LIVE from RISKWORLD 2022: Daniel Cunningham, Leonardo247

Intro: [00:00:03] Broadcasting live from Riskworld 2022 at the Moscone Center in San Francisco, it’s time for Workplace MVP. Brought to you by R3 Continuum, a global leader in helping workplaces thrive during disruptive times. Now, here’s your host.

Jamie Gassmann: [00:00:23] Hi, everyone. Your host, Jamie Gassmann here, and I am broadcasting from the Riskworld 2022 Expo Hall in R3 Continuum’s booth. And with me is Daniel Cunningham from Leonardo247. Welcome to the show.

Daniel Cunningham: [00:00:39] Hi. Thank you. Good to be here.

Jamie Gassmann: [00:00:40] Great. I’m so happy to have you here. And I know you are an exhibitor, but I want to hear a little bit about what does Leonardo247 do.

Daniel Cunningham: [00:00:47] Yeah, this is our first time at the show. We’ve not been a insurance-forward company in the past. That’s changing in some respects. But Leonardo247 is a property and operations software that’s largely focused in the multifamily industry. So, we were founded in 2011 and we now have about 2 million units, multifamily units, apartment units that are on the platform, which represents about 5,000 properties, somewhere around 40,000 buildings across the country. And what people use Leonardo247 for is we automate all of the tasks, and inspections, and workflows, and just the day-to-day responsibilities of operating apartment buildings.

Daniel Cunningham: [00:01:40] And those are typically expressed in these binders or maybe processes that are stored online in SharePoint someplace, and people are expected to to to remember all of these things, they’re expected to know it all, remember it all, execute, and it’s very difficult in the chaos of operating apartment buildings to stay on top of all these things. So, my experience prior to this that I’d been director of asset management for Aimco, which was the largest multifamily REIT in the country at the time. And we were finding that these policies and procedures that we had established were not being followed in the field. People couldn’t remember it all, people couldn’t know it all.

Daniel Cunningham: [00:02:17] And there was so much turnover in that business that even if you had somebody who really like was on board with doing everything they’d been taught could remember, like in 18 months, they were generally gone, and you were on to somebody new. So, we shift the burden of all of those policies and procedures, the execution of that, Leonardo becomes the expert in all of those policies and procedures. We have our own library of risk management best practices, for example, that if the client doesn’t have their own, they can use what we bring to the table or they can combine it, both.

Daniel Cunningham: [00:02:53] And then, Leonardo gives guidance every day to these individual properties based on a property’s unique amenity, equipment, geographic profile. Leonardo says, okay, we know you have a pool, we know you’re in the northeast, therefore since it’s November, we’re going to give you the instructions on how to kind of winterize the pool and that sort of thing. And we deliver whatever form or inspection they need to be successful, or instructions or video they want to watch, whatever it might be. We empower the folks on site to execute, so they don’t have to worry about whether or not they know it all, or understand, or even know what the priorities are. That all comes out of Leo.

Daniel Cunningham: [00:03:33] Now, you just ask them to execute and we give real-time visibility to the owners and the operators—the owners and maybe executives in those operations companies as to what’s actually happening on site. Are they in compliance with your expectations of running that property? So, that’s really been the core business. The question is, what does that have to do with insurance? Why are we here?

Daniel Cunningham: [00:03:58] What we discovered is since we sit in this unique role of being able to observe the actions that our clients are taking on a daily basis, are they doing the preventative maintenance that they claim they were supposed to be doing? Are they performing the inspections that are part of their risk management policies and procedures? We have a chance to see that.

Daniel Cunningham: [00:04:23] We then sit in a unique point of view where we’re able to assess the relative risk of any given operator based on their behavior, which prior to this, insurers were really relying on people to sort of attest, I have these policies and procedures, I have this preventive maintenance program, and I follow it, and yet then you have a loss, and you go on site, and you find out they’ve not been following any of that.

Jamie Gassmann: [00:04:55] Yeah.

Daniel Cunningham: [00:04:55] Yeah. There’s no way to see. The industry had no way to tell the difference between people that were lucky and people that were merely making a concerted effort to mitigate the risk to reduce their exposure to loss. And the bad actors were only exposed after a loss. Well, we are a leading indicator of good behavior and bad actors, so that we can help the carriers understand who’s a better risk than others based on their actual behavior.

Daniel Cunningham: [00:05:26] And so, we’re debuting something called the Leonardo Risk Indicator score, the LRI, which is a score based on that behavior that helps carriers discern good risk from bad risk, but also, for our clients, gives them some suggestions as to what they can do to reduce their risk and to improve their LRI score. Do they have water intrusion devices installed? That would improve their risk score. Are they doing like lighting inspections? Have they missed fire inspections or fire extinguisher inspections? These sorts of things, we can give them that feedback, and say, hey, if you do these things, or you do these things better, or you do these additional things, you will reduce your exposure to loss, and that’s our goal now.

Jamie Gassmann: [00:06:13] Interesting. So, are you using the data from those that are using the platform and managing those day-to-day tasks or monthly tasks to inform those scores?

Daniel Cunningham: [00:06:23] Yeah. I mean, they may not be as diligent in Leo as we would like them to be, so what we’ve done is we’ve looked at all the areas that impact losses, preventable losses generally. There’s not much we can do about hurricanes and flood, right? There’s not much we can do about that. We can impact what you do after an event like that to mitigate loss. We can push out, for example, water remediation processes and workflows if you’ve got a flood, that sort of thing.

Daniel Cunningham: [00:06:56] But when it comes to preventable losses, we looked at those things that are most impacting the claims history for multifamily owners, and we said, okay, what can we do in Leo to help mitigate that risk? What kinds of inspections can we perform? What devices can you install, and this sort of thing? So, since that’s new, we haven’t had that point of view before, like that these were the things that are important, so not everybody has been doing that over time. But now, what we’re introducing is, hey, here’s a new series of things that you should be paying attention to, and if you do these, we will help you understand your positional, like relational risk to the benchmark if you do this all in a systematic way within Leo.

Jamie Gassmann: [00:07:45] Interesting. And so, from like a property management perspective, you’re able to give them some tangible information about how they’re preventing harm to their property, basically.

Daniel Cunningham: [00:07:59] Yeah. And so, for property managers, like the actual people operating the property, like we’re reducing their losses so that there’s a cost to losses that that’s beyond just the cost of the claim. I mean, processing the claims and all that has a cost to it as well. So, while the owners feel the benefit of reduce losses in the form of spending less money on deductibles and maybe their insurance rates not going up, the operators who maybe don’t bear that responsibility still benefit from not having to process as many claims, and there’s reputational risk that happens here, and that sort of thing. So, everyone really benefits from being able to more or less quantify where they stand in terms of their relative risk and what they can do to make it better.

Jamie Gassmann: [00:08:50] Yeah. And so, this is your first time here at RIMS, so talk to me about what you’re hoping connections that you’ll make. Is it with insurance carriers? Is it with brokers? Who are you really looking to have conversations with that you’re excited to meet here at the show?

Daniel Cunningham: [00:09:05] Yeah, it was a bit of a mystery for us. Exactly not who would be there, because we have the list, but who would be intrigued by what it is that we’re doing. What we think will resonate with folks and it seems to be playing out so far is, so for the broker community, we want them to know about what we’re doing, because if they represent habitational like property and casualty clients, we want them to think about Leonardo and recommend Leonardo247 for their clients. We’ve had a number of over the years meetings with brokers, who said, look, we wish every one of our clients were using this, because it would reduce their losses and help them negotiate better rates.

Daniel Cunningham: [00:09:56] So, we’re hoping to increase our exposure with brokers. We want the carriers to know about the LRI, because we want them to—because with any luck, they’re going to start seeing LRI scores come across their desk as brokers go out and remarket our clients for insurance, and we want them to be aware of what that is, where that comes from, who we are, how that’s derived, so we can start at least that conversation at the carrier level with what we hope, someday, results in the LRI being a standard data point for evaluating the relative risk of somebody who’s applying for insurance.

Jamie Gassmann: [00:10:33] Yeah, that’s very cool. Very interesting. And I got to imagine that your platform, if you’re thinking of that turnover perspective, it’s keeping that log of activity. so it should be a good training tool for these property management companies to be able to have somebody come in where somebody left off. Is that kind of part of the design of that, and helping them kind of be aware of where somebody was at or not at?

Daniel Cunningham: [00:10:58] Yeah, we say something similar all the time. We say, look, when you have a change of staff, just one person just hands the baton off to the next person. They don’t have to know. Leonardo knows the last thing that they did, what’s up next? Leonardo can help you understand what the process is so that you can get new staff members up to speed faster than ever, help them become productive faster than you ever have before, because it’s all laid out for them.

Daniel Cunningham: [00:11:30] Hopefully, through Leo, you’re giving them everything they need to be successful, the process, the form, like I said, the video that they might need to watch, and they can just take the ball and run with it. And so, especially right now with the great resignation, has really hit multifamily in a way that I think is probably worse than other industries. Maybe not hospitality and restaurant, but certainly, in a very significant way. It’s very difficult right now to find people who want to be in this business. So, we have to find ways to make people more productive. We have to find ways when you bring people on board that they can get up to speed more quickly, and that’s the role that we fill, for sure.

Jamie Gassmann: [00:12:13] Yeah. Wonderful. Well, I hope that you’re getting the results from conversations. I know it’s been busy throughout the day in the RIMS Expo Hall, so hopefully, your conversations have been going well and you’ll get some great contacts to be able to share your wonderful platform with.

Daniel Cunningham: [00:12:28] There’s been lots of serendipity here for us already, so it’s good.

Jamie Gassmann: [00:12:31] Wonderful. That’s great. So, if somebody wanted to get a hold of you and learn a little bit more from you about Leonardo247 or your new insurance, kind of the measurement tool, how would they be able to do that?

Daniel Cunningham: [00:12:42] So, our website is leonardo247.com. Leonardo247.com. So, there’s plenty of like Contact Us information there if you’re interested. And yeah, the LRI will be sort of publicly debuted I think by the end of June, so there’ll be more information on the website starting then.

Jamie Gassmann: [00:13:06] Wonderful. Well, best of luck in that and thank you again so much for joining us. It’s been a pleasure talking with you.

Daniel Cunningham: [00:13:11] Yeah, nice wandering by, and seeing you here, and having the opportunity to appear. Thank you.

Jamie Gassmann: [00:13:15] Yeah. We always like great conversations to learn a little bit more about what’s out there in the risk field, so great.

Daniel Cunningham: [00:13:20] Thank you.

Jamie Gassmann: [00:13:21] Yeah.

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