Latest / Leaders on Shopify with John Readman / The surprising benefits of adding insurance to your Shopify checkout
Transcript
- John - Leaders on Shopify: So welcome back to the Leaders on Shopify podcast. Today, I'm super excited. I've actually got one of my, industry friends, but also reluctant cycling friend, Jamie, who runs a super cool insurtech tech business called Loxa. Jamie, do you want to kick us off? Introduce yourself. introduce lox and sort of where you fit in within the Shopify ecosystem. Jamie Hamer - Loxa: Thanks, John. yes, so my background, Jamie Hamer, coming up on being a serial entrepreneur, done everything from door to door sales, account management sales, prompter and gamble, Gartner, Debtwire. Started a real estate news business, so very different. The technology on that was a effectively a WordPress blog gated. so very relatively simple company in terms technology, but we produced breaking news on the biggest insights in all the biggest buildings throughout Europe. And that did very well. ended up being a four-year end-to-end exit. and then went and did a completely crazy thing, which is to start an insurance company without any insurance experience. And we're what's known as an MGA, so managing general agent. And what that means is we take capacity from insurers, we're responsible for all the underwriting and the claims and the tech and the development, and we then work with merchants to distribute insurance at the point of sale. So sort of like when you're on Amazon and you click on something, you anything, an iron, you you get that pop-up saying, Would you like to offer insurance? We do that, but typically on higher value items and typically with independants where it can have a huge number of benefits. so somewhat a challenging business John - Leaders on Shopify: Yeah, well, yeah, so to summarize it it's that bit in the checkout going, you've just spent, I don't know, £500 pounds on a new fridge. Do you want to protect your new fridge? It's this much extra buy now. And then you basically sort all that out. I'll make it easy for the merchant to offer that. and hopefully help the merchant with conversion rate, help them maybe make a bit of money. Do you let them have a bit of money back as well? Jamie Hamer - Loxa: Yeah, yeah. So we've got a few different executions. So we cover first year warranties for some merchants, John - Leaders on Shopify: Yeah. Jamie Hamer - Loxa: we include insurance for some merchants, and then the traditional mechanism is that add on mechanism you mentioned. So commission to the merchant, reduced returns on insurable items, John - Leaders on Shopify: and it's like when I buy something expensive, it's that little extra bit over there that says, do you want to protect your super new shiny thing you've bought for just X a month? And you're offering that as a service, you manage all that you pick up all the admin on that. And depending Jamie Hamer - Loxa: Mm-hmm. John - Leaders on Shopify: on what the model is for the merchant, they add value to their client, hopefully include increased conversion rate. And maybe even make some money. Jamie Hamer - Loxa: Yeah, yeah, that's very much the idea. So we work with brands through first year manufacturers warranty. We include insurance with items on some online merchants. We offer add-on on every insurable category. So everything from electronics to bikes to tools, furniture, home appliances, catering equipment, you name it if it's physical and insurable, we do it. So it's gonna be fairly fairly high AOV. But we provide all the technical integration and yeah, as you say, there's a good chance it increases your conversion through peace of mind. Definitely reduces your turn, definitely makes some commission. John - Leaders on Shopify: And I was always thinking this is a conversion rate thing or a peace of mind thing, but I hadn't until I started preparing for our conversation, Jamie, realized what a sort of the returns cost of big stuff and expensive stuff is a Jamie Hamer - Loxa: Yeah. John - Leaders on Shopify: nightmare for the retailers and the brands. How does having what you provide them with reduce that sort of returns dilemma? Jamie Hamer - Loxa: Yeah, and especially in big stuff, right? Catering equipment, furniture. Like I talked to a merchant the other day, you have an eight percent cost of returns. So even though furniture's a high margin category, it can be forty to sixty percent margin. A lot of people go into it thinking, okay, cool. There's a lot of Shopify merchants selling furniture out there because they're like, Great, it's a high margin category, people want it, it's a huge category, this is easy. But you don't factor in things like the cost of returns and just how expensive that can be, especially when you're offering delivery and installation, if you're doing That. So yeah, we've proven across the board we reduce returns on the insured items by about a third. the reason for that is if there is damage, can claim all the insurance. You know, they can claim it instead, they can get a repair technician in the house within three days to fix it all up. So that that materially means that people return last. And also, if you've chosen that insurance, you have more conviction in the purchase. You're more likely to keep it. John - Leaders on Shopify: Yeah, I hadn't even thought about the psychology I'm fully committed to this. I'm not going to collect the insurance if I then pay for the insurance if I just sort of half intended to send it back because I've ordered three would you call that like check out psychology? Jamie Hamer - Loxa: Yeah, there's a lot of checkout psychology in this. Just having insurance there makes it more credible. So we see conversion increases even when people don't select the insurance. You are more likely to check out if you've added insurance to it. So, you know, 80% plus in furniture, which is our biggest category, carts are abandoned. and then yeah, once you actually have the product, you know you're going to be keeping it for three to five years because you've selected that's how long you want it to last through protection. John - Leaders on Shopify: Yeah, we've talked many times about e-commerce platforms and you've got abilities to integrate into anything, but we've both made the decision to jump on this Shopify bandwagon. Why is that a good thing for you and why, suppose, are your high value, high ticket online items also jumping on Shopify? Jamie Hamer - Loxa: Yeah, that was actually the original premise of this business. Like this was going to be, a Shopify only business. and that's because, there's an amazing app store, right? it's a fast growing platform. Well, I think when we started this business, it wasn't the largest online platform for the UK, but it is now. And with you being able to design an app for the store, it makes it virtually plug and play. We've done Shopify integrations in 24 hours. We've done one in three hours, where we do all the installation, all the testing with the collaborator code. It's just a really cool ecosystem to be a part of. And our largest merchant that we just launched, Dusk, they're on Shopify. So it's not just small merchants, you know, we've raised our threshold, we work with five million GMV plus now because it doesn't make sense to have hundreds and hundreds of partners. but there are some really big merchants, some really relevant merchants on Shopify here in the UK and as we expand globally. John - Leaders on Shopify: Yeah, I think there's often a big misconception. that Shopify is doing a good job to dispel this, but so are sort of a lot of the e-commerce agencies and people like you and me. But some people think well Shopify, yeah, that's for sort of the startups and maybe the smaller scale, but there are global, large household names. Like I was at a conference the other day in River Island and migrating to Shopify, L'Oreal. Estee Lauder, all these massive global brands are putting all their brands onto Shopify. And I think it's that sort of total cost of ownership, but also that peace of mind that you can just control and manage a lot of the stuff yourself. And then this Jamie Hamer - Loxa: Yeah. John - Leaders on Shopify: ecosystem of wonderful products out there that if you need something, you can probably go find it. You might not necessarily have to build it or. go find an insurance company, then go find a technology company who builds a thing that connects that to that to that. Whereas you're just saying, well, we've got the whole thing and you just press a button, do a bit of configuration, get all the right terms in, it's days, not months. Jamie Hamer - Loxa: Yeah, and I think what Shopify has done a really good job of throughout its history is just standardizing the things that people think matter but don't matter that much. you know, my understanding, I had Chloe Thomas on my podcast, and who's a she's wonderful, wonderful e-commerce veteran. She was, I was like, what's the biggest innovation been in the last 10 years of e-commerce? And she said the rise of Shopify. And the reason for that is people used to obsess, and this is fully quoting her, she's brilliant, like, obsess about. checkout positioning and what your checkout looked like and you know, spend ages haggling and negotiating over, the payment processing fees. But Shopify just came along and standardized all of that. And it turns out very little of that matters that much. Obviously your processing fees matter, but like they're gonna be in a in a range where it's affordable for your business if you grow. and your checkout, like the standardization shoppers actually quite like that. Like when they're at that stage, they don't care that much. They've already bought, they've already decided to buy, they're just looking to check out. So Shopify taking away a lot of those choices has actually been great. And it allows brands to do what they're really good at, which is marketing, sourcing products, delivering, not always the aftercare, which is where we come in, but it allows them to focus on being the brand and and delighting their customers and not having to worry so much about their website. John - Leaders on Shopify: Yeah, so we're all in on Shopify I was at the conference just like the energy around the whole collaborative ecosystem and I suppose some people are even competing with each other but they're all sharing notes and learning from each other and there's enough out there for everybody and there's definitely a feeling of right now in the world that It's a bit like IBM in the eighties sort of conversation. Like Jamie Hamer - Loxa: Mm. John - Leaders on Shopify: nobody gets fired for buying or migrating to Shopify. And from a Loxa point of view, you've said, well, we want people of certain size and they've got to be selling a certain product. Who's like, and you mentioned before, like furniture, electrical goods, bikes, Who's the perfect merchant for you and why? What's the sort of best story or best case study you've got? And is it you want more of those or actually is there an underserved market that you really want to go after? Jamie Hamer - Loxa: Yeah, there's a combination of both. So yeah, we want to work with with larger merchants. We want things that are easy to integrate. We have native apps for all the major platforms, so they're all are in play, but Shopify is the easiest and the ones we have the most practice with, and as you say, the one that most people are migrating to. We've had four of our large merchants migrate to Shopify this year. We've only seen one go the other way, to Magento. So that does happen, but very rarely. And just to touch on that, I think the only reasons you might do it are if processing fees are really, really important to you. And historically there were some use cases, like if you do a lot of B2B business, you might, you know, Magento or WooCommerce were were set up a little bit better for the B2B side. But the great thing about the Shopify ecosystem is if there is a problem like that, it will be solved. Like there will be an app, there will be something you can plug in to change that. Because so many people are developing it, it's got such a large ecosystem. So, for example, if you look at builders' merchants, which are top prospects for us, like they sell lots of tools, lots of solar, which we're moving into, lots of bathroom supplies, which we're moving into. and then electronics, security, that sort of thing. So there's a lot of insurable goods there. They're all a Magento because they do so much B2B trade business. And Magento used to be the only platform that can do that. But we're just now starting to hear about people moving and considering Shopify because there are a series of apps. John - Leaders on Shopify: The new Jamie Hamer - Loxa: now everything's possible it didn't used to be previously. And Shopify POS is a big innovation as well. John - Leaders on Shopify: if you've got a big retailer that's got stores and online, are you now offering the insurance in store as well as online? Is that part of your proposition? Jamie Hamer - Loxa: Totally. And insurance install can work even better because while you can't sell or recommend the insurance for compliance reasons, you can say, hey, we've got this great option. A lot of people choose it. here's how it works. And you can see some of our merchants who are on Shopify Pass, the majority of installs we're integrating a couple of eco systems now, but the majority of our install merchants now are Shopify Pass they see 40%, 50% take off on insurance install. John - Leaders on Shopify: I'm interested in business models, right? And I Jamie Hamer - Loxa: Yeah. John - Leaders on Shopify: imagine one of the challenges you face is, and this is both an opportunity and a challenge, right? Because once somebody's Jamie Hamer - Loxa: Totally. John - Leaders on Shopify: in with an insurance company like Loxa, and it's working, it's probably Jamie Hamer - Loxa: Yeah. John - Leaders on Shopify: too much of an effort to shift and change. But that's also a challenge because if somebody is already in with somebody else trying to dislodge them is then a challenge. Have I just made that up or is that a thing? Jamie Hamer - Loxa: No, that's really insightful. So we've got competition at the very high end. So Cover Genius that works with Amazon, Bolt Tech, which is an international electronics specialist. both those guys do a lot of travel because travel, you need to be global. and people like buying travel insurance at the point of sale. Surprise, surprise. But then you've got the legacy competitors who are single category and mostly operate in-store. So for us, we're basically the online specialist. So 90% of our business is online. But the cool thing is that's the way the market's shifting. Like almost 40% of furniture is now sold online, which is crazy when you think about it. People used to need to sit on furniture, but they just don't anymore. With a good visualization tool, you can see it in your home, no need to go to a store. 60% of tools, 60% of musical instruments now sold online. So like as key categories that we're branching into or have really big footprints like tools where we're, the market leader in that space. So what that means is because those legacy competitors are never going to be able to integrate a website well, and if they do, it's going to be clunky, the UI is going to be set, standardized, the merchants gonna have to do most of the work themselves. Might be a three, six month process. What we do is we're plug and play with all the apps. So that can be a week, two weeks, including testing, shorter sometimes. or with our API integrations, we're using a bunch of cool stuff around Agentic and you know. handholding and sending engineers in to sit with the teams and other places so that that API integration can be a month rather than three months, even for the bespoke platforms. John - Leaders on Shopify: Yeah. and I suppose what you're saying is you're giving a better sort of native user experience, certainly in the Shopify world, there may be something clunky they've, tried to integrate or build themselves. Jamie Hamer - Loxa: Yeah. So to give an example, on a Shopify merchant we're talking to one at the moment that has a two percent take up rate on insurance, which is diabolical. Because you know, we don't have a single merchant that's below five percent. Most of our merchants are in the 50 to 25% take up online for insurance. The UI is just terrible. And they had to build it all themselves. It took six months to get it live and tested. And now we're sort of just saying, look, we can guarantee we'll do five times more than that just by including a UX. And anytime you want to change it, our app is fully configurable. So if you want to have it on the product page, you wanna have a side cart, you wanna have it in the basket, you wanna have it post-purchase. Like our app does all of those things because we built it modularly piece by piece. So we can do it. If you want to cart transform, so it's part of the product, if you want to have it as a line item, all of that is just like is just sliders on our app, right? John - Leaders on Shopify: Yeah. are you going down the route to become a built for Shopify app and get that badge? Or do you do most of it on your side? Or is it all in, embedded in the back of a Shopify anyway. Jamie Hamer - Loxa: Yeah. I mean because it's a regulated app and because there are, some variables and what we need in the API, I think it'd be a little bit complicated to make a built for Shopify. And actually we don't have it listed on the store because we're only relevant for so many merchants. Gotta be high AV gotta be insurable, gotta be five million plus. So we do all the work for you. We use a collaborative code, we come in, we configure it. We've only done one Shopify install ever where we haven't done the work and we kind of prefer it that way because we're really good at it. John - Leaders on Shopify: Yeah, people will insure like £100 to £200 pound set of headphones. But is that good or bad business? Or is it the sofas and the fridges and the ovens? Where's business here? Jamie Hamer - Loxa: Really the vet varies by category. So in furniture we see a very low take up of two hundred pounds. Because if you're buying a two hundred pound bed or whatever it is, a a footstool, that's pretty disposable. Like you wouldn't necessarily get that repaired if it were damaged, you might just throw it out. That does John - Leaders on Shopify: Yeah. Jamie Hamer - Loxa: vary for categories that are particularly was those ones that include theft. So we do, as you say, headphones, we do a good business below 200 pounds. Glasses, we do a lot of business below that number. our glasses program we're launching with a couple of online Shopify retailers right now. and it's ten percent for a year of accidental damage and death protection on sunglasses as well as prescription. And as we'll know, those are damaged an awful lot. So we're beginning to do a hell of a lot of business there. So it really varies by how strongly people feel about the risks and how much they value that as part of their day-to-day life, whether they'll take out protection or what kind of takeover rate you'll see. John - Leaders on Shopify: Yeah, That makes sense. So if I'm a merchant listening to this Jamie, aside from the increased conversion rate, this sort of psychology of checkout, maybe a bit of kickback in terms of revenue, what's the actual experience like when I need to make a claim? if I think one of the best merchants out there always puts the customer at the heart of everything they're doing, right? So hopefully they're thinking, right, this is going to protect our customer. It's going to make us look good. You almost don't become an extension or a branch of their team. Jamie Hamer - Loxa: Yeah. John - Leaders on Shopify: I've got my sofa here. It probably is not worth insuring but if I had insured it and it gets damaged or something happens and I pick up the phone or drop the email or go onto the chat, what happens and what springs into action? Jamie Hamer - Loxa: Yeah, So That is at the heart of what we do as well. Like our number one North Star is the number of customers protected, but we also track successful claims because that's when people see the value. Insurance was worth nothing, maybe some peace of mind, until you claim on it. and we're doing a series of case studies now, particularly on furniture, catering equipment tools, of like people having really good claims experiences and therefore wanting to insure more, buying more Loxa only buying from brands where Loxa is offered because they've had that amazing experience. So we're running a 93% claims acceptance rate. Right now, which we believe is market leading. You have visibility of everyone else, we've designed all of our programs so that we can service and accept 90% of claims. That's just how it's priced with no excess. And it's swift as well. So we have a 48-hour assessment time, five-day max resolution time, even if you have to get a repair technician or something like that. and most of the time we're doing it via vouchers back to the original merchant. So you buy a Bed Kingdom bed or a Toolden tool or a Chillblast PC. And if something goes wrong, it gets damaged, it gets water damaged, it gets broken, your tool gets stolen. We will give you a voucher back to that original merchant to go get it or something else that you want. So it's keeping the customers in the merchant's ecosystem, it's driving long-term loyalty, it's delighting their customers, and it's providing aftercare, which isn't always the focus or the strength of these merchants. John - Leaders on Shopify: Yeah, that's interesting. And are the categories, again, just curious, are the categories that just aren't worth getting into or just too hard to insure Because I know one of the interesting things Jamie Hamer - Loxa: Yeah. John - Leaders on Shopify: is you're not category specific, but there might be certain categories you like. don't want to get involved in that because it's just too high risk. Jamie Hamer - Loxa: Yeah, so there are certain categories we have thus far swerved. so some good examples are heating, like boilers, dehumidifiers. Those are phenomenally expensive to Insure because they break all the time. So it's like kind of like what price would someone be willing to pay at the point of sale for a year of insurance? Would they be willing to pay 30% of something? Probably not. And that's kind of the region that you're getting into if you want to do year of phone insurance of accidental damage and theft. Like just accidental damage by itself on a phone, because you use it all the time, is eighteen percent per year to the customer. So like that's why all the mobile phone policies are monthly, which we can do but haven't set up yet. we're we're adding that in Q three and Q four for some mobile opportunities. But you need to do it monthly, otherwise it seems like a crazy amount of money to pay. and the other thing is, Bikes are a little bit more challenging because they're a form of mobility. So you need the PI, you need your personal injury, you need some public liability ideally in there. So that becomes a more complicated sell that you can't do at the point of sale. John - Leaders on Shopify: do you have to insure for accidents? I'm not worried about me but then I've got insurance on my bike and I get hit by a car. Yeah, yeah. Jamie Hamer - Loxa: you hit someone. So yeah, probably the bigger risk. so yeah, all of those bike policies you might purchase from the big brands like your Picmo and your Lacca that are out there, they will have all of those bells and whistles, which means they have to be sold to you directly. They can't be sold at the point of sale. So what we do is we offer accidental damage an extended warranty. So just the damage layer at the point sale, which is much cheaper, much easier, and then we follow up with a by the way, are you taking your bike on a crazy trip abroad and do you need like supersonic insurance against everything? John - Leaders on Shopify: Yeah. And what's the opportunity for you and the merchants in like post purchase of people who didn't buy insurance and then upsell, cross-sell insurance? Is that a thing? and if it is a thing, what's the perfect sort of window to do that? Jamie Hamer - Loxa: Yeah, so what we rely on to help the merchants avoid not be regulated by the FCA to distribute insurance. is to rely on something called a connected contract exemption. And the terms of that are as long as the insurance is included with the item it's related to, so you're five years of furniture insurance with your with your furniture and your Year of accidental damage with your tool, you can include in the same transaction without regulation for a insurance value up to £500 pounds. And you can also do that for up to 30 days. So we're now working with some merchants who are including on their success emails, by the way, do you want to add insurance if you haven't? Or their confirmation emails, okay, you know, one more chance, you can use this link for up to 30 days to buy insurance. And we see another couple of points of take up where that happens. John - Leaders on Shopify: Yeah. Jamie Hamer - Loxa: but the bigger opportunity is how can we help people who like getting their things insured, who have certain assets they want to insure but, you know, I could go on a rant about home insurance. Home insurance is rubbish in this country. I don't know if it's rubbish globally, but it's terrible here. Like a 60% claim improvement rate. It's really not designed for low value claims, always has an excess, £300, £500 pounds, somewhere in that range. And the insurers hate it when you claim on low-value stuff because the claims often cost them more than like the value they're getting from you in your home insurance. So it's just not designed to claim on stuff like this. So we're looking at an execution which we'll be launching by Q4, where you can add all the things you've just bought. For up to 90 days into a subscription wallet of all the things you insuring. And that has a bunch of different executions. John - Leaders on Shopify: It feels like Jamie Hamer - Loxa: So that's cool because like it could be musician's insurance for all your gig equipment. It could be tradesperson's insurance for all your tools. It could be insurance for your 15 bikes. Right. It's you know. John - Leaders on Shopify: not Jamie Hamer - Loxa: so then you end up with like Just the stuff you want insured, insured, all of it has no access to claim, all of it's covering all of the risks you expect it to cover. And we think that's a fairer way of doing insurance. John - Leaders on Shopify: And I suppose yeah, it's interesting because I think when people set up their sort of e-commerce businesses and this, that, and the other, they probably, well, hopefully they do think about insurance, is it often an afterthought if someone's setting up a furniture business? Jamie Hamer - Loxa: furniture less so because the traditional players have been in store. So like, you know, you if you go to a DFS, you will have been sold a policy for the last fifteen years, similar often with a bit of push. but like when merchants go online, they're thinking, Okay, how can I offer the same protection? Because I know people want it, I know people take it off at a thirty, forty, fifty percent. And I know I can probably achieve half that online and that's a big business builder. So furniture less so, but some of the categories we're expanding into, like we're expanding into skis and snowboards soon. We've got a couple of merchants really excited about that because all of our policies include a hundred and eighty days of travel as well. So, you know, if you have accidental damage and theft on your ski or snowboard when you're going skiing, that's a really attractive proposition that'll have a really high take up. John - Leaders on Shopify: And that includes my ski insurance as well. Jamie Hamer - Loxa: It does not include your damage. We do it, just focus on the product. but you know, the upselling of all of those is possible in the future for sure. John - Leaders on Shopify: And as you sort of grow and expand, because you're regulated, there must be markets that are easier to get into than others just because Jamie Hamer - Loxa: Mm-hmm. John - Leaders on Shopify: of the regulation. Is that the case or is it actually not as complicated as I can picture in my mind? Jamie Hamer - Loxa: No, it it's complicated. And we're actually doing it a quite a complicated route. So getting FCA regulated here is really challenging and takes a while, and that's the right thing because you know the FCA wants to make sure that the companies that can do this aren't harming consumers, aren't putting crazy margins on the insurance. because no one knows how much this stuff costs, You know how much insurance on a phone or a bike should cost. Like you might have some idea, but it's not like exact. There was actually a version of insurance gap, which is like If a car gets written off, that was banned from the market because all the car dealers were taking like 70, 80% margins on it and ripping the end customer off. So that was just banned, right? So they're very careful about who they let in. And we're applying to Ireland, who are also very careful about who they let in. But the nice thing is once we're live in Ireland, we can, after a while, passport into the other European jurisdictions. so that's our next step. But then there are some markets which would just be really fun, I think, to trade in. Like I've spent a lot of time in South Africa, big South Africa fan. Two percent home insurance penetration there. If we offered insurance at the point of sale in South Africa, I think it would the takeoff would be ridiculous and it would be exactly what people are looking for. So excited to explore opportunities like that once we've accomplished the stage one of being a huge player here, stage two of being a huge player in a pan-European basis, through our apps and through you know primarily Shopify, where we will be plug and play in the same way with the same insurance everywhere. John - Leaders on Shopify: Yeah, it's interesting because I'm just thinking now, everybody's talking about we're getting to this agentic commerce and we're going to set off our little shopping bot. And I'm going to say, right, I want you to monitor the Fisher and Pike. Fridge. My price is Jamie Hamer - Loxa: Yeah. John - Leaders on Shopify: this when it hits that price point. And if it can be delivered in X number days, go buy it. Jamie Hamer - Loxa: Yeah. John - Leaders on Shopify: But surely we need to make sure that the LLMs are going to John, why are you buying a fridge? Do you want insurance in that price or not? Jamie Hamer - Loxa: Yeah, so that's an interesting question for us. And Shopify have done such a good job of controlling this narrative. Like I've known a couple of merchants who have switched to Shopify just because they're like, I don't want to miss out on the the AI sales that Shopify is so well integrated with with Chat GBT right? now my understanding currently of the mechanism is that any add-ons the merchant offers will be surfaced in those transactions. John - Leaders on Shopify: That was going to be the question is it just taking the standard stock price? I know it will pull in the delivery and everything else, but is it adding in the other stuff as well? Jamie Hamer - Loxa: Yeah, so we're we're monitoring that carefully. But my current understanding is those options that the merchant offers, which could include like delivery and assembly, which could include, some sort of free return mechanism or you know, a warranty registration, like those will all be surfaced during the journey, which is great news for us because we want that insurance revenue coming back to the merchant. John - Leaders on Shopify: I'm going to Jamie Hamer - Loxa: I guess the other option for open AI would be to have a relationship with insurance company like us where insurance is offered on everything, but I think the merchants might object to that pretty strongly, given that's where the benefit should lie. John - Leaders on Shopify: You're going to have Loxa to AI insurance as powered by Loxa Jamie Hamer - Loxa: Yeah. We need to get global pretty quickly to do that. John - Leaders on Shopify: That will be good. And I suppose is insurance a product that an agent can buy or does it actually have to be a human or does nobody know? Jamie Hamer - Loxa: Ooh, wow, you asked the tough questions. so the regulation says that the purchaser needs to understand the terms and condition of the insurance contract that they're entering. Which is why all of our UIs have very clear links to the IPID, and the full policy wording for those who are detailed enough to read it. And our policy wording, by the is seven to eight pages long. So you can actually read it, which is not true of most policy wording. So we've deliberately John - Leaders on Shopify: Yeah, what? Jamie Hamer - Loxa: simplified. so I John - Leaders on Shopify: you Jamie Hamer - Loxa: imagine as long as the AI can. Tell the person what they're buying and give them the ability to read the T's and C's, that would be fine. This is not a bridge we've crossed before, so I'm really curious to see how that shakes out. John - Leaders on Shopify: So I think we need to monitor and I want you to tell me, Jamie, we're the first agent that buys a product that also buys the insurance. I think there's a really interesting change in stuff there. Jamie Hamer - Loxa: I wonder if you you can preset and be like, I like buying product insurance and therefore do it. Or whether you say absolutely not. John - Leaders on Shopify: No, you could could pre-sale and raise your doing. or if I'm buying items of X, if insurance is offered and it seems reasonable, buy it or only go research products that include insurance. Yeah. Jamie Hamer - Loxa: Yeah. Yeah. That's an obviously something we'd be be hugely supportive of. One of the things that we're doing as our big Q four initiative, we're writing what we hope will be the definitive aftercare report. So we're sharing data with most of our major merchants. We've already got a dozen sign-ups to share data with us for that period, conversion data, returns data, data that they have on loyalty. And we're gonna do case studies on who's doing amazingly in customer service, who's doing innovative things to reduce returns. And obviously a part of that will be what happens when you extend your warranty, what happens when you include insurance with purchases. And to facilitate that and get good data, we're actually discounting our rates for inclusive insurance. So we're working with our carriers to say we want to offer brands further incentives at discounted prices to include insurance with their purchases. Like there's something John Lewis has been doing for years, right? Like, you get this additional warranty that can sometimes cover accidental damage or sometimes even other things like theft. And that's a reason to purchase there as opposed to anywhere else. And so we're bringing that to SME, independent merchants and saying, Hey, you can offer this benefit for Q4 for your key trading period. It's gonna do a number of things. Like it's gonna increase conversion, it's gonna decrease returns, it's gonna increase long-term customer loyalty, you'll get the claim replacements coming back to you. There's a small cost, which Depending on the category, it could be between like two and four percent of gross. But we're taking care of after get for you in this scenario. And we can test and learn and see what it does to both your short-term conversion and your long-term loyalty. And then we'll do case studies on it, we'll highlight the amazing thing you're doing, we'll do co-marketing, like we're in talks with a bed brand, do some major London bus branding and talk about how you know your kids can now jump up on the bed freely because the insurance covers that. John - Leaders on Shopify: I'm really Jamie Hamer - Loxa: So yeah not that they were going to not do that anyway but yeah, we are going big on aftercare in Q four and we're encouraging our brands to run some insurance link promotions as a different way rather than discounting that costs you far less and can have far more long term benefits John - Leaders on Shopify: So if I'm a trades person getting insurance Jamie Hamer - Loxa: Mm-hmm. John - Leaders on Shopify: for my tools that might be sat in my van and might be sat here, I might be sat there. Historically was probably in the expensive business insurance and they probably Jamie Hamer - Loxa: Mm-hmm. John - Leaders on Shopify: pay out and they probably spend a lot of time. avoiding servicing you but because you're set up in a separate way is that almost going to become like you're currently going b2b2c right so you Jamie Hamer - Loxa: Mm-hmm. John - Leaders on Shopify: you provide it to Dusk, Dusk provide it to the consumer Jamie Hamer - Loxa: Yeah. John - Leaders on Shopify: potentially you're almost going straight now to the consumer Jamie Hamer - Loxa: So we will and we won't is a short answer. I think we'll always distribute through partners. Why? Because getting people individually excited about insurance when it's not like relevant and top of mind right then is extremely expensive. Like the cack of insurance is mental. And we sell really small policies. So like it's just not gonna work. But through our brands, so like Toolden's our biggest tool brand now, we're in talks to launch a couple of of similarly sized or larger brands. so what we could do. is say hey, like, you know, point of sale insurance, you bought insurance on one tool. Here's a way of insuring all of your tools on a monthly subscription, but that would still be in partnership with Toolden and Toolden would still get a commission. John - Leaders on Shopify: They're already insured with you on one thing and then you're offering them an extension for like a portfolio of things rather than Jamie Hamer - Loxa: Totally. John - Leaders on Shopify: rather than John Redman typing into Google insure my tools and then it comes back lots of tool insurance bundle that's not what you're doing but if I've already bought one product from you via one brand you might offer me an upsell or a cross sell to insure all my other products. Jamie Hamer - Loxa: Exactly. And for people who definitely have portfolios of bikes and musical instruments and tools, that makes a ton of sense. we've already built an app which about a third of our thirty thousand customers have logged into, where you can make the claims and you can adjust your policies and you can find out which merchant Loxa already works with. but now we're gonna be adding the ability to insure a whole bunch more in there. John - Leaders on Shopify: So for those who are listening, how can they find out about you? How can they connect with Loxa If they're interested in doing this, where do they go? Jamie Hamer - Loxa: All right. Well if you're interested in really riveting posts on LinkedIn about how this all works, I'm big on those. So Jamie Hamer on LinkedIn. you go to loxacover.com to find out more see our case studies and all of those good things. But Yeah, just excited to be in this space. Not kind of fell into it by accident, but it is a complicated but really interesting space and it's amazing how the the bird the benefits the emergency once they like dig into it properly. So excited to get the good one out there, especially on Shopify. John - Leaders on Shopify: Yeah. And also, and also you've not mentioned your podcast. You should give your podcast a plug as well. So Jamie has an excellent retail podcast. Do you want to talk quickly? Where can they find that? Jamie Hamer - Loxa: Yeah, totally. So we've been running about a year now. Had John Readman as a guest on it. Great episode. But yeah, so that's a Retailer is Detail podcast. You can also find that on the loxacover.com website. Some great guests, some more great guests coming up. So it's all about retail innovation in the more general sense. John - Leaders on Shopify: Yeah, thank you for coming on. You've been a fantastic guest and I look forward to continue to work together and seeing you soon. Jamie Hamer - Loxa: Thanks John.