Episode 42: Full Transcript

[00:00:00.09] CHIP BACCIOCCO: Every insurtech pivots. I can't think of a single one that five years after they were founded are still following exactly the same business plan they started off with. They typically have to find some point of pivot. Some adaptation of the product, some adaptation of the messaging, adaptation of their technology, stack, or plan, or whatever. You have to wade out there and encounter what you will, you make your best guesses, but be prepared to be agile, and not just software development but business, and be prepared to change course.
[00:00:32.61] SPEAKER: This is the Insurance Technology Podcast, where we bring interesting people from across the insurance ecosystem to discuss and debate technology's impact on the industry. Join us each episode for insights and best practices from industry stewards and tomorrow's innovators. Now, here's your host, Reid Holzworth.
[00:00:53.78] REID HOLZWORTH: Welcome to the Insurance Technology Podcast, I'm your host, Reid Holzworth. In this episode, I'm going to be interviewing Chip Bacciocco. Chip is the CEO of Trusted Choice. If you're an IA and you're listening to this and you don't know who Trusted Choice is, man, google it. And if you don't know Chip, you're going to get to know him. Chip's an awesome dude. I've known Chip for a lot of years. He lives here right in my hometown of Milwaukee, Wisconsin. They have an office here. Chip is just amazing.
[00:01:20.28] But in this episode, we're going to really get to learn about Chip and his childhood. We're going to learn about his dreams to be the Wolf of Wall Street that were shattered when he fell into insurance. We all have dreams, but here we are, and we love it, right? We're also going to get Chip's opinion on some of the challenges in this industry. Here's a little spoiler alert, it's not technology. It's really good stuff, stay tuned. It's a great episode. Joining me today in person here at my humble abode is Chip Bacciocco, also known as Chip Bracciocco, Bacciocco, right? Depends on a--
[00:02:00.65] CHIP BACCIOCCO: Close to that.
[00:02:00.96] REID HOLZWORTH: Close to-- depends on a
[00:02:01.33] CHIP BACCIOCCO: Depends on the region, and where you're at.
[00:02:03.64] REID HOLZWORTH: --a region, but here in the Midwest, he says Bacciocco, where he grew up in Pennsylvania.
[00:02:09.16] CHIP BACCIOCCO: That's right.
[00:02:09.75] REID HOLZWORTH: Bacciocco.
[00:02:10.70] CHIP BACCIOCCO: Bacciocco there. If you go to California, they'll insist on "Bachocco."
[00:02:15.81] REID HOLZWORTH: Oh, "Bachocco."
[00:02:16.60] CHIP BACCIOCCO: I don't know why, "Bachocco."
[00:02:17.62] REID HOLZWORTH: Ah, I kind of like that.
[00:02:18.62] CHIP BACCIOCCO: And if you go to Italy, where, of course, they know how to say it, it's Bacciocco, "Baa-cciocco." You kind of say it with, like, your hand like you're making a pizza, "Baa-cciocco."
[00:02:29.47] REID HOLZWORTH: I love it. I love it.
[00:02:30.81] CHIP BACCIOCCO: So all of those work.
[00:02:32.23] REID HOLZWORTH: So Chip is the CEO of Trusted Choice. Trusted Choice, TrustedChoice.com, I mean?
[00:02:37.06] CHIP BACCIOCCO: TrustedChoice.com technically if you want we get out the lawyers and all that stuff, but Trusted Choice is the brand of the independent insurance agents that are members of the Big I, TrustedChoice.com is the technology platform. For the purpose of our audience, it's one big thing.
[00:02:53.74] REID HOLZWORTH: One big thing. So Chip and I have known each other for a number of years. Chip lives here in Milwaukee as do I, of course, as most people know. So it's awesome. Isn't it great that TrustedChoice.com is here in Milwaukee?
[00:03:06.76] CHIP BACCIOCCO: It is. I don't know about you, by the way, I-- maybe the Wisconsin Travel people need to send me a royalty. I have been pushing for years that Milwaukee should be known as the Paris of the Midwest.
[00:03:18.46] REID HOLZWORTH: The Paris of the Midwest.
[00:03:19.63] CHIP BACCIOCCO: The Paris of the Midwest. And if you think about it, the cultural things we have, and we have a river, and there's a lot of similarities as well.
[00:03:25.39] REID HOLZWORTH: It is a very romantic city.
[00:03:26.71] CHIP BACCIOCCO: Yes, it's very, very cool. So I'm going to insert that one more time, Milwaukee-- come to Milwaukee, the Paris of the Midwest.
[00:03:32.86] REID HOLZWORTH: I'm envisioning people making out one man with a very long, big beard holding a PBR next to the river.
[00:03:40.96] CHIP BACCIOCCO: Well, we have that too.
[00:03:42.33] REID HOLZWORTH: And a very nice lady--
[00:03:43.32] CHIP BACCIOCCO: We have that too. It's Paris--
[00:03:43.90] REID HOLZWORTH: --next to Harley-Davidson Museum.
[00:03:46.45] CHIP BACCIOCCO: Yes, exactly. Paris with motorcycles and beer and bronze.
[00:03:50.38] REID HOLZWORTH: That's my kind of Paris.
[00:03:51.37] CHIP BACCIOCCO: There you go, yeah.
[00:03:51.88] REID HOLZWORTH: I tell you what.
[00:03:52.54] CHIP BACCIOCCO: Why not?
[00:03:55.18] REID HOLZWORTH: So I asked Chip to join the podcast today because Chip's been in the industry for a long time. And running TrustedChoice.com, Chip has an interesting lens on our industry and what goes on there, and really TrustedChoice.com. And I'll let you, of course, get into this, Chip, more, but TrustedChoice.com is really a-- I guess you'd say a consortium, if you will, of carriers and large brokers, and, of course, the Big I that came together to promote the independent agents across our beautiful country. Essentially, it's like you're the marketing arm for the independent agent, the way I've always looked at it. So with that you drive a lot of leads and whatnot to the independent channel and really just promoting the brand, among other things that you'll get into later, but yeah, welcome.
[00:04:41.98] CHIP BACCIOCCO: Yeah. It was-- well, thanks. It's good to be here, Reid. Just a little more color on that, the industry was very worried about the competitiveness of the independent agent, the average independent agent. They weren't that worried that an Aon or a Marsh was going to go out of business. But that average main street independent insurance agent felt like it was under a lot of threat at the-- say, 2009, 2010, 2011, there were some studies and articles being written that we were going to go the way of the travel agent and the industry wanted to fight back. And so the large IA companies came together behind the Big I and other leaders in our space, and there were actually a lot of people involved in those days in getting it formed. We did have a rocky start, which was before my time, but this is actually-- December marks the 10th year of me being the CEO.
[00:05:31.89] REID HOLZWORTH: Wow, holy moly.
[00:05:33.01] CHIP BACCIOCCO: Yeah. Like, next week is my 10-year anniversary.
[00:05:35.65] REID HOLZWORTH: Man, time flies.
[00:05:36.55] CHIP BACCIOCCO: I know. It really went by fast. But anyway, yes, we have come together to help the little guy who couldn't on his own or her own. Think about it, couldn't possibly compete digitally, couldn't get to page one of Google and things like that like the large captive agents especially could. And so they said, let's get together. And we're going to pool our resources, pool our capabilities, and come up with this.
[00:05:58.15] Because the strength of that network, of thousands and thousands of independent insurance agents in every community in America, nothing can beat that in terms of being an advisor to everyone that needs insurance. So it's an amazing capability the IA channel, and it's an amazing service to American business and American families, but it's not ideally suited to just sort of step into the digital world. So TrustedChoice.com was-- the idea was, let's build a platform to aggregate and get some focus on that.
[00:06:27.91] REID HOLZWORTH: But you've done, and been very successful at it.
[00:06:29.84] CHIP BACCIOCCO: I think we have. We're getting there, yeah.
[00:06:31.66] REID HOLZWORTH: It's awesome, man. It's awesome. So before we dive into more business stuff, let's get into Chip. Let's talk about Chip. Chip, where did you grow up? Tell us a little bit about yourself.
[00:06:40.60] CHIP BACCIOCCO: So I grew up in Mechanicsburg, Pennsylvania. And if you've ever driven through Pennsylvania--
[00:06:45.69] REID HOLZWORTH: Mechanicsburg?
[00:06:46.36] CHIP BACCIOCCO: Mechanicsburg, it was a-- in the old, old, old days, they had to drive wagons between Philadelphia and Pittsburgh, and there's kind of a convenient place to stop in the middle when your wagon wheel fell off. And after a while, a bunch of guys set up like a wagon wheel repair shop there, and now today it's called Mechanicsburg.
[00:07:05.39] REID HOLZWORTH: Wow, that's awesome.
[00:07:07.19] CHIP BACCIOCCO: It was actually a little bit part of the Battle of Gettysburg, well, actually most of the towns in the middle of Pennsylvania were in some way a part of the Battle of Gettysburg, so there were cavalry troops running up and down the streets and doing all kinds of things. And it's not far from Gettysburg. So if you want to know where it is, it's kind of-- look at Harrisburg and kind of go Southwest, or West, 15, 20 miles. Great town.
[00:07:30.59] REID HOLZWORTH: Awesome. What did your parents do for a living?
[00:07:33.33] CHIP BACCIOCCO: My mom worked-- she was a hospital administrator, and my dad worked for the Department of Defense his entire career. He worked for the Department of the Navy.
[00:07:42.38] REID HOLZWORTH: Really? Doing what? As a civilian, or?
[00:07:45.14] CHIP BACCIOCCO: As a civilian, yeah. Well, he was a Marine when he was younger. Mom didn't like that idea, thought that was kind of hazardous for a father to go out and get shot as a Marine. So then he switched to civilian, and he was in software. Yeah. Back when they had punch cards, and that's-- he was really in the foundation of all the payroll systems.
[00:08:05.06] And the largest inland naval base in the world is in Mechanicsburg, Pennsylvania. It's a very weird story, but if you ever go there, you'll see these hills. They're not real hills, they're artificial hills, or, at least, they used to be in the '70s, of strategic metals that the Navy was putting there. Lead, copper, all kinds of things they needed for war, and they would store it. But they had to move it inland, so it couldn't be easily captured on the shore. So they moved it 100 miles from the ocean, and it's still there today, the Ships Part Control Center. So if you're ever looking for, like, an old part to a battleship, it's probably in Mechanicsburg.
[00:08:40.31] REID HOLZWORTH: Oh, that's awesome.
[00:08:41.27] CHIP BACCIOCCO: Ain't that cool?
[00:08:42.05] REID HOLZWORTH: Is there like battleship junkyards?
[00:08:45.95] CHIP BACCIOCCO: Yeah, but obviously not the whole thing, too big. But yeah, lots and lots of parts are secured off, you can't just walk through, but yeah.
[00:08:53.06] REID HOLZWORTH: That'd be so cool. I'd love to go pick parts in that--
[00:08:55.64] CHIP BACCIOCCO: I would too. I'm sure there's a lot of-- I hope they can have a torpedo, and I like that 5-inch gun, and I'll take all this stuff.
[00:09:05.34] REID HOLZWORTH: I get killed. Then come home, a trailer full of stuff, put it all out in the yard. Let's go, baby.
[00:09:11.51] CHIP BACCIOCCO: Yeah. It'd be a great attraction for the neighborhood for about a day, what the hell? Anyway, yeah, my dad worked for the Navy. And then eventually, he actually moved to Pensacola, so that's where he finished his career.
[00:09:23.15] REID HOLZWORTH: Oh, OK. Got you, got you. So what did you do when you were a kid? Sports, hobbies, what did you do for fun?
[00:09:30.71] CHIP BACCIOCCO: In my, say early teen years, I did a lot of fishing. Pennsylvania's well known for trout fishing, and I waited in and--
[00:09:39.50] REID HOLZWORTH: Oh, no kidding.
[00:09:40.10] CHIP BACCIOCCO: Oh, I was great.
[00:09:40.70] REID HOLZWORTH: I didn't know this about you. You're big trout fisher?
[00:09:42.80] CHIP BACCIOCCO: Back in the day I was. We moved to Wisconsin near Milwaukee and there's not a lot of trout. We have it up North as you know, there is some trout fishing in Wisconsin, but nothing like Pennsylvania. Pennsylvania is as close as you'll get to, like, a Colorado or a Wyoming in the East. And the Yellow Breeches which is in the county that Gwen and I live right between those two creeks which are really well known trout streams. I could get on my bike and ride a mile and a half and be in the water and it was great. And, of course, when you're 12, you don't even know you're in this amazing place, you just-- it's just home.
[00:10:14.18] Then later I was on the golf team in high school. And so when you're on the golf team, they let you play golf for free at any golf course. All the local places, once you let them know I'm on the golf team at the high school, they're like, you can play wherever you want. So I spent an awful lot of high school afternoons. Plus they let you out of school, like, an hour early if you said you were going to golf practice. So I'd be off at the golf course at 3 o'clock in the afternoon, play five holes, six holes, doesn't matter, wait till it gets dark, go home.
[00:10:42.77] REID HOLZWORTH: You still golf a lot?
[00:10:43.94] CHIP BACCIOCCO: I don't golf a lot, but I do still golf. It's in the insurance business. It was really handy and the early parts of my career, we played a lot more golf. I don't know why we've gotten away from playing golf. I only play it twice a year now.
[00:10:55.61] REID HOLZWORTH: I hear that golf is-- this is what people have said, but golf is kind of dying as a sport.
[00:10:59.69] CHIP BACCIOCCO: Oh, it's really struggling. I mean, COVID kind of saved it a little bit because everybody like, what can you do? Well, you can go be on a golf course because you're not near anyone. So I think it's had a little bit of a rebound, but no, it's in trouble. There's not as many 20-somethings playing golf as there were when you and I were 20-something.
[00:11:17.12] REID HOLZWORTH: Yeah, man. I'm not a golfer. I've never been a golfer. It's just not my thing. I mean, I've done it. I've taken lessons. I've joined the country club. I've played. I used to be a member over here at Tripoli University Club, I don't know if you know it. But anyways, it's just never been my thing. Like, I like-- it's fun, but I don't know, the whole day doing that, it's just--
[00:11:38.21] CHIP BACCIOCCO: You have to find-- it's right, it's not for everybody. But for some people, it's a walk in the park. It's an excuse to walk around with your friends, right?
[00:11:46.88] REID HOLZWORTH: Yeah. That's what it is. You go drink with your buddies, [INAUDIBLE] some cigars. I get all that.
[00:11:51.97] CHIP BACCIOCCO: It's like just about every male endeavor. It's an excuse to go--
[00:11:55.24] REID HOLZWORTH: Yeah. This is true. I guess maybe I just have too much freedom in my life to do that normally.
[00:12:01.57] CHIP BACCIOCCO: You have too many fast cars, fast motorcycles.
[00:12:05.08] REID HOLZWORTH: Yes. This is true.
[00:12:05.32] CHIP BACCIOCCO: If we had those-- imagine every golf course is really just a motocross activity.
[00:12:10.63] REID HOLZWORTH: Oh, that'd be amazing, right?
[00:12:11.62] CHIP BACCIOCCO: I mean, just wide open. Drive your car wherever you want. Dune buggy all you want. Now, that would be a little hard on the fairways, so that's why that doesn't happen.
[00:12:19.32] REID HOLZWORTH: I'm no joke. I've been kicked off a few golf courses for tearing it up. Like, literally, I mean, it's fun. It's cool, but yeah, interesting. So what did you want to do when you grew up? When you were a kid you're like, when I grow up I want to be this.
[00:12:32.12] CHIP BACCIOCCO: I wanted to be an insurance executive, no, I did not.
[00:12:35.61] REID HOLZWORTH: Yeah. I think [INAUDIBLE].
[00:12:37.30] CHIP BACCIOCCO: No, nobody ever-- Mike Rice, one of my-- the mentors I think I may have listed, he used to give a speech like a career day, and I kind of borrowed part of it. And there's no 12-year-olds out there that say, when I grow up I want to be in the insurance industry.
[00:12:52.83] REID HOLZWORTH: Yeah, no way.
[00:12:53.38] CHIP BACCIOCCO: It's something you find or it finds you. And once you're in it, then you realize what an amazing profession it can be. But anyway, I wanted to be an aerospace engineer. That's what I wanted to be.
[00:13:06.91] REID HOLZWORTH: An aerospace engineer.
[00:13:08.47] CHIP BACCIOCCO: I mean, it started off I wanted to be an architect. It sort of evolved, and I wanted to be a mechanical engineer in aerospace. By the time I went to college and I learned that you could make a lot more money if you were a stock-- like, an investment banker or something like that, then I kind of switched to that. Then the stock market crashed in '87, which is right before--
[00:13:27.88] I was sort of getting serious about interviewing. So all those-- some guy named Pat Ryan, who had no idea what the hell Rollins Burdick kind of did, he wanted to form this internship program, and he wanted to get one person from each of these Midwest schools, Notre Dame, and Michigan, Northwestern, and Illinois, and so forth. And I was fortunate to be the one selected from my school, and--
[00:13:51.87] REID HOLZWORTH: Wow, no kidding.
[00:13:53.59] CHIP BACCIOCCO: It just happened to me. I got pulled in. It's like, well, can't get the job I thought I wanted. I'll take this job for a while, it'll buy me all the beer I want in Chicago for a couple of years, we'll see how it goes.
[00:14:04.72] REID HOLZWORTH: Where did you go to school?
[00:14:05.62] CHIP BACCIOCCO: I went to Notre Dame in Indiana.
[00:14:07.21] REID HOLZWORTH: Notre Dame, OK. Yeah, yeah, yeah. Wow, that's amazing. It was like right in. OK, so back up a little bit. So you went to school for finance. You wanted to be a broker. You're doing Series 7, 63, whatever the hell it is. That's like, that's me. That's what I want to do. I want to be on Wall Street doing the thing, yelling at people in the pits, whatever it was, right?
[00:14:26.32] CHIP BACCIOCCO: Yeah, exactly.
[00:14:27.23] REID HOLZWORTH: And then market fell out crashing, and you're like, yeah, that's not going to work?
[00:14:31.18] CHIP BACCIOCCO: Nope.
[00:14:31.81] REID HOLZWORTH: So but there's this internship. I don't know if this--
[00:14:34.63] CHIP BACCIOCCO: This is back when they actually closed--
[00:14:36.61] REID HOLZWORTH: --with Pat Ryan.
[00:14:36.88] CHIP BACCIOCCO: Yeah. No, they posted jobs on bulletin boards, like, real paper with real thumbtacks back then. And so I'm down in the career placement center, and all these finance guys were there and we were like, there's no-- all the jobs are gone. I mean, they're all, poof, they were there a week ago, and now they're gone, there's no interviews. What are we going to do? And so like I said, yeah, there was this thing, Rollins Burdick Hunter is what Aon was called actually at that time, it was about a year before it changed names. And I thought, well, that sounds very financy, Rollins Burdick Hunter, and I had no idea who Pat Ryan was at the time.
[00:15:11.44] REID HOLZWORTH: So for the listeners, who's Pat Ryan?
[00:15:13.42] CHIP BACCIOCCO: Pat Ryan is the founder of Aon. He's also the-- he's the founder of, like, four insurance companies, but Aon is what he's best known for today. He's also the founder of Ryan Specialty Group, I got to make sure I get the S. There's different RSG, Ryan Specialty Group. So he's founded multiple insurance companies. He actually started his career with-- W. Clement Stone was one of his mentors. And if you ever get a chance, look this up, W. Clement Stone founded Combined Insurance of America, which wasn't-- I mean, it goes all the way back to the 1930s or '40s with industrial life in the Midwest.
[00:15:50.56] Like, door to door, $0.15 a week, so in case your husband gets crushed in the big giant steel press kind of stuff. It really is. And he was a real innovator, and Pat Ryan and him met when Pat was in his 20s, I think. And they did all kinds of interesting things together and then later on Pat managed to combine Combined Insurance and Rollins Burdick Hunter into one company, and that became in 1987 or '88 Aon.
[00:16:19.65] REID HOLZWORTH: And that's when he--
[00:16:20.44] CHIP BACCIOCCO: And that's exactly when he said-- he said, I need some young people that we can teach from the ground up our way of doing things, yeah.
[00:16:27.88] REID HOLZWORTH: That's amazing.
[00:16:28.75] CHIP BACCIOCCO: It is. It was quite a thing to be part of.
[00:16:30.55] REID HOLZWORTH: Straight out of school, handpicked, intern program, you guys all are.
[00:16:34.72] CHIP BACCIOCCO: Yeah.
[00:16:35.32] REID HOLZWORTH: That's amazing.
[00:16:36.26] CHIP BACCIOCCO: It was fun.
[00:16:36.97] REID HOLZWORTH: So tell me about the Aon experience. So, all right, you're a newbie, green, you come into this insurance world, what did you do? Like, what did that look like?
[00:16:45.70] CHIP BACCIOCCO: It was great, actually. It's the privilege that nobody else will be able to have unfortunately. So they wanted us-- they wanted to expose us to every part of the business, right? So in that intern program, we spent-- I don't remember, like two weeks, I think, at a time, something like that. Two weeks in a sort of small commercial, two weeks in the claims department, two weeks in everything. Risk management, different areas. Large commercial, I remember I got to work on the Ford Motor Company account for two weeks. I mean, again, I was just an intern, I was just helping. But you get so much exposure.
[00:17:19.12] And then after I was hired as a full-time person, which was nice, by the way, to be in my senior year and already have a job offer. All these other guys were worried, and I'm like, well, I've got this offer from Aon, so I think I'm going to go there. That made senior year fun. But anyway after that, I got to work-- and another mentor, if I didn't mention him, was Paul Slamar. He was the General Counsel at Aon Specialty Group at the time. And he taught me all about how an insurance policy really works. I mean, we really-- he wrote custom bespoke insurance policies for special Aon clients.
[00:17:52.58] REID HOLZWORTH: That's awesome.
[00:17:53.40] CHIP BACCIOCCO: And we even-- at different points we tried to come up with unique coverages for Aon clients. So one of the ones I got to work on and I'm like 25, 24, was a product recall insurance that we made up from scratch. And Paul was obviously the attorney, I mean, he did--
[00:18:12.88] REID HOLZWORTH: Did that insurance exist at that time?
[00:18:14.13] CHIP BACCIOCCO: It did not. So there had been some famous big contaminations of like Tylenol, and there was a big one of Perrier water and some other things. And there was coverage if it was intentional, this is a little nerdy insurance-wise, but there was no coverage if it was accidental. And so we actually set about to try to write insurance from scratch, blank piece of paper.
[00:18:37.84] How do you write an insurance policy for a brand new exposure and building all the exclusions you need and all the protections, and how do you model out what you think the claims will be and losses? I had the most in-depth sort of education and immersion in real hardcore risk management insurance at the age of 25. We're flying over to London-- I get to fly to London and help present this so we can get reinsurance behind it.
[00:19:03.42] REID HOLZWORTH: Wow. That's awesome.
[00:19:05.91] CHIP BACCIOCCO: A lot of people have to-- they get the-- they're probably sitting in a cubicle somewhere and just cold calling people all day, and I certainly did some of that. Quite a bit of that. But I also got to do some amazing things in my 20s that really helped me see what-- the challenge of insurance. It's really a rich field and a rich profession, and you can do really creative things. That was fun.
[00:19:29.08] REID HOLZWORTH: It's a great education.
[00:19:30.21] CHIP BACCIOCCO: Yeah, it was.
[00:19:31.08] REID HOLZWORTH: It's amazing.
[00:19:31.56] CHIP BACCIOCCO: I have nothing but gratefulness to all of the people that let me do that stuff and invited me into that world, it was wonderful.
[00:19:38.97] REID HOLZWORTH: Aon would be what, number two?
[00:19:41.62] CHIP BACCIOCCO: Yeah, it goes back and forth.
[00:19:42.96] REID HOLZWORTH: Between Marsh?
[00:19:43.62] CHIP BACCIOCCO: Yeah, Marsh.
[00:19:45.59] REID HOLZWORTH: Like been there to.
[00:19:46.77] CHIP BACCIOCCO: Thirdish.
[00:19:48.24] REID HOLZWORTH: Kind of fighting.
[00:19:48.78] CHIP BACCIOCCO: They all fight for it. There was a point at which if Aon or Marsh made a significant acquisition, they would literally flip-flop one week, aha, we just bought Alexander and Alexander, one more one, you know, that kind of thing that went on, oh, we back, we're going to buy whatever Johnson and Higgins or something. All these names that are gone. But yeah, they would do that for a while and sort of one up each other. That's kind of, yeah.
[00:20:13.32] REID HOLZWORTH: So what happened after Aon, so how long are you there, for a while?
[00:20:16.44] CHIP BACCIOCCO: Yeah, I did eight years, my first tour. I've actually done two but we'll get back to that later.
[00:20:19.74] REID HOLZWORTH: Go ahead, so after Aon?
[00:20:21.27] CHIP BACCIOCCO: After Aon, I met the girl of my dreams who actually had met many years before at school, at college but we finally decided we were going to date seriously. She lived in Texas, I was in Chicago at Aon, and I've been eight years, and it was time to do something different. So I went to Texas, and I went to work for a wholesale broker there called Maclean Oddy, which I'm really glad I did. I learned a whole lot about the energy business, and I learned how a real wholesaler works. We had two wholesalers at Aon.
[00:20:51.06] But this was a scrappy little 30 person wholesaler that really specialized in energy, they did a lot of their placements with the UK market, and I had a great mentor there as well, Stuart Dobbie, who probably might still run Maclean Oddy, I'm not sure. I should get connected, Stuart, if you're out there, let's talk. Thank you for everything. But anyway, that was a great immersion, I only did that for a couple of years. And then I went to work for Gallagher, again. That's when I made the jump to Gallagher.
[00:21:21.03] REID HOLZWORTH: How did your buddies at Aon feel about that?
[00:21:22.56] CHIP BACCIOCCO: Oh, they were fine. They were fine. They were totally fine. Everybody knows each other in this business right, everybody. It doesn't, it's like the NFL, you play a game and then at the end, they all walk on the field and hug each other, and say, hi. It's the same thing. So yeah, then I went to by that time, I was more moving into the technology area. So it's right around 2000. And at that point, it was like people were starting to realize there's this thing that the internet had been around for five years or whatever, we finally we're clearly going to moving in that direction was perfect for everything insurance does was all this communication on the internet.
[00:21:58.05] And I was at the right stage in my career that I could be saying things like, we should take this, why don't we take this insurance program that sells professional liability to nurses or lawyers or whatever. It's really simple. We do it all through direct mail, you just have a website, you can put it on there and you go what's a what, almost not quite that bad. But what's a website, how do we build one? So I was part of that. So I was actually the first employee at, what do we call it a Gallagher, the e-Business, we called it e-Business, Gallagher e-Business unit. I was the first employee there, and got that department started. And that's when I was working for Wally Bryce, and he was kind of the innovator at the time in the Gallagher family. And it was great, and we went from there. Yeah, it was fun. I've had nothing but one fun adventure after another.
[00:22:45.31] REID HOLZWORTH: So all right, so Gallagher, then what?
[00:22:49.17] CHIP BACCIOCCO: Gallagher, then Zywave.
[00:22:51.81] REID HOLZWORTH: Oh, here we go, yeah Zywave.
[00:22:53.19] CHIP BACCIOCCO: Yeah, that's how I ended up in Milwaukee.
[00:22:54.66] REID HOLZWORTH: So now you went pure technology, all right, so talk about that. So from where are you living when you were at Gallagher?
[00:23:00.33] CHIP BACCIOCCO: Mostly in Tulsa. So it's headquartered in Gallagher at the time, of course, was in headquartered in the Schaumburg area, Itasca, Illinois. So I was there an awful lot. But my family needs at the time, and the way Gallagher was organized, I was actually spent most of my time in Tulsa, Oklahoma. And then, Zywave was in Milwaukee, and they at the time were known more as a provider of technology services to employee benefits brokers, for the most part.
[00:23:30.54] And they really wanted, because it was expanded out of an agency that had focused on employee benefits, and so they wanted, they knew they needed to move into the P&C space. And they needed somebody that could help them do that. So they brought me on to help design or to modify some of the products they have, like broker briefcases and other things, and to start to think about a next generation of products that was more tailored to P&C agents, which I did. And and that was a lot of fun, another great opportunity to work again for a different kind of an organization, this time all technology, not, there's no insurance sold there.
[00:24:06.22] And instead, the insurance agents were the customers that was the first time that I had them as customers. And learned a whole lot about, how do you have insurance agents as customers, and what are the challenges that they face, and how do you how do you explain what a product does, and how do you make sure the products meeting their needs, and how do you support it, and when they don't use it, what do you do, and all those kinds of challenges that I still face today. So that was really interesting.
[00:24:34.61] And then they went through some private equity. This happens a lot in the technology space. It's time to be sold.
[00:24:43.71] REID HOLZWORTH: Who did they sell it to?
[00:24:45.01] CHIP BACCIOCCO: They sold it to Vista, I believe. Yeah, I believe it was Vista.
[00:24:48.76] REID HOLZWORTH: Oh, brutal.
[00:24:49.63] CHIP BACCIOCCO: I know, it was brutal. And and I was like, Oh, this is what I really signed up for. But I had sort of done the useful part that I could do, I had made enough of a nudge in a direction, and they were going to be fine. And I had an opportunity to go back to Aon. So and do a second tour at Aon. So I thought for whatever reason, you got to check things out, right, you know, I'm on the technology. Well, I want to go back to the broker side. I don't want to go. And again, right point in my career. So I went back and did another tour at Aon.
[00:25:20.59] And then not too long after that was when I had the opportunity to come to Trusted Choice. And that was unusual. I was working on some different ideas with some folks, a guy named Richard Roy for example, call out to Richard, another mentor I suppose and good friend. And he was the CEO, Founder of CSR 24. And Vinny [INAUDIBLE] was his partner, and Vinny still works at Trusted Choice today.
[00:25:51.67] So Rich called me up one day, and he said, the Big I is in trouble, they got this project, it's an interesting project but it's in some financial straits. And Rich said, I think you might be the guy that can help fix it.
[00:26:06.58] REID HOLZWORTH: What was his involvement in it?
[00:26:07.87] CHIP BACCIOCCO: He was, he's always been very involved in the Big I and sort of an advisor, right, from the technology side. I'm not sure exactly how he was in that conversation. But I know he was in the conversation. They were sort of looking around and going who could we bring in to help out. And he's the guy that threw my name into the ring.
[00:26:26.65] And so then I got a call from somebody that was doing the search for the Big I, and one thing led to another. And after many meetings, I would fly to like somewhere the Big I was having a meeting, they'd say would you come down and talk to us. I'd fly down and I'd meet with some Big I leaders, and met with a lot of the insurance company leaders that were also the original founders. And after a while, they said, we want you to try to save this thing. And I didn't know how bad it was at the time. It was pretty rough. When I was hired 10 years ago this week, there was like only 90 days of cash left. Yeah. Yeah.
[00:27:05.20] REID HOLZWORTH: That's got to be a hard pill to swallow it. Had this great career, go over here, do this mission.
[00:27:11.18] CHIP BACCIOCCO: And I didn't know it was that bad so I kind of felt like what kind of. Where's my due diligence skill? I never figured out. I had just signed a three year contract, and they had 90 days, I'm like what. And they said, don't worry, you're going to fix it. And I said, OK. And we fixed it together. It was by no means was a one person effort, it was a lot of great people that were part of the company then are still part of the big family today. I'll call out some name, Tom Minkler was an amazing an agent that was involved in that, Dave Walker, Bob Roosevelt, who still is CEO of the Big I.
[00:27:55.99] It was a team effort and a lot of great insurance company leaders as well, Matt Nickerson from Safeco, Ed Largen from Westfield, and I could name others that really pulled in, Bill Purmort, who retired recently from Central. It was really a good group of insurance executives that said, don't worry, we're going to save this, we got your back. They did put in more money, they didn't leave me with the 90 days. They sort of said, well we'll back it up, don't worry about it. And then we all came together. And so I think that was quite an adventure to be part of that, to figure out how to save that. Every InsurTech pivots, I can't think of a single one. And maybe you know one but maybe I don't that five years after there were founded are still following exactly the same business plan they started off with.
[00:28:47.91] They typically have to find some point of pivot, some adaptation of the product, some adaptation of the messaging, adaptation of their technology stack or plan or whatever, you have to wait out there, and encounter what you will, you make your best guesses. But be prepared to be agile, and not just software development but business. And be prepared to change course. The original vision of Trusted Choice was personal lines only.
[00:29:14.91] REID HOLZWORTH: Oh, I didn't know that.
[00:29:15.80] CHIP BACCIOCCO: Absolutely, it was personalized only. It was heavily focused on quoting. So the revenue model is going to be like $0.10 a quote or something. It was just a lot of things that were baked in, it was very heavily focused on providing websites for agencies which.
[00:29:34.05] REID HOLZWORTH: That's tough.
[00:29:35.19] CHIP BACCIOCCO: Tough, tough space, tough business.
[00:29:38.16] REID HOLZWORTH: I was listening to that do that in your business. Thank you. Yes, it's tough. It's tough.
[00:29:43.20] CHIP BACCIOCCO: It is very hard. It's very hard. Our purpose was, how do we help thousands of agencies, right? Well, websites are like one agency at a time. You spend your whole life trying to help 500 agencies, right. It's a long haul. So anyway, I had to almost, and there were people that like anything else when you say let's change something, there's always somebody that's pushes back, changes. Even though human beings, our best skill is adaptation, the thing we hate to do the most is change. Why is that? It's a curse. You could throw us into, whatever you can pick me in you up right now, put us in a secret helicopter and drop us anywhere in the planet, and we'd figure out how to survive. But we'd be so annoyed.
[00:30:25.77] REID HOLZWORTH: Yeah, totally.
[00:30:27.15] CHIP BACCIOCCO: Right?
[00:30:27.45] REID HOLZWORTH: Yeah, oh yeah, oh yeah.
[00:30:29.34] CHIP BACCIOCCO: Like, what the hell? I don't want to be here, I had other things to do, this is not what I planned for today. And that's what every business, especially in sure tech, right, they dream up this vision of what their tools going to do, and the product features, and they get really emotional about every little thing, right, the logo, the colors, right.
[00:30:52.68] REID HOLZWORTH: Yeah, oh yeah. Oh yeah
[00:30:55.38] CHIP BACCIOCCO: And so then something needs to change, people don't like that, we're going to change the logo. Have a meeting with people that want to change a logo, that's like I almost want to just.
[00:31:08.04] REID HOLZWORTH: So brutal.
[00:31:09.21] CHIP BACCIOCCO: So brutal. That's the wrong shade purple or something, spend an hour on that, really, I don't, come on, guys, let's flip a coin.
[00:31:18.21] REID HOLZWORTH: That's what that business is so hard, it's so tough.
[00:31:21.42] CHIP BACCIOCCO: It is very tough, it's very tough, it really is. But that's the thing I would say is, yeah, it being agile and adapting your plan. And that's exactly what we did at Trusted Choice, we just, we weren't afraid to change anything. We're not afraid to change anything. And so of course, we had a lot, as you know we had lots of speed bumps and lots of critics, and we just slogged through it. One adaptation at a time.
[00:31:49.95] REID HOLZWORTH: Yeah, that's interesting point you made about insurer tax pivoting. I think that's businesses in general to some degree.
[00:31:55.98] CHIP BACCIOCCO: Probably, sure.
[00:31:56.94] REID HOLZWORTH: As they grow and as they mature, they kind of have to pivot in certain ways. You know what's interesting? I just think about when you're saying that is I've known a bunch of insurers or people companies in this world, in our world that didn't even really know what they wanted to be when they grew up, even from the beginning. They're kind of like, yeah, we're doing this thing. And we're like, and depending on who they talk to, it'd be like a different spiel on what they actually do. And some of these not to name names at all, some of these companies have had very large exits as well at end of the day. You know but like all along, you're kind of confused at least I was, among others, it's like, wait, what do you do, like what are you actually doing. And they kind of would pivot on the fly depending on who they were talking to.
[00:32:46.83] CHIP BACCIOCCO: Totally agree. So and there's good pivots and there's bad. You got to know when to stick to your guns, and when not.
[00:32:55.20] REID HOLZWORTH: That's the other thing, on the flip side of that, there's companies out there even now that are just holding on to this thing that is just it's not going to happen. It's like you want to say, you have to change, and even if you do, it's like you don't know what you're talking about, right. And there's holding on to it. It's kind of dying on the vine.
[00:33:18.13] CHIP BACCIOCCO: Well, I'll give an example of an area where we have changed recently, and I have been dragged kicking and screaming. So even you got to look at yourself. It's not something like you can't just assume that everyone else is the one that's the change resistor, sometimes it's right in here, it's right inside yourself. So you know I hate the word leads. You know I hate it. And by the way, our mutual friend, Ilya Wagner has a sign in his office if you go to Bold Penguin, I hope you still have it out there, Ilya. It's got the word leads, and it's got like a big Ghostbuster X over it. So same thing, you can't say that word, right.
[00:33:56.95] And the reason that I don't like the word is because it doesn't describe what I want to bring to our agents, it doesn't describe. A lead is that cold thing, you know somebody filled out a loan application three weeks ago so they must be a homeowners insurance candidate because they filled out a mortgage application three weeks ago. So let's sell it to 10 insurance agents, they can all cold call the guy. And hey, you want to buy some home insurance, that's not a lead.
[00:34:23.80] REID HOLZWORTH: But to be fair, a lead technically speaking, like a technical level, CRM whatever, a lead is a business card, that's a lead. It's a lead is a business card, this is how I like to look at it through technical lens.
[00:34:37.73] CHIP BACCIOCCO: Yes, because you're thinking of it, you're thinking of a database record.
[00:34:40.78] REID HOLZWORTH: It's like, yeah, it's just a small, hey, here's a business card, hey, we met playing golf or whatever at the bar or whatever it may be, this guy has a business, here's their card, right. Leads in our space have gotten a really bad.
[00:34:53.95] CHIP BACCIOCCO: Bad name. So I don't want to hear.
[00:34:55.75] REID HOLZWORTH: All these lead, all aggregated, what have you call these guys? Like you said, oh, I'm applying for a 20% off coupon for Home Depot, and all of a sudden I'm getting spammed, right.
[00:35:06.33] CHIP BACCIOCCO: Oh Yeah, oh, this is clearly, he must have a house if he's buying a home repair. Oh, that's crazy. Yeah, so what we try to distribute to our agents at Trusted Choice dot com are real time, inbound, high intent organically sourced insurance sales opportunities. So we had somebody on our website, you know how that works, somebody on our website a minute ago, and they were on the do the home insurance if you want. They were on the home insurance page reading all about how to insure your home, and what are the important things to cover. And every page on Trusted Choice dot com, we are always reinforcing what you really need, the smartest thing you could do is have the right independent insurance agent helping you, making sure you get the right coverage, making sure your place with the right market.
[00:35:51.41] So anyway, they're doing that, and they click on a button that says find the right agent for you, and then they go through, and they answer a couple of questions. And we go, oh, look, it's Jane Smith, and she's in Milwaukee, Wisconsin, and she's got a house at this address, and she wants a quote. That's not a business card, that's a high intent inbound organic real time exclusive, we only give that to one agent, here, agent, here it is. So that's a prospect. But I can't call them, I don't know why I can't call them prospects.
[00:36:22.16] REID HOLZWORTH: Technically speaking, that is yes, it's a prospect account. But technically, that's an opportunity.
[00:36:27.64] CHIP BACCIOCCO: Yeah, it is. You and I are speaking sales forces right now, yes, I know we both have that training. So I actually internally, we do call it an opportunity in our own data modeling speak, we do, we call that an opportunity.
[00:36:41.41] REID HOLZWORTH: To enter in their information, and they said they said, hey my hands up, I would like for basically.
[00:36:46.78] CHIP BACCIOCCO: And maybe, this podcast will change things, and we can all start calling those opportunities. Because I go into any meeting in the country, and somebody says, so Chip, what kind of leads have you got? And I just want to crawl under. So I'm but I'm giving up, you know what Reed, I'm giving up, this is me changing. I'm changing. We're going to embrace the damn word, and we're going to redefine it.
[00:37:09.22] REID HOLZWORTH: We're going to redefine it.
[00:37:09.88] CHIP BACCIOCCO: We're going to redefine it. I'm going to have to erase what you and I think of because you and I think of the sales cycle in a CRM, right. That's what you and I are thinking of. We're going to erase that off the board, and we're going to since that's the word that insurance agents want to use and insurance companies, that's the word they want to use, we're going to use that word but we're going to have to get it redefined in everybody's head. It's either there good leads.
[00:37:34.78] REID HOLZWORTH: Let's talk let's talk about these for a second. So for context, I've done a lot of work in that space, back in the day. When I had tech in an area, I had a lot of these guys that spent huge money. I may have talked about this in the podcast before, but I'll say it again. They're huge, they spent huge, huge, huge money on these. Their entire business, how they brought business in the door was through leads. Now, these guys didn't just go and buy, go to like Net Quote, and all sign up for $10,000 a month or whatever it may be, they use all kinds of tools, and we built tools for them. So that when a call come in, we would hit the call controller, it automatically dial it, instantly. That's why, those are the guys when you do hit submit on insurance quotes, and as soon as you hit submit, your phone rings instantly, that's all the systems and the tech and what they've used.
[00:38:24.82] Those guys in that, they use lead ID, and all the data, they mine it. I mean, it's the real deal. I had a client, and I've said this before, I know I've said this before because I was just blown away. As an insurance agent back in the day, I used to buy a lot of leads, shit ton of leads. And we used that for a business development, we bring them in and we cross-sell the hell out of them, that's how you make money on it.
[00:38:47.20] Typically, leads when they come in but the leads that come in, and a lot of that business, especially on the personal side is mostly non-standard, historically, right. But you'll get some stuff that's like somebody just boom, you'll get really great risk as it will. But anyways, I had a customer one time, they're converts. So overall, like industry average, back when I was doing that, you're happy with like 10%, 15%, now it's, that was when they're a little more quality, now it's like a pure garbage. And here guys go like, oh, 3% is good, it's like stupid, right?
[00:39:25.87] CHIP BACCIOCCO: Yeah.
[00:39:26.11] REID HOLZWORTH: But and some of them even look at it like as a loss leader, it's crazy. But I had a customer that had a 56% conversion ratio on paid leads, 56%. Now, we're not talking about the leads you're talking about. What you're talking about is like they would consider those, I forget even what they call those like, it's not just a lead it's like a qualified lead or whatever but you're talking about somebody that raise your hand, that's exclusive.
[00:39:52.39] CHIP BACCIOCCO: Exclusive.
[00:39:53.05] REID HOLZWORTH: Exclusive.
[00:39:53.86] CHIP BACCIOCCO: Inbound.
[00:39:54.70] REID HOLZWORTH: Inbound.
[00:39:55.42] CHIP BACCIOCCO: High intent, right now.
[00:39:57.58] REID HOLZWORTH: Right now, now, to get into this, knowing this, so a good buddy of mine, Ryan McClintock, those know Ryan McClintock out there, Ryan McClintock started Kanopy Insurance. Ryan McClintock was at, what was leads 360, you know, first it was velocity non velocity by the Salesforce shop. It was velocity, what that was? It was a lead distribution platform.
[00:40:25.06] Early on, mortgage brokers would buy it, agents would buy it, and essentially leads would pipe into this thing, they do round robin-ing, they'd send it to the different people or whatever. Well, Ryan worked there when it was like two dudes in a garage, and he started running the insurance side of it. So for context, Ryan went out, and he said and he went, and he was selling this product technology products to all these insurance agents. And he's like, we'll get to this, I know you have an opinion on this. He said, insurance agents really suck at this.
[00:40:53.59] Ryan, there's like words out of his mouth. And so he's like what, I'm going to leave here and I'm going to go start my own insurance agency. So Ryan started an agency, Kanopy Insurance, he just sold it to, who was, I was just hanging out with one of the dudes, he sold it to Ever Quote. It was Ever Quote, somebody like it, anyways recently. But Ryan in the matter of two years put on 14,000 customers, pure leads. And I remember going out there in Rancho Cucamonga, and like out there and he's in, their offices in Claremont with Eddie, and eating fig burgers. If you guys are listening, I love you guys.
[00:41:30.16] Anyways, it was like pure call center, and they were crushing it. This isn't the 56% conversion ratio customer, by the way.
[00:41:38.43] CHIP BACCIOCCO: No, I get it.
[00:41:39.01] REID HOLZWORTH: But Ryan really crushed it. His thing, when he used to get up on stage, and I think he still does. He would always say, it's all about speed to lead. What does that mean? Once that lead comes in, right, you need to be on the phone with them, instantly, instantly. Because that customer, even if it's exclusive because that customer or prospect or whatever it is, is going to go to another site, enter the stuff in because they're on the hunt.
[00:42:05.79] CHIP BACCIOCCO: They're on the hunt.
[00:42:06.42] REID HOLZWORTH: And they like and like for me, dude, if I'm going to go, and I'm going to talk personalized for a second, these guys do all of it. But like if I'm going to go and shop my personal line stuff, I'm like carving out an afternoon, right, like and I'm going to blah, blah, blah blah blah. I mean, I wouldn't do that, I know, a lot of people in this world. But you know what I'm saying.
[00:42:23.52] CHIP BACCIOCCO: Yeah.
[00:42:23.88] REID HOLZWORTH: So I'm on the hunt, I'm putting my information in the five different places.
[00:42:27.12] CHIP BACCIOCCO: You got to get it done.
[00:42:27.93] REID HOLZWORTH: You got to get it done. And so the first person, and this is data driven, the first person that I talk to is typically the person that I buy from.
[00:42:36.99] CHIP BACCIOCCO: I totally agree with you.
[00:42:38.50] REID HOLZWORTH: So here's what happens in our industry, agents don't do shit. I mean, most of the time. They spend the money on it, and I used to do this when I was an agent, and I was actually working at Brightway Insurance, we bought so many leads. And I swear, leads would come in, and guys would be like, oh, yeah, come in at 2:00 in the afternoon, oh, yeah, I got to get these policies bound, and this, that, and the other I'll get to that tomorrow, right. They call them back tomorrow, and the guy would be like, first of all, they won't even answer the phone because everybody gotten 100 calls. But, and then we're talking about your opportunities.
[00:43:19.52] CHIP BACCIOCCO: We're not getting there yet but I know the problem you're talking about, keep going, keep going.
[00:43:24.59] REID HOLZWORTH: And and then they go, these are shit, this stuff sucks. Now, when you go and buy a $10 lead from Net Quote or whatever it may be or whatever the hell it is, there's a million of them out there right. That's like the Home Depot kind of stuff that stuff is hard. It's a grind to get that done.
[00:43:43.83] CHIP BACCIOCCO: It is very hard.
[00:43:44.66] REID HOLZWORTH: Now, but it's funny even with the exclusive ones. These really high quality, and I'm sure you have another term, maybe you do.
[00:43:53.00] CHIP BACCIOCCO: Referrals.
[00:43:53.78] REID HOLZWORTH: Referrals, one of these great referrals that comes in, even those.
[00:43:58.48] CHIP BACCIOCCO: Yep.
[00:43:59.70] REID HOLZWORTH: You know, I've tried this out too, by the way, I myself, like a while back. I think you and I were talking about some shit. I went on a couple of websites, and I put in my information, I got no calls.
[00:44:10.95] CHIP BACCIOCCO: Oh yeah, none.
[00:44:11.73] REID HOLZWORTH: No calls.
[00:44:12.27] CHIP BACCIOCCO: None.
[00:44:12.72] REID HOLZWORTH: No calls. And I have like I have stuff, man, like I have real money in insurance.
[00:44:17.25] CHIP BACCIOCCO: Yeah, you do.
[00:44:17.91] REID HOLZWORTH: You know what I mean.
[00:44:18.55] CHIP BACCIOCCO: Like I'm sitting in a property any agent would love to insure, absolutely.
[00:44:23.03] REID HOLZWORTH: It's like nothing, nothing. So tell me Chip, what is the problem here? Because hold on, for context, this is what you guys do.
[00:44:35.25] CHIP BACCIOCCO: This is what we do.
[00:44:35.94] REID HOLZWORTH: You do a lot of things but this is what you guys do at your core, you are spending shit tons of cash on advertising across all platforms, even TV or watching TV.
[00:44:45.40] CHIP BACCIOCCO: That's right, yeah.
[00:44:46.02] REID HOLZWORTH: That's a choice, I'm like, oh shit, that's awesome, like all over the place, radio ads, like all the traditional stuff as well as all the new stuff. You spend tons of money on advertising to drive business into the IA channel. That people come to your site like you said, inbound strategy, hey, learn about this do this and that. But hey, why waste your time, we're doing all this shit just get what the good independent agent, right. Input your information.
[00:45:08.94] CHIP BACCIOCCO: You're exactly right, and we encounter the exact problem that you have described every day. So so the challenge, I now call it the producer availability challenge.
[00:45:21.03] REID HOLZWORTH: The producer availability challenge.
[00:45:22.02] CHIP BACCIOCCO: Sounds very fancy academic, sounds like we researched it.
[00:45:26.62] REID HOLZWORTH: Wow, that was awesome. Chip Bacciocco, what an awesome guy? It's great to hear his story, he is really an industry guy through and through. He has done it, and is in at, right. This guy's never going to leave this industry. It's really, really awesome. It's amazing that he's been a trusted choice for 10 years. Man, time flies, it's wild. Stay tuned because in the next episode, we're going to get deep into the producer availability challenge, and what that means. It's going to be awesome.