Long-time mortgage industry executive Jerry Halbrook has been named president and chief operating officer of insuretech Covered Insurance.
Halbrook's hiring is the latest sign of the convergence between the lending process and insurance, the company said.
Property insurance costs have increased in recent years, and in some states, it has become difficult for borrowers to obtain homeowners coverage as increasing numbers of natural disasters have forced some underwriters to exit.
While on average, homeowner property insurance costs of all types nationwide in the
As a result, over 20% of homeowners in Miami do not have coverage.
Why adding an executive with mortgage experience was important
Covered's business is heavily relationship- and trust-based, as well as highly nuanced when it comes to technology and regulation, explained Ross Diedrich, its CEO.
"We've taken pride in understanding our partners' businesses, and with Jerry, we can double down on our industry expertise," Diedrich said.
Covered looks "to really understand our partners' businesses better, and figure out ways to make it easier for lenders and servicers to adopt the value that we can provide."
Diedrich said Halbrook is a "remarkable talent," with a track record heading up financial services and technology companies.
"Jerry has not only walked that path multiple times, but he's operated startups, scale-ups and large enterprise organizations." Diedrich continued. "So with where we're at in our growth, having a been there, done that executive like Jerry to help us do the best we possibly can and take the company to new heights was a no-brainer for us."
What is Jerry Halbrook's background
Halbrook's first mortgage industry executive position was as chief financial officer of Prudential Home Mortgage between 1991 and 1996, his LinkedIn profile said. He next became managing director-capital markets at Citi for two years.
He founded Nexstar Financial in 1998, which was acquired by MBNA; that company then became a part of Bank of America.
In 2008, Halbrook became senior managing director at Nexspring Group.
About three years later, he became
In November 2018, Halbrook became CEO of Volly for almost the next four years. Between September 2022 and December 2023, he was
Where insurance and mortgage are now converging
With that background, Halbrook can help Covered address the pain points of insurance within the mortgage process, through creating innovative solutions, Diedrich said.
Covered has become a large player in embedding insurance in the mortgage process, but until now it has been in the shadows, he said. Another reason for bringing Halbrook in is to increase its brand awareness and visibility, especially at a time when both on the origination side and the servicing side, insurance costs are a concern.
If the homeowner still has a mortgage and lets coverage lapse, the servicer needs to obtain a lender- or force-placed policy, which not only can be expensive, it does not make for a good customer experience.
On the origination side, "double digit" percentages of transactions are not going through because insurance is costly, and in some areas it is difficult to find coverage, Diedrich noted.
"There's certainly an opportunity for us to better support our lender partners, to help them reduce the fallout that's related to insurance," he said.
Halbrook added that Covered has 60 carriers in its network and if it can help the lender find their borrower a lower cost alternative, the debt-to-income ratios are lowered and the loan now qualifies where it might not have because of those higher costs.
"That's the value on the origination side, is to help them close more loans and have better experience for their customers," Halbrook said.
Not only is Halbrook versed in the economic and customer issues, but on the technology side as well, noting he is familiar with the various platforms the mortgage industry uses.
"I know all the technology partners," Halbrook said. "We've got pretty active progress going on right now with expanding our integrations to more and more of the mortgage technology partners, so that it becomes really easy for the lender to access our service."
Meanwhile, Covered is gaining traction with servicers of correspondent and wholesale loans because of the customer experience factor, Halbrook said. The most recent J.D. Power servicer customer satisfaction survey bears out that
Most of these servicers are looking to retain the customer for their next mortgage.
"If the customer's only experience with the servicer is that 'my escrows went up, and you couldn't help me,' what's the likelihood that they're going to go there for their next loan," Halbrook said.
