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Transcript

A Podcast | Eric Wetherington:

This transcript may contain errors.

Pete Neubig:
Welcome to the NARPM podcast, and thank you for joining us today. How are we may be listening? Iheartradio, iTunes, YouTube or through any of the podcast platforms, thank you for being here. I'm your host, Pete Neubig, and we have another great show today of Eric Wetherington with Renters Insurance Solutions. Today, we're going to discuss the different types of insurance solutions for property managers focusing on the security deposit replacement insurance. So Eric is an NPM RMP. He's the vice president of Strategic Initiatives for Pure Property Management and the founder and CEO of Renters Insurance Solutions. Eric has over twenty-five years of experience working in various aspects of the insurance industry and with the NARPM national president in 2019. And I was honored enough to serve under him as the regional vice president in 2019, while Eric was the president for NARPM. And Eric was the CEO of New Heights Property Management located in South Carolina. And one of the things about Eric is he has a heart of gold and he is a giver by nature. And I say this because Eric was one of the first few people I met when I joined NARPM. And like in the first phone conversation, I have somebody come over to his place in South Carolina to fly out there from Houston.

Pete Neubig:
And if I could just see how he runs his business. And Eric was like, When do you want to come? And not only did I show up with my business partner, but he then had a whole day scheduled out and he had every one of his people come and spend a little bit of time with us, which I thought was just amazing. That was back... Eric, I think that was at 2013. When I did that I was just starting out. I didn't know anything from anything. And now I am the voice of NARPM. So go figure that out. Anything is possible, people. So I look forward to speaking with Eric here in a few minutes. But now it's time for the hot topic. The hot topic of the day. So because I have Eric on and... Eric has an incredible... he has a class that he teaches at NARPM. He has taught this at NARPM, and he has actually taught this at Real World about KPIs and about knowing your numbers as a business. So I thought it would be nice of me to get on my soapbox and talk about... When I talk to all these business owners, it's amazing, how many of them do not know their numbers, they don't know what numbers to track and then the numbers that they should be tracking.

Pete Neubig:
They don't even know. They don't track them. And I'm like, How in the world can you run a profitable business if you do not know the numbers that you're supposed to be chasing and that you're making sure that you're hitting those numbers? So. You know, when I ran Empire the first year or two, I was just like that, I had no idea what I was doing. I wasn't looking at numbers and amazing, we weren't making any money right? Or we just weren't. We didn't have that North Star. We weren't going where we wanted to go. So I implore all of you, if you do not have a bunch of numbers that you're looking at, you should have your numbers for your business. So there should be about three to seven what we call key performance indicators, KPIs, and then everyone in your organization should have a number. So like, OK, Pete will give me an example. All right. Well, I'll just give you some numbers that Steve and I looked at Empire. We looked at the number of leads and the number of opportunities which they weren't. We had a distinct definition of what a lead was, what an opportunity was and then the conversion rate.

Pete Neubig:
We want to know our cost per lead and opportunity. We'll know how many doors we gained, how many doors we lost and the number of doors we had per employee and the cost of payroll per door were some of the numbers we looked at. And so we looked at our numbers weekly. And then there were some quarterly numbers that we looked at and obviously, there was some yearly numbers we looked at. But if you look at it on a number one time of year, I mean, you're not really tracking that number. So what? We like the weekly numbers and then the quarterly numbers or the monthly numbers, I should say. And then we gave everybody an organization, every job rule, so it wasn't per person per job rule had a number either one to three KPIs, and if one person had way more than three, if they had eight nine key performance indicators, that job was too big and we need to cut that job down to two or three. And so this early on, our property managers had like 11 KPIs, and I'm like, OK, there's no wonder when everything is important, nothing is important. And so we made sure that everybody had numbers were easy to report on and we had a weekly meeting.

Pete Neubig:
And if a number wasn't hit, we had to determine, is it an issue, a challenge that we had to go and do something about? Or is the number just are we not, you know, is the number not correct? Like meaning was a number, just not. We're never going to hit it and we need to readjust the number. And that's OK if you have the need to readjust the number. But people, please make sure you go out there and start tracking your data and start knowing your numbers, because if you don't, you don't know if your team is doing what they're supposed to be doing because they have no idea because they don't have a number. And then of course, you have no idea if the business is supposed to be doing what it's doing because it doesn't have a number. So that's my rant of the day. And now we're going to have our interview with my good buddy, Eric Wetherington, CEO and co-founder of Renters Insurance. So Eric, tell me... well, first, this is a normal podcast, and I want people to understand how important NARPM is not to my life and to my business. So tell me how NARPM impacted your business when you were with New Horizon.

Eric Wetherington:
So, Pete, we started our property management company, New Heights Property Management, back in late 2008. And, you know, I had a lot of experience starting companies and doing things like that, so I knew the importance of business and all those things, but I really didn't know a whole lot about property management, to be honest with you. And so I began searching almost immediately for some group of people that got together and shared ideas about property management and I looked and looked and it honestly took me several months before all of a sudden I stumbled across NARPM's website. And I found them. The closest chapter to me here in Charleston, South Carolina, with Atlanta, Georgia. And so,

Pete Neubig:
Not so close.

Eric Wetherington:
Not so close, right? About four and a half-hour drive away. And so I picked up and made a point of driving to Georgia for the next chapter meeting and drove all the way to Atlanta, spent the night there, met some just fantastic people that are part of NARPM, really, all over the country. And of course, I didn't know that at the time, but... and those people just kind of took me in and started sharing information with me and open themselves up to me, visiting their offices and calling them with questions. And that was really how I first got into NARPM. And I tell you it, it wasn't long before I realized that the value that NARPM and those relationships that I made with people that I met at NARPM just had such a great return on my investment... in my business that, you know, I had to tell other people and ultimately had to give back to NARPM and to the great folks that were part of NARPM. And that's what eventually led me to getting into NARPM leadership at a national level.

Pete Neubig:
And now there is a chapter in Charleston, South Carolina.

Eric Wetherington:
Now there's a great chapter in Charleston. And I'm glad that I was able to be a small part of seeing that getting started.

Pete Neubig:
Eric, we lost you there for a second. So, now there is a chapter in Charleston, South Carolina, and then you said, and then we missed you for a second.

Eric Wetherington:
Yeah, Pete, there's a great chapter here in Charleston, I'm glad that I was able to be a part of seeing that chapter get started, and it's a great chapter and it has a great board and a great group of folks here that get together and share and help each other.

Pete Neubig:
And that's the one thing about NARPM... I think it's different from any other organization. It's that the people that are part of the organization are so willing to give back. And so if you're thinking about joining NARPM, it's highly recommended. Like Eric said, it gave him a return on his investment, and it gave me a return on my investment as well. Without NARPM, I never grew Empire. I don't know what the heck I'm doing, I'm probably like sued and I'm probably out of business without NARPM. So, Eric, you ran a great business and I know you merged with Pure just recently, so congratulations on that.

Eric Wetherington:
Thank you.

Pete Neubig:
So tell me why start renter's insurance solutions?

Eric Wetherington:
Well Pete, that's a great question, and one of the things that I noticed, you know, as we were on our journey with New Heights Property Management was that trends that were prevalent in the multifamily space eventually made their way to the single family marketplace. And a lot of people were renters in apartments before they became renters of single family homes. And so there was a definitive tracing of being able to look at new trends and new things that came into the single family business that started in multifamily. So a couple of years ago, my daughter, who was a senior in college, needed to do an internship. And so she applied and landed an internship at the Charlotte Motor Speedway in Charlotte, North Carolina. And in order to move to Charlotte, she needed an apartment, a place to live, and so she went and applied for an apartment. Now my daughter is a twenty-one-year-old college student. She had no debt. She had no credit card. She had no credit score. And she had no job. She had no income. And this internship was going to be an unpaid internship. And so she went and applied for an apartment, and it was going to be around $1250 a month for the particular apartment that she applied for because it was a short four-month lease. And so she told me, "OK, dad, I applied for the apartment" and I said, "OK, great." I said, "Let me know when I'm going to be getting my link to the co-signers application." And she goes, "Oh, no, dad, there's no co-signer required." And I said, "Really?" I said, "Well, then how much security deposit am I going to have to put down for this apartment?" Because I was thinking, You know what, I'm going to have to pay the full thing in advance or what is the deal here? And she said, "Oh no, dad..."

Pete Neubig:
Yeah. You're deposit's one year of rent in advance.

Eric Wetherington:
Yeah, exactly, for a four-month rental. And so I said, "Well, then how much security deposit am I going to have to put down as I paid for this apartment?" And she goes, "Oh, no, dad, there's no security deposit." And I said, "You better send me that lease for me to look at because it doesn't sound right at all to me."

Pete Neubig:
Too good to be true.

Eric Wetherington:
And so I read through that lease. And sure enough, this apartment complex renting to a 21-year-old college student who has no income, no credit score, and they don't require any security deposit and they require no co-signer. And I said, this is crazy. And I said, if they're doing this, in an apartment community in Charlotte, North Carolina, just a few hours up the road from me here in Charleston, I better be figuring out how I can do something similar in my market here to offer for my single-family properties that we manage because people are going to be leaving those apartment communities and coming to the single-family rentals, and they're going to be expecting the same type of programs. And so that was really the impetus for me figuring out how we could offer a security deposit replacement program and bring that to the single-family space.

Pete Neubig:
Nice. And I want to dive deep into that because when we were talking, when you first started this concept, that was the one that was really... I'm like, this is amazing. I gotta learn more about this. So I want everybody to learn more about this as well but tell us what other programs or other pain points your programs solve for property managers.

Eric Wetherington:
Well, the pain points. I mean, you know, everybody is offering some form of a tenant legal liability program or requiring, in many cases, tenants to have tenant legal liability. In some cases, companies are requiring their tenants to have HO4 or a full renter's insurance policy. So there's a lot of property managers out there, you know, promoting these programs or telling tenants they have to sign up. That they have to get an HO4 for they have to sign up for tenant legal liability or maybe offering some type of a security deposit replacement program. But those property managers aren't able to share or benefit in the profits from the premiums that are paid every month by those tenants. And that's because in most cases, property managers are not licensed insurance agents, and the structure of the programs that they're offering is are not structured in a way that allows the property manager to benefit. And so that was another key component. If I was going to do something, I wanted to offer the insurance products that the property managers were accustomed to requiring their tenants to be involved in, and also the new product like the security deposit replacement product, but also make these programs be able to be offered in a way that was compliant for the property manager to participate in the profits from those premiums.

Pete Neubig:
And that is the hook right there.

Eric Wetherington:
Yes.

Pete Neubig:
So every time... I know when I was a property manager, right, I'm looking at everything and I'm like, OK, I want to win, win, win. I want to win for the owner, right? I want to win for the resident and I want to win for the property management company. If the owner gets a win, the resident gets a win. But all it does is cost me a bunch of time and energy and effort. And there's no, you know...it either has to give me some money, has to make me money, or it has to make my life much easier.

Eric Wetherington:
Right.

Pete Neubig:
Right. It has to be one of those two. In this case, you're actually offering both. You're actually offering...

Eric Wetherington:
Correct.

Pete Neubig:
It's a lot easier. And you're offering some commission structure on the back end.

Eric Wetherington:
That's correct. And it's really it's different than the commission structure. It's actually a share of the profits.

Pete Neubig:
Profit-sharing. Okay. Sorry.

Eric Wetherington:
Yeah, it's profit sharing. So it's a partnership. And so the property manager gets to participate in the profits of that partnership. So you look at the security deposit replacement, I mean, think about a tenant right now, you know, typically a tenant has to come up with before they can even think about moving into a property. They have to come up with a first month's rent. They have to come up with a full month of security deposit, in some cases a month and a half or two month's rent for a security deposit. So now we're at two to three times the rent upfront.

Pete Neubig:
If you have a pet...

Eric Wetherington:
Then there's a pet fee, then there's utility hookup fees

Pete Neubig:
And then there's also maybe a lease processing fee, sometimes, right?

Eric Wetherington:
Lease processing or admin fee. There's other fees. And so tenants are having to come up with literally thousands and thousands of dollars before they can even move in and have a place for their family to live. And so that's a strain on tenants. And you know, we see nationally, the trend is right now, I think over a third of the states around the country have either passed legislation already or there is legislation being considered or pending that would make it favorable for those states to offer some type of security deposit replacement program. So, there certainly has been an awareness in many states and in some cities as well in municipalities that are saying this is too much, there's too much money that a tenant is having to come up with. And so we need to encourage landlords and property managers to offer different programs. So that's where the tenant wins because in a security deposit replacement product, they don't have to come up with all of that security deposit up front. They can pay a small monthly insurance premium and then then the landlord is protected in the event that there's damage or unpaid rent at the end of that lease term.

Pete Neubig:
So let's talk a little bit about that in a second, but I do want to bring up. I'm everything is going the way of no more upfront fees like I always look at the technology industry. I can't buy QuickBooks anymore for whatever, $500 and then, you know, have a yearly subscription. I can only buy it now for twenty-nine dollars or forty-eight dollars a month. I remember when buying a car, they used to ask you, what can you afford? Everything is built based upon your monthly payments, and I think we're the last industry or one of the last ones that are having all this money come up front. And so more and more people are like, I want to pay a monthly fee. I don't want to pay an upfront fee. And what I found when I did the math. That if you charge monthly fees, typically we make more money because the upfront fee maybe only gets you for a year at least, but most people are staying in the lease three years and you're missing out on some of that income and for and for the resident, they're paying a lot less money upfront, so your barrier to entry is less so. So then you get to rent your places quicker, which is when the one time the employer or the owner fires. You typically is when you can't get the place rented, right?

Eric Wetherington:
Right.

Pete Neubig:
And so if you get these things rented quicker. So let's say I'm a property manager and I'm listening to this and I'm like, Oh my goodness, this sounds great. Take me through the steps of how I would not just sign up, but how do I implement this? Moving forward, Do everybody? Let's walk through those steps?

Eric Wetherington:
Well, I mean, to implement the program, there's a couple of things you can do. Certainly, you could start by offering it to all new residents, new tenants that are coming in signing a new lease. You know, we provide documentation, the lease addendum. We provide an explanation of benefits of coverages for the program because again, the property manager is not a licensed insurance agent, so they can't talk about those things. So we provide all the documentation. We work with the property...

Pete Neubig:
Do we have to offer a security deposit for a new resident coming in? Like, is it like, Oh, you have to only take this program or if they want to pay a security deposit, do they have the option to do that?

Eric Wetherington:
Well, remember, you can't force someone to take an insurance product that you're offering. So you have to offer an option? Yes. And so we certainly recommend offering the option of a full security deposit, whether that's one month's rent, one and a half month's rent, two months rent, whatever that would be. Or there's an insurance product for a nominal monthly fee that can take the place of your traditional security deposit.

Pete Neubig:
Now, does their credit determine how much I'm going to pay for my premium or how does that work? How does the property management company know what to charge?

Eric Wetherington:
So we wanted to make this simple for the property manager. And again, you know, renters insurance solutions. I mean, myself, I can see the idea. I brought in some partners Greg Doering and Jeff Doering from GDAA Property Management down in Round Rock, Texas and we really... So as property managers and property management professionals, we really wanted to make this simple for our clients on the insurance side. And so we said, what are some of the other companies doing that are that have these products that are, you know, position themselves as security deposit replacements? And a lot of those companies require the application to be sent off to them to be reviewed so that they can then determine what the insurance premium is going to be and all this stuff. And we said that's too complicated, that takes more time. And so what we do is upfront, when we are talking to a property management company, we ask them to provide us with the last three years of information from their portfolio on their security deposit dispositions. And so we review that information and then we give the property manager a rating based on what they've been doing. And then that rating coincides to a fee scale, a schedule of premiums that they will charge to all of their applicants. So it's very simple for the property manager.

Pete Neubig:
Great, so if I have some A-Class homes and some D-class homes, am I still charging the same premium across the board, or do I have the flexibility as the property management company to change the premiums? Like Do you give me a range? Or...

Eric Wetherington:
Absolutely. We give you some flexibility. We set, what the minimum is for you and we give you some flexibility or some guidance as to what you can do if you have a non-conforming tenant or a non-conforming application. We give you some guidelines as to what you can do within the premiums that are filed to collect more premium in those situations. So absolutely. Yeah.

Pete Neubig:
So the win for the resident is, I come up, come out of pocket less money, and I'm paying this basically monthly fee to have security. To win for the property managers, I'm going to be part of this bonus structure or this profit-sharing, and I'm also going to cover this house through this premium. So take me through what's in it for the owner?

Eric Wetherington:
Well, certainly here's a couple of things that are in it for the owner. As you alluded to earlier, Pete, the owner doesn't want vacancy. They want a tenant in place. They want a tenant in there as quickly as possible. And so anything that we can do to reduce the burden on the tenant, bringing in a lot of money up front, we have a better chance of renting that property faster. And so that's one definite benefit to the owner. Another benefit to the owner is on the back side of the scenario, you know, in a case where a tenant leaves and there's unpaid rent or there's damages or things like that, and they've been paying their insurance premium all along. Well, if that tenant doesn't immediately, you know, come out of pocket and pay the damages that they've incurred, then the property manager can immediately file a claim against the policy. And within 48 hours, we'll have money in the property manager's hands that they can use to make repairs, make good... On the obligations under that lease, up to the coverage limits in the policy. And so the owner isn't having to wait for a length of time, for there to be, you know, money recovered. And so then that can help their property get ready faster, get turned around faster so that they can move on to the next tenant. So there's another advantage there to the owner.

Pete Neubig:
And potentially less out of the pocket for the owner.

Eric Wetherington:
Right.

Pete Neubig:
If we're chasing the money from the resident, the owner has got to cover those funds.

Eric Wetherington:
Right.

Pete Neubig:
Now, is it true that you can actually...like, let's just say I had a $1500 deposit that I would normally take, but I can go ahead and... with this insurance premium, I can actually insure for almost double? So I can the insurance claim would be less, but I can insure it for $3000 is that a possibility as well?

Eric Wetherington:
That certainly is... again, each property manager and we give the options to the property management company as to how they want to roll that out and work that in their market. But that certainly is an option. They can choose to have additional coverage on the property, which again helps the owner if instead of, you know, instead of one month's rent and security deposit. Now maybe the premium that's charged to the tenant will cover one and a half months or two months.

Pete Neubig:
Right. So it's another way to market to your owners that we get two months rent, but we also get you a place rented quicker because we're on this monthly premium.

Eric Wetherington:
That's right.

Pete Neubig:
Take me through... So let's say the resident has been there a year and now they're going to move out. So they've been paying their premium all year. So let's go before that. What happens if they stop paying the premium and they're only paying the monthly rent? Because I'm assuming that for most managers, we're going to have a separate line item in our books. Right. So it's going to have rent at $1500, let's you say, and then insurance premium at whatever, 30 bucks. I'm just throwing a number out there and then... Are we getting a monthly invoice from resident insurance, your company insurance?

Eric Wetherington:
Right.

Pete Neubig:
And I'm paying that monthly invoice, right?

Eric Wetherington:
Correct.

Pete Neubig:
Which 99% of the time, no problem because the residents are paying their full amount. Now what happens if a resident does not pay their premium? Is the manager stuck with it? Or do we just then terminate? Like how what's your recommendation on solving that challenge?

Eric Wetherington:
Well, in that case, there would be a lease violation because there is an addendum to the lease that states that the resident as 'selecting' this program in lieu of upfront security deposit a large sum of money. And so then there would be a lease violation. And so that should be handled by the property manager, just like any other lease violation situation that would be handled. And so they could they can take the next month's rent, apply that to outstanding charges, which in this case would be the outstanding insurance premiums because they want to make sure that that policy stays in effect, of course. And then any money that's left over is applied to rent last. I know that's how we do it at New Heights. Depending on how your lease reads, you need to follow what your lease says or what your state laws are. But you know, so that would be the way to do that or to perhaps even, you know, have to take the step to say, OK, if you're not paying the total charges that you're responsible for the tenant, then we need to take further action, which could be eviction,

Pete Neubig:
Right. Now, can we cancel that policy from them if they stop paying it? Or would that be something that we don't we...

Eric Wetherington:
Yeah, you wouldn't want to cancel the policy in the sense that, because you don't have a security deposit on hand. And so if you cancel the policy, then you've got nothing.

Pete Neubig:
Right.

Eric Wetherington:
So you don't want to remove them from the protection under the policy that's there.

Pete Neubig:
So do you find that most of your.. and I know we're talking about the one percent guy, so I'm not trying to scare anybody from this...

Eric Wetherington:
Right.

Pete Neubig:
But right now, do you find that most people just charge the owner of that premium if it's not being paid so that the owner gets the coverage that they're supposed to get because this has gone? Obviously, this will be going towards an eviction, right?

Eric Wetherington:
At this point. What we're seeing is kind of more what I talked about, which is, you know, applying any new monies that come in towards the most outstanding payments that are responsible in due. I haven't seen any cases yet where anybody's charging an owner.

Pete Neubig:
Yeah, because it doesn't really happen very often.

Eric Wetherington:
Right.

Pete Neubig:
Ok, so now Pete, the resident has been there a year. He's been paying his monthly premium and now Pete, the resident moves out and everything is fine. There is no, you know, there's maybe, maybe there's some cleaning that we need to charge back. Take me through that process.

Eric Wetherington:
So what the property manager would do would be to go out there and see that there's some cleaning that needs... Maybe Pete didn't follow to move-out instructions. And so there's going to be a $150 charge for cleaning.

Pete Neubig:
Yeah, Pete doesn't follow any rules.

[Laughter]

Eric Wetherington:
You said that. not me, Pete. And so then in that case, then what we would ask the property manager to do is send a demand letter to Pete that just says, "Hey, Pete, you know the terms of your lease say that you would you agree that you would follow the move out instructions when you moved out, you didn't follow those instructions. And so you owe one hundred and fifty dollars" and then give Pete three days or five days to comply by sending the property manager that that fee. If Pete doesn't send that fee, then the property manager can file a claim against the policy. The claim packet is sent to us and then within 48 hours, we would fund the claim back to the property manager so the property manager would get their money within 48 hours, two business days of filing that claim. And then what we would do on our end is then we would reach out to Pete and we would say, "Hey, Pete, remember that property that you left and that you didn't do all the cleaning? You still owe $150 for that. We really don't want to send you to collections, so we'd really like you to send us one hundred and fifty dollars." And then if Pete doesn't send one hundred and fifty dollars to us as the insurance company, then we would send it off to collections and then Pete would go through the collection process. Now the beauty of this, the beauty of this,

Pete Neubig:
I don't have to file collections anymore.

Eric Wetherington:
You don't have to do collections. But also, if we collect that money before we send it to collections, if we collect that money, then that one hundred and fifty dollars is going to go right back into the premium pot that we pay the profits out to the property manager of. If we have to send it to collections, then obviously there's some collection fees that would need to come out of that money that we collect before that money would then be whatever's left would be sent into the premium pot.

Pete Neubig:
So as a property manager, least amount of claims we put out there, the more bonus money we're going to get. The more claims we put out there, the less bonus money we're going to get. Or we can get dropped if we put a lot of claims out there, I'm assuming.

Eric Wetherington:
It's a standard insurance program insurance product. You put a pot of money aside to pay claims. The less claims you pay, the more money there is to distribute as profits at the end of the day and in understand too that, you know, profit distributions, especially on security deposit products. You know, it's going to take a little while to build up enough reserves to handle those claims that will come. And typically the claims really, they won't come until after year one.

Pete Neubig:
So what is it like a three years before you have to put into it before you start getting any money out?

Eric Wetherington:
Two years? Two years, typically. Typically, it's two years before we would start seeing distributions on the security deposit product. That's correct.

Pete Neubig:
So, all right. So now Pete leaves and the house is a mess. It's not one hundred and fifty bucks. It's like $3000. Is this the same? Basically, it's the same concept. I put a claim in?

Eric Wetherington:
You put the claim in and then the policy would pay out up to the limit of the policy. So we would look and see what what coverage you elected, what coverage you, you were charging Pete for, whatever the cap of the insurance coverage was. That's how much the claim would be for. The insurance company would take care of that claim, and they would take care of pursuing Pete for getting that money back. And then if there was more money that was still owed by Pete, then the property manager would have to decide if they were going to pursue Pete for that amount that was over and above what the insurance coverage was for.

Pete Neubig:
So this solves... One thing it solves for the product manager is like it reduces the number of collections that I got. I got to go handle.

Eric Wetherington:
Absolutely.

Pete Neubig:
And the other thing I'm feeling like this solves the security deposit dispute that seems to be just a bugger of a burden for all of us property managers. And so with this solution, I have less security deposit disputes, I'm assuming, yeah?

Eric Wetherington:
Yeah, you should have less security deposit disputes. You know, we'll see how that works over a longer period of time as we work through the program and more and more folks get on the program. But you know, also the other thing that it helps with the property manager, Pete is since I'm not holding a security deposit that I have to have a security deposit disposition done within 14 days or 20 days or 30 days, depending on what the state law is. I have an insurance product, so I really don't have to worry as much about those days because I'm not returning...

Pete Neubig:
Isn't Georgia like three days or something crazy. Like, I know Texas...

Eric Wetherington:
I think it's 14, but yeah, I know this 30 days in South Carolina

Pete Neubig:
Three to five days or something. Yeah.

Eric Wetherington:
So, yeah, right. So you're eliminating that constraint because you're not holding their money and giving them back their money. So, very beneficial.

Pete Neubig:
So now if I wanted to... So let's say I'm a property manager and I sign up with you guys and I love this product and I'm getting it out there to my, you know, to my new people first. And I'm like, "Man, this is working great. I want to get this to my existing folks." Is that legal? Can we do that? Can we ask them if they want to move over to this, to this product? And I'm guessing during a lease renewal is when we ask.

Eric Wetherington:
Yeah, I would say. I mean, is it legal? I mean, there's no reason that it's not legal that I'm aware of. Check your state laws. Of course, I'm not in every state, so can't speak to every state law. But you know, certainly we can. You know, there's no reason that we understand from the state insurance commissioners that it's not legal. And then the other thing I would say is, you know, make sure you notify your owners, you know, make sure you tell your owners what you're going to do because your owners are under the impression that you're holding that security deposit right now. So if you're going to offer to give the security deposit back to the tenant in lieu of them signing up for the insurance product, then you might want to make sure your owners are aware of that. And then the last thing I would say is you probably want to do a visual evaluation of the property to make sure that the property is in good condition. Because again, remember if you bring, if you...

Pete Neubig:
Put a claim in.

Eric Wetherington:
When somebody trashed the property and you haven't gone out there and seen it and you give them their security deposit back, and now they start paying a premium for a security deposit replacement and then they leave, you know, Guess what? There's a big claim and that claim comes out of your premium pot, so you're really hurting yourself if you don't get out there and do a visual evaluation of the property to make sure that it's in good condition before you offer to return that security deposit.

Pete Neubig:
Think about how powerful is it this could be. Let's just say it's November...

Eric Wetherington:
Yup.

Pete Neubig:
And I start going... All my residents saying, "Hey Phyllis, I see that you have $1500 here and a security deposit. Would you like that fifteen hundred dollars back and have this $40 or $30 or whatever it is, a month fee instead?" And Phil's going to be like, "Well, heck yeah, I'm going to want that", you know? So I think it's pretty powerful to get people to transfer over. And is that how it would go? Would it be like, Hey, I'm going to give you back your $1500 if you sign this addendum?

Eric Wetherington:
Right? Here's a lease addendum. If you want to opt in for this program, here's what it would cost you each month. And if you do that, then we would return your security deposit to you. Correct? Yep, that's exactly how it would go. And, you know, during these difficult times with COVID and with, you know, people out of jobs and different things. And you mentioned, you know, November, December, January timeframe two certainly would be another great, great time frame to reach out.

Pete Neubig:
After credit card...

Eric Wetherington:
Yeah, exactly. And then, you know, and offer it, I think it's, you know, it's definitely something that would bring value to your tenants.

Pete Neubig:
Now, if I wanted to sign up just for this product with you guys, can I do that or do I need to sign up for all your products? So how does that work?

Eric Wetherington:
No, we have the three different products right now that a property manager can select from, and they can choose one or multiple of the products, depending on what their needs are in their company and in their market area.

Pete Neubig:
And just refresh my memory. So you got the security deposit product. You have the tenant liability product?

Eric Wetherington:
Tenant legal liability, right? And then the third one is HO4 or the full blown renters renter's insurance coverage.

Pete Neubig:
Renters insurance. Ok? Yeah, that was one thing early on that I was getting pressured to have the tenant liability insurance. I think I was with propertyware at the time and they were trying to sell through their tenant portal. And I'm like, Well, what about content? And like, Oh no, it's just liability. And I'm like, Well, that's just a win for the owner. It's not a win-win. Like, how do we get it to be a win-win? So you actually have one for HO4 which is contents, and one for liability?

Eric Wetherington:
Right. So the liability the tenant legal liability product that we offer does offer a small amount of content coverage for the tenant by about $5000. So there is something in it for the tenant. If that's standard in your market and what you typically do, by using our tenant legal liability program, you can have same coverage. But again, the difference is the property manager gets to participate in the profit sharing at the end of the day. Now if your tenant says, well, I want more coverage for my content, $5000 isn't enough to cover the value of my contents. Then you can move them into a product that's closer to the HO4 or the HO4 product then the tenant can actually go on our website and complete their application, and they can select ten thousand twenty thousand thirty thousand forty up to one hundred thousand dollars of coverage for content and then the premium. They'll pay the premium and they'll be covered. If the tenant does that option, then of course we would be able to let the property manager know that the premium's being paid and let the property manager know of any lapses and coverage or anything else?

Pete Neubig:
So on the product management side. Do I need to have a full time person doing this stuff or like how simple is it? Is this like so easy a caveman can do it like, you know one of those things?

Eric Wetherington:
I mean, once it's set up because, you know, so again, I'm a property manager. Greg and Jeff are property managers. We've really tried to make this as simple as possible for the property manager. So we've got the documents for you. We've got reports from the major systems that we work with. So we grab this data, this information from your system, send it to our system on a weekly basis so that we know which tenants are covered for the security deposit program or the tenant legal liability program. And we issue a blanket policy so you're not having to pass policies back and forth every time when somebody moves in or moves out. And so these reports just can automatically flow back and forth and then we know what's going on. You know what's going on. We'll send you you just go about your normal lease signing process. There's just another addendum at the back of the lease. And then when you collect your rent, you know, there's another line item for that premium that's paid. We'll send you an invoice once a month and you write us a check for that invoice. So it's really simple. You don't have to hire more staff. It's just a matter of training your existing staff on one more lease addendum.

Pete Neubig:
And the one thing I know about you and Greg and Jeff are all process-oriented guys. So you're looking at the process, you're making sure it doesn't impact the team too much and you literally have the easy button.

Eric Wetherington:
Right.

Pete Neubig:
When people think insurance, they just think of complexity. And it sounds like you guys taking a complexity out of it. And you have the here's the here's the easy button we're going to go ahead and give you the package on it. Here's how you do A through Z. Do you have anybody in your organization that will help onboard people so that if they are a little nervous and they're not sure what to do like, you guys will kind of walk them through it?

Eric Wetherington:
Absolutely. We've got, you know, we've onboarded with several different software packages already, so we know the processes and the systems for that, and we will provide all the help and support that anybody needs to get this implemented within their office. And it's really again, it's really a simple process if you just follow the process and we'll help you all throughout the way.

Pete Neubig:
So now, Eric, we're going to put you in the hot seat for the lightning round. So I'm going to ask you a series of questions they're, like one or two-word answer questions, whatever you can think of, you know, just go ahead and answer and let's get to it. You ready?

Eric Wetherington:
I'm ready.

Pete Neubig:
I see a little bead of sweat there, so I know you're nervous from the lightning round. All right. What PM software the do you use?

Eric Wetherington:
Propertyware.

Pete Neubig:
What is your current structural organization or current organizational structure?

Eric Wetherington:
We're a pod structure, so we use pods,

Pete Neubig:
Pods, okay. Do you use virtual assistants?

Eric Wetherington:
Yes, absolutely.

Pete Neubig:
Do you have BDMs?

Eric Wetherington:
Yes, absolutely.

Pete Neubig:
What is one piece of advice you would give someone just starting out in the PM business?

Eric Wetherington:
Join NARPM and get involved.

Pete Neubig:
I like that second one. Get involved. Brian Birdy, right, wasn't that his tagline?

Eric Wetherington:
That was his theme. Yes. Yes.

Pete Neubig:
Does Pineapple belong on pizza?

Eric Wetherington:
I can go either way, I enjoy pizza, with and without.

Pete Neubig:
That's been being very noncommittal right there. Ok? Doesn't what the pineapple people after him. What book are you currently reading or one that has impacted your business or life?

Eric Wetherington:
Wow, what book am I currently reading, currently reading "Never Split The Difference".

Pete Neubig:
Chris Voss?

Eric Wetherington:
It's my second time through that book. Chris Voss. It's a great book on negotiating and dealing with people in difficult situations.

Pete Neubig:
If you ever have a chance to see him speak. Not just jump at it. He is an unbelievable speaker, and he just got great stories.

Eric Wetherington:
Yes, he does. He's got some great story, that's for sure.

Pete Neubig:
Stories that he says in the book, he kind of elaborates a little bit more. What Disney character do you most associate with?

Eric Wetherington:
Mickey Mouse,

Pete Neubig:
Mickey Mouse, all right. What is one challenge you're currently facing in your business?

Eric Wetherington:
Everybody wants to sell.

Pete Neubig:
All right, yeah, yeah. Losing doors to sales prefer cats or dogs?

Eric Wetherington:
Dogs.

Pete Neubig:
That's it, that's the end of the lightning round. You survived it!

Eric Wetherington:
Great.

Pete Neubig:
Wasn't that great. So, Eric, if somebody is interested in getting in contact with you, how do you have a website or how do they get contacted? How do they learn more information about the resident insurance program?

Eric Wetherington:
Sure, you can go to our website. yourris.com, that's Y-O-U-R-R-I-S .com or our phone number is 512-384-1724. We're going to have a booth at the NARPM convention in Kansas City, so that would be fun to see the NARPM folks there in this podcast may come out after that, but that's OK. they can certainly go to our website.

Pete Neubig:
What about an email? Do they have an email that they can reach out to? An info at or something like that?

Eric Wetherington:
Yeah, let me make sure...

Pete Neubig:
Or let's give everybody your personal one?

Eric Wetherington:
support@yourris.com is the best email address to get somebody. support@yourris.com.

Pete Neubig:
Excellent. And if you want to join NARPM, go to NARPM.org. N-A-R-P-M .org. Or give the nice folks to call at 800-782-3452. And although I'm asking you for an email, I don't know what NARPM's email is. I'm assuming it's info@narpm.org?

Eric Wetherington:
info@narpm.org is an email address that can be used to reach NARPM, yes.

Pete Neubig:
It is an email address, and if you're interested in virtual assistants, feel free to contact me, Pete, at vpmsolutions.com. Or go to V-P-M, Victor-Peter-Management or Virtual Property Management, vpmsolutions.com Eric, thank you so much for being here today. And until next time, folks. We're over and out. Talk to you later. Bye!

Feb 8, 2022

A Podcast | Eric Wetherington

In this video, learn more about the different types of insurance solutions for property managers. This podcast episode is hosted by Pete Neubig from VPM featuring the CEO and Co-Founder of Renters Insurance Solutions, Eric Wetherington.