in consumer applications for financial services
One of the most interesting developments I have seen at Even is the sea change happening in the financial advisory sector. Financial advisors have historically focused on helping their clients manage their wealth, many of them refusing to take on clients who have less than $1M in assets. But with the introduction of robo-advisors like Betterment and Wealthfront, financial advisors have been forced to rethink how they help their clients. It’s no longer enough to help clients balance their portfolio when that task can be mostly accomplished by an algorithm. Financial advisors are realizing that they need to help their clients more holistically, and that includes looking at both sides of the balance sheet - not just with assets, but also with debt.
53 million US households have a combined $1 trillion in credit card debt, and that debt hurts their credit score and is not a wise economic choice if it can be avoided, due to the relatively high interest rates of credit cards. Further, 45M borrowers have over $1.5 trillion in combined student loan debt. These clients often feel that their next best dollar should be going to paying off that debt, which holds them back from developing an investment portfolio until much later in life.
Financial advisors are finding that offering solutions to help their clients deal with their debt, enabling them to put a plan into place, is often a great door opener to a long-term trusted relationship. At the same time, once that plan for debt repayment is in place, clients feel more comfortable putting money to work in the market.
Financial advisors are generally more familiar with traditional lending products like securities backed loans and mortgages, and might seem wary of the newer products that have proliferated as part of the fintech era born out of 2008. One of the key instruments to help people get out of credit card debt has been the advent of the personal loan. Financial advisors can easily identify when a client or prospect has a mound of revolving credit card debt, and then can support them by enabling them to refinance and/or consolidate that debt onto an installment loan called a personal loan. This loan doesn’t require the client to pledge any of their assets, rather it is an unsecured loan underwritten mostly based on credit history and income, with limits up to $100,000 and often single digit APR’s.
Many financial advisors recommend that their clients have at least six months of cash expenses on hand in case of an emergency, like losing a job or a medical issue. The obvious question a client might ask is then: “where they should keep that money?” Historically advisors haven’t had a great answer for this, but many advisors are now starting to plug into marketplaces where they can help their clients compare different high-yield savings and cash management accounts.
The evolution of the financial advisor space is something to watch in the coming years. As advisors are forced to differentiate from their algorithmic counterparts, the best weapon is the strength of the relationship and the advice they can bring. When I worked at SoFi, (now an Even partner), I was always amazed to see how happy their customers were when they refinanced their student loans or credit card debt, and how much of that positive halo accrued to the SoFi brand. Financial advisors of the future would be well served to learn from that and start using debt solutions as a way to help their clients take the first important step in their financial journey.
Disclamer: The material provided on this site is not intended to provide legal, investment, or financial advice or to indicate the suitability of any Even Financial product or service to your unique circumstances. For specific advice about your unique circumstances, you may wish to consult a qualified professional. Any information or statistical data sourced by Even Financial through hyperlinks, from third-party websites, are provided for informational purposes only. Although we promote products and services form our partners, our opinions are our own.
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Goldman Sachs-backed Even Financial, a digital matchmaker between banks and customers, just bought an insurance startup as life insurers are seeing policy applications boom
Even Financial has acquired LeapLife, a leading insurtech platform. The addition of LeapLife allows Even to immediately commence its insurance capabilities, aimed at simplifying and enhancing the way consumers search, compare, and get matched with insurance policies (LeapLife’s existing platform will continue to operate from leaplife.com). Business Insider wrote an article about it, interviewing our CEO and Founder Phill Rosen.
Even Financial Launches Insurance Offerings With Strategic Acquisition of LeapLife, a Leading Insurtech Platform
Pioneering B2B Fintech Expands its Industry-Leading Financial Services Monetization Platform to Help Insurance Carriers Find and Connect with Consumers New York, New York – April 22, 2020 – Even Financial (Even), the leading API for financial services search, acquisition, and monetization, announced today that it will be launching services for the insurance industry through the acquisition of LeapLife, an insurtech platform and digital life insurance agency. The addition of LeapLife allows Even to immediately commence its insurance capabilities, aimed at simplifying and enhancing the way consumers search, compare, and get matched with insurance policies (LeapLife’s existing platform will continue to operate from leaplife.com). Even and LeapLife now offer the only full end-to-end, multi-carrier digital life insurance marketplace experience. Over the coming weeks, Even will further integrate LeapLife’s technology and insurance offering into its industry-leading API, making turnkey insurance marketplaces programmatically available to a vast network of channel partners — when and where their consumers are most in need — while also enabling the company to expand to other insurance sectors, including homeowners, renters and auto insurance. This adds to Even’s peerless breadth of real-time, personalized financial product offers — an expansive suite that already includes loans, savings, credit cards, and more. “Even’s goal to evolve how financial institutions find and connect with consumers is not limited to loans or credit cards, but applicable to all financial products and services, including insurance,” said Phill Rosen, Even Founder and CEO. “Despite its importance, purchasing life insurance is often an overwhelming and inconvenient experience. With more than $600 billion in premiums paid each year, and only 6% of policies sold completely online, we see tremendous opportunities to help modernize the life insurance industry and offer solutions that solve challenges for consumers and carriers alike.” LeapLife is an established insurtech platform and digital life insurance agency that utilizes data science, deep underwriting knowledge, and proprietary technology, enabling consumers to apply for instant-decision life insurance policies with real-time quotes. LeapLife works with many best-in-class insurance carriers to offer consumers a seamless experience from beginning to end. This approach made Even and Leaplife a perfect match. As a digital insurance broker, LeapLife offers personalized life insurance recommendations based on a consumer’s unique needs. Paired with the Even API, which enables customer acquisition for insurance to be native and programmatic, consumers benefit from a more streamlined, transparent, and highly personalized experience when shopping for life insurance. Just as Even’s 2018 acquisition of Birch (the award-winning credit card rewards app) allowed the company to accelerate its expansion into credit cards, the addition of LeapLife will similarly put Even at the forefront of consumer insurance offerings. Charles Svirk of MassMutual Ventures, an investor in Even, said “The Even and LeapLife teams share a vision that the future of insurance acquisition will rely on the power of data-driven, programmatic distribution. We are thrilled to support them as their industry experience, impressive technology, and trusted relationships will help scale Even’s insurance offering and build partnerships to provide these critical innovations in insurance acquisition.” The Even API and platform solve significant, long-standing pain points in financial services acquisition by seamlessly connecting supply and demand. Even has continued its rapid growth trajectory in 2020, surpassing over $1.5 billion in credit issued through its API and expanding its platform to over 400 partners. Even has secured over $55 million in funding from major financial institutions, venture capital firms, and fintechs to back its goal to evolve the financial services acquisition ecosystem. About Even Financial Founded in 2015, Even Financial is a B2B fintech company that is transforming the way financial institutions find and connect with consumers. By seamlessly bridging financial institutions (including American Express, Goldman Sachs, and SoFi) and channel partners (such as TransUnion and The Penny Hoarder) via its industry-leading API, Even turns any consumer touchpoint into an ROI-driven, fully customizable, programmatic acquisition source for financial product offers with full compliance, security, and scale across loans, savings, credit cards, insurance, and more. Even is backed by leading financial services firms and VCs including American Express Ventures, Canaan Partners, Citi Ventures, F-Prime Capital (Fidelity), Greatpoint Ventures, Goldman Sachs, LendingClub, and MassMutual Ventures. Even is the leading search, comparison, and recommendation engine for financial services. Media Contact: email@example.com
Even CEO/Founder Phill Rosen quoted in Protocol Braintrust Newsletter
Our CEO and Founder Phillip Rosen was included in the most recent Protocol Braintrust newsletter along with answers from some thought leaders from Plaid, Slack, and DuckDuckGo!