Closing the Health Protection Gap with Modern Supplemental Health Insurance. A Conversation with Brella & RGAX

The majority of bankruptcies in the US are due predominantly to medical bills. Even with health insurance many of us are one bad event away from financial hardship. In this episode, I spoke with Veer Gidwaney, Mike Zarrillo (of Brella) and Scott Grandmont (of RGAX) about the critical importance of supplemental health insurance. We discussed how SHI can smooth out the financial costs of medical situations and emergencies. Deductibles, overlimit costs, and extra expenses make medical emergencies a financial nightmare…EVEN IF YOU HAVE TRADITIONAL MEDICAL INSURANCE! Brella is using technology to make it easier for employers to offer coverage, but also as important, easy for benefit holders to use it!

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Mike Zarillo (LinkedIn)
Scott Grandmont (LinkedIn)

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Transcript

Nick
And welcome back, everyone. This is the Coverager Podcast. I am your host, Nick Lamparelli. I am in Coverager headquarters in Naples, Florida, where we measure time by how many haircuts I'm getting so this is COVID haircut number four. That's how we do it here. And so I'm excited to have this particular conversation because continuing on with a theme that we've been having on wellness and health and just that overall theme when it comes to insurance. I have a full chalked panel here where we're going to talk about it. Veer Gidwaney...did I pronounced that right?

Veer G
You got it. You just about got it. Well done.

Nick
Gidwani. Okay, Veer Gidwani, Scott Grandmont and Mike Zarrillo. We're gonna be talking about wellness and health and things like that. So I start off all of these guys by allowing the guests to just give a little bit of an elevator pitch on who you are and what you do. You guys have a different Brady Bunch cubes than I do. So I'm going to go clockwise, which means Mike Zarrillo who's right underneath me, Mike, then Scott, then Veer Introduce yourself. Who are you? And what do you do?

Mike Z
Awesome. Well, thanks. It's good to be here. I'm Mike Zarillo, Chief Revenue Officer, here at Brella and join the organization in I guess it was March of this past year to help get our our company launched and off the ground in the great

Nick
What a time to join! My goodness...

Mike Z
Oh, yeah. Yeah, I've been known for good timing in my life. But, you know, I joke. It'll be sweeter in the end, right, because of the hard work it takes to get here. I joined quite simply, because I've spent 22 or so years now on what I'll call the traditional or dinosaur insurance company, side of our of our business, and they have a chance to join in early stage organization who's hyper focused on the consumer first and solving a real problem. Second was a no brainer for me. So good to be here and excited to share a little bit more about what we're doing at Brella with you.

Nick
Thanks, Mike. Scott...

Scott G
Hi, I'm Scott Grandmont. Happy to be on the podcast as well. Big fan of yours Nick. Actually live in a different row seat here Sr. I currently lead the Greenhouse Life organization been with RGAX since its inception, about five years ago, have broadly been in the innovation space. Most of my career, having worked in underwriting and carriers for in excess of two decades, largely working in new initiatives, largely working in underwriting product development. And carrying that forward here at RGAX has really been just brilliant, the icing on the cake relative to my career. And then Cantor getting to work with the team like this at Brella has been just a real delight. And we're doing some meaningful work here. And I happen to have a role relative to that

Nick
Fantastic Veer.

Veer G
Okay, thanks for having us, Nick. We appreciate it. My name is Veer Gidwani. I'm CEO and founder here at Brella. And have been an entrepreneur for about 22 years since I prematurely left college. And my last company, Maxwell Health was in the HR benefits space. So certainly had an opportunity to learn firsthand some of the challenges that people face with respect to benefits. That company was acquired by Sunlife in 2018, and excited to be building Brella. Thanks for having us.

Nick
So I should, I should have started that way as well. And just talk about the two companies from my that the panel represent our Brella and RGAX. Although Scott, you have I'd like to learn a little bit more about the Greenhouse element of that. But that's essentially it, which is Brella. I want to get into the Brella element of it. But for those that do have listened to my podcast in the past, you probably are aware of RGAX which is a large global, predominantly life and life reinsurer. And so coming in and the RGAX elements of RGA, I said, like I said that right, the RGAX element is the innovation element of RGA. And so that's very, that's going to be very important as we kind of work through this particular agenda. So Veer, I wanna, I want to start with you. I want You, you are an entrepreneur by...sounds like DNA. But you've got a few under your belt now. So can you tell me why Brella was formed? What did you see that was underserved in the market? Because you were at a health organization just before this. So what was missing that a company like Brella needed to be formed?

Veer G
Yeah, so let me start off by just giving you a sense of what our mission is, and then or backwards as to why that matters. Our mission is to make sure that health distress doesn't result in financial distress. And, you know, I think the unfortunate reality is that for the vast majority of middle class families in the country, if they were to have an unforeseen medical event, it would almost certainly lead to some level of financial distress. And the reason is because the unfortunate economics of healthcare, put people in this position. And when you look at what the average deductible or out of pocket access for a family medical plan, that deductibles in the, you know, $3,500 range, when you look at the cost, if you were to be hospitalized, and what that would likely end up costing you as a consumer. And you put that in the context of what most families can actually afford. So what sort of liquid cash do they have available to deal with said emergency, the math doesn't really add up. And so the unfortunate reality is, is that if you, you know, come down with pneumonia, or if your kid breaks their ankle, or God forbid, you have a heart attack, not only are you going to be dealing with that health issue, but you're also going to have a financial challenge. And in our view, the first order problem, of course, is to get the cost of care down in America. In absence of that, we need to make sure that there are financial instruments that are available so that people can deal with those shocks. And so when we looked at this space of supplemental insurance, broadly speaking, what became apparent to us is that the products that have existed in this arena for the last 30 years, critical illness, accident, insurance, hospital indemnity, really have lost product/market fit, in our view, and you see this in the numbers, the vast majority of companies don't even offer a supplemental policy, even when they do, the enrollment rates are very low. But conceptually, what these products are intending to do is very useful. They pay out a lump sum amount of cash if you get sick or injured. And that's what Brella does, as well. But what makes brela unique is the sheer breadth of conditions that we cover, over 13,000, which makes Brella, the most comprehensive supplemental product that has ever been created. And the reason we designed it that way is that, you know, we want to make sure that it's a useful product that people will actually utilize, because of the breadth of what it covers and the ability it has to help people offset those financial challenges when they get sick or injured.

Nick
Where did the product market fit break down? Is it because the products that you mentioned were too siloed? and couldn't expand? Or was it just a question of as you as you mentioned, like 10s of 1000s of different elements could trigger a claim that just needs to be bundled more and just needed to evolve better. How did it break down?

Veer G
Yeah, there, there are three things that really stood out for us. And Mike should certainly jump in on this. He's an expert at it as well. One is that traditionally, if you wanted to have comprehensive supplemental coverage, which first of all, let's all admit conceptually is not something that the average person walks around thinking about, but if you knew you needed it, you would have to buy three or four different products today. You know, after you've bought medical insurance, dental, vision, life, disability insurance during open enrollment, say to the consumer, here are four more products you need to buy to fill the gaps on the five you just bought is a pretty ridiculous thing to put forth. So that's the first thing. And related to that, and in how are people supposed to predict what emergency that was unforeseen that they're going to have? Is it going to be an illness? Is it going to be an accident? Is it going to be something that causes you to be hospitalized? Obviously, we don't know. So for someone, that choice is really problematic. Next is that these products traditionally have been very vanilla, they're in no way personalized to the specific needs of the consumer. And when you think of this conceptually, the product should adapt to what your medical plan covers and they should adapt to what you as an individual or family can afford. The products that have existed traditionally don't do that they don't know much about the consumer, they don't adapt themselves to the consumers needs, they don't really personalize themselves. And finally, and you highlight it on this is that is the breadth of what we cover. You know, Brella covers three to four times more than what traditional products cover, even when you combine them. So it's just a far more useful benefit to consumers.

Nick
Mike...

Mike Z
Yeah, you know, and I think I would add to that, it's a bit of sort of playing on what Vir said around just the sheer number of products available to an employee and the typical enrollment today, you know, the traditional products, there's three or four of those that make up some sort of wide or comprehensive coverage. But how would an employee sort of in our mind, sort of understand how they all work, understand how they connect to the overall benefits offering, and specifically how they connect to the medical insurance, you know, Veer took you through a very common menu, starting with medical, dental, vision, life, disability, and then all the voluntary stuff. Well, it's the voluntary stuff, like supplemental health products, that should be right up next to the medical product, so that an employee making that buying decision understands how it connects to the, to the health insurance. So the other piece to our thesis here is when we talks about product market fit with traditional carriers is they're misaligned with the most important component, and that's the health insurance, it's impossible to get if you're an employee, first, it's an impossible decision. It's an unfair decision. And the vast majority of employees don't buy multiple products. So employer who gets the need for supplemental health insurance that decides to offer these benefits. They're just too far down the menu, they're too much of an afterthought. They're not part of that sort of core decision making process. And that's where the that's where it becomes really difficult for employees to make that educated and informed decision.

Nick
Well, I'm putting myself in the employee shoes. So I mean, I think November or October is generally the the month of the year where these things that you know, the benefits kick in and you want to plan for the next year. So I don't know a lot about this space, and I'm supposed to be an insurance expert. If those things came offered to me, I think I would just glance over and say I'm covered, I got health insurance. Tell me why I'm wrong. I mean, I know why I'm wrong, but it's explain, explain the disconnect in in how this stuff is actually communicated to the employees? Because it seems like there's a gaping hole in their in their protection.

Veer G
Yeah, that's a great question. And, and lifting off of what Mike said, the connection of the health insurance is really crucial. So if you were to go to the average person today and say, Hey, tell me what about your benefits, you least like other than the cost of premiums, most people will say, the deductible they have on their health insurance is well beyond what they can afford. Now we accept it, because the only way to keep premiums down is to accept a higher deductible. And so year after year, for the past decade, that's been one of the tools that employers have had no choice but to use in order to keep premiums down for their employees. But if you if you dig into that response, look, these deductibles are beyond what I can afford. Brella is a perfect solution for that. Because what we're essentially saying is that if you were forced to spend a big part of that deductible because of an emergency Brella is here to offset that unforeseen expense. Whereas today, voluntary products aren't positioned with that simplicity, partly because they're not simple. The idea that there's several solutions to select, or products to select that are at a point in their nature, they don't cover very much, claims denial rates are relatively high. It's tough to, you know, back those products with a level of confidence that says they're really good at what they do. And when that's lacking, you know, on top of the complexity, it's really hard to connect the dots for the average person. So we come to the table and say, look, here's a simple product that covers a lot more, and it's directly connected with offsetting the most concerning thing you have about your medical insurance.

Nick
So how do you do that? I'm at my health insurance is a disaster. Right? Like I have no idea what my co pays are, when they are, just not it's not something I want to focus on. I think that happens with a lot of people as well. So can you can you take tell us a little bit, Mike or Veer Talk about like, how do you do that? How can you make it dovetail? And maybe that's the right word dovetail to the health insurance plan that these companies might offer, Mike.

Mike Z
Yeah, it's a good question. I was speaking with a broker partner recently around our product and and this particular individual has done some some business in the critical illness, accident, hospital, indemnity space. And he asked what what what do you refer to your product as? I said, supplemental health insurance? And he said, No, I mean, I get that. But what's, you know, if there's critical illness, there's accident, there's hospital nothing, I said, No, supplemental health insurance! We're not. We're not accident. So I think the at the Foundation, the structure and design of our plan, just on its own is meant to be a natural complement to the health insurance discussion. So trying to have the average employee figure out what is a critical illness? What's an accident? How does it all work back to that, that point I made earlier is is, is a bit challenging. The other piece to this, though, is the experience from enrollment all the way through utilization and these benefits now, in our world, you know, it takes a village, right, it takes the insurance provider, it takes the insurance broker, and it takes the employer to all come together, get in sync and understand that we all serve the employee at the end of that process. So whether it be you know, working closely to develop an enrollment plan and strategy, so that communication is crisp, is clear, product placement naturally flows from health insurance to Brella, or to a supplemental health product, and then down the line. But I think the other piece of that is I sort of alluded to is the utilization, right being able to sort of explain and demonstrate how easy it is to use a product like Brella, and I'll let beer sort of take it, take it from here. But that's only made possible when you can simplify the insurance product like like we've done.

Nick
Veer...

Veer G
Yeah, dad to that, you know, one, we've built a recommendation engine into brella, that, you know, with two or three responses to simple questions about your health insurance, or your savings profile, your family profile, we can tailor a version of our product to you. Right on the fly. So that that's one element. second element and you know, this is something that has been really near and dear to us, as we thought about building brela was to innovate on the insurance product itself, and not just the technology and the go to market strategy around that insurance product. So as an insurtech company, where as much about the insurer as we are about the tech, and in this particular space, you know, sort of a bottoms up rebuild of the product was really important. And one element of that rebuild was how we think of a valid claim. And this gets really towards the experience. So one of the things that's unique about Brella is the fact that the only piece of evidence we need to assess whether a claim is valid, is proof of a diagnosis. And the beauty of that is that it allows the consumer through our app to give us evidence of their diagnosis that they would likely receive at the point of care, whether it be a set of X rays, the wristband they're wearing from the ER, discharge papers, they can literally take a photograph of those and submit them to us. From that kind of evidence, we can assess the diagnostic code and trigger a payment. And the way that Brella is designed today, within 72 hours, we can have a claim paid. We expect that within a couple of years, that'll be down to seconds for the vast majority of claims, automating that experience almost entirely. On the other hand, if you look at the incumbents today, who do not pay on diagnosis, and as a result need you to present a bill that you might have received, which which possibly was only something you receive many days or weeks after leaving the hospital. By definition, they're not able to get you a payment until many weeks after the expense was incurred. And so by then your credit card was due, your rent was due, and the cash flow crunch already hit. Brella is is completely distinct from that from an experiential perspective. And part of it is driven by insurance innovation on top of technology innovation,

I can tell you that I find the entire health process extremely frustrating in the amount of paperwork, bills that get sent and then the amount of time that it takes to basically figure out well, what are they talking about here? What what doctor's visit was this? Why am I being charged this? Oh, they're billing me because the insurance Company hasn't sent them the check yet. And then having to continuously follow up on that. It's it's a, it's extremely messy and frustrating. From my side. And so I'm Scott, I'm wondering from your end, you hear this, you hear this pitch from this company called Brella? What are you thinking?

Scott G
I'm thinking engagement, Nick, I got very excited when I first heard the pitch about a year and a half ago from Veer. To me working in the innovation space and hearing pitches that are a mile wide in terms of promise, but very, very shallow in terms of delivery. This was a fresh look at resetting the narrative with the consumer.

Nick
Scott Did you did you know, there was this particular problem? Were you aware of it? Or did you become aware of it as as they went into it?

Scott G
No...I'm an individual life insurance guy, that's my area of expertise, you know, much like everybody else on this call. And in our audience, my experience is through the lens of being a consumer, understanding the problem, chasing after my HSA, trying to get a copy of the bill, you know, so it spoke to me when I listened to the vision for the team, you know, so I was drawn in immediately with that idea that this is addressing a real problem. You know, it's not talking about a fancy delivery mechanism for a stale old product is trying to continue living, it's solving a new problem. And it solves a problem in a way that I think is very accessible to non insurance people, you know, explaining it to my wife is just like, yeah, that's great!

Nick
That's how I feel right now.

Scott G
Exactly. So there was that immediacy of it to me. So once you get engaged on a topic like that, I mean, you start thinking about the block and tackle work necessary to get this project downfield. So the excitement and the understanding was real. This drove me right out of the gate.

Veer G
And if I can, I can add to that, from what Scott just mentioned, I mean, the vast, pre COVID, if you were to ask the average American, do you think if you had a medical emergency that it would cause you financial hardship? Most people would probably answer, Yeah, probably it would. In the COVID era, if you asked that same question. virtually everybody would look at you as if you had just sort of missed out what happened over the last nine months. Clearly, a health emergency that's unexpected, can lead to significant financial distress. 62% of personal bankruptcies in the US are due to the accumulation of medical debt. Your millions of people have contributed to GoFundMe campaigns for absolute strangers, raising money for medical bills. You know, whether you believe in a single payer system or not, is aside, but literally half the country is open to the idea of a single payer medical system. So to us, these are these are indications of the fact that people can't afford health care. And they're afraid that if they have something happen to them, it's going to cause real problem and that that's the problem we're trying to solve, which is not something that's novel. Most people can relate to that issue. Sorry, Mike, you want to hop in?

Mike Z
No, no, no, I just wanted to add on to that, right, that's 62% number of personal bankruptcies caused by you know, the accumulation of medical debt, that that's not necessarily a new statistic. What's an interesting one, though, to your point, post COVID. In July, Gallup West did a study and 50% of US adults, fear bankruptcy, right? There's very different that 62% numbers, the actual bankruptcies that have occurred, but we've got half of the US population right now, fears bankruptcy, it's just a really disheartening stat when you think about it. And when I think about the incumbents, and I spend a lot of time in that space, you know, the traditional products, they seem to be geared towards those, those really big ticket events, the heart attacks, the cancer, the strokes. Now, listen, those are devastating for everybody, certainly financially. But the same study that was done in July indicated that about 26% of adults would have to borrow the money needed to pay a $500 unexpected medical bill, think about that for a second. We're not talking 10s of 1000s of dollars, we're talking about a four and a $500 medical expense. So when we look to build our product, again through the lens of the consumer and their experience and the challenges that they're facing, yes, heart attack, stroke, cancers, you know, certainly devastating but for some some people so is the kidney stone and the dehydration right on the other end of the spectrum of severity. It's it's just too wide to focus on just the the high dollar end of that.

Nick
Right? And I will, my background is in property Casualty. And I always say theoretically, there's an alignment of interests between a policyholder, and a carrier or reinsurer in that no one really wants a claim, right? There's a whole bunch of reasons why that sort of breaks down. I think of my health insurance. And I, it seems like everything breaks down in, in how all of that works. For one thing, I don't actually know what I'm covered for, I think I think I'm covered for a lot. But my guess is that I'm only getting I'm only paying the copay for these visits that I go. But if something significant happened, I'm probably not nearly as covered as I think I'm covered. Right. And I think that that probably goes for most health care plans. Am I wrong?

Mike Z
No, I think that's right. And I think that comes back to some of that literacy around benefits, certainly. And when it comes to health insurance, it's hard. It's complex. It's not easy stuff. Oh, and I want the idea.

Nick
Yeah, I think there's, I think there's a there's a breakdown in that there should be an alignment of interest between the two parties, right. But it kind of breaks down. It's almost like a conflicting relationship, they feel as though they feel as though they can't use it, or they're going to they don't want to use it, because they don't know what the outcome is. But in fact, there, there almost should be some encouragement to use it to be proactive on things like preventative care, you know, to prevent the big things from happening, you know, small, small, wellness, small health, preventative actions can prevent that big thing from occurring. And there almost feels like there's a disincentive to do that.

Veer G
Well, I think I think related to that, is that no matter how healthy we try to live, things happen. Yes, some of these things are not because we live unhealthy there, because we're human beings. And life is complicated. And there are lots of things that can go wrong when it comes to one's health. Think of all the accidents that we might have that are not because of reckless living right there, because it's just something happens to you. It's the true reality of it. You know, I think what's unique about Brella, when we've been trying to make as core to our philosophy, is the idea that we're built to say yes. Now, there's there's an original philosophy around insurance that that often gets, you know, tangled up in the modern world of insurance that when insurance was created, know, a couple 100 years ago, the concept was that a community of people would pool their funds so that in an emergency for a small portion of that pool of people, they'd be able to rely on the community's collective wealth to solve a problem. Insurance is still that today, we just don't think of it that way philosophically. And Brella has really tried to reconnect itself to that core of what insurance is about. So we're built to say, Yes, we are not trying to find a way to minimize the claims we receive, we are not trying to find a way to have language that will, you know, make it only possible to get a claim in a very specific situation. We are trying by design to pay out as often as we physically can. Because we want to make sure people use this product. And that is the point of it. You know, it's it's an odd term, when you think of a loss ratio, right? We use insurance think of a loss ratio. Well, that loss ratio is actually the point of the product, right? Maybe we should think about it as the value ratio, what value is this insurance product delivering to its consumer? That's really central to how we think of Brella and why we designed it to cover so much, you know, a good example, obviously, one that's topical for all of us is what's going on with COVID. And if you were hospitalized for COVID. You know, there are 100,000 Americans in hospitals today because of COVID. In the vast majority of cases, they would have also likely have been diagnosed with pneumonia, sepsis, or acute respiratory failure. As it turns out, those three conditions are not covered today by the vast majority of supplemental health products. So what are they missing? You know, when we designed Brella? We didn't design it for a global pandemic. We designed it last summer before COVID existed. But when we asked ourselves the question, when we asked this 1000s of times as we went through every single diagnostic code that exists, we asked ourselves taking pneumonia as an example, if you had pneumonia, would you expect the product with our mission statement to pay? And if the answer is yes, Then you pay, it's very simple, you cover that condition. And I think that's that purity is, I hope, a new bar we set for others in this space, but more importantly, is really value that that people see. And they think umbrella is an important part of their overall benefits. makeup.

Nick
Scott, can you talk about the evolution of how RGAX you know what your element was in participating in this and getting it from idea to having a say on, you know, how the risks should be backed all the way to, you know, go to market strategies, and things like that talk, talk about the beginning, because it's a good mission, right? Even you were kind of like, yeah, that's, that kind of hits home. But a mission's one thing now we got to get it we get it's got to stand on its own at one point, or at some point in the future, talk about that span of time and what had to occur in the background to sort of backfill that the consumer that's benefiting from this, they never get to see it because they've been, it's been abstracted away.

Scott G
That's a great question. I can in all candor, I could probably spend about an hour & 23 minutes talking about just this. It was a great journey from the very opening while we started talking about thinking about the new narrative with the consumer in this was all about putting that consumer right in the middle of the conversation, weaving a product, a delivery mechanism and experience around that that was completely new. As you know, product development innovation generally is something that takes a little bit of muscle memory takes internal alignment takes commitment. When you're talking about building against something that doesn't exist, you have to have somebody that's around that that is effectively the Veer on the inside of the operation who's architecting some of the solutions internally, evangelizing around the innovation, and just really wrapping duct tape around things at times, you know, we had to work cohesively across the enterprise, be at pricing folks or underwriting folks in our group operation, our claim subsidiary, our team, I mean, all of these things had to be there anyways. But when you're talking about something that you completely take off the whiteboard, because there is no surrogate for it in market, it really kind of galvanizes people to sit up and pay attention like, No, no, this is worth solving for the reasons we've been talking about for a year and a half. So to me, there was a lot of challenges, there was a lot of shuttle diplomacy, there was a lot of fear hat in hand, can we have a talk. And similarly with some of our pricing folks, or some of our claims, folks, and really trying to forge something that didn't exist before? Those are challenges, it just makes the work rewarding. And when you finally get that across that finish line and get it launched and marquee look around and say, Good god, I can't wait to see how this does over time. Right? You know, and that to me, is that the value in being an innovative organization and supporting partners like this?

Nick
Can you can you guys talk about some of the background elements of this? So ultimately, is is Brella considered an insurance carrier? Or is the risk of being handled elsewhere?

Scott G
I'll jump in on that one Greenhouse's the paper for this case, we reinsure with our parent company, RGA Re. And that's how we're able to get a partner like Brella to market and once in market, the world's their oyster.

Nick
Now, this this has elements to it that I've that I've seen elsewhere, right? Like this almost seems like if you can execute here, this seems like a springboard where you could then extend this out to beyond supplemental health insurance and just basically make it health. Right, like the whole thing. Is that a plan for this?

Veer G
Right now we are laser focused on solving this one problem, which in and of itself is a big and difficult problem. And we want to do it really well. So I think part of that is is having focus, and not complicating what you're trying to do. So the answer your question is no. We are focused on this problem alone now, today, this product is only available in Texas, that was the state in which we decided to launch. Our expectation over the next you know, 12 to 18 months is to become available largely nationwide. You know, one of the things that's been really important to us and you know Mike and I Just spokespeople here for a team of folks, both within Brella. But we have partners in addition, RGAX, who have all helped bring this to life. But all of us have been really lasered in on on creating this experience that Mike talked about. And part of it is to control a lot of the elements. The entire platform behind Brella has been built by Brella. You know, obviously, there's other software that we use, but we've not outsourced our software platform, we have not gone and found someone else to do customer service. We've built the concierge operation within Brella. We do all our underwriting, we do all our own claims, etc, etc, etc. And part of the realization there is that if you want to create a really tight experience that focuses on delivering the most value to the consumer, then you do need to be willing to get your arms around the entire journey, and influencing, you know, from end to end, which has been really core to our whole philosophy here. Brella from day one.

Nick
So what does it take to go from one state to a nationwide thing? How, what is the regulatory environment? Is this also a state by state thing? And is supplemental health insurance regulated, in the same way that regular health insurance is regulated?

Veer G
So it is regulated state by state, within the Insurance Commission's and you know, there's good precedence for a product like Brella, we've talked about other supplemental products that have existed for, you know, two, three decades, you know, what we've realized, from our experience, we have, again, a team of folks who file products nationwide, in the arena of health, you know, at the end of the day, state insurance commissioners want to bring value to their constituents, the citizens of the state. And the problem we're solving is so clearly dealing with an issue that is very real for the vast majority of people. So, you know, yes, there may be questions about our approach and how we're pulling it all together. But ultimately, we, we work with World experts, when it comes to pricing this product, we've designed it in a way that follows all the regulatory frameworks that exist, it's a new way to solve the problem. And we've constituted it in a different kind of product. So I expect that we'll get a positive perception in the vast majority of places that we want to take this product to. And, you know, so far the reception has been really positive.

Nick
Can this can this product, I know it's right now being delivered on at the distribution angle via employee benefits, too. So are there two other potential distribution elements to this? Could you go direct to consumer? Or could with this really massive surge into wellness? Could this product be sold into the wellness communities?

Veer G
Mike you want to take that?

Mike Z
Sorry, audio audio issue? there?

Nick
It's Zoom!

Mike Z
I think the answer is yes. And yes, so two beers point. We're hyper focused now on the group side of our product and product design. But from a roadmap perspective, we absolutely see the direct to consumer channel is one that makes sense and that we should continue to focus in on as we as we continue to grow and expand. I think the wellness example that you shared sort of falls into this area of what what I'll call strategic partnerships. And, you know, I think there's many constituents in the benefit space that touch the consumer in some form or fashion, that it may make sense for us to think about some sort of partnership or alliance to get in front of the consumer in potentially a joint way to augment that experience. Something obviously, we're very focused focused on. And I think post COVID, candidly, Nick is going to shine a new light on a lot of this. As we go forward, there's just a greater focus on health and benefits. Certainly employees are going to expect more in demand more. I don't think the core focus of benefits being a tool to attract and retain key employee talent is ever going to go away. So I think it's going to continue to challenge us as product manufacturers, as administrators as carriers to make sure that we are continuing to innovate in a space on the insurance side that hasn't seen a lot of innovation.

Veer G
I was just gonna lift off something that Mike had said is that, you know, one other element of broadly speaking distribution opportunity here is that, you know, for good or bad the benefits in this space have been typically collectively referred to under the banner of voluntary, which is an odd categorization. But what it essentially means is that the employer doesn't contribute to the to the premiums of the benefit, the employee's paying for 100% of it. Now, you have to ask yourself why that's been the case? Why haven't employers funded benefits in this space? And would they be willing to contribute to the premium if you offered a product that was better, and was actually going to be utilized because it covers so much more. So part of what we are experiencing as we speak to brokers who speak to employers is an interest that is, is leaning towards, you know, maybe this is something we should contribute to, because if we, as an employer contribute to this benefit, more people will buy it, which will mean that they're less likely to face financial distress, if something were to happen, which will, by and large, rub off well on the medical plan, because it's going to make that have more value to the consumer. And overall, it's a better benefits package. So we definitely want to pursue the channel we're in right now. Because, you know, as Mike said earlier on, this is supplemental health insurance, so buying it alongside your health insurance, and, and being part of that economic decision makes a lot of sense. So, you know, there's lots of ways to take this to market and I expect we will pursue many of them. But but we also just want to make sure that we're really illustrating the value proposition in a way that's in the context of your overall benefits, which means as a individual or family, yeah.

Nick
And there's, there's a work from home element now that, you know, Mike, to your point, I think COVID clearly has changed everything, right. But to sort of pile on to that the work from home element now makes it extremely complicated, because, you know, I know in, in my company on a day to day basis, you know, we've actually had conversations about people working from home, and they're stressed out, they're probably working more now than they have. And, like, we have to remind them to drink water, you know, get up, and stuff like that, like that is a that is a significant departure, from normal day to day business activity, with your labor force, especially the office force who's used to going, you know, commuting, going into an office, I know, there's, there's a term water cooler talk, getting up, going to the bathroom, going to the water cooler, having a conversation, like there was a lot of productive networking and collaboration that went on with that, as disappeared with the work from home. And we may not get that for a long time. And so there's a mental strain on the employee now, in a work from home. So that's kind of like a throw out question to all three of you, there's there's the element of like, the world has changed piece in that employer should be looking to be more proactive. Right. But then there's the other element of, you know, to to Brella's point, if you're in Texas, and you start rolling out state by state? What if it's a company in Texas that has a work at home work from home employee in Hawaii? Like, how does how does that get arranged? How does that work?

Mike Z
Yeah, I'll start. I mean, if you think about, again, all of the stakeholders in this equation, you know, we all have to think a little differently in the world that we're in, and it starts with, you know, how are benefits communicated? How do employees engage in those benefits? Right, that's we just came through, we're in the midst of sort of the back end of fourth quarter and the open enrollment cycle and, you know, Gone are the days of benefit fairs and in person group meetings and on site and rollers. So how are employees making heads or tails of all of their benefits and, and understanding them that you know, so simplicity is better? I think the other piece here is if you think about the reason we're in this sort of work from home environment back to the pandemic and COVID and this refocusing on benefits and how am I covered and what am I covered for and, and how does it work and all of that it's just a complete shift in many ways on how benefits are going to be consumed by employee. So as stakeholders in this I think we all play a part in making that experience as positive and as easy as it can be. And I keep coming back to simplicity, right the the, you know, the the best way to get employees engaged is making it easy. Make it simple, right? Because they've got so many other things going on to make heads or tails up. So I think you're right, Nick, and I think it's gonna, it's gonna force us to sort of really look at the world around us. And, you know, I feel like we have in a unique position here at relic is we built our entire foundation on simplicity, we built the entire foundation on the consumer to Scott's point earlier, where, you know, some of those traditional or incumbent carriers, you know, have some work to do candidly to, to make that shift. So we feel like we've got a really good start on that. And, you know, I'll let Veer sort of chime in or Scott from here, but I think it's a great question.

Veer G
Yeah, those are, those are all. Excellent points, Mike. And I think the other thing is that, you know, hundreds of 1000s of businesses across the country are also having a very hard time making it work. And they also need to go through the annual benefits process still. And you know, whether they want to be in benefits or not as separate from the fact that the vast majority of American employers have a role to play in benefits. And so as as budgets get further crunched, getting enough value out of the benefit dollar your spending is going to be a has always been an important question, but it's becoming an even more urgent question. So you know, being able to rethink of benefits, to be able to reallocate how those dollars are spent to optimize the value for the employee, I think, is a reality that many employers will face and there's going to need to be some innovation around insurance to make that happen. It won't just be around technology. It won't just be about better process. I mean, there'll be some of those things, for sure. But it will also be because of better insurance products. And I think the burden is on the industry to rethink about their products a bit and figure out is there a better way to do this, that is going to benefit people, it

Nick
Scott, got to the point of sort of rethinking it, I not only have one smart device that I got to help me with my wellness, I got two! okay, because, you know, fill in the gaps type of thing. And so from an innovation standpoint, how do you how are you viewing companies like Brella? In? And what's your expectation for them to evolve? As this is? What I can think of it like a crystal ball? How do you see this crystal ball? How do you What's your, what's your desire, or hope that that kind of plays out with the the sort of startup tech companies that are coming into the space and, you know, really rethinking the customer, which is phenomenal, because we haven't done that a lot, but putting emphasis on simplicity, putting emphasis on technology, and all of that what's what are your hopes and desires?

Scott G
That's an excellent question, Nick. And I'll throw a few comments at it here and invite the group to support those comments. As I look at Brella, and I've seen them mature over the past, the better part of 16/17 months at this point and beginning to grow and market. The thing that I'm looking to see here is maturing some of our underlying premise around customer engagement, market/product fit, and service, right. Right now, these are all still small, you know plays for us, I'd like to see this thing grow. I'd like to get to a point where we think in terms of resetting that narrative and other product lines. we all struggle with activating consumers, no matter what protection product you're selling, if we could think about it through the framework of how Brella is engaged that right start with a pocketbook, start with the hazards that people are subjected to, and work back from that problem statement, and work through it methodically. Don't reach too quickly for a solution off the shelf, rethinking through the lens of how do I not only get that pitch out to that consumer, but make sure that pitch all the way through continual support and claims payment. If you think about it from that perspective, there is no part of the market you shouldn't be able to unlock. So the future for me is thinking through the lens of the successes of market and seeing if you can replicate some of the magic around activating that consumer creating a market solution that provides value for those people or the gatekeepers or the carrier, right. All of those constituents need to be harmonized in these solutions. How do we rethink that kind of thing through the lens of the right product fit the right technologies and the right approaches? Yeah,

Nick
so let's finish it off this way. Can we do a round of 2021 predictions? How, Aside from the obvious that, you know, the vaccines work and COVID kind of goes away. And not only from the perspective of your individual companies, but what's a successful 2021?That's a tough one. I know, Mike,

Mike Z
I'll give you one, it's got a little bit of a selfish nuance to it. But I keep this the selfish nuance to myself. Success in 2021, for me would be that the entire village committed to putting the consumer and the employee. First, I'll give you an example. We're coming through open enrollment cycle. And there were a lot of benefit decisions put on hold, because employer groups just had to get through fourth quarter and figure out how to manage the work from home environment and new policies as it pertains to leaves and furloughs. And, and and let's just get through this time, and we'll catch our breath in 2021. What we're wired to do is catch our breath in the fall of 2021. Next open enrollment cycle. So to me success will be that the village says, maybe we should challenge that status status quo a little bit, maybe we should think about, maybe we can implement a benefit or a change in April, because at the end of the day, it's going to benefit the consumer and the employee, right? So that would be what I define as success. And it's going to require us to get a little bit outside of our comfort zone. But I think 2020 helped us figure out how to do that. So I don't know if that makes sense. But that's my wish.

Nick
Not nothing like altruistic selfishness. Good. Good job, Mike.

Veer G
I'll lift off, you know, I think we have an opportunity to build that better, as a society, not to just go back to where we were, but to think of where we'd like to be in and use where we're at now as a springboard to go there. My hope and and to some degree prediction is, is that I think we as a society will figure that out. And, you know, think about solutions that say, hey, if we were to build the America that we want, how would we do it? Not not? How How can we get back to where we were in February 2020?

Nick
Yeah, I like that. Scott, finish it off.

Scott G
I'd like to repeat exactly what Veer said. That's just perfect. For me, 2021 would be a success, if we really kind of throw out the prior norms. I think 2020, despite its challenges, has galvanized a lot of people to reach out and care. We do meetings like this all the time. And to a degree I feel closer to folks, there's certainly a greater degree of candor in our conversations than pre COVID. Oftentimes, as an industry, we would take up meetings, and just simply be on a phone call. Now you've got the look and feel and I hope people take sort of the silver lining of 2020, which is these connections with people and carry it forward to the new norm that Veer was talking about a moment ago.

Nick
Here here. I like that What a great way to finish off this particular conversation. Veer & Mike from Brella. Scott from Greenhouse/RGAX. I I just I love these wellness, health related conversations. I think, I think you guys are right. I think 20 is galvanizing. I think people have opened their eyes and they're going to be a large swath of our fellow countrymen and women who are going to decide things have to change and they're going to, we're going to start making a better society. Let's hope so anyway, so with that Veer, Mike Scott, thank you so much. Appreciate the conversation. You know, I learned so much I hope the audience did as well.

Veer G
Thank you, Nick. Appreciate it.

Nick
Yeah, so we're still in COVID time. Everyone's still be careful. Wash your hands. wear a mask. It's not that hard. So for Veer, for Mike. For Scott. My name is Nick. Thanks again everyone, and until next time, be safe.

Scott G
Thank you.