Sai Vishnubhatla is VP of Product at Hippo Insurance, a company taking a proactive approach to homeowners insurance by bundling modern coverage with smart home technology. Sai leads the product management teams responsible for launching products across acquisition, growth, and activation, as well as for building best-in-class pre- and post-purchase customer experiences. Before joining Hippo, Sai built and scaled product, engineering, marketing, and operations teams at various successful enterprises, including Yahoo, Microsoft, and Prudential.
In our conversation, Sai shares how his team is creating customized customer experiences in a highly regulated industry. He shares how his team started proactive outreach to customers who were at risk for high premium increases, as well as how customers have a new, heightened standard of expectations around product experiences.
Working in a compliance environment makes your product lifecycle a bit more robust because you are covering all the bases and making sure that you’re compliant across the board. I think compliance and regulatory considerations are actually more focused on protecting consumers, and if you translate that into product language, it means it’s incentivizing you as a product leader to be more customer-centric. It is burdensome, but it also keeps you on your toes to make sure you’re doing what is right for the customers.
For us, this means that our product lifecycle tends to become a tad slower. In the agile nature of it, the ability to experiment, take some shortcuts, and get quick A/B tests becomes more difficult for us. It’s a big challenge during the acquisition phase of the product life cycle, and it also enforces rigor in you when you’re trying to do renewals and retention. At these two stages, we faced significant challenges and learned we had to develop an arm for compliance and regulation by staffing our team with someone who has a compliance mindset.
When it comes to competition and competitors, it’s the same issue. But who is doing it right and who is not doing it right? Some people approach it like they’ll cross the bridge when they get there, otherwise, you get a notice from compliance or the Department of Insurance. It gives you an incentive to design your systems properly.
I’ll give you an example of what happened at Hippo. We have our policy management system, where all your policies live. It’s a workflow system, our core platform, and the heart of any insurance company. You have to design keeping who accesses what information at what stage in view.
When you’re a new company, your first customers tend to be yourself, your friends, and your employees. Employees have homes, they want home insurance. They also have access to that information about your policy, your system, and the home you live in. When we identified this as a potential PII data risk, we had to redesign the entire security system around this.
All our product experiences, which in our case are life cycles of a policy, are done by individual product teams. That’s how I structured my organization. So, there’s a director across each of these processes — acquisition, the entire buying process, the post-buying process, the servicing that goes in the middle, and then retention and renewal. I have four product directors who work with their individual engineering teams, and that’s how we are structured.
What’s very critical for us, and more importantly in InsureTech, is aligning your teams across the lifecycle of your customer. I align my product team exactly in this perspective.
For acquisition and onboarding, it’s how we get new customers or partnerships. How do we put your product in other people’s lead flows? How do we get net new carriers to underwrite our process? This will bring the customers into our funnel.
Then, the buying experience. What do you see on your end? How is the offer customized to you? Insurance is very customized to your lifestyle, your home, and the associated risks, even though it looks very commoditized. How do we get that customization? We know so much about our customers, we would love to actually save them money proactively. This is the entire buying experience. There’s a team that does this and this is where machine learning, AI, data analytics, and product features come in.
Next are the mundane things, like how and when you buy a policy. It’s an extremely complicated manual process, and then there is the checkout process.
Hippo writes home insurance, but other types of insurance can come from other carriers. That’s where the complexity comes in — how do we create a single experience for customers? There are processes. We have to make that entire claims process very simple, and also at the same time try to protect our own company paying the claim. So, how can we do it? That’s the entire customer experience. Then at renewal, typically there’s a 5–15 percent increase in the premium. How do we make sure the customer doesn’t feel anything? Can we be proactive?
One of our customers was reacting to the renewal offer she got. She’s been with us for three years and was very upset that her premium grew, our agent and her were playing phone tag, so the frustration was building up. When we got on the phone with her, the customer sentiment was extremely negative. Her point was, “I’ve been a loyal customer. You don’t treat loyalty well. How could you increase my policy? I was expecting a reduction.”
She said, “Why can’t you proactively do it for me? Why couldn’t you have told me, maybe three months in advance?” Well, that could cannibalize our own sales. If I tell you three months in advance, you have more time to shop. But we wanted to learn something from that.
Our feedback was to send customers a renewal policy, but also give them a call and proactively shop for them because we saw that the renewal was increasing. We started developing this dashboard to identify customers and get early signals from underwriting. We created an AI machine learning program that scans everybody who’s coming up for renewals in the next four months, and it gives you a prediction score of who would actually have a significant increase.
We started putting customers in buckets of 40 percent, 30 percent, and 20 percent increases. We didn’t focus on anything under 20 percent because that’s an expected increase. Anything above a 30, 40, and 50 percent premium increase is considered very high, so the immediate action was to ping individual carriers and try to get quotes from them for these customers.
We started by taking a sample of 500 customers in each one and sending emails to them, giving them proactive calls and SMSes. We saw a 94 percent response rate from the customers. I kid you not, everybody was saying, “Thank you for doing this. Nobody else does that because I see that Hippo is increasing and you are cannibalizing your own.” The good news is, that we had a tie-up with these insurance companies where they would pay us an agent commission for offloading them from Hippo to their policy.
We were getting paid as a commission. The customer was gaining, we were gaining. We were technically reducing our risk profile. It was a great win-win situation for us, but the challenge was to identify who these customers were and the price. When we nailed that down, reaching out to the customers and creating a proactive customer experience was very simple. It impacted customer experience and loyalty in a very significant way.
No one is measuring our customer experience with Lemonade or Allstate or anybody else. Customers today expect everyone to provide a top-notch experience. They compare you with the best customer experience they have, independent of the industry. I think it’s human nature.
Customer experience and insurance is such a huge and hot topic right now because people say, “We are doing much better than the legacy companies.” But that’s not the case, customers are not measuring you by that. Customers think that you’re bad compared to their experience at Amazon. Their standards are higher. It’s a new trend. More and more, we’re observing that and investing quite a bit in customer experience.
We had a very interesting view, but most of them were trying to optimize. 50 percent of them chose the cheapest option which was very good for us because we could offload people who are trying to optimize for price, meaning they are higher risk. We have also seen people who are willing to trade the same premium — that is, a 30 percent increase in premium when they saw value that we were giving them higher coverages.
We actually followed up with those customers and they were willing to add an additional product, like auto or fire insurance. So we saw that loyalty actually increased.
Generally, we measure customer loyalty by our renewal rate. Our renewal rate is off the charts. It’s 95 percent because we have a very unique product. We are very competitive in terms of pricing. More often than not, we have more than 57 percent as of today, that become multi-line, which is very interesting.
We look at NPS and retention metrics. Retention is a great number and NPS is the greatest measure of how loyal your customers are. Loyalty is a very interesting term because when your product becomes extremely commoditized, there’s no concept of loyalty. I cannot incentivize you because it’s a regulated industry, all I can do is purely based on customer experience.
We do a lot of CSAT and claim surveys after a claim is actually done because we have touched the customer in a very vulnerable state. Loyalty, to us, also shows a lot in terms of cross-sells and upsells. Loyalty, to us, shows a lot in terms of cross-sells and upsells — when single-line customers become multi-line with us.
We also track what we call a customer web. It’s when the head of the family buys something. We do NPS for their kids who are moving out of the house. We’ll take a 50 to 60-year-old individual and see, is there a spouse, son, daughter, neighbor, friend, etc., relationship?
Right, how are they connected? Are they an influencer or not? We have a product for newly built homes that is offered via the builders. They offer our products in their workflow when a customer is closing their home.
We need to change the loyalty factor from a builder’s point of view because the customer thinks the builder is the one who’s offering the insurance. It’s actually not, it’s Hippo. How do you change that? We do quite a bit of loyalty conversations with them. We try to do a nine-month check-in, and Hippo has a very unique feature in that we send smart home devices. It’ll measure water leaks or something for every policy you buy from us for free.
I think what distinguishes you from other product managers is if you are curious. A sense of curiosity and how new technologies actually help you to be more curious about what’s happening can set you apart. The second important thing is how you balance short-term and long-term goals. Short-terms are important but never compromise for your long-term goals of where your product has to be.
Then there’s collaboration. How can you keep collaborating with your engineering or business teams? This ability and curiosity also give you the mentality of filtering. You can filter out the noise, that makes you a distinct product manager.
Then I think, don’t be afraid of change. Adapt and embrace change. You have to be a brave individual. Don’t look at change as your hindrance, but rather how you can learn from it and adapt it. For example, AI is not taking away your job. Rather, the person who does not want to get on board with AI is the one who’s going to become redundant.
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