Where's My Money? Solving Insurance's Last Mile Problem

Paul Tyler (00:33) This is Paul Tyler and welcome to another episode of the L&A Hub. Today we're really talking about the last mile of insurance payments where friction and fraud, even margin and also I'd say pose a pretty grave risk to customer experience, particularly as we head into the next generation of consumers.

Today, listen, I'm lucky enough to have a founder and CEO, Moshe Golomb, CEO of Juice Financial, here with us. Moshe, welcome. And just tell people a little bit about who are you and what did you do and how did you find your way to insurance?

Moshe Golomb (01:10) Thank you. Thank you. Nice to be with you.

Yeah, my name is Moshe Golomb. I'm the founder and CEO of Juice Financial. I've been digitizing payments for the last 26 years. Sounds to me like an interesting problem to get rid of check and cash. Unfortunately, we haven't done yet. There's $10 trillion still written checks are all over the place. So I'm getting very curious in streamlining workflows and making sure that people are getting paid fast and whenever they need to get paid and electronically.

And we've done this in the retail industry. First in the electronic gift cards, we moved to the banking down bank with all kinds of electronic payments and more than 150 different digital payment applications we built. The last seven years we are in insurance trying to remove the friction from insurance payments. And as you all know, it's not an easy task.

Paul Tyler (02:16) No, you think writing a check or sending a disbursement would be extremely easy. It's generally easy to get the policy and get payments from or get payments back and forth. It tends to, you tend to say like, why? Why does this...

Maybe talk about what exactly are friction points you've addressed and where are the biggest ones you've either felt personally or solved with a product you have.

Moshe Golomb (02:51) Yeah, so obviously being a digital payment, I look at everything in this kind of a special lens and I look at experience and what I'm getting. For example, you know, when I'm getting an Amazon package of $11 Play-Doh delivered to my house, I know exactly when we make the purchase, when it's on the truck, it's off the truck, it's three stops away from my house and it's dropped in front of me. I get a picture of the driver even. I get everything.

When I had an insurance claim here, a tree, a big oak tree fell on my house in Hurricane Sandy. And I had to call every day the insurance agent and he called our insurer and they told me to check in the mail. Obviously, check services were not even available in some of the coastal areas — I'm living in the New Jersey, New York area. Luckily, we got the check after four or five days.

And then, but again, the level of anxiety in the first four or five weeks to get paid a check after a check after a check, didn't know when the check is coming, not even when it's mailed. It's a big problem. And in this day and age, when we are living in the Uber and Amazon, everybody understands what good experience is. We go into the insurance industry and we rarely see that kind of a great experience. So that kind of keeps me awake at night.

Paul Tyler (04:14) Yeah, it's... maybe you talk a little bit about your platform. I had the privilege of coming to an event you had with Mastercard and saw you, and it was a great demo of this piece. Obviously, some people are listening, probably most people will be listening to audio, but maybe kind of describe, if I'm a life insurance carrier, an annuity carrier, what does your solution look like?

Moshe Golomb (04:42) So the way we solve the problem is we're not just a payment platform. A lot of the payment companies and insurance companies, they all live in a kind of a separate bubble. And when they get together, it's just too complicated. Insurance companies have a lot of very complex ecosystem, different policies, different TPAs and carriers and providers and stakeholders, different stakeholders that you have. Obviously claimants and beneficiaries, multiple beneficiaries, etc.

So the ecosystem that you live in is complex. And if you add on top of it, 70% of your budget goes to taking care of legacy systems. So you have almost a no-go match with payment platforms who are dealing with a lot of complexity themselves. And they usually like to give you an API and say, good luck, have fun, and make payments. And we know reality is not like that.

So when we came to solve that problem, again, this is not our first rodeo. We decided that we have to get involved in the experience. So how do we take an insurance company and take her from being kind of a disjointed multiple payment options to a very streamlined experience like an Uber experience or an Amazon experience? That's kind of our example. And we said it shouldn't be that complicated.

So we went and built the whole experience. And when we are engaging with an insurance company, we do two major things. First of all, is we give them a solution for all payment options. Because again, dealing with multiple vendors, multiple payment, that's just too complicated. And the second thing is we take care of all the experience from A to Z turnkey. We don't teach you how to build an Uber-like product. We give you one fully deeply co-branded product — guy, product head of product comes from Apple and Disney. We understand how it should look like. So we make it look like the big guys even if you don't have the resources.

And so we provide both the payment and the turnkey solution, but also the whole experience, not just rails.

Paul Tyler (06:47) I was just out at Refocus in Las Vegas with a number of reinsurers. There are a couple of interesting connections to make with what you said. One is your mention of smaller companies because everybody's talking about AI out there. We'll not go deep into AI here, but it's very interesting. The larger companies, especially the CEOs, were, I would say, farther behind than some of the companies who are smaller, maybe less funded, but more nimble.

Do you find, as you've taken this solution out to market, is there any type of segment you could say, you know, this is the type of company that's willing to not only rethink how they're doing fintech, but take a leap? Because payments are, money's the lifeblood of the industry. If I'm making payments, you're asking me to put my job online.

Moshe Golomb (07:48) Yes, and I think that again, we can fit small or large. We know we have a Fortune 50 company we're servicing and we have smaller companies too. But I think the way we built it is we have a no-code solution so we can land and expand. We can start with what we are — usually we come to a company and say, we're not gonna solve all your payment problems in day one. We give them an easy way to start, no-code solution. And you can go all the way to embedded and do whatever you want later.

But you can start quickly with, I would say, I always say, take your most painful use case. Start there. We are not afraid from solving complex payment problems. That's what we're doing for 26 years. And we built an off-the-shelf library of use cases, or as we call them here, juice cases, where it's already kind of ready off the shelf, ready to co-brand. You can start with that and then kind of expand later into more specific use cases. Again, every insurance company is a little bit different.

That's a challenge I'm sure for them to launch something with a bigger company or a platform or what we call a platform. That's how we are really going with a solution use-case-based first. That's kind of why we used Mastercard to automate as much as we can, use their technologies to have identification, fraud monitoring, a lot of things like that. So we take away from the insurance company a lot of their workload that they have today, save them cost, get them to market quickly and then expand on that.

Paul Tyler (09:18) Another comment from this Las Vegas conference was there was a lot of discussion around novel product offers, things that were related to genetic testing, health-related issues, health-related underwriting, you know, GLP-1, a lot of discussion out there. One of the CEOs who spoke about it from one of the reinsurers said, you know, fundamentally, this business is just a low margin business. You have to be very conservative when we take these kind of risks.

I guess probably three different times in my career at different carriers, we looked and I was part of the push to say, why don't we take credit cards? Let's take some other different payments. And the business case was actually hard to make. It was, you know, if you think about like interest rate on a multi-year guarantee, well, the interest rates three, four, five percent, even a two percent haircut's a lot. Same thing with life insurance premiums. And there are set up charges.

How's the equation change? Because clearly you're getting traction with companies that I'd say there's no way they would put that kind of money in or that kind of be willing to sacrifice their margins to do this.

Moshe Golomb (10:45) Yeah, I think it's a module, actually, it's a module builder for disbursement. So when you make payments, one of our clients, I think was quoted, that says 65% of the phone calls to the call center today is "where's my money." And that's a huge cost. So you can reduce operating costs and payments is a big part of that. So you want to spend — either you want to cut your operating cost, or you want to rededicate them in different places.

So make sure you have all the data, you make the payments transparent, everybody gets paid, there's less customer complaint, less churn, okay? If you talk about churn, 46% of people said if not happy with the way they are paid, they're not gonna use this insurance company.

So it might be less of a problem in life insurance after you solve the policy. But even when you solve the policy, when you need to fulfill payment at the end of the policy, you want to give them options. And customers are willing to pay for a good option. If the customer is already residing outside of the US, let's say in Costa Rica, he's retired and needs to get a payment, he wants to get money directly to his bank account in Costa Rica, not to his Chase bank account. It doesn't help him if the check is in the mail. So there's so many use cases where the way you're paying is very, very vital.

Paul Tyler (12:09) Well, I also think this business is so complicated. It takes a long time to really understand how the math really works. Like on a life insurance product, one carrier I worked at made the push. I'd say, Moshe, got close enough that we actually would take, we got the operations group to agree to take credit card payment, but it was literally fill it out by hand, send it in, we're gonna charge him some convenience fee of 20, I think it's $20 or something ridiculous.

But what was the problem with that block of business? Oh, lapse rates. This was a product sold into the mid-market. This was a group of customers that I think a lot of companies are trying to reach. This was fascinating. So we went and looked at the lapse rates and what would be predictive. And at that point I was running an incubator up at Hartford, we brought one of our startups in, did their machine learning analysis and it came back and said, oh, make a lot of calls in the first two months. This is a high indicator they're gonna lapse.

Okay, well. Really? So if you call, why you gonna lapse? Well, one was, didn't understand what they bought. Okay, that's typical. One of these calls were on payments. But, Moshe, it was, here's my payroll coming. I know my payroll drops on Wednesday. I want you to take the money out Tuesday. But then it's a holiday. And this thing moves. How does your system know?

Now, I bet I could have made a business case...

Moshe Golomb (13:27) Yes, I'm not surprised.

So that's a great use case. So we built for that, we built what we call communication center. So we are building for you, for example, notification. I don't know if you've seen this, but already modern companies today, even credit card companies today, they're saying your payment is about to happen next Tuesday or next Wednesday. We built this communication engine already for an insurance company. So the insurance company doesn't have to figure this out. We have already built an experience that is superior.

So we're trying to push the envelope every day with developing a new feature that matches what today's consumer is used to. For example, if your mortgage payment is coming or your insurance payment is coming this Thursday, why don't you tell the guy Sunday that this is what's gonna happen? It's gonna reduce the number of what they call chargebacks or insufficient funds or all kinds of things. It will just help the customer.

Customer signs a direct deposit, either the direct deposit kind of a, charge me every 25th of the month and forgets about it. And same thing with credit cards. So with a recurring payment. It sounds like a simple thing. It's not a simple thing. You got to take care of all the experience. You got to listen to your customer and you got to implement that into your workflow.

So just the payment itself, accepting credit card, that's not unique to us. Everybody can know how to accept electronic transactions. The question is, how do you make sure, as you said, that you optimize the workflow? And for that, we built, for example, a communication center that is completely white label. So you basically build your own branding, everything else, and you set up the amount of reminders. And by the way, after the payment is made, you send him a nice email saying, thank you for the payment. It's all part of our platform. So the experience itself is end to end. We thought about those things. Obviously we're getting input all day from clients. We're trying to implement them across all our clients.

Paul Tyler (15:38) Yeah, interesting. I think I could have made that business case right in the lapses, had I known. Now, one of the emerging, I think, opportunities here or threats is fraud. Do you want to talk a little bit about what's happening on the fraud front and maybe why it doesn't make sense to take paper checks or ACHs?

Moshe Golomb (16:04) Yeah, I think a few of the things that we are doing is, especially when we pay people, but also when we accept money, you need to make sure that people are the right people. There's no anti-money laundering, and all risk, et cetera. So you want to make sure that people are paying the right people. That's one.

So we do obviously our checks being in the banking and the financial sector for years. That's what we do for a living. So we give you another level of protection for the insurance company from compliance and risk perspective, but also paying people.

How do you know they pay the right people? So we've implemented some technologies from MasterCard, for example, that rank the payee. So the payee in this day and age can be a bot for all we know. So we have implemented a tool that ranks basically the payee. So if the insurance company tells us we want to pay or send a check even to this client, we run him through a solution that MasterCard has actually built and we give him a rank and we send it back to the carrier and say, hey, this looks like either a bot or a new email that just opened yesterday or something like that. Do you still want to make sure that you want to pay this person?

20% of the cost of insurance today is fraud. It's especially in P&C, but also in life, the same thing. You have one time that you need to pay a premium policy, you want to make sure you pay the right people.

Paul Tyler (17:28) Yeah so my open call agent asked for a check it's not gonna you know it'll probably get flagged here for you.

Moshe Golomb (17:36) Yeah, exactly. 100%. Yes, this is what the world we're going to live in. No, it's going to get even worse.

Paul Tyler (17:43) Yeah, yeah.

Well, it's interesting. I think clearly P&C fraud's a massive problem. Claims, billing, the insurance side, you're right. These are big checks flowing out typically. Death claim check, annuities, lots of small amounts but going out over time they add up to a lot.

It doesn't feel to me that the normal sort of... I think fraud is gonna be a bigger problem in life and in the space going forward. I'm always kind of shocked to see, it's almost like email chains, they're not quite email chains, but hey listen, here's the latest fraud on the medallion front. Click, here's what it looks like in the signature. It doesn't, you know, it feels like there's gotta be a better way.

Moshe Golomb (18:41) Yeah, there's in the FinTech industry, we are using technologies today with open banking. So we know when we are paying you, if it's a significant amount, when you're an ACH, there's no feedback cycle. You're sending the ACH and if it doesn't fail, it's okay. If somebody complains and says, you sent it to the wrong person, then it's bad. Now you have to chase the money.

There are tools, for example, in the open banking that you can verify that this account belongs to Paul Tyler. We can even verify that you receive the money. So if we are sending you $500,000, we might as well want to make sure it deposits in the right account. So you can implement today, it's electronic ways to do this, it's cheap. It's happening in the loan business today.

So you can implement open banking tools. That's part of our services. As I said, putting together the experience is complicated. Because this is our business, that's what we deliver to our customers kind of end to end.

Paul Tyler (19:46) So suppose, like I'm just curious how flexible this thing is. Suppose I'm getting an annuity check, monthly payment. How difficult is it for me to say, this is great, but I don't want it to land in this bank account, I want it to land in two or three bank accounts, maybe one in one state, one in another. Does your system allow for that?

Moshe Golomb (20:12) Yeah, so the way we solve that problem is we have what we call a payment link. So the payment link will send you a link or an invite through a text or an email to a payment center. In the payment center you can choose from different payment options. And the options are flexible. You can do anything — redemption to a debit card, to redemption to a bank account, to a Venmo account or whatever. And you can do split payments.

And the way we are building this payment link is that you can set up business rules as a company. So for example, you can decide the guy has to access his money within 30 days, otherwise we take the money back. So we are completely customized and also the payment rails. So you can decide to pick, that's what we call talk about payment hub or payment rails. It will allow you to choose, do you want a PayPal, a payment to PayPal or Venmo or bank account or any other third party service provider. That's really up to the insurance company to choose and it's all dynamic through APIs or through a portal.

Paul Tyler (21:14) Okay, so I have family in Latin America. I live in Miami. I want half in my Bank of America branch bank in Miami. I'd like half of this in stablecoins to my family in Costa Rica.

Moshe Golomb (21:33) We have an integration to, right now we're using PayPal, stablecoin solution, okay? But you can do this immediately in real time. And sometimes they wanna keep the money in US dollars. So we have a use case where insurance company they're paying international payments. They wanna make sure that the money is kept in US dollars. So stablecoin obviously is a great solution for that.

So you get all this package of innovation to your insurance company with no pain. That's the whole thing. Going back to where we started, those solutions exist in some shape or form in the market. How to put it together, that's where the industry failed, both the insurance industry and the payment industry failed in kind of putting this all together. That's what we're trying to solve for. We're trying to solve for that gap between what's possible and what actually is happening.

And we see in the case of Amazon or in Uber where a successful kind of implementation of execution of experience happens, just the barriers open. And the economics obviously work. So this is not new that you can save 50% at least on operation cost if your payment is more efficient.

Paul Tyler (22:50) Interesting, I guess I would really be interested in the advice, generic advice you give to people who are like, get probably in the Treasury or CFO office, I'm assuming those are typically the, are those typically the people making the buying decision?

Moshe Golomb (23:10) Yes, it depends on what side of the organization we're talking about — money in or money out. But we feel that money out is sometimes even more painful than money in.

Paul Tyler (23:20) So if I'm in a treasury department or some sort of claims payment division of a business, you mentioned a little bit about say, hey, pick a small use case. Maybe give me a recipe for like, how do I find that one use case where it's big enough that I can show returns.

Moshe Golomb (23:42) I would go back to your call center and ask him what most people complain for. Because I think that I would start there, obviously, unless there's any other obvious thing where you lose money. For example, your fraud, check fraud, checks are going to the wrong places, people are paying too late, okay?

For example, the workers' policies, they have to pay by a certain time. And if you're not, you're fined by the states. Some states' fines are up. So if you need to meet the timeline, okay, the one thing that electronic payments will do for you is we will give you a timestamp. And we manage all the reporting and all of that stuff. So maybe you wanna go there where you have a regulatory problem. You have to meet a certain kind of guidelines of payments.

So the motivation sometimes is different. It's saving operation cost, improving the customer experience and kind of go to the call center logs and see what people are actually busy with the time. Talk to your accounting department, finance department and see how many phone calls are coming around, where's my money? One of the biggest problems, where's my money?

So that's kind of what we go through with discovery conversations. Very quickly we get to the point, in some cases they know exactly immediately say, hey, we have a problem around this issue or that issue.

And remember the information is key here. So whenever you make payment, I always give an example of the Uber wait — when you call a taxi, it tells you 15 minutes, you're now nervous for 15 minutes. But Uber tells you 15 minutes, you are comfortable because you see where the taxi is. And you say, okay, I have time, I'll drink another espresso or whatever. So just having the information is a huge difference.

Going back to my tree example, if I knew exactly that the check is in the mail, the check is on the truck, the check is going to be in my mailbox tomorrow, I would be more relaxed instead of calling my agent 18 times. So that's, you know, I think hopefully that answered the question.

Paul Tyler (25:42) Yeah, by the way, my experience is Uber says two minutes and then I order it and it's like 25 minutes and they're accurate. The second time they're accurate. The second time.

Moshe Golomb (25:59) I thought the two minutes is too fast. Sometimes you have to cancel it because it didn't, you thought it was going to be — I'm, again, we are spoiled. I'm in a tri-state area here. So we're getting Uber pretty fast here.

Paul Tyler (26:10) Yeah, we are. We are.

So, Moshe, like, just curious, you know, you've been an entrepreneur for quite a long time. What motivates you? Why? This is hard. It's hard to change an industry that hasn't been changed for 150 years.

Moshe Golomb (26:28) So I think I've been successful in being part of the changing industries before. Okay, so we have changed the behavior in the retail environment. We moved from gift certificates to gift cards. When we started, there was nothing and then everybody suddenly moved to electronic cards and today everything is digital vouchers. We did the same with kind of banking down bank. So when we started that, nobody was able to kind of bank down bank.

Actually, I remember how we streamlined welfare payments into electronic payments. So we did that for a while. So every industry we go into, it's kind of the same motivation. It's just the use case is a little bit different. In insurance, it looked in the beginning like an insurmountable task. It's just too complicated. But I think the upside of that is there's a huge amount of volume. It's like the amount of money that you guys are handling.

It's too much. It's too important to too many people. So from my perspective, this is a perfect way to spend my time.

Paul Tyler (27:33) Yeah, well, listen, thanks so much for spending time here, and what's the best way for people to get in touch with you?

Moshe Golomb (27:42) The easiest thing is you go through juicefin.com or through LinkedIn. We have different plugins where you can reach out to me. Obviously my direct phone number is also everywhere. Email is MosheG@juicefin.com. So anyway you can possibly — we're not hard to get to, be approached with.

Paul Tyler (28:06) Okay, excellent. Alright, listen, thanks for the time and look forward to watching more companies come online with your, carriers come online with your product. Thanks.

Moshe Golomb (28:10) Thank you, Paul. Thank you for having me.