Show HN: Software to give insurance advice like an agent would

Your T&C are poor.

"[add if applicable];"

"You are granted a limited, non-exclusive right to create a text hyperlink to the Site for noncommercial purposes, provided such link does not portray Goodcover or any of its products and services in a false, misleading, derogatory or otherwise defamatory manner...This limited right may be revoked at any time."

"You acknowledge and agree that any materials, including but not limited to questions, comments, suggestions, ideas, plans, notes, drawings, original or creative materials or other information, regarding the Site, Goodcover or Goodcover's products or services that are provided by you in the form of email or other submissions to Goodcover, or any postings on the Site, are non-confidential and shall become the sole property of Goodcover. Goodcover shall own exclusive rights, including all intellectual property rights, and shall be entitled to the unrestricted use and dissemination of these materials for any purpose, commercial or otherwise, without acknowledgment or compensation to you."

"If you post User Content to the Site, unless we indicate otherwise, you grant Goodcover and its affiliates a nonexclusive, royalty-free, perpetual, irrevocable and fully sublicensable right to use, reproduce, modify, adapt, publish, translate, create derivative works from, distribute, perform and display such User Content throughout the world in any media on or in connection with the Site and the promotion thereof. You grant Goodcover and its affiliates and sublicensees the right to use the name that you submit in connection with such content, if we choose."

"IN A WRITING"

Thanks for the feedback, happy to consider. Could you be more specific about what you would expect? That would help us make adjustments.

It seems like the ToS is just filled with typos and "insert here" type statements that you'd find in a template.

I don't think there are specific items that the parent commenter is trying to change; instead, the entire document just seems sloppy...

Best of luck with your business, but make sure the fundamental legal contract between you and your customers is thorough so that both you _and your customers_ are protected.

The first and last quoted sections are sloppy/bad drafting.

The second is egregious, and embarrassing to be found in a YC company. You should not be asserting rights to how people "link" to you.

Third and fourth basically say any user provided "content" (whatever that may mean) is now "non-confidential" the "sole property of Goodcover", "entitled to the unrestricted use and dissemination of these materials for any purpose".

That sounds like you plan to use some relatively sensitive user provided materials in any way you see fit to advance your company.

But wait! you say...we have a privacy policy! Great, except the privacy policy has an exception...

"We may share information about you as follows or as otherwise described in this Privacy Policy: ... With your consent or at your direction, including if we notify you through our Service that the information you provide will be shared in a particular manner and you provide such information."

which arguably means that since the user accepted the T&C, they've approved your usage of their materials.

I don't feel you did this maliciously, you probably copied this from some template. Doesn't mean you shouldn't be thinking about this much more carefully though.

Hi guys thanks for the comments, and yes, I see what you mean. Will be reviewing these in full.

If you focus on the risk management side of personal lines I think you're going to have a hard time to scale. The problem is most consumers don't care enough about coverage to shop for it. What attracts new clients is price, price, price. Clients unfortunately won't worry coverage until they really need it. The problem with focusing on price is you'll attract clients who won't renew after 3-5 years, messing up the retention numbers. Navigating the balance between those two will be critical.

Now there is some space in the high-end personal lines for focus on protection. But there you're competing against entrenched insurance agents.

Small commercial is also a very interesting space to explore. Protection is much more important for these people and the sales process is easier to automate (than med/large commercial.)

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I sold my startup in this space last year. We provided marketing automation for agents. Feel free to reach out.

Yes, I hear you on fighting the price war, and agree navigating a balance of price and coverage will be important. In our view, we intend to keep prices low through the use of technology and our dividend of risk profit, but definitely charge a sustainable premium for the cover we provide. Policyholders will be able to see where the money goes so it'll be an ongoing conversation.

Would love to get in touch, will drop you a line.

I couldn't agree more, I've been in personal lines (consumer) insurance for more than 10 years - price is king for the vast majority consumers. The issue this causes is insurers tend to discount new business premiums heavily and make a loss in years 1 and 2 (at least). The follow on problem for an insurer is the ease at which consumers can shop around, so retention rates are dropping - especially as the insurer will attept to regain some of that lost income at renewal by increasing the price. It's a buyers market. However cross selling add on cover is a common way to regain income. In any case, it's great to see innovation in insurance, and good luck for the future! (PS. are you intending to be a broker or actually underwrite the insurance policies?)

Suggestion: Show an example of the type of advice that it can automatically give on the homepage. I clicked through to the homepage but didn't necessarily believe that the automated advice could be great so I wasn't motivated enough to dig up a policy of mine and upload. Would be great to see the sort of advice/info it can give, presented as soon as you hit the advice page.

Yeah that's a great idea. Thanks!

I think it would be good to specify what kind of policy you are talking about. You are apparently doing just renters and homeowners policies, but comments even within this discussion are talking about medical insurance.

I don't know what a good, succinct term would be for both renters and homeowners coverage. I know that various kinds of real estate related magazines fall under the umbrella term of shelter magazines. A lot of people seem to not know that, which just highlights how hard it is to come up with a good umbrella term for such diverse things. But I think you need to try to clarify that somehow on your landing page.

And if your advice app is broader than the renters/homeowners insurance niche, then specify that as well. I feel this is just not really clear at the moment.

Best of luck. Insurance R hard. ;)

Was the website not clear or just this post? Yeah, great feedback. Property is probably the most general term, but technically it is property and casualty (liability).

The post was clearer than the website, but not 100% crystal clear. It leaves some wiggle room for creative interpretation.

You might just go with property or A/B test it. Insurance industry terms are often confusing, even for industry insiders.

When I paid accident claims, we went round and round as to what the best term was for the health care provider in question. "Provider" was the gold standard, but both customers and employees found that so vague as to be meaningless.

"Life" claims actually meant "death" claims. It's when someone dies and you file a claim on your life insurance policy. (eyes cross)

So you will need to maybe get with whomever your legal advisors are and whomever your marketing advisors are and find a term that both can accept.

I don't know if it makes sense to get renter's coverage.

I had a friend who had his apartment burn, the first thing the cops asked him was if he had insurance, and the they told him they were very relieved, otherwise he would have been an arson suspect automatically.

Homeowners generally do have insurance, so they don't face this stigma, but renter's coverage is rare enough that having it and using it makes you look like a crook.

Some landlords require renter's insurance as part of a lease agreement.

Doesn't renter's insurance only cover the stuff you have inside your residence, not the actual unit itself? Why would the landlord care if you had that coverage?

Liability, which is basically protection from lawsuits (slipping and falling)

There are two primary coverage types under renter's insurance policies: liability and personal property.

The liability coverage triggers for anything from people getting hurt on the property to (other) people's stuff accidentally getting damaged on the property. Basically anything anyone could sue you to pay for if it occurs on the property.

The personal property coverage is what covers your stuff if anything happens to it.

A landlord's policy will generally cover two things as well: liability and structure (and possibly property, e.g. major appliances that are supplied with the unit).

Landlord's requiring that tenants have a renter's policy specifically require liability coverage (usually a minimum amount, such as $100k), and don't care if you have personal property coverage. By doing so, they ensure their own premiums stay low because liability claims will go against the tenant's policy first, and only fall back to the landlord if the liability claim goes over what the tenant's policy will cover. So if a tenant has a $100k liability limit, and someone wins a $120k liability claim, then $100k of that gets covered by the tenant's policy before the landlord's insurance even comes into play. If someone wins a $50k claim, then the landlord's insurance never has to deal with it.

Ah gotcha. It's been 14 years since I rented, so I don't really remember any of the details of renters insurance. As a homeowner, I totally get that.

That's anecdata. I have no idea if it is generally true that trying to make a claim on renter's insurance is inherently suspicious activity. You would need to provide more evidence than one anecdote to support such a broad claim.

I'm pretty anti-insurance. If you can find some means to meet your needs that doesn't involve insurance, I say go with that. But the reality is that insurance is a necessity for many people and makes sense in many cases.

I really wish the US would move to single payer health care for the nation. I think major medical insurance is inherently problematic and I hate that the US handles things that way.

Nonetheless, I'm happy to support the development of good services in the insurance industry, especially in areas outside of major medical coverage.

If you have any assets (401k, savings, stocks, car, etc) you should consider renter's insurance because it will offer liability protection. If a visitor is injured in your home and you are found legally responsible you could lose everything.

I've moved about a dozen times over the last decade, and all but one rental required me to have a renter's insurance policy as part of the lease terms - most of whom also required me to list them as an interested party[1].

A renter's policy is ridiculously inexpensive for what you get. Because it only covers liability and personal property, and not the full breadth of coverage a homeowner's policy would have, it's easy to get a really comprehensive policy for less than ~$15 a month. I've only had to use my renter's policy once after a break in, and the payout for personal property coverage was more than my entire decade worth of premiums[2]. Especially if you're a techie, electronics/computing stuff[3] really starts to add up if you take a look at all the little gadgets and computers and home office[4] style stuff you have around.

[1] It basically sets it up so that your landlord gets notified of any policy changes (non-renewal, cancelations, limit changes, etc) and can know for sure that you're continually insured, and don't let the policy lapse after you've shown your proof of insurance at lease signing.

[2] Paying a few extra bucks for "replacement cost" coverage vs. "market value" coverage is well worth it. It's the difference between "here's $100 for your 5 year old MacBook Pro" and "here's $1000 to cover the replacement cost for another entry level MacBook Pro".

[3] If you have personal property replacement, you'll generally have per-category limits. If you don't explicitly request a rider for it, your e.g. $20k personal property replacement coverage may cap out electronics at $1k.

[4] If you have company-owned equipment at your house, your personal renter's policy would likely not cover it. If you work for yourself from home, your "for work" equipment is probably not technically covered under a standard renter's insurance policy, so you may want to explicitly clarify if you need a separate policy with your insurance company if you don't want to chance a claim with it getting denied.

My wife used to be a leasing agent for an apartment complex. One day a tenant from her complex started the dishwasher, something broke and it flooded the entire apartment and the apartment below it. Had tenant paid the $13 or so a month for renters insurance it would have been nothing or only a few hundred out of pocket for a deductible. Instead, tenant was looking at over $20,000 in repairs.

Any reason the landlord wouldn't just build a $13/month policy premium in to the rent and purchase the insurance themselves?

I'm not firsthand familiar with property insurance, but there are restrictions on who can purchase insurance. You have to have fiduciary interest.

So, for example, you can't buy a life insurance policy on a random stranger. That can go bad places and be an incentive to commit murder.

So it is possible the landlord cannot buy this specific insurance themselves and the coverage they can legally purchase does not cover the instance in question.

Wasn't the dishwasher owned and installed by the complex? Why was the tenant responsible for damage caused by a failure of the complex's equipment?

41% isn't 'rare' [0]. Aside from protecting your stuff in the event of disaster, the real value of rental insurance (must like car insurance) is liability protection in the event that something bad happens to someone else. Policy Genius has a good overview of what renters insurance does and doesn't normally cover [1].

Renters insurance is cheap, especially compared to the value of your stuff, the cost of living in a hotel for an extended period of time, or paying someone's medical expenses after an accident.

[0] https://www.iii.org/fact-statistic/facts-statistics-renters-... [1] https://www.policygenius.com/renters-insurance/learn/what-do...

After uploading pdf from farmers I was told to click a link to verify my email address. I clicked the link and was taken to a page that told me to check my email and click the link. :D I refreshed the same page and the instructions updated.

It's eventually consistent :) I'll add it as a bug, thanks!

Have you considered interfacing with the third party insurance customer sites to retrieve the insurance documents to process?

I would love any such integration. But coverage-wise I think it's easier to do a simple upload at the moment.

We started experimenting with building an automated insurance agent bot that would help someone purchase various types of insurance from a particular provider. This could easily be tweaked to provide different information/comparisons of various insurance types from various other providers/sources. You could also pull in public reviews/feedback to allow for rating and recommendations.

https://m.youtube.com/watch?v=1xgMEkvEppM#

Chris Lotz, cofounder of Goodcover here. The team and I are around and happy to answer any questions.

Would love to hear any feedback too! Particularly around the user flow, and whether our instructions make sense.

Thanks!

Hi Chris, This is a great service for almost 70% of the population who don't know what events are not covered and the fine print gotchas from the insurance companies.

This should be a really helpful service, kudos on the idea.

The only concern I have here is, privacy. Most of the home owners are not comfortable to upload docs that includes their names or property details (easy to know their net worth) from this. Also, how are you managing data security?

Do you have any plans to address these concerns?

Thanks!

You make a really good point on privacy - insurance is a trust business and managing this right is really important. We delete Dec pages w/in 30 days (we don't need to keep them past giving you the advice), so that's a start and something we don't mention on the site but should. We also never expose user data, or show you what you've uploaded.

Unfortunately though to get insurance advice, property details are pretty important, and if you are concerned with your Liability coverage net worth is pretty important for a service to know too. What we don't need are names - actually people could black out that personal info (even address) and it would be fine!

"(even address)"

I thought geography factored into deciding premiums since different areas had different risks of specific events that would lead to an insurance payout. Does what you all are doing simply not need that? Or are you saying that analysis can be left off if they desire for privacy?

Edit: Thanks for the info!

Geography is important, but your specific street address isn't required for this tool. And really, most insurance pricing is done at a higher level than street address (zip, or insurer-defined territories) so actually it is one of the last bits of info needed. For rough advice as this gives, we don't need it.

Dan at Goodcover.

The later. It's a factor for insurance premiums, because being in an urban landscape vs a wooded area has a massively different fire risk.

Man, I bet it's even higher than 70%.

I was in the hospital in February, and I asked the nurse how much it would cost to drain a subungual hematoma. Nobody knew!

Maybe it would've been free; maybe it would've cost $1,000 - it definitely doesn't feel good to decline a procedure because you have no idea how much it'll cost.

I've seen "haven't read my policy" numbers in the 80s and 90s depending on the survey. And yes - we're property insurance people but know that health can be even crazier. I understand a lot of the times the price for the procedure isn't really decided until they find out who's paying for it.

While this post thread is fire and casualty insurance, when you look ad medical insurance, it is just insane.

I had an appointment at a specialist and I am on a high deductible plan. I called up and asked how much I would be spending. They refused to tell me. I tried this again, and another person refused. "We can't know how much it will cost."

So I went in and asked. Same line. "It matters what happens in the appointment and if you have any treatments." "Sure, but what about the base cost assuming nothing else happens?" "We can't say." "Look lady, I'm needing to know if I can afford this. I don't need exacts. I need ballparks. $100? $500? $1000? $5000?" "Oh, i can't imagine it will be that much?" "Which?" "I can't say."

I needed the appointment, so I went in blind. Came back out, and they literally couldn't figure out what to charge me. "We don't see a deductible..." Yeah, I am from an HSA and have a high deductible plan." "Um, no change at this time. We will send you an invoice." Turned out to be $50.

With such price transparency, we will never fix things in the US.

While the problem is not as crazy on property insurance, it is still subject to complexities. Different policies have different exclusions and different riders. You can't just compare apples to apples. Heck, even auto insurance has nuances. Some only pay out if you are driving your own car while others will pay out for any car you happen to be driving.

I was just within the last hour look at renter's insurance, so I appreciate the goal of the company. It doesn't look like you currently give advice for people comparing different offers - is that something you plan to do?

Also, I didn't understand your description of "returning any unclaimed premium back to customers, keeping a fee instead". Being not too familiar with insurance, can you give an example of how this would work?

Thanks - and good luck with your renters insurance search. You're right we don't currently give advice for comparing through the tool - but I've written about it on our blog, and have a even more low tech comparison tool there (google sheet!). https://blog.goodcover.com/save-time-and-buy-home-condo-rent...

Hopefully that could help you out in the mean time.

Regarding returning unclaimed premium - good question. The way insurers make money is by 1) collecting premiums and holding on to them, generating some interest, and 2) keeping more premium than they need to pay out in losses and expenses, which is called "Underwriting Profit."

Typically Home/Renters insurance is written in such a way that a company tries to keep 5-15% of premiums as Underwriting Profit.

We think that the conflict over underwriting profit is at the heart of why the insurance experience is bad - there's not much incentive in improving a user experience that you don't want users to use... So we want to give that 5-15% back in the good years where we don't need it to pay claims. So, what you would see is a dividend at the end of the insurance year. It's not going to be much, but it is "putting our money where our mouth is" on our commitment to policyholders.

Turns out that's really hard to do legally and financially - mutual insurers would technically do this, but starting one is a hugely capital intensive process. We're on the path, and hope to be able to share more about the process soon!

A question about this "dividend".

Obviously, this is a major source of profit for a insurance company, but I imagine is also used to refill reserves after a big payout year. Insurers must have been piling cash away for years after Andrew, Katrina, Sandy etc to recoop payouts. How would this balance with returning money on good years?

Underwriting profit hasn't always been a big component of insurer profits - typically "float" or that interest on the premiums held has been the big driver. But in a low interest rate world, companies have had to keep more and more underwriting profit in order to exceed cost of capital. As they need more UW profit, so the fight over claims gets worse...

You are right though that money needs to be set aside for bad years - in insurance we call it "reserving", and actually it is already accounted for before the 5-15%. It is stashed away in the loss ratio as "incurred but not reported" or is paid in reinsurance premiums, which are a fixed cost. 5-15% is what is left over after all that (and admin expenses).

CAT Reserves are not IBNR...IBNR would, e.g., be after the CAT event happens, but before the claims are reported. I'd like to see a definition that says otherwise!

Yes, correct, IBNR can come from cat, or non-cat.

I am not sure you understood. This sentence--

"You are right though that money needs to be set aside for bad years - in insurance we call it "reserving", and actually it is already accounted for before the 5-15%. It is stashed away in the loss ratio as "incurred but not reported"

Is not correct. CAT reserves are not related to IBNR. IBNR is a) we know the loss has already occurred b) the policyholder has not reported the loss yet. (Or at least in a probabilistic sense, like the hurricane has landed, and we know it will take 10 days for all the claims to be reported, and that 2 days after landfall, say 20% of claims have been reported, and the other 80% of those hurricane claims will be reported over the next 8 days. So at that moment "2 days after landfall" the actuaries will estimate how much IBNR there is.)

What you described is a CAT reserve...it's a seperate reserve taking into account, say, over a 10 year period, the odds and severity of a CAT risk.

If you still are unclear about the distinction, please consult your local actuary or CPCU :-)

Underwriting profit shouldn't be a major part of the business model. If you're making too much money year to year from that, there's going to be regulatory pressure to lower your filed rates in a given market, and absent that, competitive pressure, because your competitors are going to have similar loss behavior in your segments and will cut rate to take market share from you. Customers see insurance as ~fungible and they will shop, although not as often as they should.

EDIT: I see the OP responded to you, and independently, I'll say he gave a great explanation and probably knows WTF he's doing. Didn't expect to see IBNR explained on HN!

Thanks! Oh IBNR... I'm surprised too, but glad it got a chance to shine!

And you are right - UW profit shouldn't be a big part, but it's a contentious issue right now with interest rates where they are. Since it shouldn't be a big part of our profit model, we're looking to put our money where our mouth is and return it.

What will you do in a bad year when a couple of cats drive your loss ratio north of 110%? I imagine the answer to that is a big part of the regulatory challenge!

I wish you the best, I do like your goal. I spent almost 15 years from post-college to ~present in insurance before moving on recently to something else here in SF. Ping me if you ever need anything or just want to bullshit about the industry :)

Awesome, I will - thanks!

Property insurance attritional losses are fairly predictable, and reinsurance is there to smooth out Catastrophe loss years; they'll be there to support us and bring our Loss Ratio back under control. So key is to charge enough to cover attritional (i.e. predictable) losses + reinsurance premiums.

But yes in those bad years where there's no UW profit, there's no dividend - everyone's contribution was needed.

If you're covering CAT risk 100% using reinsurers, you are at a competitive disadvantage compared to insurers who can cover some of that risk themselves...reinsurers have their own returns they look for.

That's true, but I've yet to see a primary insurer that doesn't use reinsurance.

It's not about using "reinsurance", it's about how much risk you are laying off to them. Large insurers don't insure "just the predictable losses" (unless they set up their own reinsurers) because it lowers their ROE too much to give reinsurers so much of the underlying risk.

> So we want to give that 5-15% back in the good years where we don't need it to pay claims.

Isn't that what Lemonade initially tried to do? They ended up having to go to their charity angle because of rebate laws. How do you think you are different? Mutuals do not seem to have a competitive advantage when it comes to Loss Ratios...what is your thesis exactly? Not to mention Lemonade is running at almost 3x their filed Loss Ratio now.

End of the day, personal lines is a very competitive market, where insurers are happy to get a net ~95% combined ratio (including CAT). Why would you think you will do better?

Are there any California HO providers that still offer Guaranteed Replacement? I had it at one point with AAA, but they jacked rates on me, and it got too expensive. I'd like to get it again, but haven't been able to find it.

Typically Guaranteed replacement is offered by HNW providers such as PURE, AIG, and Chubb. Travelers might do so too. It's hard to find though, so talking to an insurance broker that can access those specialist markets (i.e. they do not sell online) might be your best shot. Also, most insurers will offer some kind of Extended Replacement Cost which pretty much does the job too.

Interesting development though is in CA, insurers are legally required to recommend you a replacement cost coverage amount that is adequate for your place. That probably has a lot to do with the changes you've seen on "guaranteeing" something vs just recommending.

Yeah, the HNW policies are also stupid expensive. AAA was the only provider for normal people I found that still offered it. Extended replacement cost theoretically does the job, but in coastal california, we're already looking at rebuild costs in the $300+/sqft level. Add in the cost increase from labor shortages, and I could see it spiking significantly above that. (Looking at my policy, I see the Extended Replacement providing 30% more than baseline, and 80% more than baseline for FEMA declared disaster, which I suppose is probably enough. I still prefer reasonably priced Guaranteed replacement, as that pushes all that risk on to the insurer, rather than requiring me to guess what the rebuild cost of my home will be).

I did run your automated advice system with my recent policy renewal. Reporting was pretty good, although I was surprised that you consider a $3000 deductible "abnormally high". I don't think it's worth trading money with the insurance company as premiums to cover small stuff like that. Not everyone shares my feelings, though.

Yes, you're right - "abnormal" is a bit in the eye of the beholder. It would have been a relative assessment - a 3k deductible is much more than most people carry (even HNW, an area I've worked in before).

On guessing rebuild, in CA you shouldn't have to guess, as it's the insurer's legal requirement to recommend something accurate, and the DOI supports the consumer there. Generally those increases will do the job on like-for-like replacement - the big problem is if your Building limit has not been reviewed for years, as they get out of date.

Guaranteed is definitely expensive since it has cost insurers some big claim headaches, so not surprised it's even harder to find now as some insurers are hurting after all the fires.

Ahh, good to know that the DOI has some teeth on the accuracy of the recommendations. That makes me more comfortable to take the extended replacement. Still frustrated that I can't just sell that risk to an insurer. After all if GR has caused big claim headaches in the past, and ER wouldn't have had those headaches, wouldn't that be to the customer's benefit to have GR?

The headaches as I understand it are mathematical really - without a limit to cap costs, outliers have the potential to completely mess up the pricing. Anything where one claim could destroy the predictability of results is hard. So only a few wildly inaccurately priced GRs can take down a whole book - hence capping. If you aren't likely to have outliers, you don't need limits, and some HNW insurers are removing limits entirely since they just price accordingly.

Amusingly, the Farmer's Insurance website went down just as I was trying to get my decs page. :)

I liked the flow, although I did have an issue where when I dragged the decs page onto the box in Safari it just opened the page, but once I got it uploaded it worked fine. Still waiting for my report now.

Have you seen this: https://www.youtube.com/watch?v=ETUVcm5rU_4&t=13s

Might be a simple way for you to get it done.