Case study: Ladder loves embedding for maximum distribution

Case Study: Ladder likes to embed for maximum distribution

“We’re always looking for ways to continue to innovate,” said Mike Izakov (pictured), head of financial institution partnerships at Ladder. “We have a lot of work to do.”

The company and its 150+ employees are in growth mode. Ladder has raised nearly $200 million in venture capital to date, including about $110 million for product expansion and headcount. Ladder launched in 2015 and debuted its first product two years later.

Secret sauce

Ladder’s ability to deliver flexible coverage digitally in a short amount of time comes from what Isakov said “takes a holistic approach and builds every piece.”

This included designing the product itself, as well as an underwriting engine that allows the company to process claims in real-time. Ladder also operates a policy management system that aims to give consumers the ability to manage their policies. Flexible insurance means that customers can “ladder” or adjust their coverage as their needs change.

Isakov said Ladder’s approach is different because it operates in multiple ways, in part through partners Fidelity Security Life Insurance Company, Allianz Life of North America and Allianz Life of New York. The company’s Ladder life product is proprietary and built on the paper of their carriers (California-based Ladder Life Insurance Company is separate).

The company’s core digital platform is designed to be carrier-agnostic and leverages layered APIs with partners.

“Our APIs allow partners to embed every step of the purchase journey into their home environment, whether it’s consumers figuring out how much coverage they need or applying online and [then getting] offer, [or] we can link our policy all the way to the other end of managing that policy,” Isakov said. “We have APIs that enable all of these things.”

Machine learning is a critical ingredient that helps Ladder continuously optimize its underwriting process and improve the application experience. In addition, Ladder’s insurance engine is both unique and crucial, Isakov said.

“We don’t take shortcuts or deal with a simplistic problem that only serves a few hours of health, [and] we are moving from preferred plus to non-standard table ratings,” Isakov noted. “One of the reasons we can do this is…it took us two years from inception to launch. [a debut product]. We really built this insurance engine to process claims in real time.

This insurance engine also allows integration of third-party data, which allows the company to verify the information that customers provide it in real time, Isakov said.

Integrations

Typical integrations include fintech applications, such as a bank’s mobile app, or financial institutions, such as SoFi, a private finance company, and an online bank that manages mortgages and other financial services.

The SoFi partnership began in 2018, and Isakov noted that they have a consumer finance wellness platform that highlights its various products. SoFi partnered with Ladder and embeds it into its customer-facing systems.

As a certified member, you can calculate your life insurance coverage needs by logging in. You can view personalized offers or get a quote on insurance coverage, and there you can apply and buy life insurance policies,” said Isakov.

When a customer approaches Ladder about a potential integration partnership, the company first examines the customer’s needs and whether they would benefit from learning about life insurance on the proposed platform.

Assuming this is the case, the conversation explores the best relationship for mutual benefit and gain.

Partnerships/integrations range from where the partner simply promotes Ladder to customers, to a sort of white label experience where Ladder is fully embedded in the partner’s system.

Assuming a potential partner wants deeper integration, the product and engineering teams on both sides will connect. Ladder presents potential options based on the customer’s platform and Ladder’s capabilities, and then Ladder “builds the integration and schedule,” Isakov said.

Next, attention is paid to creating a secure connection so that both data and user experience can flow back and forth. He noted that product designers step into this by working with customers to create the best possible customer journey.

Also key here are APIs, which Isakov said “provide the pipeline on the back end” that allows you to shape the customer journey on the front end. Both companies exchange API credentials, and Ladder provides a sandbox environment for testing and design tweaks.

The process can take from two weeks to two months from start to finish, depending on the size of the client and their integration needs.

Isakov said that there are currently only a few hundred partnerships of this nature. He added that these attachments/integrations should grow “significantly” by the end of the year.

“Over the past few years, partnerships have become our biggest distribution channel,” Isakov noted.

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