Our Spirit Guide

My guest today is Rick Lindsey (mp3, youtube), who has attracted some attention in the insurance market because his company, Prime Insurance Company, is willing to take on the toughest risks in the toughest lines of business, particularly commercial automobile insurance which is going through a wrenching dislocation right now. Very, very few insurers are making money there. Prime is making a fortune.

Why? How? Then I heard that Rick is from Utah, pilots is own helicopter all over the country and I instantly knew I needed to get to know this remarkable contrarian. I was not disappointed. Rick has built an amazing organization with an amazing culture.

Rick Lindsey: Every other business you’re not asking someone else to tell you what the product is worth… what we do is use common sense. First thing I ask you let’s see what you have.. show me the claims.

Every year we ask them: how did we do on your claims. Because that’s all I care about. I want my insured to tell me you guys were great. You talked to us about the claims, you kept us informed about them and we agreed with the result. With what you did.

What I hear from everybody else is..

what happened on your loss run?

I don’t know.

Well did you know they paid it?

No, I didn’t even know they paid it.. first thing I know it’s on my loss run.

Well why’d they pay it?

I don’t know. I wish they wouldn’t have. they shouldn’t have paid it.

As a company we need to have a relationship with our insured… they feel scared and uncomfortable and their insurance company doesn’t communicate with them. You should be contacting them the minute you have a claim.

I am not going to punish you for reporting claims. I will cancel you for not reporting a claim because then I can’t do my job.

And of course we learn that Rick isn’t just interested in distressed business. That’s just the easiest entry point for his to build a relationship with a client:

If I charge somebody who can’t get insurance anywhere else an extreme price and think I’m going to keep getting that if they perform for me? I’m an idiot.

Perhaps the most fundamental human quality is trust and the thing that great underwriters are great at is figuring out who is worthy of that trust and nurturing it. Rick Lindsey is to me the embodiment of the humanity in insurance. His insurance isn’t about technology and data transfer and machine learning. Rick understands a few really big ideas better than the rest of us and has the force of personality to show us the way. I’m calling him our spirit guide. Listen to hear why…

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