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Making Insurance Palatable for the Green Industry | Perspectives from ArboRisk

August 6, 2020

People buy insurance because they have someone to pay for their mistake or cover their accident, but insurance isn’t all-inclusive, and insurance isn’t risk management.

In this episode of the Green Industry Perspectives Podcast, Sean Adams welcomes Eric Petersen to the show. Eric has a degree in forestry and spent time as an arborist, and after being laid off from his job due to budget cuts, he began a career in his family’s insurance business. Eric addresses how to make insurance more palatable for the green industry.

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On this episode, you’ll learn:

Why having an insurance policy is not practicing risk management.
The areas of risk in your business, you need to evaluate today.
The importance on establishing a company culture that works for your team.
Developing a structured schedule time blocks to evaluate your business.
Understanding how to dictate your future with insurance companies.

What to listen for:

[2:15] Eric’s journey from arborist to insurance provider.
[5:30] Insurance is not risk management.
[14:30] Utilize associations and the resources they provide.
[20:05] Develop a strategic plan.
[30:15] The power of “time blocking”.
[35:00] How to prepare yourself to get the best insurance deal.

Links to love

Full Transcript:

Sean Adams:
You are listening to The Green Industry Perspectives podcast, presented by SingleOps, a podcast created for green industry professionals looking for best practices, tactics and tips on running their tree care or landscape business. Eric, welcome to the show.

Eric Petersen:
Hey, thanks, Sean. Appreciate you having me.

Sean Adams:
So, we like to kick off with some immediate value for our audience and I like to ask everybody that comes on the show right away what do you find as the top three traits, actions, ideas, mantras that you tell yourself or that you’ve found have contributed the most to either your success or some of the success you’ve had with your clients as well?

Eric Petersen:
Sure, yeah. Personally, I think it begins with me having this feeling of responsibility to help my clients get every employee home safe each and every night, really taking what we do seriously and having that that responsibility that I owe my clients the best attention to safety and risk management for their firms. Probably the next step and where that comes from is my combination. I was an infield arborist for a little bit before joining the insurance industry. So, I’ve been able to combine both backgrounds and kind of talk the lingo on both sides and make it work for not only the tree care industry but also for the insurance industry to understand what tree services do. And probably, the last thing and the most time that I’ve spent is just simply volunteering different International Society of Arbor Culture chapter conferences, membership committees, the ANSI Standard Committee for Safety, those type of things, just volunteering and being involved in the industry, learning, meeting more people, guys like you and talking, giving presentations. Those type of things have been the best top secrets I guess of what has led us to this point.

Sean Adams:
Love it, love it. Yeah. And then bumping into you at a couple of the events this past winter and kind of seeing the entire educational side of what you put on, it’s one of the reasons we synced up. We’re very like-minded in that sense and I think you’re putting a tremendous amount of value out there for the audience. So, greatly appreciate that.

Eric Petersen:
Thank you.

Sean Adams:
So, really great tips there. Let’s unpack, you kind of talked about this ability to have one foot in both arenas, the sort of operational background in the green industry actually being an arborist, understanding that world and then understanding the confusing, often hated world of insurance and all the baggage that comes along with that. So, give us kind of a rundown of how you got started in the industry and how that molded into your current role.

Eric Petersen:
Yeah, absolutely. So, I went to school for forestry, University of Wisconsin-Stevens Point, graduated in 2003, got a job right away out of college as an arborist with the municipal parks department, really enjoyed the infield work that I was doing. Unfortunately, budget cuts in the county that I was working in came through and I was one of the low men on the totem pole and I got axed off. So, I joined the family’s insurance agency and at that point, I asked my father for a job and just wanted to combine both backgrounds like you said. So, I started talking to some arborists that I knew from school, started attending the Wisconsin Arbors Association annual trade show and conference and really started to understand their challenges and unique parts of running a tree service and how it relates to the insurance and risk management piece.

So, insurance agents are kind of like tree services where a lot of tree services can get the tree on the ground safely, right? Insurance agents can issue a policy but it’s what that tree service does after the tree is on the ground or perhaps before the tree gets down in advising and giving consultation advice and that to the homeowner, that’s really where our specialty and my background has been able to help take the insurance world and make it palatable for the tree services because I know how they think and operate. So, it’s been a very good marriage of the two. It’s been a lot of fun to see my old college classmates in the professional world now and yeah, it’s been a great way to do that together.

Sean Adams:
Eric, what I love about your story and the way that you hold yourself professionally is that you really practice what you preach as far as specialization, understanding that target market, things we talk about all the time on the business side of I’m not trying to be all things to all people and while you understand that operational, the tactical side here, you’re saying I’m not going to just blanket my services, I’m not going to just go for the low hanging fruit wherever I can. I want to make, going back to your earlier points, I have a passion for getting people home safe in this industry. So, I’m going to help illuminate some of those things that maybe the blanketed insurance agent, just like the blanketed property management company, property maintenance company, they’re going to miss things, right? There are nuances here. And we’re certainly going to unpack some of those things and the insurance, the risk management. That’s kind of where I actually wanted to kick things off because as a former business owner in this space, my head used to spin thinking about these concepts and having to call around and just kind of throw your hands up at the end of the day because you just don’t know where to start and it’s very overwhelming and you have no idea, premiums and all these fancy words that get thrown around. So, for the audience, can you help just start by clarifying kind of risk management, the insurance side, are they the same things? If they’re not, what are those ways in which we could bucket or think about that from a high level?

Eric Petersen:
Great question, Sean. I truly believe that insurance is not risk management and what I mean by that, they are two separate concepts. Risk management in the general sense is the practice of lowering the exposure to your business, minimizing what could possibly happen from happening and so forth. Where insurance comes in after the risk management process has begun working and if you can’t do anything about it to prevent it or minimize it, that’s why you buy an insurance policy to pay for whatever happens. So, unfortunately, in the green industry, in business in general, people buy insurance and they think that yeah, I’m practicing risk management because they have someone that’s going to pay for their mistake. The insurance policy is going to pay to cover that accident. That mindset can be very dangerous because it’s not all-inclusive. It really should be take a look at all the different exposures that you have, make a plan for each one of them. Insurance comes in then at the end.

Sean Adams:
Absolutely. And I think this is such a good microcosm for how green industry professionals look at so many other elements of their businesses too, right?

Eric Petersen:
Right.

Sean Adams:
It’s a very reactive sort of superficial knowledge of certain elements and because they’ve got an LLC with their name signed at the bottom, they’re sort of this CEO in their own head but there’s just a lot that goes into this. And in order to succeed, there are very set procedures and processes and what I really like about some of the things we’ve talked about off air is your focus on strategy and this idea of being as proactive as possible, having things like a risk management plan in place before we even develop or leverage something like an insurance policy so that you can understand where your weak points are. So, let’s really get tactical here. Let’s talk about that business owner who’s looking at their organization. How do we come up with that strategic plan to say okay, I’m sure I’ve got risk all over the place, how do I even start to think about and maybe highlight some of those areas and how to attack them?

Eric Petersen:
I kind of try to make it as simple as possible and I think in five different areas. But I think number one as a business you have a lot of stuff. That could be your equipment that you take to the job site, that could be in your warehouse, it could be in your shop, it could be at your home office, right? You have stuff. What can happen to your stuff? Fire, theft, that kind of stuff, right? Could an employee walk off with it? One part that we want to think about there is also your income and your bank account and all those type of things that aren’t traditional insurance type coverages or thought process but certainly is an exposure to your business. So, we talk about your stuff. Then I like to talk about your people. Your people obviously are your employees. It could also be the subcontractor that you bring in to finish a job or to help with the crane work. What could happen to your people? Could they get injured? Could they cause damage? What are we doing with your people? Then the third one is other people, right? That’s your liability. What could other people do to you and your team? What could [inaudible 00:08:45] could be from a branch falling down on a little kid underneath you in a tree. We want to talk about your vehicles and equipment. That’s the mobile part of this, right? In the green industry, we’re not just contained to one four-walled business and it definitely has much more exposure when we leave our premises but we have to get our job done. So, your vehicles. And then the last thing and unfortunately, as a business owner this one typically gets missed too, it’s yourself. The business owner usually puts themselves last from a lot of ways. You know it from the income standpoint but also from a work comp standpoint, from an injury standpoint or disability standpoint. If you as a business owner aren’t there, what’s going to happen to the business?

Sean Adams:
We constantly get people asking us about sort of the systemization, documentation and what we do, thinking about how if I was to remove myself, not even from the liability perspective but just simply for a vacation or anything else, right? Most people can’t even conceptualize what that would be like. And so, I find that exercises like what you’re talking about are a great way to sort of be that 30,000-foot view on top of your organization and this is how you start documenting your processes and organizing where those bottlenecks are maybe operationally or with your leadership or your team or back office, whatever that may be. There’s this component of your safety and how that is weaved into our culture as a company or sort of that strategy that we’re going to put together. So, let’s say we sit down, we have a six-pack on Saturday night and we write out kind of all the gaps that we’re seeing and start thinking in those five buckets which I think is really tactical and useful for us. So, we kind of map out where those areas are. What do you see as sort of the next step from there once we sort of recognize maybe how over leveraged we are? What do you usually suggest for a business owner as a next step?

Eric Petersen:
Yeah. Another very good question there. I think when you’re talking about you have your list of what could happen to your business, right? You need to quantify or put some type of order of importance, right? What’s the most likely and most dangerous to my business? And let’s handle those first. The risk management world, they have these matrixes that you assign severity ranking but it doesn’t have to be that difficult, right? What’s going to put me out of business if this happens tomorrow and then we work on that. When you mention the safety, obviously, the safety comes down to the responsibility of the owner from a human perspective, right? So, the ultimate safety goes through all the different little channels of your business and I think it’s that culture of why you’re in business that makes that next step. So, if we know logically an auto accident could take us out financially, okay, we can buy insurance. That kind of takes that easy. But our employees, we need them to do the job, we need them to continue to be safe and all of that. I kind of rambled in a bunch of different directions there. But as you know, they all intertwine together.

Sean Adams:
A hundred percent, yeah. And that’s what’s so challenging I think where it gets into these gray areas for a business owner because they think about all the what-ifs but then they think about all these sort of exceptions versus the rules and then they start sort of spinning out of control because of all the variables that are there and it gets extremely overwhelming. So, I love the idea of taking it in bite-size chunks and looking at the big rocks, the big dominoes that I can start with that are going to make big improvements and then these other things, we can start to implement as we get time and as we have availability and we’re working in order of importance. So, that’s certainly going to help there. And maybe an off-topic question but as we start scaling down to the importance level there, I’m always a proponent of trying to speed up that learning curve whether that’s grab a manual or leverage an association or hire someone. What are some of those ways that a business owner might be able to sort of level up without having to reinvent the wheel? I think a lot of guys would go oh, oh, hell yeah, I’ve got this problem and I know that I need to have a solution for that and I’ve got like the rough outline but I want to be able to maybe pick up somebody’s manual or use a template somewhere. How do you think about that, if any of that makes sense?

Eric Petersen:
Yeah, exactly, Sean. Not reinventing the wheel is a big thing for any business owner, right? And there are a number of different resources. Certainly, I like to push our clients towards the associations that have a lot of templated stuff right off the bat that they can use. Your other business partners, your attorney, your accountant, your insurance agent, your software vendor, all the different partners that you use to run your business, they all have resources. So, making sure you’re connecting and understanding this one vendor might just be one part you think but they have connections well beyond it. Obviously, this whole podcast series comes from that perspective there. And there should be no shame in getting help from other people, right? I think one great thing about the tree care industry is people are so willing to share and help others I think because of the high hazard net aspect to it that I don’t see too much competition from basic things of helping the profession, the industry as a profession move along. So, reaching out to local International Society of Agriculture chapters as well as the TCIA, The Tree Care Industry Association are big, big things that I recommend all the time.

Sean Adams:
Love it. Yeah. And in the landscape side, the NALP, there are several nursery organizations, groundskeeper organizations. Every state has different entities that help put these things on and while there is a heavy focus on operational best practices, that safety component there, I mean it’s very prevalent in something like the arbor culture space where it’s obvious that it’s one of what? Maybe the top three most dangerous professions you could be in. So, it’s sort of a giveaway that that’s going to be a main focus. But even groundskeeping and how we have our ground crew dragging brush, right? There are best practices for how these things happen and not only from how to drag the trunk better and how to grab a piece of debris and move it safer but also how we think about this from this top-down approach as a business owner and we’re looking over how we’re going to weave things into when the guys get to the shop and I mean preventative things, sunscreen and bug protect. I mean there’s a million different avenues that you could go into and people only think about I’ve got this crazy dangerous saw in my hand and I’m 100 feet in the air so that’s what I want to focus on. And that’s obviously a top priority but there’s so much more trickle down that happens. So, I know a big thing for you is sort, of course, in your specific business now making sure that people get home safe and are able to have a nice and safe business, all these practices they’re building. But I want to talk about the culture side. I mean you’ve explained this well to me before about kind of how you help people start to weave that into their business at all elements and not just those crazy hazards that everybody thinks of right away.

Eric Petersen:
Yeah, absolutely. I kind of touched on it real quick in the beginning. But we want to talk about why are you in business and where does your passion as a business owner come from. That passion is what’s going to attract other people that are passionate and going to work for you in that same area. From there, then we have to separate out what we need to do from our operations standpoint, what we want to do from an individual personal standpoint, right? And get into the okay, if I want my company to be here in the future, I need to have my team, my people that are important to me get us there. So, ownership and responsibility, those are words that I use all the time. You’ve heard me already use responsibility a bunch but allowing your internal team members the ownership or responsibility to help move the whole organization to where you need to go. I think like a tree service that starts out, maybe they’re a good production arborist and I can do this on my own, I’ll run my own business and technically, they’re fantastic. But from a business standpoint, they don’t have quite the skills to be able to manage people, do the books and all the different components for it. So, accepting the fact that you might not be the best in all those areas, that’s okay. Understanding where you’re good and where you need help I think then can bring in other team members, building that culture and allowing your company to grow with other people and not just have it be the one main first owner of the business.

Our insurance agency is a classic example where my talents are definitely not everything of the business. No way. I need to have a lot of help in a lot of different areas and that builds that culture, that team. We use the word team all the time and really I think when you talk about a team, it is then when you go down the line towards safety, go down the line in terms of employee development and all of it builds on each other and it snowballs in a good way of building your business up where you want it to go. If you’re just trying to do everything on your own and you keep decisions just to yourself and you’re very closed in the information that’s shared between the other employees that you have, you’re not going to build that culture, you’re not going to build that trust, that attitude of safety or commitment to each other, to making sure that they get home to their families. All of that is so much harder to create. So, kind of wrap it all together, giving ownership of responsibilities, of tasks back to the employees to make sure that they feel responsible for success.

Sean Adams:
Yeah, yeah. That’s a really valuable insight there and it’s that while you want to have this trickle-down, top-down approach of you setting the strategy for what the business is going to be like, I find that there’s a lot of what we would consider like abdication, right? Where we find an employee that has a certain set of skills or a certain experience and we just sort of dump on that responsibility without parameters and if that person were to be say injured or just leaves, moves on, so do your processes or lack thereof. It’s very, very common. So, can you speak to that? I mean maybe it’s an injury and how that could cripple your business. Maybe it’s a key employee who leaves. To me, it sounds like we’re building a safety net around process and programs versus I went out and found really safe people.

Eric Petersen:
Right. Yeah, absolutely. One of the things we’ve started to help our clients with would be what we’ve called the knowledge transfer and that’s truly identifying what you just mentioned, Sean, and the fact of there are key people within your organization that know certain things that no one else does. You have to identify that and understand that if John Doe is gone, that set of knowledge and how he interacted with the vendors or with his crew or with that piece of equipment is gone as well. And I think also with the whole coronavirus quarantine and that whole shutdown and thing that we’re going through right now brought to light is what happens if we have half of our workforce out sick even if that’s only for two weeks. We know the season is X amount of months. We need to be operating during that time. We can’t just shut down for two weeks. So, I think this time that we’re in right now has helped hopefully companies identify like yeah, I need to know if my equipment manager Bob is gone that I’m kind of screwed. I need that knowledge not just with Bob. So, I do think that that’s part of the process of the risk management side of it.

Now I know you’re going to probably ask about this too. I think it comes with the needing to work on your business and not in it and that’s the hardest thing to do as a business owner especially when you’re just getting started or you’re down the road a few years, right? Setting up time to work on it has paid off a lot for me in the last two years but I was always so busy. I couldn’t get to that thing. I didn’t [inaudible 00:21:02] how you got to get done with this part. It’s production work. I got to do this now, I got to do that now and really setting aside time to do your strategic planning is huge. You know that, Sean. You’ve talked about it in all your different messages. I think that again ties into a lot of what we’re talking about. If the strategic planning of where you need to go and we know that there’s certain key people, we need to have a meeting with them and understand what they know and what you don’t know about their job so that you can make sure that it gets transferred the right way.

Sean Adams:
Yeah, yeah. And we talked about this before in my business that was the lead domino, the idea of getting that, I call it the knowledge silo, right? And just everything’s stuck up here or in one or two key employees and then that’s the process. But it’s sort of this transition, transfer of information that happens haphazardly and it’s just not documented. It’s not consistent therefore it’s not scalable and talk about being over leveraged and managing risk, right? You start to really see that when you sort of take that step back and you recognize that I’m one, two, three trip hazards away from a major issue here. And so, that’s a big part of that is identifying those things. So, we’re recognizing that we don’t want to just develop this super high level plan and just dump it on our employees. You mentioned this idea of having buy-in and responsibility from your team and having them a part of that. Can you talk to some of the ways in which we can help involve them in the process while still having where we’re trying to take that strategy but also not giving them free range to pick any sort of thing they want, whatever’s easiest? How do you help a company live in both those worlds, have the buy-in and have the ability to have insight in their own opinions in the mix and help you develop the plan without stepping all over their toes?

Eric Petersen:
One of the best things that we recommend right off the bat is talking about having a written job description. It seems simple, right? But if you don’t have them written out right off the bat, you involve your employees to write out what their duties are today and what they think they can handle into the future. Now if they need to do something else or they want to do something else, what other training do they need and you start involving them as an individual about them directly. They start thinking okay, if I want to become a sales person, I’m going to need probably some sales training or something else. So, now we can start building out like an employee development plan which is helping them take ownership in themselves and that’s what people want to talk about themselves the most right off the bat. But putting in little things. Okay, John Doe, if you want to get there, the company needs to do X amount in revenue. So, if we need the company to do that amount, what other things can you or someone else contribute to get us there? So, like I said, we start with a job description, we start talking individually to that employee and we work up that way through the employee’s perspective and to the bigger goal, if that helps answer your question.

Sean Adams:
It does, it does. Yeah. On a former episode, we interviewed Martha Woodward. She talked about this idea of kind of radical transparency both from the job description side but also revenue, company metrics, employee metrics. And she was saying how like even on the walls of the office, there was this visual sort of ladder of success and it was not a mystery, right? If you were the entry-level cleaner or the entry-level weed whacker or the grounds guy at X amount of dollars and you felt like you were the green guy getting beat up each day, you could see a very clear-cut path as to where you needed to go because management took the time with its team to sort of cultivate what was possible, where things could go. And that transparency took all the questioning out of the equation because then it was just okay, well, I need you as an employee, I need the business to be profitable in order to support me and I need you to be safe and I need you to be following the rules in order for me to be able to support you, right? And there’s this symbiotic relationship that can exist there. So, I think during this process when we’re doing this sort of excavation of our current processes or lack thereof, there can be a lot of big red flags that get pulled up and some organizations may be in growing phases where they can’t hire say a safety director or they can’t hire a dedicated person for that. And so, can you kind of speak to how you help point people in the direction when they’re—obviously, the associations and that sort of thing—but just understanding how they’re going to weave these new ideas in now that they’ve identified what they are, they’ve had a talk about where they need to go and they don’t have a dedicated person but they’re kind of working this direction? Because we know it’s all about that progress.

Eric Petersen:
Yeah, absolutely. So, speaking directly on the safety director position, if you want that title, right? It’s a big role and it takes a special person that can be able to communicate between the team on the ground or in the field and then the leadership team and what have you. I usually like to have the safety director if that title is in the small company not be the owner. Again, that creates that ownership, right? Now there’s someone else not just the owner that’s telling me what to do. Okay, this must be someone I got to listen to. It’s not the same voice over and over and over. But really it’s small stuff starting with you can form a simple safety committee. If you don’t have a safety director, just grab three of the best employees or maybe not even the best employees, three from different areas of your business and start asking them questions from a safety perspective. Once they start feeling comfortable with that, then you can introduce the safety document and have them read through it and comment on the first two pages for one guy and the next two pages with the next gal and so forth so that you kind of work through it together little by little. That builds confidence. That builds obviously awareness.

You can’t just dump it all at once like you said. It’s too much. It’s bound to fail if you just put it all on someone’s shoulders and they’re not ready for it. So, strategically thinking about it step-by-step, understanding that in a month it’s not going to look like what it did today and in two months, it’s going to look a little bit better. But it’s not going to be like this shiny new object that’s just done. It’s going to constantly evolve. Probably that’s the biggest thing that I’ve learned within my agency is we’re getting better every day and if we look back six months ago, we look different and it’s better than what it was. But as you’re going through the daily grind of it, it doesn’t seem like you’re making leaps and bounds but you really are. So, trusting in the process of you have a starting point and eventually an end point that you’ll get there, believing in your people to get you there and allowing them to help with it.

Sean Adams:
Yeah. When I did consulting work, I spent a significant amount of time with a few of my larger clients physically helping them write standard operating procedures and programs and putting everything in these nice shiny pretty boxes where everything could go. And one of the inherent issues was this idea both physically and mentally of putting it down on paper. Okay, here’s our process or closing the binder and then it sat up on the shelf whether that was it’s in their phone and they never looked at it or it physically was in the shelf in the office. And so, I love what you’re mentioning about sort of this iterative nature, right? We’re constantly improving. So, how do you suggest firms help bring and weave in that accountability so that we’re not just oh, you know our safety policy, it’s written on the door in the bathroom, right? Like check it out when you get time, make sure you’re always doing it but there’s no sort of check-in. So, do you suggest a cadence? Is it a series of meetings? I just want to get practical with maybe some suggestions for those that are looking into this on how to keep things relevant so that we don’t start to sort of phase them out when we get busy and other distractions and priorities come up.

Eric Petersen:
That is the biggest challenge, right? The storm rips through. Now you have storm cleanup to do. You got to get out there right now. Oh, now we’re delayed and we’re behind schedule and all that. We got to get back and get in the production mindset. That happens all the time. It goes back in my mind to that working on your business and not in it and the fact that you have to block the time, time blocking, whatever you want to call it. You have to say no, nothing is more important than moving this organization forward. That means even that storm work that we need to spend this two-hour block of time working on, our processes or updating our structure whatever that might be, the knowledge transfer piece and it has to be sacred time. Time blocking is so hard to do. I think anybody in business understands the importance of it but struggles with it daily. I’m no expert at it by any means but we started doing our weekly business tips two years ago now, two and a half years ago I guess it was. It was a struggle but I took Tuesday morning and that was my time and everyone in my organization knew that that was my time to do it. Now it’s just become part of what it is. It’s easy.

So, as we look to continue to improve our business, we got to set aside time. One of my clients in in Wisconsin, there are two business partners and they have a different skill set and they work really good together. They had a weekly meeting and one set the schedule one week, one at the schedule the next week and they would alternate that and that helped keep them both engaged and on the same page with what the other was thinking but also have their time to explain their ideas. That didn’t happen without time blocking. That was their sacred time that they kept together. There was another company that had two brothers that run it. They went golfing. They did nine holes of golf every Friday morning and that was their time away from the office. They talked about operation. They’re talking business the whole time. Sure, they’re having a fun activity but it’s out of the office and they’re by themselves. But they block the time.

Sean Adams:
Yeah. And even for the act of looking and making sure the processes are being followed, not even improving and adding to them. One of the things we always suggest is the daily huddle or at least a weekly huddle if we can like you mentioned. Unbelievably impactful for an organization because there is rarely a time in a mobile field-based business where we’re all in the same place? So, there are constantly miscommunications and, of course, technology and tools are very, very helpful to alleviate and be proactive to iron out a lot of these things. But there’s also something very visceral to being in a group with someone and being able to hey, you look really beat up or did you get enough sleep last night or what’s going on with your hands. I noticed X, Y, Z or just letting someone without a need for a huge amount of structure to just kind of voice what’s going on. We had in my company like a weekly, same thing on Fridays where we would talk through safety, kind of like a tailgate talk almost about a topic and here’s what I have lined up, guys. Where do you see gaps in this? So, it was like what are we doing really well on right now? Where can we improve? And then we’ll talk as a strategic team about how we’re going to implement that and more buttoned up process behind it. But we got them to sort of, the field staff who critically are the ones that are in the muck each day allowed them to sort of brain dump what was going on, the ones that are putting their life at risk in a lot of these cases, right? Fundamentally important to give them that sounding board to be able to express those things. You’d be amazed at what you can extract from those sort of meetings. It’s really powerful.

Eric Petersen:
Did you keep the same similar agenda so they started to come to expect we first start with the success, we first start with what’s positive, then we get into maybe a near miss or a challenge? Did you see, Sean, that keeping the steady agenda was helpful?

Sean Adams:
A hundred percent and that’s exactly what we would do. And what I started to do is actually get out of the meetings because I found when I was there, it was not the same meeting because it was oh, we’ll get it done, like whatever you need. Not that I was a dictator in any mind but it was I came in with the big idea and we’re going to do this, this and this and then it kind of trickled down from there. And so, when I started to delegate ideas, out one of the first things I started to do and my foreman said you’re not invited to this meeting anymore.

Eric Petersen:
That’s awesome.

Sean Adams:
Like it’s more powerful for us to talk. He’s like I’ll record it if you want to or I’ll type up notes or I’ll come to the office right after we have that and I’ll say look, here’s what we did well because I had all the data, right? I already saw the man hours, I already saw what our revenue was, right? I had the raw stuff there but I wanted to know the emotional, the feelings, who was upset, who was fired up about something, who was pissed off that he was working with this guy again today. Those sort of feedback loops. Who felt unsafe, who felt that the chains on the truck weren’t doing what they’re supposed to do. You don’t get that feedback on a work order and you do in the group setting where they feel like there isn’t a consequence of them bringing something up and having the structure of tell me what’s going right but more importantly any critical feedback. We genuinely want to know. If the roles were reversed, what would you add to the scenario? What what’s driving you crazy with your day-to-day? And that was so powerful for people to see that their opinions actually got folded into the mix for the processes that we’ve designed.

Eric Petersen:
And I think that’s exactly the success there needs to be that you actually listen and do something with the information they gave you, right? That’s the quickest way to shut it down than if you don’t do anything with it. But yeah, absolutely, that’s fantastic. Good job.

Sean Adams:
Yeah. And the communication loop was really powerful there. So, Eric, as we sort of transition to this next phase of this conversation, let’s say we’re putting this risk management hat on, we kind of develop our safety processes, we’re starting to get this communication back and forth from our team, we’ve got a good plan that we’re working on here. Let’s talk about the insurance side of this. This is an area where a lot of companies, again they just sort of turned a blind eye to because of the complexity that’s there. So, let’s just talk pure benefits to start with. How helpful is it from an insurance standpoint to look at an organization who has been proactive about these sort of things?

Eric Petersen:
Absolutely. So, my job as an insurance agent is to do a couple things, like I said, to help you as the customer get your employees home safe and have a job, a business still remaining if there’s something bad that happens. And it’s my responsibility to present your business to the insurance company in the best possible way, right? One area and why we specialize and do what we do is so that we can understand what you need to put in place and what you have in place and then explain it to the insurance company for that. I don’t know if you’ve heard this stat but they call it a loss ratio and basically in the insurance world, they want to make money, right? They’re a business. They need the proof that they’re going to make money on XYZ Tree Service. So, they look at a number of 60%; 60% loss ratio basically means the money that they take in from premium, from dollars that you pay for your insurance, if they’re paying out more than 60% of that back in claims, they’re losing money. So, it’s not taking in $10,000 and paying %10,000. It’s 60%. It’d be $6,000 that they’re paying out. When I explain that concept to our clients, it helps make sense more.

So, if we know the insurance company has this internal number that they’re looking at, we can help position your business saying well, we have our safety program, we have our fleet safety, we have our driver management, we have our hiring practices, we have all these different things in place that can help lower our risk management and therefore, we deserve a lower insurance cost. That process takes—I don’t know if process is the right word—that is a little bit longer and more involved of a communication between the company, the XYZ Tree Service through the agency to the insurance company but it really builds that connection and that bond that you want in your insurance company. You want them to be ready and be there for you and then add to where your deficiencies are versus a lot of times, we see the insurance companies dictating down to the individual company hey, you have to do this, you can’t have that driver, you have to do that, you got to change this.

If we start from the place of this is where we’re at and then bring it up to the insurance company, it creates that relationship and makes it an experience together, a partnership together. So, that’s really the biggest thing is helping your insurance agent sell your business to the insurance company. So, when people say I don’t want to give you that because I don’t want to share all my information, that’s a time where you have to say okay, well, if they don’t know you’re doing these things and you are, you’re going to be paying higher rates, higher insurance costs than what you should. If we’re open and we’re giving everything to the insurance company and showing them hey, this company is fantastic, they really take safety seriously or whatever aspect it is, it really helps.

Sean Adams:
Yeah. It’s that advocacy and what a quality agent is going to do that specializes and understands not only the industry that you’re in specifically like in your case of knowing the flip side of that, what that’s like but you also know some of the, like you said, what they’re really looking for. You know the filters and the criteria in which they’re going to black-and-white view your business against, right? And as a business owner, we’re very emotional about our business because we put so much time and sweat and blood into this, right? So, when someone just puts a number to us, we feel sort of diminished in that sense and it can be very emotional and we therefore just hate insurance companies, right? We start to bucket those things out there. And insurance, when you were talking, I started to kind of have a light bulb go off there in the sense that it’s largely one of the bigger expenses that we pay as an organization and it doesn’t go away, right? There’s no paying it off and it’s an inevitable expense for every company. And so, knowing that you have to pay it, knowing that there is a criteria in which you’re going to be judged against, taking this proactive view, why not wear that more as a badge rather than just sort of molding to what they’re asking for after the fact, very retroactively? And I mean that to say in like our proposals that we’ve helped companies put together, we’ve put certificate of insurance, we’ve put I carry this mess general liability, we put that on their websites, we would physically when we put together large projects, we would help people give them sort of the insight into their safety program and here’s what we do. These are actually differentiators for your business. These are not just what I had to do to appease to get my rate lower, right? So, can you speak to some of those examples that you’ve seen, that companies that have said I’m not just going to look at this for the insurance company, I’m also going to look at this because this is actually the standard in which I want to hold myself and my organization to?

Eric Petersen:
Absolutely. And I think that’s why insurance is not risk management, right? When we do the right things internally, lowered insurance cost follows and it follows whether we proactively tell the insurance company hey, we’re doing all these things or it’s just our experience from a claims, from an accident standpoint gets reduced intentionally, right? That’s our goal and therefore our rates evolve over time. If you can be more proactive to get the documents to the insurance company, you can speed that up but definitely insurance is one piece of the risk management process. So, we see it all the time. Tree services that have a low experience modification in their workers comp are the ones that are doing the safety programs, the tailgate safety, they’re talking about near misses, they’re having that open communication, they know what to do when there’s an injury. That’s a big thing that we see with a lot of companies that they don’t have many injuries, right? When they have one, it could be a bad one. So, how we manage that, how they manage it internally as an organization is huge and that therefore is reflected in their insurance rates for years after if they do have an injury.

So, the more that we can do to prepare ourselves and run a better business, the insurance rate piece follows. And I guess I want to mention on the insurance rate side of it, my industry, the insurance industry is at fault for a lot of the price gain that goes on with insurance. Hey, I’ll give you a cheap quote, I can do this, I can do it lower price and they spin applications out to different companies and they get one company this year and the next year it’s a different company and it kind of creates this game of chasing the lowest rate and when you do that, you lose sight of that relationship that you can build with an insurance company that can work on you long term. So, we like to say to our clients, we reshop our clients every three or four years unless something major happens. Now the reason we do that is we want them to build a relationship with the insurance company, we want them to understand that the insurance company understands how they operate and everything that goes with their business, knowing that there might be some bumps in there but at the same time, we’re looking at the longer term value for our client with that.

When we shop every year, the insurance companies actually start to tend to get turned off by that business because they don’t see it actually coming to them. If they’ve quoted it year after year after year, they get to the point of oh, here’s XYZ Tree, I’m not going to get this one. We’re going to put at the bottom of the stack, work on the ones that I can actually write. So, every three or four years, that’s a legitimate time to really reinvest. You should be looking at the insurance policies. You should be looking at your insurance policies every year from a coverage standpoint, from a values and all that but reshopping every three to four years is what we do and what we recommend, not every year reshopping.

Sean Adams:
Yeah. You took my next question. I was going to ask that because I’m sure we’re going to have some companies that are wondering what their current policy means, maybe making sense of what the gaps are in their current policy and when they should be sort of re-evaluating and not just thinking pure bottom dollar cost just like you try to demonstrate for your clients, right? There’s a reason in which you’re a little bit more expensive than your competitors. There’s a reason in which you pay a little bit more for the vendors that you work with. And if you have that sort of synergy there, then you’re practicing what you preach, right? Because you want that quality and again, it becomes a reflection of your organization. So, I love that logic. Eric, as we start to wrap up here and we’ll learn a little bit more about how people can start working with you, any final thoughts from an insurance standpoint, best practices, just maybe other habits or ideas or misconceptions that you see in the industry around insurance that you wanted to touch on?

Eric Petersen:
Yeah. The fact that insurance is not risk management. I beefed that up enough but that’s so important and it’s what radiates hopefully outward from our organization and really should be taken seriously on the consumer standpoint. But the other part of that is insurance may seem like a pain, like you mentioned, Sean. It may seem overwhelming or boring at times but if you look at any major disaster throughout the course of history in say the United States, the insurance companies are the ones that keep the businesses in place, keep things going, right? So, insurance has a place and a big part of your security and your stability as a business that it has to be taken seriously. So, not spending time with—if it’s something that totally bothers you, assign it to someone that has the responsibility or ownership that can dig into it. It is a relationship just like your attorney or your accountant that needs to be part of your ongoing operation. When you want to launch a new service, get into plant health care or start selling urban wood furniture, there’s a big liability difference from running a tree service and that needs to be discussed and figured out and make sure that there’s coverage there in case some injury happens from the other people section. Understanding that insurance is one of the pillars and risk management more so is the pillar of your business and giving it the time that really you should is very important.

Sean Adams:
I love that and it goes back to our delegation point, right? And finding what you’re best at, doubling down on those skill sets or strengths that you have, recognizing that your weaknesses are not to be put on a shelf and forgotten about but it’s okay for you to not do those. But someone has to do them because they’re equally as important. I always use the example of the accounting, the bookkeeping was always the part of my business I put because I just hated it. It was boring. I wasn’t interacting with people. I just couldn’t stand it, right? And I put it off for so long until it became such a giant issue that I had to involve and spend way too much money on, right? So, it’s the idea of saying look, I don’t understand this. As a company, we need to have that available. It’s okay if you’re not good at that but you’re going to find vendors, find partners, talk to people like Eric who actually specialize in that, right? If we asked Eric to come to your shop and change the oil, he’s probably going to be like that’s not something I’m very good at and I want to do, right? Because that’s not his expertise. So, it’s not about being this sort of jack of all trades. It’s about recognizing there is a spectrum of responsibility in your organization. Someone’s got to help you do those things or you’re going to pay to get that support and help but you don’t have to be all things to all people to your clients as well as to every element of your business. So, Eric, with all that said, I’m sure there’s going to be a bunch of people who are going to say yeah, well, one of those big points for me is insurance and risk management and I would love the opportunity to have an agent on my side who is the gap or the broker between this crazy scary stuff and where I am. How can people work with you or learn more about you? Just give us an idea of kind of how you help companies and the type of companies you help.

Eric Petersen:
I appreciate the opportunity. ArboRiskInsurance.com is our website. We have a ton of resources on there. I kind of mentioned the weekly business tip but every Tuesday morning, we send off a weekly business tip on employee management, business strategy, safety, marketing and sales, all those different topics and that’s a great way to get introduced to us as an organization. But on our website, there is a get started form that gives us some information directly about your company that we can begin to put together our thought process for your company. We really start with what we call the Arbo Risk survey where we go through and we ask the questions that are business topics. What are your challenges? What’s going good for you? Where do you see your company going? How do you do your training? How do you do your safety? That all tie into that risk management piece, right? That’s not just insurance because when we know those information, all that stuff, then we can take what we have and go to the insurance company and get you the lowest rate because the insurance company knows what they’re dealing with. So, we take an extra step maybe than some agents in just shooting off an insurance quote. That’s because we want to build that scenario for the insurance companies. So, we just have a phone conversation and we go from there. Sometimes we do Zoom calls and we have the client or customer walk around their shop right now during this pandemic so that we can see it. Visual inspection is huge as you know. We ask for pictures. They say so much about a company.

So, the more information that we can help get from the client to take to the insurance company, the better off it is and that’s really how we operate. And we also have a separate program called Thrive that gets into some of the business consulting pieces. That takes us kind of that next step on the risk management. When we talk directly, hey, I need to put together a higher end recruiting plan, we can help work on that. We walk through a bunch of different topics and questions and get you to the point where you know what you need to do to hire, you know where you need to go to find the people and you know what you’re looking for and then you can implement it. So, from a higher recruiting safety standpoint, like I mentioned, sales and marketing, overall business planning, those big topics, we said through our Thrive program that we have consultants all across the nation that help and have been in the industry. It’s been fantastic. So, trying to do what we can to help professionalize the industry, trying to obviously be the resource to make sure everyone gets home safe each night.

Sean Adams:
I’ll plug Eric even more because he was being generous with his introduction to his business services there. But I’ve seen him in action and talked to some of his clients when we were out at events and things and these guys are the real deal, right? So, if you are looking first off just high-level business advice or just good quality content that’s specific to our industry, go on LinkedIn, go on Facebook. The weekly tips, awesome, awesome program they put together. I’ve heard nothing but great things about Thrive as well from the business standpoint. And then obviously to get really tactical about the service, insurance is one of those things that I’m sure you have questions on. Take the time to speak with Malcolm or with Eric at the team. They put together a lot of really great content and they know the right questions to ask. You’ll notice that from the get-go. It’s very process-driven. They have an organization that practices what they preach which is one of the reasons we want to have him on here today. So, Eric, with all that said, I really appreciate your time. We didn’t even get into the recruiting side very much just because we didn’t want to keep you here for three hours. We’d love to pick that conversation up at a later time. But really want to just thank you for your time. Really appreciate you being here.

Eric Petersen:
Absolutely. Thank you so much, Sean, and keep up the great work. You’re doing an amazing job for the industry and it’s been really fun to follow you. I’m so glad that we got to meet in person a number of months ago and it’s been great. So, I really appreciate it and look forward to what’s next coming from you.

Sean Adams:
Thanks so much. Really appreciate that. We’ll catch you in the next one.

Eric Petersen:
All right. Thanks. Take care.

Sean Adams:
Thanks for listening to this episode of Green Industry Perspectives presented by SingleOps. If you got some value out of this episode, drop us a five star review on your favorite streaming platform and don’t forget to become a pro member of the podcast at SingleOps.com/podcast. As a pro member, you’ll get notified of each new episode, access to exclusive bonus content and be entered in to win some great prizes. Thanks for listening and don’t forget to tune in next week.