SNC Spotlight

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Innovation and Client Experience

We define success by more than financial outcomes — we consider the quality of our relationships with our clients to be just as, if not more, important. Our high NPS score is due to State National’s culture, which is built around technological innovation and customer experience.

Innovation and Customer Experience

The Pillars of State National Culture

With 2020, a year like no other, finally behind us, I — like many of you — am excited about what 2021 has in store.

As an eternal optimist, I am expecting great things in the year ahead. However, I’m also a pragmatist, and I know that expecting is only half the task. Looking forward realistically requires reflection on what has come before.

Taking a good hard look at past performance is essential, whether you’re talking about personal success or a company’s success.

At State National, we define success by more than financial outcomes — we consider the quality of our relationships with our clients to be just as, if not more, important. Building lasting, solid relationships has been at the core of our business for almost 50 years.

That’s why it’s essential for us to reflect back on our partnerships each year to assess how successfully we accomplished that mission. We have several metrics we use to do this, and many are built directly into our business model, from our Annual Client Survey of Service Quality to our Net Promoter Score (NPS).

And although those scores have continued to rise year over year, we know that simply patting ourselves on the back and resting on our laurels won’t cut it. As long as there is ANY room for improvement, we want to find those opportunities and capitalize on them.

Drilling Down Into Marketplace Perceptions

To that end, in 2020, we wanted to take a deeper dive into understanding how we are perceived not only by our clients, but also in the greater collateral protection insurance (CPI) market. This goal led us to a partnership with the Mays Business School at Texas A&M University, whose team surveyed a variety of stakeholders in the marketplace — not just our clients, but also those who currently use another provider.

Overall, the results reflected our prominence in the industry and largely validated what we already knew. It was great to see that lenders who are familiar with CPI recognize that State National’s commitment to innovation has led to us having the most advanced technology available — and by quite a large margin. We also ranked higher in the areas of service speed and borrower communication.

To be completely transparent, we are so proud of the superiority of our technology and the continual, substantial investments we’ve made when it comes to innovation that we’ve talked about it a lot! For years, our messaging has highlighted our technological advances and innovations in CPI delivery.

Many of our marketing efforts as a company have revolved around telling the story of how our AI robots, VeriTrak processing system, and other innovative solutions make our programs tops in terms of speed, accuracy, and ease of use. And while that is all true, it means we may have neglected to tell another story that is just as important, and frankly, just as impressive — our service story.

To learn more about how our bots work for you, watch the video.

More Benefits With Less Effort

Because our technology IS so seamless, our programs don’t require a lot of hand-holding. Our users have a dedicated Client Executive who is always available to provide whatever service and answers they need — but because the overwhelming majority of transactions go very smoothly, they don’t have to contact their CE very often outside of routine visits. In other words, it’s one thing to say that you were able to call up a service provider and they handled your problem for you, and it’s another thing to have things work like clockwork and never have had a problem in the first place.

We, internally, know beyond a shadow of a doubt that we provide better overall service than our competitors. It’s just a fact. We know it because we hear about it from clients who have transferred from other companies — including those who were with us, switched to another provider thinking “they all offer the same thing,” and then switched back after they quickly realized how untrue that really is.

We know that recorded calls immediately on demand in InsurTrak are not the same as having to make a specific request for a call record and then wait weeks to receive it. We know that offering our clients a turnkey text messaging program at no cost to them is not the same as giving them a 3rd party referral and a loan file and letting them handle it themselves. These are just two examples of how State National goes the extra step at every step.

We also know it because of our world-class Net Promoter Score of +86 that ranks us among companies known for their stellar service, like Amazon, Apple, and Tesla. And that score went up again for the fourth year in a row — during a pandemic!

True Sky & State National: Technology Partnership Enhances Member Experience WATCH THE VIDEO

Always Here for You, in Both Good Times and Difficult Times

Speaking of COVID-19, I am happy to say that our business partners gave their Client Executives an overall score of 4.9 out of 5 for how accessible and helpful they were in guiding their institutions through what was a difficult year by any standard. Our clients told us directly that our flexibility and expertise helped to provide them with a proven, stable, and reliable program in a time of uncertainty.

I know this may all sound like a lot of braggy self-promotion. But based on what we know to be true about actual service delivery, we deserve to be braggadocious! In the words of our boisterous and exuberant Executive VP of Sales, John Pearson, “I just don’t understand how we don’t have ALL the business!” In 2021 we are determined to shatter the myth that all CPI providers are the same, and will work to highlight our many distinct differentiators and exclusive benefits. When it comes to portfolio protection, State National is simply the best in the business.

That’s our commitment to ourselves, to our clients — and to our future clients. Thank you, and I wish all of you the best in 2021 and beyond.

Jeremy Clark
Jeremy Clark
State National Sr. Director of Client Service Jeremy Clark leads State National's Client Executive Group to facilitate client support, satisfaction, and retention.

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With Custom QR Codes, It’s Now Even Easier for Your Borrowers to Upload Their Insurance!

State National brings back QR codes — now new and improved!   When was the last time you scanned a Quick Response (QR) code? Was it on a restaurant menu, on a real-estate sign, or maybe to access a form? The reliable QR code has now become a part of our daily life. In our mobile-first technology era, QR codes are back, giving consumers instant access anywhere to the targeted information you want to provide them. There is no need to keep pamphlets in stock or worry about your customers going to the wrong website when scrolling past noisy ads on search engines. While State National has offered our clients the ability to have QR codes on their borrower notices before, there was not a real demand for them until the recent increase in use sparked by the pandemic. With increased consumer receptiveness to these abstract squares and State National’s dedication to constant improvement, we are harnessing the power of QR codes again — adding on improved customizations that make it even easier for borrowers to submit their insurance when they take out a new loan or have a lapse in coverage. "We appreciate having a good vendor partner that understands your needs sometimes before you even know you have a need. State National is always looking for ways to make things better for your staff as well as your leadership.” – JAX Federal Credit Union QR Codes for Borrower Notices Borrowers can scan their personalized QR code on their mailed paper notice and be directed straight to their personal account on MyLoanInsurance.com. On this borrower-friendly site they can view their insurance status and easily provide updated proof of insurance. Since the QR code on each borrower’s notice is specific to them, no reference ID or PIN is needed, and the webpage will automatically populate with their name and vehicle type. A helpful short video applicable to their particular situation will instruct them on exactly what they need to provide to resolve their specific impairment. And finally, the site will also show them how to easily upload and submit their information. Our borrower-specific QR codes personalize the website borrowers are directed to, including details such as informing them if the lien holder is missing or if their deductible is too high.   QR Codes for Lenders Lender custom QR codes are another way we provide total access and empower your borrowers to easily update their insurance with us before they even enter our notice cycle. These institution-specific lender QR codes can be used anywhere you choose, including your website, lender agreement, and loan closing documents. Borrowers who scan your custom lender code are directed to a MyLoanInsurance.com page branded with your financial institution’s name and logo. From here, borrowers can upload insurance even if they do not know their access PIN.   Pro Tip: Add Your Lender QR Code to Your Lender Agreement to Prompt New Borrowers to Submit Their Insurance We encourage you to add your custom QR code in your new loan packet and actively point it out to borrowers when they take out a vehicle or home loan. Let your borrowers know they can scan that QR code to quickly and easily provide their insurance details. The visual effect of having the QR code on the agreement packet reminds the borrower to take action, and as soon as the website pops up, it tells them exactly what they need to do to update their insurance. MyLoanInsurance.com is accessible 24/7, so borrowers with missing information or a lapse in coverage can update their insurance at any time, at their convenience.   Scan Here for an Example of a Lender QR Code Leading by Always Improving Since 1973, State National has been dedicated to a culture of continuous improvement. We are proud to be the technology leader in our industry, and are consistently evolving to make portfolio protection easier, faster, and more user-friendly for your borrowers and your staff. We are glad to provide our lenders with these customized QR codes as the latest feature to make the process even more seamless and convenient. Borrower QR codes are already actively employed on all mailed notifications. To find out more about getting your own customized lender QR code, contact your Client Executive today!

Tackling Inflation and the Auto Industry Part 2: Maintaining Your Competitive Edge

Inflation is squeezing businesses and consumers alike. Perhaps the easiest industry in which to spot the consequences of financial stress is the automotive industry. How can you maintain a competitive advantage while also protecting your portfolio in this market? Read on to find out.   Spotlight Soundbite: Maintaining Your Competitive Edge During Auto Industry Inflation   Consumers Are Facing Post-Pandemic Financial Stress The government’s stimulus checks have long run out, as have the grace periods many financial institutions implemented at the beginning of the pandemic. Many individuals have returned to work and are again bearing the costs of gas, transportation, childcare, and other employment-related expenses. With many Americans increasingly financially strapped, what does this mean for lenders? Unfortunately, prices are soaring and may continue to rise. We know that those directly impacted by inflation (which is all lower- to middle-class Americans) alter their consumption, investment choices, and spending habits as their purchasing power decreases. Something has to give as many consumers struggle to make ends meet. Unfortunately, many may choose to scale back on or even cancel their auto insurance as a result. In addition, consumer debt-to-income ratio is expected to increase. As borrowers take out large auto loans, particularly on used cars, they will be stuck with these loans even if the value of the item purchased decreases long-term — potentially putting borrowers upside down on their loans, with a vehicle worth considerably less than what they still owe in the future.   Revenue Lost in Charge-offs What does this mean for financial institutions? Unfortunately, this financial stress being felt by consumers also increases risk in a lender’s loan portfolio. As financial institutions are providing loans for vehicles with a hyper-inflated value, it’s likely they will see an increase in bad debt as those loans start to default to historic norms and possibly higher. Without proper risk mitigation measures in place, if the collateral sustains damage or loss when a borrower is uninsured or underinsured, the financial institution making the loan can also find itself “upside down,” so to speak, with the claims amount received insufficient to cover its exposure. Not all is lost, however — financial institutions with a high-quality portfolio protection insurance program will experience relief from a significant amount of this bad debt. Not only will this critical protection keep your borrowers covered, it will also safeguard your balance sheet.   Insurance Tracking Also Helps Lenders Manage Risk In addition to the protection provided by the insurance coverage, lenders can also use the detailed borrower insurance tracking in the program to assess and mitigate risk. High-quality, real-time tracking allows lenders to leverage knowledge of a borrower’s lack of coverage as an indicator of when a loan may be at a higher risk of default. This early warning sign provides an opportunity to initiate preventive steps to work with those borrowers to avoid collections, as well as take proactive measures to step up early collections efforts.   How a Program with State National Tackle Inflationary Hardships We can help as you are undergoing a double squeeze from tighter net interest margins. In addition to decreasing your charge-offs, here are a few of the relevant ways our program supports you no matter the storm. Our partners have full transparency and access to immediate real-time data with InsurTrak, the industry’s only system built from scratch specifically for CPI. It’s your single sign-on source of truth for insurance tracking, claims, and reporting, resulting in maximum ease, speed, and transparency. With your loan portfolio data at your fingertips, accessible instantly all in one place, it's easy and quick to identify trends and potentially at-risk borrowers. Our internal infrastructure is supported by our parent company Markel, a $33 billion Fortune 500 company, which has been proudly rated “A” (Excellent) by AM Best for many decades and is regarded as an industry leader. Our combined tenure, strength, and expertise translate to unmatched peace of mind and security for our partners. Our Claims Advisory Recovery Services (CARS) boosts your bottom line by mitigating your auto portfolio losses, reducing your internal expenses, and giving you more time to spend servicing your borrowers. 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To read the first article in this SNC Spotlight series, Tackling Inflation and the Auto Industry, visit: Protecting Your Credit Union from Car Market Volatility    

Tackling Inflation and the Auto Industry Part 1: Protecting Your Credit Union from Car Market Volatility

In today’s auto lending environment, a comprehensive and high-quality portfolio protection program is more important than ever — including partnering with a provider that will pay the full loan balance instead of actual cash value (ACV).   Protecting Your Credit Union from Car Market Volatility   According to Scott Colbert, EVP, Chief Economist for Commerce Trust Co., in Q2 of 2022 there were 17,000 auto dealers in the U.S. — but there are only about 34,000 new vehicles on those dealers’ lots. That’s roughly only 2 to 2.5 new vehicles per dealer available today. Employees have returned to work amidst a shortage of the auto parts necessary for the vehicles they drive to get there. New car inventory sits on hold due to a shortage of microchips and other supply chain issues. Some dealerships report their back order for new vehicles ranges from a couple of months to 5 years! This has caused used car demand to skyrocket, along with sticker prices. According to J.D. Power, the average sales price of a new vehicle during the first six months of 2022 hit a record of $44,907 — 17.5% higher than just a year ago. Edmunds.com reported that 12.7% of borrowers who financed a new vehicle in June 2022 had monthly payments of $1,000 or more. And used cars are definitely not exempt from rising prices — the average monthly payment on a used car was $503 in the first quarter of 2022 — up from $413 for the same period in 2021, reports Experian.   Relief Is Not Yet In Sight Analysts don’t expect auto prices to begin leveling off until late in 2023 or even into 2024. Unfortunately, people who need a car now don’t have the luxury of waiting for prices to decrease — they will pay whatever they can stretch to afford. To meet this demand lenders are offering larger and larger loans for both new and used vehicles. This desperation in the car market has forced many borrowers into disproportionately high-cost auto loans — with recent higher interest rates adding to borrowers’ monthly payment burdens.   Borrowers Aren’t the Only Ones at Risk Future market volatility has the ability to impact a vehicle’s perceived value between now and when a member pays off their loan. Today’s larger loan balances and longer loan terms leave them at risk of being upside down, with a vehicle worth considerably less than what they still owe. As a result, this also increases risk for credit unions in their loan portfolios as they are providing loans to their members for vehicles with a hyper-inflated value. If the collateral sustains damage or loss when a borrower is uninsured or underinsured, the credit union can also find itself “upside down,” with the claims amount they receive insufficient to cover its exposure.   The Good News The solution? When you partner in a high-quality collateral protection program with State National, you can receive Waiver of Actual Cash Value (ACV) coverage — which means State National will pay the value of the entire loan amount remaining and not just a car’s value at the time of a claim. In “normal” times, Waiver of ACV coverage is a valuable tool for decreasing risk in a lender’s portfolio. In times like these, when lenders are already being double-squeezed by low net interest margins and increases in bad debt, it’s a vital part of a successful credit union’s risk mitigation strategy. For more information on how this valuable solution can help your credit union, contact one of our specialists today!   To read the second article in this SNC Spotlight series, visit Part 2, Maintaining Your Competitive Edge.