2025-01-13 Root, Inc. Presents at 27th Annual ICR Conference 2025

Unknown Analyst

Welcome to the next company. We're going to speak today to Alex Timm, Co-Founder and Chief Executive Officer of Root. Alex is a veteran of Nationwide. He cofounded Root and is an actuarial by trade. Root has demonstrated a great ability to execute and perform, but importantly, they are early in their growth trajectory and the best is certainly ahead of the company.

欢迎来到本环节。今天我们将与Root公司的联合创始人兼首席执行官Alex Timm交流。Alex曾在Nationwide任职，是一位资深保险人，也是精算师出身。他共同创办了Root公司。Root展现出了出色的执行力和业绩表现，但更重要的是，公司目前仍处于增长早期，未来潜力巨大。

Root was founded in 2015 by Alex and his co-founders based on the idea that insurance rates should be based primarily on driving behaviors, not demographics. They utilize mobile technology and data science to offer fair, personalized rates and to good drivers. Sorry about that.

Root公司成立于2015年，由Alex和其联合创始人创办，理念是保险定价应主要依据驾驶行为而非人口统计特征。他们运用移动技术和数据科学，为优秀驾驶者提供公平、个性化的保险费率。抱歉，刚刚有些打断。

Root went public in 2020. And today, it's the largest auto insurtech in the country in both one of the best underwriting track records in the industry.

Root于2020年上市。如今，它已成为美国最大的汽车保险科技公司之一，并拥有业内最出色的承保记录之一。

With that, let me introduce Alex.

下面有请Alex发言。

Unknown Analyst

And Alex, let me start with the first question. Can you share a brief history of how you got to where you are today, and how did you create Root?

Alex，我先来问第一个问题。你能简单讲讲你是如何走到今天这一步的？以及你是如何创办Root的？

Alexander Timm – Co-Founder, CEO & Chairman

I mean, first, right, it starts with the customer problem. And like I always say, I have never met anybody who, when you talk to them about car insurance, they're like, oh, what I get to do this weekend, I get to go shop for car insurance, right? Like nobody likes this industry. No consumers really enjoy the product. And you ask them why, right? And they're like, well, if I buy the red car, then I'm going to pay more or the black car. And no matter what I do, my prices just keep going up. I don't know how this thing works. It's a racket. It's -- I mean it's an industry that is generally pretty despised by consumers, and it's getting worse, obviously.

一切都始于客户问题。正如我常说的，我从没遇到过谁在谈到汽车保险时会说：“太好了，这周末我终于可以去买车险了。”没有人喜欢这个行业，没有消费者真正享受这项产品。你问他们原因，他们会说：“我买了辆红车，价格就上去了，或者是黑车也贵；不管我做什么，保费就是不断涨。我根本搞不清这个行业怎么运作。”这是一门“套路”生意，说实话，在消费者心中，它一直被厌恶，而且情况还在变得更糟。

And I -- to Brad's point on my background, I had a front seat to that. I'm an actuary by training. My father was an insurance entrepreneur. And I was working in corporate strategy at Nationwide Insurance, and it was my job to look at -- what do we do about this, right?

而正如Brad提到的，我的背景让我对此非常了解。我是精算师出身，父亲是一位保险企业家。我曾在Nationwide Insurance从事企业战略工作，我的职责就是思考：我们该如何应对这些问题？

And two big things were happening. The first is really the advent of data science and big data. And so as an actuary, I used to be sort of a hunter and gatherer of data. I used to say, oh, what's your credit score, can I get this credit report, and then put it in a linear model to try to figure out whether or not you're going to get to a car accident. And that was fundamentally changing, right? Now suddenly, we're all walking around with supercomputers in our pockets, called your smartphone that you're sleeping next to, and it's just generating data like crazy.

当时有两件大事正在发生：第一，是数据科学和大数据的兴起。作为一名精算师，我以前像是个数据的“狩猎者和采集者”，我会问你的信用评分是多少，能不能拿到信用报告，然后把这些放进一个线性模型中，试图预测你是否容易发生车祸。而这一切都在发生根本性的变化。因为现在每个人口袋里都有一部超级计算机——智能手机，甚至你晚上睡觉都把它放在身边，它源源不断地产生数据。

And so the data problem totally changed. It was now I get to plug into these sensors and I'm just awash in data. And I have to figure out what data makes sense and what doesn't. And it turns out this thing called machine learning and -- or artificial intelligence was super helpful. And so this was 10 years ago, and this was sort of when these algorithms really were starting to be developed.

因此数据问题发生了根本变化——我现在可以直接接入各种传感器，沉浸在数据海洋中。我的任务变成了要识别哪些数据是有用的，哪些不是。而事实证明，“机器学习”或“人工智能”非常有帮助。那是在十年前左右，这些算法刚刚开始真正发展。

And the second thing that was occurring was consumers are moving, right? Consumers are moving to the smartphone. It's the fastest-growing retail channel in the country, and there wasn't really a single large market incumbent that was leveraging mobile technology to meet consumers where they are.

第二个趋势是消费者行为正在转变。消费者正在向智能手机迁移，手机已成为全国增长最快的零售渠道。但在当时，没有任何一家大型保险公司真正利用移动技术去迎合客户的习惯和行为。

And so the core idea of Root was let's build an insurance company that meets consumers where they are on the smartphone. And by doing business this way, let's leverage all of the rich behavioral data that we can get off the phone to better and more accurately price risk. So insurance is all about matching price to risk, right?

因此，Root的核心理念就是：打造一家“在手机上与消费者相遇”的保险公司。通过这种方式经营，我们可以利用手机产生的大量行为数据，更好地、更准确地对风险进行定价。因为保险的本质就是价格与风险的匹配，对吧？

And by the way, by doing business this way, we can increase transparency. We can create a much better customer experience. We can offer 3-click purchases. We can -- now we're embedding with vehicles directly, so whether it's an OEM or a vehicle sale to make the consumer much happier to create a frictionless product, so it doesn't take 15 minutes to purchase a product online that you never wanted to shop for, frankly, in the first place. And so that's really how Root was born. It's been a long time. We launched the first product in 2016, and it's certainly been a journey since then.

通过这种方式运营，我们可以提升透明度，创造更佳的客户体验，实现“三次点击完成购买”。我们现在甚至直接与车辆系统集成，无论是OEM还是整车销售，让消费者获得更轻松愉悦的体验，打造“无摩擦”的产品——毕竟，没有人会真的想花15分钟去在线购买一份原本不想买的保险。这就是Root诞生的过程。自2016年推出首款产品以来，我们走过了漫长的旅程。

不太清晰的用户体验，现在各种订阅太多了，最好在一个地方管理所有的费用支出，这个地方一定不是汽车的显示屏。

Unknown Analyst

That's very interesting. Can you -- love to -- we have a lot of new investors here who haven't known the story. Talk about the technology. What's behind that? And talk about the distribution of the model.

非常有意思。我们今天有很多新投资者，他们可能还不熟悉你们的故事。能否请你介绍一下你们背后的技术？还有你们的分销模式是如何运作的？

Alexander Timm – Co-Founder, CEO & Chairman

So the technology, I said it a bit earlier, one, there's obviously our mobile app and our mobile phone, and we were really the first to come out and say, hey, you can use mobile cell phone data to sort of predict auto insurance claims. At the time, all of the sort of most of the telematics state in the industry is based on these things they call dongles.

关于技术，我刚才提到了一点。首先当然是我们的移动应用和智能手机。我们是业内第一家真正提出“你可以使用手机数据来预测汽车保险理赔”的公司。当时，业内大多数车联网（telematics）方案都依赖一种叫“dongle”（插头设备）的硬件。

And so the model was, hey, sign up for insurance. I'm going to ship you a device, you're going to plug it into your car, you're going to drive around with it for 6 months, take it out and send it back to me if you forget them, I'm going to charge you $200 for the device, all in the hopes of like a renewal discount. And obviously, consumer adoption was very, very low.

当时的模式是：你申请保险，我寄一个设备给你，你插到车上，开上六个月，然后拔下来寄回来。如果你忘了寄回来，我还要收你200美元的设备费。目的只是为了之后给你一个续保折扣。这种方式，消费者接受度非常低。

One of the pieces of technology that we built was how do you actually do that using a smartphone? And that's super hard. That technology problem is very different than using an OBD2 device. If I showed OBD2 device, the data would look super -- you'd know what the car was doing.

我们所开发的关键技术之一是：如何通过智能手机实现这一切？这非常困难，技术挑战与使用OBD2设备完全不同。如果你用OBD2设备，采集的数据很清晰，很容易判断汽车的具体行为。

On a smartphone, you plug into these devices, and it's really built for video gaming. So we hit the device multiple times, 16 times a second, either super noisy sensors, and we have to take all of that sensor data to figure out. Were you the driver? Were you a passenger? Was that a bus trip or not, right? You've got to clean all of this data to actually figure out what the physical events are on the car. And by the way, you have to do it also in a manner that doesn't kill the smartphone battery.

而在智能手机上，传感器其实是为游戏而设计的。我们每秒采样16次，但这些原始数据非常“嘈杂”。我们必须分析这些传感器数据，判断你是不是驾驶者、是不是乘客、那次是不是搭公交？我们需要清洗所有这些数据，才能识别车辆的真实物理行为。而且，还必须在不耗尽手机电量的前提下完成这一切。

And so we really are one of the only ones that have developed internally as an insurance company a closed loop on data science and machine learning that is involved with the -- with that smartphone technology. So we control the way that we collect that data off of smartphones, which is very difficult, how you ultimately clean that data and then ultimately, how that actually relates to risk. And so we've had this now validated by Milliman as an independent third party that sort of said our telematics is just far more predictive than anybody else because of that platform, that closed platform we've built.

因此，我们是业内极少数能在公司内部自研完整闭环数据科学和机器学习系统，并与智能手机技术深度结合的保险公司之一。我们掌控整个从手机采集数据、清洗数据、到将其与风险定价关联的全过程。这一套平台非常复杂。Milliman（知名精算咨询公司）作为独立第三方，已对我们的系统进行验证，认为我们所建立的闭环车联网平台，其预测能力远超行业其他同类方案。

We've also -- I mean the entire company is a technology company at its core, and so we've really created an insurance company as a platform. So one of the things, too, that we leverage in terms of distribution is not just our direct channel and our mobile phone -- our mobile app, but also, we have an embedded in partnerships channel. So if you go to carvana.com and you purchase a car, and you want to include insurance with it, that Carvana insurance, it's actually Root. And the reason we're able to do that is because we've built these really flexible and dynamic underwriting models and systems that allow for us to ingest all of the data during that vehicle purchase process, actually inject data -- ingest data also off of the vehicle if it's a connected vehicle, and then offer just a 3-click purchase experience for the consumer.

此外，我们整个公司本质上就是一家科技公司，我们是从技术出发重构了整个保险公司结构。我们在分销方面不只依赖直接面向客户的移动App渠道，还建立了嵌入式合作伙伴渠道。比如，如果你去Carvana.com买车，并希望顺带购买保险，那份“Carvana保险”实际上就是由Root提供的。我们之所以能做到这一点，是因为我们构建了非常灵活、动态的承保模型和系统，能在购车过程中实时获取全部数据，如果是联网汽车，还能接入车辆的数据，从而为用户提供一个只需点击三次就能完成购买的体验。

So when we launch that product, for example, on Carvana, we, by many multiples, increase their adoption of car insurance. So that's been growing. We're adding more automotive partners to our platform right now, which we like. It lets us get closer to the data too that's coming off of vehicles as vehicle technology is changing.

当我们在Carvana上线该产品时，其车险采纳率提升了数倍。这一渠道持续增长。我们目前也在接入更多汽车合作伙伴，这也帮助我们更紧密地连接到来自新一代汽车的实时数据，因为汽车科技正在不断演进。

So really every part of Root, we've really rebuilt the entire insurance value chain based on modern technology, which then has allowed us to really put these really rich data science algorithms that sort of are self-tuning on top of that. So it's really -- the technology is pervasive. It's across everything.

所以从根本上说，Root的每一个环节都基于现代技术重建了整个保险价值链。这也使我们能够在其之上部署高度复杂、自动优化的数据算法系统。我们的技术是全方位的，渗透在公司运作的每一个角落。

Unknown Analyst

It's interesting. There are these giant insurance companies, legacy guys. How do you compete though against them? Like can't they just do this?

挺有意思的——现在市场上有很多传统的大型保险公司。你们怎么和这些巨头竞争？他们难道不能自己也做你们在做的事情吗？

Alexander Timm – Co-Founder, CEO & Chairman

Well, you'd think that they -- I mean they've -- listen, they have competitive advantages, and we don't sit here arrogantly saying, oh, we're just going to blow right by those guys. We've got a lot of money and a lot of brand, and they really compete on marketing, right, billions. It's actually -- auto insurance is the #1 advertised single product category in the United States. By the way, it's a mandated product to buy. So it's not like they're creating a bigger pie. That's how they're competing. The way we're competing is with product and technology.

是的，你可能会觉得他们也可以做。但他们确实拥有自己的竞争优势，我们也不会傲慢地认为自己可以轻松超越这些大公司。他们有很多资金和品牌影响力，实际上他们的竞争方式就是营销——每年花几十亿美元去投广告。事实上，汽车保险是美国广告投入最多的单一消费品类。而且，它是一种法律规定必须购买的产品，并不是说广告可以扩大需求规模。他们就是靠砸广告来竞争。而我们则是靠产品和技术来竞争。

幻觉，最主要的因素还是价格，控制成本以后给消费者的价格。

And the reason these guys can't do it, most of our competitors are over 100 years old. GEICO, as Jain just said at Berkshire Hathaway that they have 600 back-end systems, and they're trying to get down to like 600 or 700. A lot of these guys are still on main frames. Most of them actually within the last 12 months, Progressive included actually have had COBOL programmers posted on their websites or to hire.

至于为什么这些公司做不到，大多数竞争对手都有上百年历史。比如GEICO，正如Jain在伯克希尔·哈撒韦的会议上提到的，他们的后端系统多达600个，目标是“压缩”到600或700个（笑）。许多公司至今仍在使用主机架构（mainframe）。甚至在过去12个月内，包括Progressive在内的很多公司都在自己官网上贴出招聘COBOL程序员的职位公告。

So when you think about trying to do enterprise modernization, and I saw this working at a big insurance carrier, they're trying to just get the basics right. And they've outsourced almost all of their technical capabilities, even like policy management and claims management, those aren't even their systems. So when you talk about creating a new closed-loop system based on modern technology that's leveraging machine learning. I mean -- they're not even close.

所以当你谈到企业系统现代化时，我在大型保险公司工作时亲眼看到，他们很多时候只是努力把最基础的事情做好。他们几乎把所有技术能力都外包出去了，连保单管理和理赔系统都不是他们自己的。所以当你说用现代技术、用机器学习打造一个全新的闭环系统时——他们根本做不到，连入门都还没进入。

有可能是事实，但是支持单一品类的系统不会复杂到哪里去。

Unknown Analyst

It's very interesting. So talk to us a little bit about -- I think you're the first insurtech company get to GAAP profitability, and you did that in the third quarter of '24. Talk about this and how it validates your business model. It took you a while to get there. And how are you guys thinking about that?

这真的很有意思。你们好像是第一家实现GAAP盈利的保险科技公司，而且是在2024年第三季度做到的。能谈谈这件事吗？这如何验证了你们的商业模式？毕竟你们花了好几年才走到这一步。你们现在是如何看待这件事的？

Alexander Timm – Co-Founder, CEO & Chairman

Yes. One of the hardest things about starting an insurance company from scratch is you have no data and loss data. And so one of the things -- if you look over the long history of the company, since we launched, we've been getting like 3 points out of the loss ratio every quarter, which is basically 3 points of margin every quarter that we've been building in the business. And there was COVID and hyperinflation, which was kind of a challenging period for us. It was a very challenging period when we saw used car prices go up. But actually, if you trend right through that, you kind of end up where we are today, which is best-in-class margins. And the way we're able to do that is because of the technology.

是的，从零开始创建一家保险公司，最难的地方之一就是你一开始没有数据，特别是理赔数据。如果你回顾我们过去几年的发展，从推出产品以来，我们平均每个季度在赔付率上提升约3个百分点，也就是说，每个季度都在业务中累积3个点的利润。而在这期间还经历了疫情和通胀加剧，特别是二手车价格飙升的阶段，这对我们是很大的挑战。但如果你把这些短期因素拉平看趋势，你会发现我们如今达到了业内领先的利润率水平。我们之所以能做到这一点，关键就是技术。

Being able to segment risk better means we're able to pick up the most profitable customers. Being able to have differentiated access to customers through our distribution channels has also created really a moat around our business. And as we've scaled, what that has resulted in is really margins that are not just better than all the insurtechs -- by the way, they're also better than, I think, most all the incumbents.

我们可以更精准地细分风险，意味着我们可以吸引到最有利润空间的客户。而我们差异化的分销渠道让我们能够接触到别人接触不到的客户群体，为业务形成了一道护城河。随着公司规模扩大，我们的利润率不仅超越了所有保险科技公司——甚至我认为也超过了大多数传统保险巨头。

So we're very profitable. We've also grown our customer base. I think year-over-year as of last quarter, it was close to 100%. So the business is growing and is -- like I said, in terms of margin on the business, it's maybe the best or one of -- if not one of the best in the auto insurance industry.

所以我们现在已经非常盈利了。同时我们的客户数量也在快速增长。上一季度的同比增速接近100%。所以业务也在增长，而就利润率而言，正如我所说，我们可能是汽车保险行业利润表现最好的公司之一，甚至可能是最好的。

Unknown Analyst

Let's step back and assume this is not an insurance conference. Talk about loss ratio, explain that to them, how you look and think about loss ratio and what that means.

我们换个角度思考，假设这不是一场保险行业会议。你能解释一下什么是赔付率（loss ratio）吗？你们是如何看待和衡量它的？它的意义又是什么？

Alexander Timm – Co-Founder, CEO & Chairman

Yes. So it's the most important financial metric in any -- in an insurance company. And really, it's your losses divided by your premium. So how -- what percentage of your revenue are you giving back into pay claims? And that's so important because, one, it's 60%, 70% or so of all revenue, if you just look industry-wide, right? And so you might be able to innovate and do some interesting things on distribution costs or fixed expenses through automation. But if you want to be serious about disruption and taking cost out of the system, you've got to be serious about how do you get loss ratios down. And that game is all about who's going to get into an accident and who's not.

好的。赔付率其实是保险公司最关键的财务指标。它的计算很简单：理赔金额除以保费收入。换句话说，你的营收中有多少百分比是用于赔付的？这个比率非常重要，因为从全行业来看，赔付支出大约占总收入的60%到70%。你可以在分销成本或固定费用上通过自动化做一些优化创新，但如果你想真正改变这个行业、从系统中挖掘成本效率，那你必须严肃对待赔付率的控制。而这归根结底就是判断：谁会出车祸，谁不会。

And when you look -- take a step back, really what that game is about is how do you identify the 5% to 10% of people who are causing basically all of the accidents, right? There's like a few -- this data is incredibly skewed, right? Like when you're driving down the highway and you see somebody weaving in and out and go to that, guy is going to cause an accident, you're right. That's like 10% -- 5% to 10% of the population.

如果你再退一步看，其实这个游戏的核心是：如何识别出那5%到10%造成了绝大多数事故的人群。数据的分布极度偏态。比如你在高速公路上看到一个人蛇形变道、开得飞快，你可能会想“这个人迟早要出事故”，你是对的。那5%到10%的人，就是事故的主要制造者。

And so what's really important is how do you identify that percent of the population and get them out of your book as soon as possible. And we've been able to do that both through our telematics advantage, and that's really what's led to that loss ratio being one of the best in the industry, again, if not the best.

所以关键是：你如何尽早识别出这部分人群，并把他们从你的保险组合中剔除。我们之所以能实现业内领先（甚至可能是最优）的赔付率，靠的就是我们在车联网技术上的优势。

Unknown Analyst

That's very interesting. And then let's talk about you reach profitability, but you have to grow, right? You haven't gotten to scale. How are you going to balance that? Talk to us about balancing scale, investment in the business versus profitability. How do we think about that?

非常有意思。你们现在已经实现盈利，但还需要继续增长，对吧？你们还没有达到真正的大规模。那你们会如何平衡扩大规模、业务投资与利润之间的关系？我们应该怎么理解这个权衡？

Alexander Timm

Yes. And this is always an interesting question to me because I never thought this would be an interesting point of view because you kind of go to school and you learn, hey, we're all supposed to deploy capital at our -- above our IRRs and then stop, and that's how you sort of optimize. But what we do at Root is we basically -- like I say, we worship at the altar of the unit economic gods. We continue to grow provided that we are returning with a high degree of confidence our cost of capital. That sounds obvious. That's a textbook answer, right?

是的，这个问题我一直觉得很有意思。按理说这个观点很简单——你在学校学到的理论是，企业要在达到目标IRR的基础上部署资本，然后适时停止，这样才能实现最优。而在Root，我们信奉的是“单位经济学之神”。只要我们能以足够的确定性实现资本成本的回报，我们就会持续增长。这听起来像教科书答案，但实际上很少人真这么做。

It's remarkable because when you look at our competitors, what we tend to see is that they're very focused on a 12-month period, and what that's resulted in sometimes is suboptimal decision making by them. And so for example, if I need to hit my bonus metrics for the year, and I'm ahead on profitability but behind on growth, I might just push a whole bunch of marketing capital into the system even if it's not accretive. Or conversely, if I had a bad Q1, and I'm not profitable and now I'm in Q4, maybe I'm going to pull way back even though my current marketing would be accretive. And what that does is it creates these cycles in the industry.

有趣的是，当你观察我们的竞争对手时，会发现他们往往非常关注12个月的短期表现，这往往会导致非最优的决策。例如，如果一个高管要达成年度奖金指标，利润已达标但增长未达标，他可能会在年底强行投入一大笔营销费用，即使回报率不足。反过来，如果第一季度表现很差，等到第四季度即使营销活动是有价值的，他也可能缩减开支，以美化短期利润。这种做法在整个行业中形成了“周期性抽离和投入”的波动。

And so when we talk about growth, what you'll see from us and what we've shown is we are almost countercyclical to that because we don't operate that way. When they pull out, we'll push in heavily. When they push in, you'll actually see us push out. And so on our direct channel, you actually see sort of this countercyclical growth sort of up into the right. But again, it can come down and up, and it can ebb and flow.

而我们在Root的增长策略，几乎是与这种行为“反周期”的。别人撤出时我们加码，别人大举投入时我们反而收缩。因此你会看到，我们在直销渠道上的增长曲线是以一种反周期方式向右上方推进。当然，它也会有波动，有起有落。

这个行业更合适的哲学是活在当下。

On our partnerships platform, we actually -- that's been very consistent. That's been a balance of growth. We continue to add more automotive folks to our funnel. That funnel is extremely healthy. Given what we achieved with Carvana and then subsequent partners, we -- that's just coming through and is -- if anything, that's more about can we service all those partners as they come through.

至于我们的合作伙伴平台，它则表现得非常稳定，增长也比较平衡。我们不断引入更多汽车行业合作伙伴，整个渠道非常健康。以Carvana为代表的合作成果已经开始显现，接下来的问题更多是我们能否高效服务这些不断加入的合作方。

So we're very -- on the capital side and profit side, we're very, very healthy. And -- but at the same time, if we see the opportunity to push growth harder, we'll certainly do that, provided we hit our returns. So it's not we're going to make this amount of money every single quarter. We don't think that's the right way to run the business. It's we're going to deploy capital at our target returns. And that's how we optimize the long-term value of the company.

所以在资本和利润方面，我们处于非常健康的状态。但与此同时，如果我们看到推动增长的机会，只要回报率达标，我们一定会抓住。我们并不认为公司应该每个季度都维持相同水平的盈利，那不是正确的运营方式。我们认为，应该按照目标回报率去部署资本，这是实现公司长期价值最优的方式。

Unknown Analyst

So it sounds like you're taking a long-term approach to growing this business and...

听起来你们是在用一种长期视角来推动这项业务的发展……

Alexander Timm – Co-Founder, CEO & Chairman

Yes. Yes. And it's provided long term -- yes, yes. I mean...

是的，没错，我们确实是以长期目标为导向……

Unknown Analyst

Versus the quarter-to-quarter.

相较于按季度运营？

Alexander Timm

Yes. Oh, yes, absolutely, not a quarter-to-quarter. We take a multiyear approach.

是的，完全不是季度导向的。我们是以多年为周期制定战略的。

Unknown Analyst

That's great. And then talk about these growth. What levers can you pull? How do you make this business grow? What growth leverage do you have?

太好了。那么关于增长，你们有哪些“增长杠杆”可以操作？你们是如何推动业务增长的？有哪些策略性拉动点？

Alexander Timm

Well, so the biggest lever I mentioned is the -- number one is just adding more partners to our platform, OEMs all the way through vehicle advertisers. We're live with independent agents. It turns out they don't want to be on the phone with you for 20 minutes selling you insurance any more than you want to be on the phone with them. So they like our platform a lot. So we're continuing to add partners. That's grown. I think as of last quarter, it grew like 130% year-to-date, and that's been really linear and consistent.

我们最大的增长杠杆是不断拓展合作伙伴平台。无论是整车厂（OEM），还是汽车销售平台、广告渠道，我们都在持续接入。我们现在也支持独立保险代理人，这些代理人也不想像过去一样跟客户打二十分钟电话推销保险——正如客户也不想接这种电话。他们非常喜欢我们的平台，所以我们持续增加合作方。这个渠道的年初至今增长率上季度达到了大约130%，而且增长非常稳定、线性。

Second, we're in 35 states. And so that's about 75% of the population. We're regulated on a state-by-state basis. No reason we shouldn't be national. So we're going to continue to push to get national.

其次，我们目前已进入35个州，覆盖了大约75%的人口。由于保险是按州监管的，但我们没有理由不做到全国覆盖。因此我们会继续推进全国性扩张。

And then third, we're continuing to add actually new marketing channels to our platform. So we still are primarily operating in lower-funnel search channels. We're starting to actually experiment more with social media, YouTube and some of those higher other marketing channels as well, where we can use our data approach to sort of acquire the right customers.

第三，我们还在平台上持续拓展新的营销渠道。我们目前的核心仍然是转化路径底层的搜索类渠道，但现在我们也开始在社交媒体、YouTube等更靠上层的渠道进行更多测试。在这些渠道中，我们仍然可以运用我们的数据驱动方式来精准获客。

科技公司还没有理解推荐引擎。

Unknown Analyst

That's helpful. And that growth figure you gave, is that back -- you said year-to-date, I assume you're tying backwards to [9/30]. Is that or [indiscernible].

这很有帮助。你刚才提到的增长数据是从年初至今，那是不是指截至9月30日？还是？

Alexander Timm

Yes. Yes. We didn't -- yes, that's -- we don't have anything for you.

是的，是的……我们暂时没有额外披露的信息。

Unknown Analyst

Yes. Yes. Just clarification on that. Talk about the partnership channel and getting channel and OEMs. How do OEMs -- what do you learn from OEMs? How does that become important to you?

明白了，只是想确认一下。那再谈谈你们的合作伙伴渠道和OEM渠道。你们从OEM那里学到了什么？它为什么对你们来说如此重要？

Alexander Timm

So OEMs are so important. One, what we've learned is -- the idea to embed insurance at the point of vehicle sale is not a new one. Lots of folks have failed trying to do this. But that's because what they're doing is they're putting like an independent insurance agent inside of a dealership. And so after you've been on the lot for 3 hours trying to purchase a car, then they're saying, oh, go talk to an agent for another hour and consumers don't want to do that.

OEM（原始设备制造商）对我们来说非常关键。我们发现，其实“在购车环节嵌入保险”的想法并不新，很多人都尝试过，但多数都失败了。原因是他们的方法是：把一个独立保险代理人放到汽车经销商的店里，然后当消费者在卖场上耗了三个小时选车后，还要再花一小时跟代理人谈保险——这显然是消费者不愿意接受的。

What we've done and what we've shown with Carvana is that when you do this in a digital manner, it's totally different. So when you can actually integrate with whether it's an OEM app or a Carvana app or even the vehicle itself, offering a 3-click insurance experience as part of purchasing that vehicle, that does work. But to do that, you need to be able to integrate with those vehicles, which means you need to be -- you have to have modern technology. Root is really the only one that is both an insurance or car insurance carrier and a technology company that can provide that solution. And so that's what we have shipped and built.

而我们与Carvana的实践证明，如果将这一过程数字化，结果就完全不同。无论是整车厂的App、Carvana App，甚至直接在汽车操作系统中嵌入，只要我们能将保险流程简化为三次点击，就能实现极高的转化率。但要实现这一切，就必须具备与汽车系统集成的能力，也就是说，必须具备现代技术能力。而Root是目前唯一一家既是汽车保险承保商、又具备自研技术能力，能够提供这一整套方案的公司。我们已经构建并交付了这样的系统。

There's some really interesting things with OEMs. Lots of it -- they are also working on their own technology. Now these cars are suddenly changing in terms of their risk parameters through over-the-air updates. So what does that do?

OEM方面还有很多很有趣的事情。他们自己也在开发技术，比如现在的汽车可以通过OTA（远程升级）不断改变其风险参数。那这对我们意味着什么呢？

And what we've done is by this platform that we can embed on sales is we're also starting to ingest a lot of that OEM data so that we can start to say, hey, this autonomous feature works and actually does reduce risk, for example, when it's used in this manner. These other -- by the way, they're not all created equal. These other autonomous features on these other year -- make models, maybe they don't work. And so we sort of have a front seat to understanding how that vehicle technology is changing, which then allows us to be a better partner, a better price risk and build a better company.

我们通过嵌入式平台，不仅实现了销售端集成，还开始接入大量OEM的数据。这使我们能够评估，比如说某个自动驾驶功能在某种使用情境下确实能有效降低风险；而其他一些车型、年份的自动驾驶功能，可能并不起作用。这些功能并不都是“生而平等”的。我们因此能够“坐在第一排”，亲眼看到汽车技术如何演变，从而更好地定价风险，成为更可靠的合作伙伴，建设一家更优秀的公司。

Unknown Analyst

Besides avoiding that crazy driver out on the highway, who is your target customer? How do you find that?

除了要避开高速路上的“疯子司机”，你们的目标客户是谁？你们是怎么定位并找到他们的？

Alexander Timm – Co-Founder, CEO & Chairman

It's interesting. Generally speaking, where we over-index on people from the ages of 25 to 40, and they tend to be a little bit more tech savvy. They tend to be a little bit more urban, but we've actually seen a very wide halo effect. We have lots of different customer demographics on our system. And one of the keys, too, has been we can be profitable in each one of those segments, and that's super important for us.

这个问题很有趣。总体来看，我们的客户主要集中在25到40岁之间，他们普遍更精通科技，更多居住在城市地区。但实际上，我们在系统中看到的是一个很宽泛的“光环效应”——我们拥有各种各样不同类型的客户群体。关键在于，我们在这些细分市场中都能够实现盈利，这对我们来说非常重要。

Unknown Analyst

That's super interesting. So in terms of pricing, you noted -- you said recently that you may be able to reduce rates for certain customers. Is that -- how does that work? And, are you doing that to grow market share? Or how do you explain that?

非常有趣。那么就定价而言，你们最近提到可以为某些客户降价。这个是怎么做到的？你们是为了扩大市场份额才这么做的吗？能解释一下背后的逻辑吗？

Alexander Timm

So it's interesting. As we get better and better, as we collect more data, we retrain all of our models which get better. And what that does is it basically tells us who's a good risk, who's a bad risk through a variety of different data sources. And then we have a decision to make. We can either increase margin with that model or we can reduce rates. And the way we make that decision is we look at the microeconomic curves and elasticity. And we said, well, what optimizes for the long-term value of a customer? And that's exactly what you'll see us do.

这点很值得聊。随着我们获取的数据越来越多，我们会不断地重新训练模型，这些模型也随之变得越来越精准。结果就是，我们能通过各种数据源判断谁是低风险客户，谁是高风险客户。然后我们就面临一个决策：我们是通过这些模型提高利润率，还是给客户降价？我们会分析微观经济曲线和价格弹性，选择那个能最大化客户长期价值的路径。你看到我们所采取的策略，正是基于这样的判断。

单笔保单的利润率X数量=利润总额，白痴最擅长的是简单问题复杂化。

And so what's happened as we've continued to update our models and become better at segmenting risk, our loss ratio has actually come below our targets. And so what you're seeing now is actually a reduction of rates, and so we're lowering insurance premiums actually for our customers as these models are getting better. And then it's interesting because as we do that, we grow faster and we get more data. And that flywheel, when that began to spin, that's really when you started to see sort of everything work in the business because, again, it's that virtuous cycle. And so we're not lowering rates to sort of reduce profitability. We're actually it's the opposite. We're fine-tuning that for profitability. However, you will grow faster.

随着我们持续迭代模型、风险细分越来越精准，我们的赔付率也降到了目标以下。因此我们目前正在降价，客户的保险费实际上是在降低。更有意思的是，随着降价，我们的增长更快了，数据也更多了。这个“飞轮”一旦启动，整个业务运转就开始加速——这是一个良性循环。所以我们不是为了牺牲利润而降价，恰恰相反，我们是在微调利润结构，同时也实现了更快的增长。

Unknown Analyst

So you talked about you came from a giant insurance company. They have these -- you said the biggest budgets of anybody. How does Root compete? How does Root sustain this growth of disrupting the industry? What do you need to do? Talk about that.

你之前提到你曾在一家大型保险公司工作，他们有业内最大规模的预算。那Root是如何与之竞争并维持自己的增长势头？你们想颠覆这个行业，要怎么做才能实现这一目标？

Alexander Timm

I think one is we have to stay true to our technology. We have to continue to invest in the future. We have to continue to invest in our partnerships and embedded distribution and our product, and then we have to stay true to our principles and our culture, right? We have a very different culture, and I think we've got to continue to hold on to that, and that's what's going to long term, I think, create a really great company.

首先，我们必须坚持我们的技术优势，不断投资于未来。我们也要继续加大对合作伙伴关系、嵌入式分销模式和产品的投入。同时，我们必须坚守自己的价值观和文化。我们的文化与传统保险公司截然不同，我认为我们必须持续保持这份文化，这是我们打造一家伟大企业的长期基础。

Unknown Analyst

And then just talk to what technology do you invest in? Where do you need talent that you don't have today? Or are you going to take that?

那说说你们重点投资在哪些技术领域？有没有哪些方面是你们现在还缺乏人才的？或者你们打算在哪些方面招人？

Alexander Timm

We -- we're heavily investing in data science. That's still probably our #1 area that we're recruiting. And so we've got a lot of data scientists on set that's who we're mostly just like a bunch of math nerds and engineers. And so we're heavily investing into those -- into both of those areas, so to both improve our embedded platform and create a more seamless customer experience, continue to launch new partners. And then as well on the data science side, where we continue to see opportunities to refine more and more of our model suite.

我们目前最重点的投入方向仍然是数据科学，这是我们招聘最积极的领域。我们团队里有很多数据科学家，基本上就是一群“数学极客”和工程师。我们在两个方向上都在大量投入：一是继续优化嵌入式平台，打造更无缝的客户体验，持续扩展合作伙伴；二是在数据科学方面持续迭代我们的一整套模型，我们仍然看到很多可以优化的空间。

Unknown Analyst

Great. And I'm going to ask one more and then we can open it up. But tell us what's your vision? What's Root look like in 5 years? And you don't have to give us numbers, but what's your vision?

太棒了，我再问一个问题就让大家提问。你们的愿景是什么？5年后的Root会是什么样子？不需要给具体数字，但请谈谈你们的目标。

Alexander Timm

Well, we -- this as an opportunity to build a historic company. Nobody came to Root to build the #10, the #12 or whatever the market share might-be number. We all came here to build #1. And we think it's very rare that you find an industry that is so widely hated by customers, so massive. I mean it's a $300 billion industry just in car insurance. It's even bigger if you look at all property casualty and has been basically untouched by innovation, with over 100-year old competitors basically dominating all of the top 10.

我们把Root当作打造一家“历史性公司”的机会。没有人是为了做行业第十、第十二名而加入Root的，我们的目标是做到第一。你很少能看到一个行业——客户普遍厌恶、市场规模巨大（仅车险就高达3000亿美元）、创新严重缺乏、由一批百年老企业长期垄断前十——还能给新公司留下如此大的颠覆空间。

And at the same time, you have these massive changes in technology that really change the fundamental value proposition of insurance, which is pricing risk. And so we think when you get that right, that we're actually just -- we're not even in the first chapter. I say we're like on the first page. And so we think that like our ambition is to be the #1 carrier in the country.

与此同时，技术正在发生深刻变革，直接改变了保险的核心价值主张——也就是风险定价能力。当我们把这件事做对了之后，其实我们才刚刚翻开第一页，连第一章都还没开始写。我们的雄心是：成为美国第一的保险公司。

Unknown Analyst

That's highly compelling. I think we're kind of out. Root is going to have breakout sessions. They got two down in Coquina room. And I thank everybody for joining us. And Alex, thank you for your time today.

这太令人振奋了。我想我们时间差不多了。Root接下来还有小组交流会议，会在Coquina厅的两个房间进行。感谢大家的参与，也非常感谢Alex今天的精彩分享。

Alexander Timm

Thank you.

谢谢大家。

Unknown Analyst

Thank you.

谢谢。

2025-01-13 Root, Inc. Presents at 27th Annual ICR Conference 2025

2025-01-13 Root, Inc. Presents at 27th Annual ICR Conference 2025

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