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Celebrating 25 years of insurance success

Joel Cavaness, president of RPS, has many reasons to celebrate – not only has the company been named a 5-star Wholesale Broker and MGA for 2022, but it is also marking its 25th anniversary. Here he explains how far the company has come since its early days, the big changes that have occurred in the sector over that time, and what’s next for the firm.
 

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5-Star Wholesale Brokers and MGA's - RPS Celebrating 25 Years 

Bethan: [00:00:14] Hi everyone and welcome to Insurance Business TV. I'm Bethan Moorcraft, senior editor at Insurance Business. And in this episode I am delighted to welcome Joel Cavaness, president of Risk Placement Services, one of insurance business America's five star wholesale brokers and MGAs. Joel, welcome to the show. 
 

Joel: [00:00:33] Thank you. I'm glad to be here. 
 

Bethan: [00:00:35] It's great to have you on board. So, Joe, this is a big year for RPS. You're celebrating your 25th anniversary. And I know that must mean a lot to you as one of the co-founders. So congratulations. Perhaps we could sort of go back to the early days, if you don't mind, to start off with. Can you tell us what it was like to form RPS as a startup? 
 

Joel: [00:00:56] Well, sure, and thanks for that. It has been quite the last 25 years. Sometimes you look back that far and you can't remember if it was totally clear and kind of what you were feeling, because 25 years is I looked at a whole, whole bunch of pictures from me and others from 25 years ago. And all I can tell you for sure is we were a lot younger, a lot of miles, 25 years, but that's okay. We you know, it was it was it was really, truly an exciting time going into an area that was the shell and the business was very, very different 25 years ago. It was very fragmented. It was held by hundreds and hundreds and hundreds of brokers and NGOs and program managers. And it was when you start a new business, your average thing you have to do, you have to do it all. And whether it was marketing, whether it was policies, whether it was accounting, whether it was hiring HR, you name it, you had to do it all. And fortunately, I'm very, very fortunate that over the past 25 years, I've been able to shed a lot of those responsibilities to a lot of other talented people, which lets me focus on really thinking about the next 25 years, because that's really what we're thinking about all the time. What's next? What are we going to do next? What are the next five years look like? Three years look like 25 years. What does it look like and what are the things that we need to do to position ourselves to continue to be a great spot for all of our employees, all of our customers, and, of course, all of the carriers that that we do business with. 
 

Bethan: [00:02:55] That's great. So we're going to take a look at the future, perhaps a little later in the conversation. But, you know, Joel, two and a half decades. What are some of the big changes that have occurred in the wholesale space during that time? 
 

Joel: [00:03:10] Industry in general was very, very different. It was an extraordinarily fragmented market without a lot of big, big players. I mean, there were some, but generally the industry looked very different from the standpoint of who was conducting the business. It was a lot of family owned, especially in the energy space and an awful lot of family owned businesses that controlled their region or their state or and that was just the way that it worked back then. I'm not going to tell you that it was bad or good. I would just tell you that it was different and that's okay. I think as we as we've all looked at this industry in general over the past 25 years, there has been a lot of change and a lot of it from people who are interested in being in the market. You know, I to a certain extent, we probably woke up a lot of people to the to the excitement of this industry. You know, this industry was always that that. People early in their career would never consider insurance. And I think we've woken up people to the excitement of the industry, the changing environment, the landscape of our business. All of the various careers that you can have in this business. And we've woken people up to it that it is an exciting business. You can do an awful lot of different things, fit the profile of what you want to do in your life and in your career. And so the industry has continued to evolve and get get significantly larger, especially when you get into the space. Most everyone has seen the dramatic growth of this sector, of the industry, and it makes it exciting. It makes it fun. And you can have a lifelong career in it and have have success. 
 

Bethan: [00:05:11] There's certainly a lot of buzz in the sector said, and that is partly to do with the last few years of kind of I don't want to use the word unprecedented, but I'm going to so unprecedented growth. What would you attribute that growth to, Jill? And do you see that continuing over the next few years? 
 

Joel: [00:05:30] Our our sector of the industry, we have obviously our advantage in many cases is our ability to react very quickly, to change in environments. And that environment might be the harder market environment, which we're kind of still in today or what we all talk about in the form of climate change and the impact that that has had on our industry and will continue to have. So our ability to have freedom of rate and form and our ability to react quickly to changes that occur, we can all think that something's going to change it. And all of a sudden one day it does change. And the ability of our part of the industry to react to that change quickly is really a major advantage to us. We do have the most creative people in the industry, in our sector, and their willingness to really find creative solutions is is certainly a huge advantage to us. So I think that we will continue to see significant growth in our industry due to that and look forward to seeing what the next few years look like. 
 

Bethan: [00:06:56] So, Joel, what are some key global issues that you're watching now within RPS that could impact the wholesale and ENS market in the future? 
 

Joel: [00:07:06] Yeah. I think that, you know, the the bigger issues, of course we'll we'll mention that the impact threat concern probably the the way that I would describe climate change as it called global warming and the impact that that's had on our industry. And it is something that you watch because of the impact that it has on on the risk taking community, our carrier partners, their concerns over what that can do to their balance sheet, to their loss ratios and of course, their stakeholders, shareholders. And those are concerns. I mean, I think that we would all agree that the activity of different levels of storms, whether those be hurricanes or freezes or tornadic events or candidly, of course, a wildfire in California, while those are US issues, so to speak, it also impacts the rest of the world. Whether that could be the most recent unfortunate Australian flooding, which was traumatic and that's kind of occurring all over, all over the world and that impacts global markets. We operate in a very global environment today and in the insurance business, whether that be Japanese owned carriers, UK owned carriers like Lloyd's and those syndicates or lots of other global insurance companies, it what might what you might think wouldn't impact you because it happened in other part of the world. It truly does impact all of us. So always watching that, what can we do both as a worldwide entity and then all the way down to what we can do on a local level? One person at a time to really hopefully impact or soften the speed of this change. So those are the kind of things that you do that you do worry about a little bit. You can't worry about it all night long or you drive yourself crazy, of course. Those things worry, worry. That might have an impact on us. And then, of course, what's going on in Russia and Ukraine certainly has an impact. It is a it is a it's awful for them, a distraction for us. We met with Lloyd's of London this week. And I can't imagine with the sanctions and the changes and the things that they have to think about and what they can and cannot do is it's mind blowing, mind boggling of trying to think through all those issues. So now there's always things going on. Unfortunately, you know we'd love to wake up every morning and the news be nothing but good news. That's just unrealistic. So you do have to worry about everything that's going on with any type of social unrest, any type of of of bad news is is tough. 
 

Bethan: [00:10:26] So Joel, I'm going to change tune slightly and talk about two big T's talent and technology. Obviously big themes in the industry. I'll start with technology because we're talking two years after the start of the COVID 19 pandemic, and there has been a lot of change in the industry during that period. Everyone had to move to remote work. Digitalisation, just lots of big things going on. How has the past, this period sort of impacted RPS's investment in technology and kind of change your perspective on using technology and the wholesale broker sort of MGA value proposition? 
 

Joel: [00:11:08] I like your definition of the two big T's. Both of those are, of course, very important. And B, when you really look at where we spend our money. Those are those are the two highest areas. We spend most of our money on talent. We spend a considerable amount of money on technology and new technology and our investment, of course, in furthering our ability and technology. But so really when we talk about technology, of course, coming out of the pandemic, I'd be candid with you. The technology or the platform that we're using today is is Zoom. I've never heard of Zoom before the pandemic, candidly. And then everybody rushed to Zoom, of course. Then you started looking at other platforms. Well, is it the best platform to do meetings? Is it the best platform for for ease of use? All those different things, stability, privacy, all those things. And so you start exploring other technologies to look at investing of is it the best platform and what is the best platform? And then as you kind of work your way through the course of the last two years of thinking about how this business has changed due to COVID and the way in which we work. And so then you have to really look at technology that will support the new way of work. Just yesterday, yesterday afternoon, we spent a couple hours with the Cisco people talking about new technologies with cameras, new technologies with platforms, new technologies with not not iPad, but other forms of monitoring devices and sound. And the fact that now you can buy a technology, which we've all been on meetings where you've heard the dog barking or the blower running or whatever, and there's a technology out there that actually mute anything other than the human voice, which is I didn't know that existed until yesterday. And that's that's pretty cool stuff. And as we go down the road of people having the flexibility to work from many different places, hopefully some in the office, hopefully some some remotely, that we can invest in those kinds of technologies to make their job easier. And technology has dramatically changed this industry. And as we look at technologies to accumulate better data or structured data, the use of data scientists and analytics to support better decision making on behalf of all of us, it's pretty cool. I never thought again, as we talked about the excitement that has been created in this industry, we probably never thought that we would be using the types of technologies that we have today to make ourselves even that much better. And so I'm excited about where that technology goes. Excited to really see the things that you can do that you couldn't do before, both from an efficiency play, both in more professional way, and, as we call it, 24/7 fine. So I'm excited about that. We've invested in a lot of great platforms to give people the ability to buy digitally. I don't think we would have ever imagined the Amazon experience and insurance, and we're getting closer and closer to that. So it's going to be it's going to be a great run in the next few years. 
 

Bethan: [00:14:48] It's interesting. And technology also ties into the other big T and of talent and what you were saying earlier about all of the exciting opportunities that there are to kind of work in insurance and make a difference. So I'd like to sort of focus on your sort of talent strategy at the moment. I know it's been a big part of your growth strategy, RPS, but can you tell me what you've done to combat the talent gap experienced by other insurers and what your approach is in that area? 
 

Joel: [00:15:18] Yeah, look, I'd love to touch on. It's probably one of the my biggest passions, my biggest passion is really bringing introducing this industry to people that are really trying to figure out what they're going to do with their life, what they're going to do with their careers. We have always going back to the very, very early days of our jobs. We've always invested in bringing in young talent in college. So providing. These college young people a summer to experience what we do, how we do it, and give them kind of a broad experience of showing them our industry. And I'm excited, actually. I got an email with a picture from our very first intern that RPS had over 20 years ago, and it was a picture of her and I at a at a conference that we attended. And it's just it's fun to think about. Right. You have your very first intern that you ever had 20 plus years ago, and she's still with you. And she's successful, very successful in her career, providing well for her family. And that's fun. It's exciting. So I think that as we look at it, when I came into the industry, there were a lot of training programs people, insurance companies and others hiring right out of college, training them into underwriting or claims or whatever it was. And then over a period of time, people kind of felt like they were getting the short end of the stick because they would come, they would learn, they would invest in them. And then three years later, those folks would leave and go to somebody else. And so I think a lot of a lot of people felt like maybe it was they were just doing the training ground and paying for it and somebody else had the benefit. And and you can feel that way. But just to size it for you, this summer, RPS will have over 80 college interns. Obviously, our goal is it's somewhat of a a little bit of a selfish goal, of course, because your goal is to is to convert a significant number of those 80 interns and turn them into full time employees after they graduate from college. And that is a way that we've been able to manage our gap and our attrition. Our ability to retain these people after five years is over 75%. That's a fantastic statistic, one that we're proud of that we're excited about, because that means that we're providing people with a good career, with a place that they want to stay. And of course, that goes along with a growing company. If the company is growing, there's more opportunities for people. So as you grow, like we've been able to grow and provide career paths for the young, younger people, that's that's our preferred way. We bring them in. We teach them our culture, our our way of doing things. And if we're growing and they can advance in their career, it's a win win for everyone. 
 

Bethan: [00:18:41] Well, congratulations on that, because it is a big topic for everyone. And it sounds like you're doing some some great stuff. So, Joel, I'm going to go right back to the start of the conversation when I said it was your 25th anniversary at RPS, and now I'm going to ask you to take a look forwards. What are you excited about for what's next for RPS and your next 25 years?
 

Joel: [00:19:05] When we started RPS, I never probably gave it enough thought. Of course, when you start a company you're not thinking about 25 years later, you're thinking about candidly tomorrow. And now the flexibility that I have have been able to grow the company to where it is today. I can think I can think forward beyond tomorrow. I can think forward to the next three years. We've always focused on really kind of four main things we do. We do grow organically. We like that. It's important for us. We do mergers and acquisitions. We're not going to stop. We're going to continue to look for firms that would like to join us who have similar cultures, similar desire to grow in similar businesses, that we can make one and one add up to three or four or five. We're going to continue to be more productive and get our quality even higher than it is today. And then we're always going to focus on what you call one of the big T's are we're going to focus on our talent through our culture, make sure that we maintain the proper amount of culture. And so if I get if I get those four right, then it does give us the ability to do everything else that we want to do, which is really to grow the company, to provide for all of our stakeholders, our customers, if we develop new products, new ideas and thoughts, new ways of doing things, whether that's a digital way, which we're getting very, very good at, you can go on our platform today and find 30 different products that you can pull by in an issue in less than 2 minutes. That's a that's a great growth strategy because that is the way that people will be looking to buy into the future. We will we will all be challenged with providing better service, faster service and superior products. And if you get those right, the the opportunity is really the the moment. So we're excited about that. So what I think about the next 25 years, I think it's going to be a lot of of developing the products and services that we provide in a much more seamless way. Speed will always be important because it will be required and demanded and the ease of the transaction will also be very important for us. So I think that when we think about we're always looking 3 to 5 years out and what are the investments that we need to make today? That will pay off in 3 to 5 years because you don't get immediate payback on anything these days. So let's think about the next 3 to 5 years. Let's look out. Let's let's try to anticipate where we need to put our investments. And that's kind of what we're what we're excited about. And I think it's going to be talent. It's going to be ultimately important as well as technology. And those are the two key areas that you pointed to, and I agree with you 100%. We're going to have to make great investments in people. We have to make great investments in technology and to provide really that level of service that we require in the future. So I'm excited. I'm excited about where we're going. 
 

Bethan: [00:22:30] Well, that's really good to hear. Joel, it sounds like there's certainly exciting times ahead for RPS. Congratulations once again on your 25 years and also your five star award from Insurance Business. And thank you for joining us on IBTV. 
 

Joel: [00:22:46] Thank you and thank you for the recognition and we look forward to the future with you. 
 

Bethan: [00:22:52] Thanks also to our viewers for tuning in. I'm Beth Moorcraft, senior editor at Insurance Business. Make sure you check out the rest of our IBTV episodes, IB Talk Podcasts and Daily News at www.insurancebusinessmag.com/us. Thanks, veryone.