- Obie, led by Aaron Letzeiser, is modernizing insurance for real estate investors by providing tailored solutions for small residential property owners.
- Obie aims to simplify the process of buying insurance for small, residential real estate investors by offering instant issuance and convenient access through various platforms.
- Aaron envisions Obie becoming a trusted resource for real estate investors’ insurance needs, focusing on expanding services and tailoring insurance products to match customer preferences and needs.
In this episode of the Poplar Propcast’s first season, host Justin Lieberknecht is joined by tech and insurance expert Aaron Letzeiser. As one of the co-founders of Obie, Aaron leads an in-depth discussion about how his team is transforming the landscape for property owners and investors looking to protect their investments.
Aaron attended Michigan State University and worked at Y Combinator before co-founding Obie with his brother, Ryan Letzeiser. His work earned him a spot on Forbes’ “30 Under 30” list, and he was also recognized as a “Global Shaper” by the World Economic Forum.
In this insightful exchange between Aaron and Justin, who happens to own a few properties of his own, the two go through topics such as how Obie started, the current challenges faced by landlords when trying to obtain insurance, and the various age-old inefficiencies of the insurance industry that Obie aims to address.
Aaron cites different situations in the insurance industry that prompted him and his brother to kickstart Obie. Ultimately, it was a decision to streamline an industry used to outdated practices that underscored the brothers’ decision to start their company and develop a product specifically for all types of real estate investors.
How Obie started
Obie’s journey started with a clear-eyed assessment: the traditional insurance industry clung to archaic practices, reliant on paper-based processes that didn’t help anyone. In the episode, Aaron notes “…the challenge for your kind of traditional insurance space” lay in these outdated methods, where there would be many instances of back-and-forths from carrier to agent, to the client.
Another observation that motivated Aaron and the rest of his team to start Obie was that existing insurance products primarily targeted apartments and bigger commercial properties. Their team wanted to provide a solution to this issue by shifting the focus of their products and services towards small, residential real estate investors.
Fueled by the potential of technology and data, Obie aimed to “utilize the data and ride the wave of where PropTech was going” to streamline insurance procurement as a seamless step in the property investment process.
How Obie works for real estate investors
Obierisk operates as an intermediary, acting as a Managing General Agent (MGA), which means that they work to expedite the quoting process.
What sets Obie apart is its fusion of extensive real estate expertise. This allows them to craft insurance products specifically geared towards landlords’ needs, a stark contrast to many generic policies on the market. As Aaron points out, “I think that’s the big differentiator for us, is taking a lot of our co-founders’ experience and meshing it with an insurance background to build a product that truly benefits landlords.”
Obie’s core mission revolves around simplifying the insurance experience, especially for real estate investors who make the common mistake of getting the wrong type of insurance for their investments. Many existing policies are repurposed homeowners’ products, laden with unnecessary coverages. Aaron highlights, “For many, their policies were initially derived from regular homeowners’ products, resulting in unwanted coverages.” Obie solves this by offering highly customizable policies, retaining only what’s beneficial to real estate investors.
Obie also employs technology to engage clients, making the insurance selection process transparent and consultative. Clients can fine-tune their coverage choices, visualize price impacts, and gain a comprehensive understanding of the type of coverage they’re about to purchase. Aaron envisions an empowered client experience, saying, “What I want you to be able to do is get to the end of our process and say: ‘Hey, I want to toggle this on and off, I want to see what a $10,000 deductible looks like and a $2500 deductible looks like.’” For him, this approach fosters partnership, dispelling the opacity often associated with insurance.
Aaron sees this product as meeting clients’ needs at the ideal moment, simplifying insurance as a seamless step in real estate investment. “Insurance is that thing you want to set and forget, ensuring you’re protected and then move on to the fun stuff about owning the asset.” By providing a streamlined and tech-savvy platform, insurance can now be a painless step for real estate investors that they no longer need to worry about.
Advantages of Obie
As one of the first and only ‘Insurtech’ platforms, Obie stands as a transformative force in the industry. Throughout the episode, Aaron cites several issues in the industry for which Obie has specific solutions.
Customize coverage according to your needs
One of the primary benefits of Obie is that it allows property owners and real estate investors a level of policy customization that traditional insurance carriers don’t allow. Aaron discloses that many policies in the market are simply reworked versions of regular homeowners’ insurance, laden with coverages that may not be relevant to property investors.
The team at Obie approaches this matter differently by analyzing existing rental policies that are geared toward real estate investors and assessing which components they could strip away.
“So what we did is we looked at that, and we kind of pulled out the stuff that we didn’t really need, and we added in stuff that we thought was really helpful.”
For Obie, this meant omitting coverages for identity theft protection or contents coverage, which may not be risks that property owners need to be prepared for. Instead, their policies include coverage for more urgent matters, such as loss of rent. This meticulous tailoring ensures that each policy aligns precisely with an investor’s needs, enhancing both the relevance and affordability of coverage.
Generate policies instantly
Another significant advantage that Obie brings to the table? The ability to secure a policy instantly, through its website eliminates the need for back-and-forths between carriers and agents, allowing both sides of the transaction to use their time more efficiently.
At one point in the episode, Aaron humorously recalls an instance he encountered when a user on his website signed up his portfolio of 47 properties for policies.
“He was about halfway through and I sent him an email because we kept seeing him come through our system but I never talked to him. You know, he was flowing through our system throwing in his credit card every two and a half minutes and I still haven’t talked to him. He sent me an email that said: ‘Thanks! The platform works well.’ And then he moved on and that’s his entire portfolio, and he just got insurance for it in an hour total end to end for all of them. That’s the experience that people expect. Insurance is never going to be a sexy business at the end of the day, but it is that thing that prevents and causes unnecessary headaches.”
Purchase your coverage at your convenience
For Aaron and his team at Obie, operating as a partner-first company means embracing innovation for their customers because “most of the business that we get is because we embed ourselves in the exact solutions that you were just talking about.”
Also, Aaron notes that if an investor is navigating property marketplaces, they’ll be able to obtain a policy as they complete their purchase.
Obie is also available in other lender portals or tech-enabled property management tools “to alleviate the frustrations often associated with property transactions, bringing technology and convenience to the forefront.”
Obie in the next five years
Justin rounds out the episode by asking Aaron what he thinks is in store for Obie in the next five years. Aaron says he envisions a multifaceted journey. In the immediate future, Obie aspires to be the go-to resource for small residential real estate investors’ insurance needs.
“I really want to become the brand, the provider, and the resource for small residential real estate investors for their insurance needs.”
He says that the overarching goal that Obie wants to achieve is to become a resource and guide for investors and property owners who find insurance an intimidating component of their real estate journey.
Aaron’s team’s long-term goals involve expanding their services, especially to investors with multi-unit portfolios.
The ultimate aim is to continuously refine insurance products, tailoring them to what people genuinely want and need, a task made easier with the help of technology. “Let’s pull back the coverages that people don’t want and increase the limits on something else, using your premium for something that people actually care about.” In essence, Obie envisions a future where insurance becomes not just a necessity but a value-driven asset for real estate investors across diverse property types.
It’s clear that Obie is reshaping the insurance landscape for property owners and investors. Its technology-driven platform is a much-needed change in an industry that’s been plagued by antiquated processes, paving the way for a new era of ‘Insurtech’ that allows property owners to get coverage for their investments without the fuss.