Scout InsurTech Interview with David Embry

David Embry is the Founder and CEO at Mylo, where he focuses on amplifying insurance solutions for companies who want to meet the coverage needs of small business owners and individuals. David was interviewed by Michael Fiedel, Founder and COO at PolicyFly and Co-Founder at Scout InsurTech.

David, what do you think is the biggest misconception the industry still has about how technology is changing insurance delivery?

“I think the biggest misconception is that it's either all technology or all not. What matters is the business outcome. Insurance is huge, and you have simple stuff on one end and more complex things on the other. It’s easier to automate travel insurance, pet insurance, and maybe auto only. But you have huge risks you have to underwrite on the other end. Smart folks in the space figure out how to add value and drive better outcomes throughout that entire ecosystem.

At Mylo, we're really focused on the smaller end of higher volume, lower premium small commercial and Main Street personal lines, so we're closer to the automation side of the equation. One of the outcomes we care about is the easiest solution for our customer. Nobody wants to buy insurance when they wake up in the morning. It's something you have to buy if you're a small business owner. You want to be asked as few questions as possible, get the right coverage, and when the bad thing happens, not be surprised. You want to make sure you're paying fair value for what you're buying.

At the same time, because we're a broker, insurance carriers are our clients too. We want to make sure they get the type of risk they have an appetite for. If you put all of those things together, regardless of how you deliver it – whether it's online, over the phone, on a mobile device, talking to a person or an AI agent – you're trying to get to an outcome that is good for all parties as efficiently as possible. There's a lot of gnashing of teeth around whether technology is going to change everything, but the expert advice should be the same regardless of how you ultimately deliver it, at least in the space that we're in.”

Where do you see companies over-indexing on technology instead of focusing on better customer outcomes?

“There’s momentum now to put insurance recommendations into ChatGPT and other AI tools. I think that will be an important delivery method. But if you look at it as a silver bullet, you're going to lose. If your entire bet is on not having a person in the middle, letting the agentic platform make a recommendation by itself and expecting everyone in the whole world to be okay with that sort of experience, I think that's wrong.

You need to figure out ways to deliver the right recommendation and match it with carriers that have appetite, at the right value, and let the customer consume it the way they want to. The pitfall – or the upside depending on how you look at it – is that if the customer could do all of that without talking to a person, it would increase your bottom line dramatically. But I don't think the world is there yet. Part of it is demographics, and part of it is simply how people want to consume things.

We use Claude, Claude Cowork, and other products in our own ecosystem to make us more efficient, but the outcome we're driving for is a better outcome for the customer. That is the focus, as opposed to saying that doing this will drive all the cost out of our business, because I don’t think the world is there yet.

Where do you see the line settling between automation and human agents in small commercial and personal lines?

“When I raised my first capital over a decade ago, I predicted it would be in the 10 to 15 percent range, and we're nowhere close to that. Part of the issue today is that carriers have to adapt. Carriers think they have differentiated products, and if you're in a multi-carrier environment, you need to be able to show across different carriers reasonable products, or at least show that you shopped different products for the same recommendation.

We used to say we're revolutionizing insurance, but I really think we're evolutionizing insurance. The advice you give and the placement you make should be consistent regardless of how somebody wants to interact with you. Think about auto only. That's pretty straightforward with some carriers. But if you want to add a house, an umbrella, some toys, it's almost impossible today from a carrier perspective, and from a multi-carrier perspective it's even harder.

The simpler the product, the more it will trend toward automation. The more risk you have, the more human involvement will remain. Two things will drive the evolution. First is raw capabilities, and second – and very importantly – is the demographic of people who want to interact and buy things that way. Trusting a non-human to recommend an opaque purchase like insurance, where the downside is either paying too much or not having the right coverage when you need it, is still a hurdle. We see people go all the way through an online process and then hover over the bind button and call us because they want to make sure.

Demographically, though, I think about my own kids in their twenties. If they don't have to talk to somebody over the phone, they never will. So it's our job to be able to deliver those recommendations as efficiently as possible and let the consumer decide how they want to interact with us. I don't think it flips overnight from all analog to 90 percent digital. But I do think it will be much greater than it is right now, and I caveat that with the fact that ten years ago I also thought it would be much greater than it currently is.”

How much of a competitive advantage comes from reducing friction in the buying process versus adding new capabilities?

“We've been working on reducing friction for a long time and it has dramatic outcomes on our business, because we're not asking people to do something we should already know. We're not asking for information that people shouldn't have to give us. If someone comes from a partner's website to ours, we're not asking for their name again when we already have it. We build integrations from our partner sites into our own agent hub, which powers everything we do and can be embedded in partner sites, so they're all sitting on the same chassis.

Even at the carrier bind stage, which is an industry limitation more than ours, many carriers make you go into their system to bind. We pour effort into simply reducing keystrokes on the front end. One of the hardest things in small commercial especially, is risk classification. The easier we can make it for a consumer or an agent to do that has huge bottom line impact in terms of volume. And at the same time, the customer gets what they want with confidence and gets it faster. We become more efficient. That's a win-win.

Sometimes it's really lowbrow, the things we're using technology to do, including the AI work we're doing with Claude inside our own system. How can we use that to make it easier for one of our agents to make the right recommendation, ask fewer questions, give a better customer experience, and drive a better outcome for that client?

On the other side of the equation, the more transformational work is taking what we think of as The Mind of Mylo, our algorithms and AI, and delivering those through our website, through agentic insurance agents, or through the mouth of someone talking to customers who has all the information on the glass in front of them. Someone who doesn't have to be a subject matter expert in everything can use that to deliver a better outcome. The True North we're driving toward is a better and more efficient experience with better outcomes for small business owners and mainstream consumers.”

What do you think every agency or carrier has to get right over the next three to five years to stay relevant?

“When I started Mylo, one of the biggest carriers came out and spent a lot of time with us thinking through what we were building, and they said they would never let someone buy online without talking to somebody first. That same carrier probably spent more money than anyone in the space to actually get there. Then COVID happened and buying patterns shifted dramatically.

I think carriers will continue to get comfortable using what we used to call big data, or AI, or publicly available information to do underwriting. They'll allow brokers like us to do more, with fewer inputs, more easily. If you're writing a $2,500 Business Owner’s Policy and you've got to call an underwriter, that defeats the entire purpose of trying to be simple. The carriers that will win will continue to invest in removing those barriers. We're even talking to Excess and Surplus lines carriers who are investing in exactly the same direction, which would have been unthinkable five or six years ago.

From a broker standpoint, I think the more ubiquitous you can be in how you take in data and deliver the right recommendations, and the more you recognize that it's not just the customer who is your client but also the insurance carrier, the better positioned you'll be. You're trying to make a match that gives carriers the risk they want, gives customers the coverage they need at fair value, and makes the whole process efficient. Being the platform that brings those things together, along with additional data inputs, is what winning looks like.

Talk to any large broker and ask them what one of their bigger operational challenges is. They'll tell you they need their people focused on the bigger accounts, but a lot of small stuff comes in because they exist. How do you make those two things work together? In our space, solving that problem efficiently is what I think winning looks like over the next three to five years.”

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