any longer.

In most of the Western United States, there's a lot of areas that are getting hit pretty hard. Getting out in front, knowing what the story is, and getting to the right people. Listen, we appoint brokers throughout California. There's a lot of great brokers across California that are really aggressive on the front part of it. Make sure they help consumers. And there's some that just want to mail you a renewal and not talk to you. Knowing the difference really makes a difference

at this point of having really someone represent you. There you go. So it's been wonderful to have you on and very insightful. And hopefully, yeah, you can bring the change and innovation that this industry needs and that we can, I don't know, get back on it. You know, it's been uh cataclysmic since coven because it seemed to just shake it everything it just seemed like a norm and you know

insurance never really thought about it you're just like that it's always there it's always you know do the thing it's pretty cheap the car insurance went through the roof car prices you know it's just everything just like uh you know and supply chains and but you know, it's just everything just like, you know, and supply chains. But, you know, when you recover from something like what we did with COVID, I mean, it was so disruptive. It's going to wreak some havoc for a while. You're going to feel the effects. So it's interesting to me how people don't get that aspect, but there you go. Well, that's it, Chris.

You nailed it. You nailed it right there. And the thing is, though, it's not a question of if, Chris. We're going to fix this. It's not a question of if. Everyone needs to hear that nailed it right there. And the thing is, though, it's not a question of if, Chris. We're going to fix this. It's not a question of if. Everyone needs to hear that out there right now. I joke around in meetings. I walk in.

It is, yes, we're fixing this. There you go. Well, I love it. This is the great thing about entrepreneurs and innovation and everything else. There's always a better way to build a widget. And sometimes necessity is the greatest creator of innovation. Better mousetrap.

Sometimes having that gun to your head helps. It does. It makes you move. It makes you move faster. It does. You're like, hey, I should probably do something about this. When previously you were just ignoring it. Well, thank you very much for coming on the show. We really appreciate it.

Give us your.com, Robert, as we go on. You can email me. Anyone out there wants to email me direct, you can email me at robert at wows, W-O-W-S, insurance.com. You can also see our website that Chris has mentioned many times on it is wows, W-O-W-S, insurance.com. There you go. Thank you for coming on the show. We really appreciate it, Robert. Thanks for us for tuning in.

Go to good research.com. Fortress, Christmas, LinkedIn.com. Fortress, Christmas, Christmas one on the tick tockety and all those crazy places on the internet. Thanks for tuning in.

Be good to each other. Stay safe. And we'll see you guys next time.