How to Become the BEST in Your Niche | with B3 - Risk Strategies

You guys, what I love about the niche you guys have built. How many clients do you have right now? And then final mouse face, probably 2,000 or so. That's insane because I think a lot of people in our industry say, well, I have a niche. Right. And then you dig into the books and like, oh, you have a dozen. Okay, great. You guys have thousands.

Hey.

Hey. Welcome back to the accelerate your insurance sales podcast. Yes. We're doing this live from the risk strategies sales summit. Did I have that right?

Correct.

I'm excited. I'm here with Brian Jungleberg and Brian Ice. We are missing one, Brian. Brian Pallozzi is not so feeling. Feeling so good. Brian, if you're watching this, we, we feel for you. You probably are up in a room up there, hopefully getting better. But I wanted to have Brian and Brian on to talk about the work they're doing as B3 and they have a really cool story to share about how they grew up, turn that into a very successful agency and now have created a very, very cool niche when it comes to the final mile space as it relates to think of companies like Amazon delivery and so really excited to have this conversation. So, Brian, I'll start with you people who have no clue who you are. Tell us a little bit about yourself.

Yeah. Grew up in Strongsville, Ohio, born and raised, still live there today. Brian Palazzi, who again, hope he's doing well. We met in seventh grade in junior high.

Became good friends, obviously with through sports and football.

And then when junior high, we had two separate junior highs at the time and we then merged once we started high school, met Brian Jungerberg. We all became good friends, share the similar name obviously and played varsity football together on the same team. We're a very good, strong team, one of the best in the school's history. Ranked 2 in the state at the time.

And then from there we all decided to take our sports careers to the same college.

We're going to talk about that. We'll talk about that. So, Brian Jungleberg, as you can hear, these guys grew up in the same city, same town, went to the same high school. You guys graduated in the same class, went to the same college. Yep. Now you live on the same street. That is correct. So, Brian Jugberg, introduce yourself.

To be clear, we're not a cult. And he sound that way. We're not. And we did have a small time without each other of three of them.

I was just gonna say, how was it like when you worked together?

So Brian and I came out working together for his dad, Jeff, and. And got into the final mile space that.

Yep.

Brian Palazzi came out of college and was working for Town Planner Calendars, which sells franchises of calendars to Geographics. And we convinced him, through our great salesmanship that he should join us on the insurance side of things. So he did. In 2007, I believe. Yeah, sounds about right. And that's when D3 was born. And from that point on, it was originally B squared. It was. It was.

Yep. And how. Wait, how did you guys get Palazzi to join?

He was in a family business, and so once he. Once he came on board, it just went where we were able to really balance each other out. And it came at a really good time because we were all on the brink of having children. So we found a lot of good balance at work and life and be able to capitalize on each other's strengths. And you do this part, and I'll do this part. And it just. The team went from there.

That's awesome, man. This is such a weird story, like how you guys have been tied at the hip for so long.

Brian Ice, I believe it was your father.

Yes.

That started the agency. Right.

He started Kandran, Ice and Krieger back in the late 90s.

Okay.

And, you know, typically, like anything else, started this program on a golf course, if you will, and kind of stumbled into the industry and found it was really underserved. Little local Cleveland delivery operation. And just kind of took it from there. Went into some alternative risks. And a cat created a captive with our current. And then underwriter, Joy LaFrance, who is the chief underwriting officer at 180 Intermediaries.

Her.

The two of them, with three other partners, created the first effectively delivery program for this niche question.

And I'm going to bring it over to you in a second. Being the son, when you went to college, did you have intention of joining dad's agency or. I don't. Unsure at that point.

Yeah, I mean, it was pretty unsure, but I always knew that it was there should I need it. And then the opportunity presented itself that my dad approached me and Brian and said, hey, you guys want to come work for me? And, you know, what better opportunity to work with one of your best friends? You know, we kind of took it and. And thought we could take it to. To another. Another level.

Yeah. So same thing for you in college. Did you ever think you'd be in insurance?

No.

I was a psychology major, which, by the way, I tell people, had I known better in this industry, I would have gotten A psychology. It's.

Yeah, sure. It's served me well. 100. I think it was very. It's very interesting even listening to some of the presentations throughout the breakout sessions here. And a lot of it ties back to that. I was either gonna go to do research or, you know, have to go to graduate school and get a doctorate.

So I'm curious because you said your dad built the program, that. We'll talk about this in a second. How did he. How did he find the final milestone?

Well, again, he. He was. He played golf with a local courier company out of Cleveland. And again, just talking normal business, shop and understanding. Trying to understand his industry and the needs and seeing some weaknesses in his program. And I think he. Shortly after that golf outing.

He visited with the client, and the client invited him to the. What was then the clda. And that was the second year, I believe the CLDA was around. So it was like 88, 89. So, yeah, he went to that show, and we've gone ever since that year. He's gone to that show and again worked his way into the industry and then just really trying to understand the needs for that industry. The lack of what's become problematic in this industry now is hired, not owned, auto liability. That's what they created a captive for back in the day. And that kind of was. It was the. When the program was.

What I love about what you guys are doing is you not only have a niche, you've not only built a program, but you almost built a program around a specific issue within the niche.

That's correct.

And that's what's so cool about that. Now for the people listening in who have no clue what final mile means. Give us a debt, Brian. Give us a definition. What is the final asterisk?

Someone asked us earlier, and I said, it depends on who you ask. We will use it as an overarching term, umbrella, to take care of anything that moves same day across town. Usually very local in nature, but it's grown into a lot more of that. It could encompass the Amazon delivery guys, everybody up. Because we all see them in our neighborhoods. It can be a routed distribution that goes from a warehouse to a pharmacy or a managed care facility. It could be legal documents or accounting documents moving across town. It could be bank documents still moving, all of that stuff. If it's got to move in an expedited fashion. Yep. Or they want more of a. I'll call it a kinder touch and care. You heard Ryan say when we started where he said courier, now it used to be when we started it was courier, messenger service. It's the industry is incredible and reason one of the reasons we love it and it challenges us is it, it evolves constantly. So it's evolved into, you know, back then it was walkers, bikers and small cars, mainly in large geographic areas like New York City or Chicago. And now it goes all the way up to tractors that can run short haul overnight doing this heavier freight and everything in between. So they've never stopped being challenged by their customers as hey, can you do this? They don't say no, they just figure it out. And then from the insured side you get the challenge of all right, what are the risks? How do we take care of those for you? How do.

Well and I'm thinking, you know, my head's going immediately, like of all industries that were impacted by the pandemic, this one JT has taken off.

Correct.

Because of the pandemic. Like what did you guys see post 2020?

There's a definite increase for demand but a lack of a workforce to fulfill it. That's the biggest thing I'm seeing post pandemic is people just don't want to go back to work.

Yeah.

And even the nature of how they go back to work is different. You know, whereas you know, pre pandemic you had drivers that effectively had a full time job of delivering packages like this. And because of the way that the mindset has changed in that workforce, in a way it's, you know, I need a new pair of shoes. I'm going to work until I can earn enough to get those shoes or a purse or whatever it may be and then they stop working until they need that next thing.

Isn't that interesting. I have a hard time thinking that way, but I know that, that a lot of people do think that way. It's a start to get your next hit of dopamine.

So that quality of driver has, has been a struggle for the industry.

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The issue again when, when the captive was initially created, there was no other options out there by my father and that group. And at the time, and still to this day, the majority of the drivers drive their personal vehicles with their personal insurance with a personal auto policy. Well, in most personal auto policies there's an exclusion for delivery for hire. But throughout that time, you know, the drivers would say you know, I'm not working or you know, it was, it was much easier to get away with a claim where the personal auto insurance policy paid those smaller claims. Whereas what's happened, you know the last five, six, seven, eight years is we kind of deem the uberization of the industry or the gig economy space where everybody is using their vehicles for delivery for hire. And the attorney, the legal, legal world, the insurance world has all caught wind of this obviously. So it's their first number one question when there's an accident, were you doing delivery at the time of the accident?

Technology's also pushed it. Right?

Correct.

Because back when we started they were still drivers that were dispatched with walkie talkies, radios, there was no trace there. Right. Enter smartphones and all of the things that go with the dispatch software and it's super easy now for claims council or whoever's investigating it to say well hey, we know you were under dispatch and this occurred. We know you were on the clock and now it pulls in all parties drivers by nature. You know, just speaking to what Brian said, where they're a little transient in nature, they're, they don't have a lot to weighed assets so they just have a small personal auto policy limit that responds or there's a serious accident. Someone's always looking for the deeper pockets which is why they're coming after our delivery final pile delivery companies where the hired and not owned is now being more severity and seeing more frequency at the losses. That's what's making it so well and.

On top of that they're driving their own vehicles. It's hard to find drivers. So let's be honest, what's the quality of the average driver?

You're correct.

Not always the best.

And yeah, that adds up quick. You know it's interesting you guys, what I love about the niche you guys have built and this actually blew me away when I heard this. How many clients do you have right now?

And then final mouth fits, probably 2,000 or so.

That's insane, you know, because I think a lot of people in our industry say, well, I have a niche. Right. And then you dig into the books and like, oh, you have a dozen. Okay, great. You guys have thousands.

Correct.

But what's interesting, and we've talked about this offline, it's actually put a target on your back.

Yeah.

What's that experience been like? Because we could argue in the final mile space, you guys are the name recognition in many ways. What does embedding like now that you've got other organizations who are trying to replicate or even trying to come after you because you are now the big boys.

Yeah. I mean, it's unfortunate because I think, you know, who's going to suffer is unfortunately, the clients. Right. I mean, because in order to compete, they don't have the data to support creating a program that is properly constructed in terms of coverage, properly priced to be sustainable and sustained losses over a long period of time. So again, many of these programs that are coming out, you know, their only way to counter what we've done all these years is, you know, price. We can save you, you know, X percent.

And, well, in the way they're getting the price out is cutting out product coverage.

Yep.

Right. That's the only mechanism in the insurance space. From an underwriter's perspective, too. Yeah. I'll give you a discounted price, but it also means I'm not going to give you the same outreach. And I think that's. People are getting caught up at the price factor and not the coverage.

But I think that's a message I want people who are listening to this to hear. You could say you have an industry niche because you have a certain product. Right. Oh, we're working with this carrier who loves this niche. What you guys have done, the problem with that model is then anybody can get access to that carrier. Once they do, you don't have a niche anymore. You don't have a competitive advance.

Right.

What you guys did, though, is you've actually built coverage specific for that industry. And to your point, you're a competitor, you want to come in and chip away at the B3 client. The book of business. All you can compete on is price. But what you're forgetting is they built coverage specifically for the final mile space. So you can go get that price, Mr. Final Mile Career. But now you could be dealing with a complete lack of coverage.

That's right.

It's not about price, it's about protection.

Correct. We're trying to read where they're going to go next. Right. The evolution thing comes to play all the time because the reality is they get pushed by their clientele to move into a new vertical and way and we're trying to engineer policy forms to pick up whatever that risk is without even knowing they're doing it. Right. Trying to stay ahead of them so that there's never a coverage question. Right. We sell the coverage because we want it to be their claim. Doesn't do anyone any good us or them to have a claim that's uncovered. And what we're finding is that the folks coming into it aren't forward thinking in the policy forms. Right. It goes. Alice speaks to like we go back to often do, you know, often imitated, never duplicate.

Yep.

You know we, that's. No one has the forms that we do.

That's a great way to put it because. Because I'm not against replicating and duplicating model what people are doing and replicate it. In your case though, the issue is they're imitating and trying to duplicate which means they're not providing the same type of plan to the client.

Yeah. I mean and again.

The more you get into the form and the coverage and again what's going on in society and inflation, you know, if the more you strip out coverage, the more vulnerable you're going to be unfortunately. Because the reality is a million dollars of coverage isn't what it was 10 years ago.

Especially with the nuclear claims that are.

Out there and legal costs. So you know, the average, you know, bodily injury claim these days is you know, something of a decent size. The average defense is 250 or $400,000.

Was that used to be when we started.

Remember the number probably under 100 now if you've got a policy that's got defense within the limits with an aggregate.

Yeah.

You're eroding your limits and then you're capping what you can even provide on profit at. So you've got half a million bucks maybe to. To pay a claim. That's probably, you know.

You know I'm curious you guys being in the niche your dad's been. When did your dad actually build it?

Well the captive was late 90s.

So. So good 10 years for you guys. Yes.

I was running MBRS in, in high school for him like in 96.

I remember all the construction companies I used to go after at Federated go do the mbrs.

That's what I did over the summer.

I've got to believe you've had a bunch of opportunities to go outside the niche. Have you really tried to stay focused even if other opportunities present themselves to stay within your lane, your zone of genius?

Well, yeah, I don't think we've even had the time. I mean again with the evolution and the constant evolving of the industry, it's, we've had to continue to evolve with the industry and again, I think you know, which, yeah, there's commissions and you know, this is how we earn a living. But we actually truly care about the industry because again, if this program goes away, it could be detrimental to the entire industry.

That's, that's, I think an important. I would love your advice, Brian is, you know, it's one thing to say you have a niche, right? And you, but you guys have done so much work around the niche of building a program specifically for it that's led to having more than 2,000 clients. If you, if, if, if you were to give another producer a piece of advice, who wants to niche, what would you be? With all the work you guys have put in for 20 plus years in building a niche, what would be your advice?

If you're a relationship person, it's the only way that you're going to be successful for a long time in the insurance space. That's just the feeling I have and probably because that's how we've lived our whole careers. But I think that when you're in a niche and you're, you are in it, your ability to understand the client and what their needs are and try to again, stay ahead of where they're evolving to, to provide them the right advice, the right coverage, the right direction is huge. And you don't get that unless you're living that and breathing it every single day. I mean, one of the greatest things about us is we have the ability to hear from clients nationwide that are doing all sorts of different verticals within final mile and be able to apply what we learned from one to the other and, and see, oh, okay, this happened over here. That's great. How do we stop that from happening over this way? How does your adviser. So it's, it is, it gives us the ability to talk to clients and they really, truly know where their outsource risk management. Yeah, just, we're not just selling a product, we're giving them advice all the time. How do we avoid claims? Because look, you could have million dollar claims and have coverage just as easily. They could have a ton of little cargo claims that nickel and dime them to death. It's just death by a thousand cuts versus a huge loss.

Well, and I remember when I was talking, catching up with a friend of mine about a year ago who was working for an agency similar that they just did benefits and PNC for the auto dealer industry, auto dealers, motorcycle. And I remember catching up with them and saying, hey, how are things going, man? He's like, dude, it's been the best two year run of my life. I said, how? He goes, I've written 70 new accounts in the last two years. I'm like, how? And he said, there's nothing more powerful to go into a room with a prospect and say, we just work with you.

But only, not only that, but we also become experts in our own industry. We understand policy forms. I mean, you know, again, another credit to my father, who's. He was, he's a technician. He, he was a former inland marine underwriter, cargo underwriter for Chubb and his early days. And that's what, you know, he's really held his hat on, is developing the best, the broadest, the most user friendly and the easiest to understand coverage in the industry. Because again, we can sit up there proudly say that in the last 30 plus years, we've never had a major loss that was uncovered.

Yeah, that's awesome.

They really haven't.

To that point, I got a couple more questions and we'll wrap up keeping these guys from a keynote address. So I got to get them done.

To that point, have you had other producers try to come work through you? Because they know you're, they know your expertise in that space versus trying to compete. Have you had other producers actually come to you for help? Yes. Okay.

Probably every day.

So to your point, it's not only building that, that awareness with the, the prospect, you're actually building that awareness with the industry. Correct.

Yeah.

Yeah.

We work with many other retail, large brokers, small brokers, everything in between. We've developed some very good relationships and friendships out of that. It's been great. And some are a little bit more standoffish with getting us in front of the client. And that's okay because they're saying, well, what do we need you for if we can just go to them?

And I understand that last business question. We'll wrap with one more after this. Because you've done so well at the niche, you are the big boy with the target on your back, which has led some prospects to actually think they're too big. Right. What would you say to that prospect who says, guys, you Are actually, you're so big now, I don't know if we should work with you.

Yeah, we get, and we get that, especially since we've been acquired and obviously Risk Strategies is, as the 9th largest broker in the country, you know, you get that question a lot. I think what it has allowed us to do is bring more resources to bear to the client. Right. Especially on the larger clients, there are more things we can pull in we do for the small clients, too. They just don't tend to have the needs of service that the larger ones do. So I think all it's done with our size now is, hey, we could do one or two, three things now. We can do 10, 12 things for you if that's what you'd like.

Yeah. And to dovetail into that a little bit further is, you know, again, because of our resources, you know, we've got a large private equity practice. So, you know, what's the end goal for these guys? Right. Create a business profitable. Sell it or pass it on to an error, whatever. But in order to do that, you have to make. Paint the prettiest picture you can. Well, Risk management's part of that.

Yeah.

Right. So if a private equity company is looking at you from a due diligence perspective, they're going to look. Make sure you check all those boxes before they're really going to fully engage. So that's an important. Let us help you paint that picture.

All right, One more question, gentlemen. What advice would you have to the producer, the agency, that two buddies are getting together and they want to work together? Since you guys have grown up together, now you live on the same street together, what advice would you give two friends who want to get in business together?

Yeah, I mean, again, I think it. You've got to be pretty comfortable. I mean, I think the athletic background is important or something along those lines. Right. Because you can have that locker room talk. If someone's not holding their end of the bargain, what are you doing? Like, you can kind of give them some slack. Yeah.

So.

So again, I think the, the, the athletic background and being able to have that, you know, blunt locker room talk and, and, you know, having that team camaraderie and passion and competitiveness. Right. We. Another weird thing that you may not know is we share our compensation. It goes into one pot. We divide it by three equally.

And I think that what's happened is we've been able. We just, we know each other well. We grew up together. Right. We all did. And we're able to have those discussions along the way without anyone getting cue insert without having like it's nagging, nagging, nagging, boom. It blows up. Right? That's that sometimes you have in relationships. So it's, I love that everybody in the group, if you're, if you're accountable and you're competitive and you can get along and communicate well, you'll have no issues.

Well, thank you guys. It's been awesome. B3 again, we're missing Brian Pallotti. Maybe we'll put a poster of him in here. But these guys built a hell of a hell of an itch in the industry of the Final mile space. Over 2,000 clients speak to that. And if you are looking at building a niche no matter what the industry is, these are the kind of guys you want to model you good. That's all we got for this episode of the Accelerate your insurance sales podcast. One of the most valuable things you can do to help us and other new potential listeners find our show is for you to rate the show and leave a review. So as a special bonus for you, if you leave us a review, take a screenshot of your review and send it to me as a DM to my LinkedIn profile. I will send you a free copy of our LinkedIn Diamond Playbook, our proven four step strategy to grow your business on LinkedIn. So go right now, leave us a review, screenshot it and send me a DM on LinkedIn. Also, please share this podcast with anyone you think would enjoy it. That's it for now.