Last Updated on: July 20, 2021

Talking to Clients in Defined Terms, Shoptalk Series – Episode #14

Podcast » Talking to Clients in Defined Terms, Shoptalk Series – Episode #14

In this episode of The Power Producers Podcast, David Carothers and co-host Kyle Houck discuss how you can relate issues to your clients or prospects in defined terms, and how you can calculate the total cost of risk.

Episode Highlights:

David mentions that there’s a gentleman who’s currently recruiting for an insurance sales representative in his branded office. (2:00)
David thinks that most of the time when they get in front of their clients, we start explaining, and expect them to understand insurance jargon. (3:17)
David shares that a lot of people don’t do the total cost of risk, but if they’re going to do it, they must understand the calculations. (4:14)
David mentions that it’s significant to give those calculations to the client in a way that’s directly tangible to their business. (4:37)
David explains how to calculate the total cost of risk. (4:48)
David shares that he’s been in situations where he had clients that are over 100 million a year in sales that weren’t willing to give him the sales figures. (6:10)
David mentions that you should always go high on sales, and always go high on profit. (7:09)
How does David estimate their sales? (7:46)
David mentions a scene from Jim Carrey’s movie called, Liar Liar. (13:26)
David shares that every time he’s in a meeting, he always thinks about that scene. (13:36)
Kyle mentions that David has more experience in the insurance world than him. (16:22)
David shares that they use frequency and severity rates, for calculation. (18:07)
David mentions that when they do the Mod analysis, they’re relating to somebody in defined terms. (18:30)
Kyle mentions that you don’t get very much more defined than the ModMaster. (19:51)
David mentions that they’re in the process of placing subcommittees for each department. (20:48)
David shares that one of the subcommittees they have is on graphics, and they’re working on creating a proposal template for any kind of middle-market company. (20:58)
David mentions that from a service standpoint, you need to define what you’re going to do. (22:11)
David shares that the same big brokerages that are taking business from insurance salespeople are the same big brokerages they’re taking business from, every single day. (24:51)

Key Quotes:

“So you know, a lot of people out there don’t do a total cost of risk, I get it, we’re trying to change the world, one recovering agent at a time. But, you know, if you’re going to go in with the total cost of risk, you need to understand that calculation. But you also need to understand how to articulate what that calculation is to your clients.” – David Carothers
“It goes back to the difference between selling somebody a product and solving a problem. You’re going to tell them premium, but you’re not going to talk about all the other stuff because quite frankly in many cases, agents don’t know that other stuff in the total cost of risk calculation.” – David Carothers
“Setting expectations for clients is paramount. Because if you don’t set them, they’re going to formulate their own and they may not be even remotely close to reality.” – David Carothers
“What I’m going to tell you is customer service. It doesn’t cut it. Customer service is the expectation. If you can’t talk to people in defined terms that they can understand that relates to the sales and profitability of their business and give them results in an awesome client experience, you’re done. You will lose every single time.” – David Carothers
“The revenue that you lost by that account leaving you is the tuition that you are paying to never have to learn to never have to deal with this again.” – David Carothers

Resources Mentioned:

Available On

David Carothers

Kyle Houck

Parametric Insurance Explained: How Middle Market Producers Can Hedge Economic Loss, Protect Revenue, and Differentiate at the Point of Sale

March 9, 2026

The commercial insurance industry is in the middle of a quiet evolution.

While most conversations still revolve around premiums, deductibles, limits, and carrier appetite, a different category of risk transfer has been gaining traction beneath the surface—parametric insurance. It is not new, but it is finally becoming accessible, relevant, and actionable for middle market producers who are willing to think differently about risk.

In a recent episode of the Power Producers Podcast, I sat down with Brian Thompson from Descartes Underwriting to unpack what parametric insurance actually is, what it is not, and why producers who ignore it may be leaving their clients—and themselves—exposed.

This article breaks that conversation down into practical, producer-friendly language and shows how parametric insurance fits into modern middle market risk management.

Winning in Catastrophe-Exposed Markets: Underwriting Discipline, Agency Strength, and the SageSure Approach

March 4, 2026

The last several years have reshaped the landscape of property insurance across the country. While most national carriers have retreated from coastal states, wildfire zones, and other catastrophe-exposed regions, a handful of disciplined players have taken the opposite path—leaning into difficult markets with a strategic, data-driven approach.

From Bottleneck to Builder: Why Systems, Culture, and Accountability Define Real Business Growth

March 2, 2026

For most entrepreneurs, the decision to start a business is rooted in the promise of freedom. Freedom from a boss, freedom to control income, and freedom to build something meaningful. Yet for many business owners, particularly in service-based industries and middle-market companies, that freedom slowly erodes. What begins as ownership eventually turns into obligation, where the business demands constant attention and the owner becomes the single point of failure.

Why Standalone Cyber Insurance Beats BOP Extensions Every Time: Protecting Clients from Modern Threats

February 25, 2026

The insurance industry is full of shortcuts. Some producers look for ways to streamline the quoting process, others avoid hard conversations with clients, and many rely on endorsements or extensions because they are “easier” than diving into the details. Nowhere is this more dangerous than in the world of cyber insurance.
Too many agents assume that a cyber endorsement on a BOP or commercial package policy is “good enough.” It isn’t. In fact, treating a BOP cyber extension as a replacement for a standalone cyber policy leaves clients dangerously exposed, puts producers at risk of losing accounts, and opens the door to costly errors and omissions (E&O) claims.
Cyber threats evolve faster than any other area of risk, and endorsements simply can’t keep up. If producers want to protect their clients and themselves, it’s time to understand why standalone cyber insurance is non-negotiable.

Profiling, Preparation, and Persuasion: What Middle Market Insurance Producers Can Learn from Diamonds, Intelligence Work, and Executive Coaching

February 23, 2026

In the middle market, producers don’t lose because the competition has better pricing.
They lose because the competition understands people better—their motivations, their fears, their priorities, and what makes them say yes.

Cyber Insurance Risk Management: Why MFA, MDR, and BYOD Policies Can’t Wait for a Hard Market

February 18, 2026

The cyber insurance market has softened in recent years. Requirements that were once rigid — like mandatory multi-factor authentication (MFA) or endpoint detection and response (EDR) tools — have been relaxed by many carriers. But here’s the danger: just because carriers aren’t demanding these safeguards today doesn’t mean businesses can afford to ignore them.