Learn how Bike Owners Pedal to Protection on Chief Endurance Officer Podcast

Podcast - Chief Endurance Officer - Pedal to Protection

Greg McDonough, Chief Endurance Officer: Welcome to the Chief Endurance Officer Podcast. I'm your host, Greg McDonough. Today's guest is a passionate cyclist, a dedicated father, and a true innovator in the biking industry. After experiencing firsthand the challenges of recovering from a costly bike accident, he turned his passion into a mission.

Partnering with USA Cycling, IMBA, and USA Triathlon, his company provides comprehensive coverage to protect riders from the financial risks of accidents, theft, and more. Please welcome the CEO of BikeInsure, Buzzy Cohn. Welcome, Buzzy.

Buzzy Cohn, BikeInsure CEO: Thank you so much for having me.

Greg McDonough, Chief Endurance Officer: It's great having you on the show. As you know, we love talking about the endurance mindset.

So, to kick off, Buzzy, can you tell us how your endurance mindset has impacted your life unexpectedly?

Buzzy Cohn, BikeInsure CEO: I hate to rain on your parade, but there is no endurance mindset related to me. I had a really nice road bike that I was riding one Mother's Day with a group of five. I rode over part of a commercial truck hubcap and destroyed the bike. That was my aha moment as to insurance.

I had done all my due diligence leading up to that moment. Before getting that nice bike, I resolved coverage with my homeowner's carrier. And it wasn't until post-accident that I filed a claim. I had a three-week runaround in which I got transferred all the way up to the head adjuster of this large carrier, and he said, Mr. Cohn, you've got pioneer-level status. You've been with us for over 20 years and have never filed a claim. Thank you. I said, OK. He asked if he had a moment to provide context. I said, please. He said, first of all, you've got a $5,000 deductible. I said, process the claim. He said, hang on. He shared that if your roof blew off or your house burnt down, you would consider your $5,000 deductible inconsequential.

Correct. And I said. Absolutely. He said that if we process this one claim and you haven't had a claim in over 20 years, your one-year renewal premiums will increase between 25 and 60 percent, depending on your state. I said, process the claim. He's like, hang on. If there's a second claim within a three-year window, we're required to follow the industry standard, which would mean you would be non-renewed. I said you would cancel pioneer-level guy. He said we don't use those keywords, but you understand clearly. And what's worse is. Those are personal article claims, regardless of whether you have a scheduled rider for the bicycle, would be added to the industry C.L.U.E. report. I asked if that was a blackball list. He said, once again, we don't use those keywords, but very clearly, you understand. I asked, what's the solution? He said it doesn't matter whether you have a fine art piece, a nice piece of jewelry, or, in your case, a bike. Remember these keywords. It's the same thing. Separate or standalone. You need a separate bike insurance product for this bike. Get it off of your home insurance. So when it's on a separate bike insurance product, if there's ever a claim, it won't have any impact on your homeowner's insurance policy. So that was my teachable moment.

There was one product in the market. It was filed and approved nationwide by Markel. It's actively sold today by Velosurance and about a half dozen different agencies. And in my opinion, it was modeled very similarly to automobile insurance. However, the drawback is in the auto industry, there are VIN numbers for every automobile with a unified database. So if you or any one of your listeners ever called into a licensed insurance agent and said, I'd like an auto quote, they'd ask your name, they'd ask the VIN, and instantly, all of the variables would be populated so that the carrier could deliver an insurance quote. In the bike industry, that doesn't exist.

Most bikes have a serial number, but no unified database exists. Therefore, years ago, when I wanted to get separate bike insurance, I went to the Markel website and had to answer a dozen questions. They asked for a social security number. I thought that was invasive. They did a FICO score. I thought that was wrong. I answered all the questions, and my quote was almost as expensive as the auto insurance I had for my SUV driving at the time. So, I was quite upset and obsessed while operating a business outside the insurance industry with what I felt was a void in this large cycling lifestyle marketplace. So, when you talk about an endurance mindset, it was more of a solution-providing mindset for me. I could fix the gap in the marketplace. I'll yield to you, but that is the origin of my experience that helped me to create this product.

Greg McDonough, Chief Endurance Officer: You know, so many entrepreneurs start their businesses or journey because of that, of finding a solution to a problem they're dealing with. As you were explaining, you know, the VIN number for a car, those types of things, what came to mind was the components on the bike.

And so, Buzzy, I'd love to understand how you, as the insurer, handle the components that are part of it because the price of your bike can vary from reasonable to expensive just by your wheelset or your drive chain, or your name it. How do you incorporate those types of components into the insurance quote?

Buzzy Cohn, BikeInsure CEO: The brilliance of that question is that we all assume we own a four-letter word, BIKE, but we understand it's much more complicated. It is analogous to The four-letter word HOME. All these unique components and accessories make up that four-letter word that we ride and enjoy, BIKE. The brilliance of the BikeInsure product is that it was created by a cyclist who had an issue and then connected with an AM Best A+ Rated, Fortune 500, US-based carrier in Great American Insurance. And in that collaboration, create the bike insurance product from the ground up. There were a few pillars that were of primary importance. One was to make it fixed-priced. And I say that because, in the United States, we know that when we own a home or a car, it's a requirement, a keyword requirement for insurance. However, when we own a bike, it's an essential need. It's like elective insurance. Fundamentally, when I was creating this product, I assumed that nobody who owns a bike in the United States knows that bike insurance is a thing, understands the essential need for a separate bike insurance product to offset the financial risk exposure of owning what you refer to as a bicycle and all of the non-stock attached accessories and components that can become quite costly. Therefore, BikeInsure created the first fixed-price yet comprehensive bike insurance solution. What is it? At enrollment, it covers the bicycle's make, model, year, non-stock listed, attached accessories, and components. Sometimes, a customer, an insured individual, will buy a stock bike. They put in the make, model, and year, and they're done. Others will have what they may refer to as a frameset. I've had some customers put 30 to 50 accessories, make and model line items of that category that make up the totality of their bike. Fundamentally, every policy we issue aims to provide them with comprehensive coverage for the blueprint property of the bicycle they own. And we do that.

Greg McDonough, Chief Endurance Officer: In doing that, are you working directly with the consumer, bike shops, or the manufacturer? How are you getting this message out?

Buzzy Cohn, BikeInsure CEO: So the question is two parts. It is a consumer-facing product. All of my professional experience before Bikensure had been from commercial business to business. In the BikeInsure business plan, the objective was a product optimized for a bike owner's instinctual conversion. They see a well-branded, intelligible product, Bikensure. It makes sense. I need it. And in two minutes, I can enroll for it. However, the objective of Bikensure is to work with each of the companies within the categories of five or six distribution channels that I've mapped out that would achieve the objective of meeting every adult in the United States who owns a bike where they desire to procure their favorite cycling goods and services. So, when we talk about BikeInsure, it is the official bike insurance of all five large cycling trade organizations in the United States. That is accomplishing an objective when BikeInsure is the official bike insurance partner of USA Cycling, IMBA, which is the International Mountain Bicycling Association, USA Triathlon, the League of American Bicyclists, and Adventure Cycling Association so that their members essentially authenticate the bike insurance offering that they're introduced to in their membership forum.

Then, they can come to the BikeInsure property, research it, and be convinced of what they are signing up for when they deem it appropriate. And then what BikeInsure does is render the white glove service. We intend to provide each of those enrolled customers with a welcome call so that we can thank them for their enrollment and, more importantly, help define what they've signed up for. So they understand what they have and essentially, as part of the BikeInsure family, become our greatest bike insurance sales advocates.

Greg McDonough, Chief Endurance Officer: And it sounds like they start building a community, right? As they communicate this with their colleagues and riding buddies, that grows. You're almost creating a cyclist community that believes and values the bicycle insurance product.

Buzzy Cohn, BikeInsure CEO: Exactly. And the insurance product is highly regulated. The individual that you're talking to has 102 insurance licenses. I've got 51 individual property and casualty, along with 51 business property and casualty for BikeInsure. The product by Great American is filed and approved in all 50 states plus Washington, DC, and BikeInsure is the producing entity of the product nationwide. The greatest challenge of a business is the start of building that community. However, from the consumer standpoint, it doesn't matter that BikeInsure has been in business for several years, and maybe not several decades, because the bicycle insurance product is filed and approved in each state. So, the carrier that's been in business for over 150 years guarantees the one-year policy that BikeInsure has offered. When I say it's guaranteed, that's the brilliance. There's no other product in the marketplace that has that assurance.

Greg McDonough, Chief Endurance Officer: So simple, right? But what are you seeing as the barriers for a cyclist like me to go ahead and purchase bicycle insurance?

Buzzy Cohn, BikeInsure CEO: As a business owner and creator of a product, I aim to eliminate those consumer barriers. There are certain things that BikeInsure does exceptionally well. When an adult owns a bike in the United States and is looking for comprehensive coverage with a $100 deductible when riding a bicycle for unexpected and transit accidents and may desire theft protection. For example, when the bike is secured and stolen, there is a $250 per occurrence deductible. For bike and e-bike insurance in the United States, BikeInsure is peerless. If there are certain things that somebody is looking for, like they want coverage on their kit if it gets damaged in an accident while riding, that's not something that we do. We offer coverage for the bicycle property.

We are BIKEinsure. If you want coverage because you get the sniffles and can't make it to a triathlon that you've paid a couple hundred dollars for. That is not something that's included in our coverage. If you break down on your bike and want to get home, that's not something we cover.

Once, I rode over tar on the road just as I crested a hill and pulled apart the entire rear wheel tire. It was not repairable. I tapped Uber black, and the largest SUV I've ever seen appeared four minutes later. He pushed a button, and all the seats went down in the cavity of the SUV. My lovely carbon bike lay down, and we had a relaxing ride home. That was something that I paid for separately. When you're looking for comprehensive coverage for your bike, BikeInsure is the solution.

Greg McDonough, Chief Endurance Officer: A hundred percent. I had that similar Uber ride last training season, but that's another story. But I'd love to go back and tell the audience the story of your business planning process. You know, you had the issue. You're looking for a solution. You got frustrated with what's out there.

Like what was, from the entrepreneur's journey perspective, tell us, walk us through that story. How did you go from ideation to starting the business, finding the insurance carrier, and ultimately finding partners? Please give us some of the stories of your entrepreneurial journey.

Buzzy Cohn, BikeInsure CEO: I overlaid the BikeInsure business plan with a previous business that I had success with. When I left corporate America, I departed to start my own business. It was a private labeled electronic messaging services product. I was reselling vendor services under the private label of the brand, and at that time, I felt the gap in the marketplace was the effective sales and marketing of the product, not the product. I thought that if I resold vendor services, selling and managing effectively would help me scale and derive a great income. And when I saw the void of bike insurance in our cycling lifestyle marketplace, I thought I could overlay that practice here.

And how is that done? So when I say I resold vendor services, I looked at an insurance carrier being vendor services. So, Great American Insurance Company is the paper underwriting the product.

And what am I doing? I'm doing what I do best. I'm selling and managing the process. So essentially, I overlaid those business practices with BikeInsure, and it's a matter of having a plan and executing excellence. It's not for the faint of heart. It's not a simple Shark Tank pitch. It is very nuanced and requires great discipline and fortune because when you start and operate a business, you either rely on employees or contractors or sometimes both. You don't have control over everything. You need to have good fortune regardless of the due diligence and the deliberation you go through sometimes. You're not perfect in your selection to fulfill aspects or nuances of the business, and you have some losses and some great wins. Ultimately, when you hold discipline to a well-written business plan, you can have a good foundation of business that is built, measured success, and then achieved scale.

Greg McDonough, Chief Endurance Officer: As you've been growing the BikeInsure business, is there anything unexpected that pops up positively or negatively?

Buzzy Cohn, BikeInsure CEO: No, but when a contractor goes dark on you, and five figures have been capitalized in the line item initially, that's problematic. So when you say unexpected, I hate to answer the question, no, and to assume that that could have been expected, but they're all teachable moments. You never wire somebody a deposit. Instead, you pay by credit card, so there's protection. But these are all nuances that are hopefully learned over time and shared with others. Interestingly, I've also engaged with small-scale yet very talented freelancers. I've educated them on their best practices: to take a 50 percent deposit and accept it via credit card to protect both the contractor and client.

So, the greatest challenge of this product is that it is a non-tangible value-add. So when you talk about bike shops, very candidly, we would assume bike insurance. Cycling consumers would be the most natural fit. Who would not sign up for bike insurance that's buying a bike? It makes no sense. But bike shop proprietors typically do a very good job selling hard goods. Hard goods often have a reasonable margin for the retailer. This bike insurance is truly a value-add that should be introduced to their customer.

What are Bike Shops doing? They're using bike insurance to contribute to their profitability from a consumer standpoint. And most important, bike insurance helps their customer sustainability and satisfaction. Because think about it: if you go out and you spend a thousand, $3,000, $5,000, $10,000, or whatever on a bike, and you're unaware of separate bike insurance, and two months later, two weeks later, sometimes the consumer's paying no interest for a year and 30 days into their payments, one month, one payment, wrecked their bike or the bicycle or ebike gets stolen resulting in a complete loss. And they walk back into the bike shop in tears. I've got no coverage. What do I do? Whereas for example, Cadence Cyclery in Texas had their first 50 referrals that signed up for BikeInsure, five customers had accident claims.

Greg McDonough, Chief Endurance Officer: Wow.

Buzzy Cohn, BikeInsure CEO: Five of those customers had costly damage. However, each one of those customers paid a $100 BikeInsure deductible. Cadence Cyclery had almost $20,000 in highly profitable service as a result of the partnership relationship. So, it's value-add.

Greg McDonough, Chief Endurance Officer: $100. Yeah, I could see that. You almost hope that it turns into the Apple model where you're buying your iPhone as you are at the checkout with the sales rep, and they say, would you like to insure this? And it's a yes or no. And it gets added to the bill and registration happens. Is that the future of bike insurance?

What you're hoping for.

Buzzy Cohn, BikeInsure CEO: That would be most ideal, however, in the United States. Insurance is highly regulated. There are certain insurance carve-outs, and the smartphone is one of the few. So when you buy your smartphone, and you're in a Verizon store, there's a carve-out for a mobile phone. And for airplane tickets, it applies; however, with bike insurance, that cannot occur. Bicycle Insurance must be sold by a licensed insurance entity, like BikeInsure. So with the partnerships, what we do is we have them market and promote BikeInsure. And there's a tightly integrated way for the customer to end up at the BikeInsure co-branded property, which, when they enroll, is done correctly.

Greg McDonough, Chief Endurance Officer: Certainly. Buzzy, I'd love to have you tell the audience a little bit more about you. I mentioned at the beginning that you're a passionate cyclist. Talk to us about how you got into cycling, you know, give us a little bit of your history.

Buzzy Cohn, BikeInsure CEO: I started riding a nice bike about 20 years ago. And I remember Googling bike ride. And the first thing that came up was Philly Livestrong, meaning Livestrong in Philadelphia, Pennsylvania. I thought to myself, Hmm, I'm going to click on this. It was a fundraising ride, and it was in two and a half weeks.

You had to raise $500 to participate. And my mom had died of cancer. And when my mom died of cancer, when I was in college, it was a very private matter. There was the doctor, there was the family, there was the patient. And nobody talked about the issue. Nobody shared information. So when I looked at this Livestrong ride, I thought to myself, wow, this is interesting. These people at Livestrong are raising money for cancer survivor programs. I'm thinking to myself, cancer survivor programs didn't exist when my mom was being taken by cancer. So, I signed up and raised $2,200 in two and a half weeks. I went to Philly Livestrong, and when I arrived, there was a Livestrong Village. It was almost like an out-of-body experience, and I hate to get emotional, but it was the first time in so many years that I felt that there was a place for somebody who was impacted by cancer. I mean, I didn't die. But it impacted my life. And when I saw what these people were doing in cancer survivor programs, they were everywhere. They were providing assets and tools for those who had cancer and the families who were impacted to navigate their way through that journey effectively, and it was compelling to me. So I decided when I got back home that I would be creative with fundraising, and I ended up participating in that for three years, raising over $60,000 to help fund cancer survivor programs in memory of my mom. And then, I was asked by the organization to be a volunteer cancer lobbyist for One Voice Against Cancer on Capitol Hill.

I live just outside of Washington, D. C. So I've participated in that. That's a beautiful thing. It's fascinating that you used the "community" keyword. There are so many unique communities for everybody. Regardless of your interest, there are many uniquely special cycling communities. And the cool thing about what BikeInsure is doing is that it is a solution that's offered to every one of those individuals in each one of those communities. And I'm telling you, it would give them peace of mind ownership of their bike while participating.

When I say participating, I reflect on Philly Livestrong and the additional years I went to Austin, Texas, for the Ride for the Roses. The fascinating thing is that although those are single-day events, those participants train on their bikes as though those events are their Tour de France.

So what are they doing? They're not only participating in that single day event, which has meaning, but they're training monthly, weekly, daily, obsessively, for fun. And every time they're on the bike, what could happen? They could hit a stick, a bump, a hole, and unexpectedly, there's a costly accident. With BikeInsure, a $100 deductible gets your bike back on the road. All new OEM parts, labor, and tax at your local bike shop. It's not complicated.

Greg McDonough, Chief Endurance Officer: That's such a powerful tool, Buzzy! If an audience member wants to contact you and learn more about BikeInsure, where should they go?

Buzzy Cohn, BikeInsure CEO: BikeInsure.com. That is B I K E I N S U R E .com‍

It's all right there.

Greg McDonough, Chief Endurance Officer: And we'll certainly,

Buzzy Cohn, BikeInsure CEO: To sign up, click Get BikeInsure using the big red button. Once again, there's really nothing that a customer can do wrong because BikeInsure reviews the enrollment application virtually real time. We call to welcome each customer. If there's ever something we see not listed in the accessories, like a bike, but no pedals are listed, we help correct that.

Well, there's no bike that comes with pedals. So that's a non-stock-attached accessory. We make sure that the policy application is dialed in so that when we generate the unique policy for the customer, the bike or e-bike is good to go.

Greg McDonough, Chief Endurance Officer: That's super helpful. So, Buzzy, thank you for your time today. We'll put all those links in our show notes so audience members can click right through to get to BikeInsure. Truly, thank you for your innovation. When you and I connected a few weeks ago, I had no idea about bike insurance.

That this was a thing and you're changing my life. You're changing how I ride. I'm going to be riding now with a little bit more peace of mind. Audience members, if you got some value from the show, please like it. Please share it with your community. Let's get this message and this peace of mind into the hands of those of us who are on our bikes.

Again, Buzzy, it's been great having you on the show.

Buzzy Cohn, BikeInsure CEO: Thank you so much for your time. I appreciate it. And I welcome your audience to bikeinsure.com.