Flood insurance firm grows 366%, hits $7M in sales

In the summer of 2016, Trevor Burgess scored the entrepreneurial victory of a lifetime. Arkansas-based Bank OZK had acquired the bank Burgess had invested in and run for eight years, St. Petersburg-based C1, in a $402 million deal.

To celebrate, and for a long rest, Burgess, his husband and their 10-year-old daughter went on a nine-month, 13-country worldwide trip. Stops, with a governess in tow for their daughter’s schoolwork, included London, Singapore and Australia. (Burgess’ favorite? New Zealand.) “We had a great family adventure,” Burgess says.

His new adventure, while not globetrotting, is something Burgess is infinitely more familiar with: using technology, with a heavy dose of marketing, to rapidly grow a financial services business. Instead of banking, now it’s with St. Pete-based Neptune Flood. The insurance firm’s mission is to save customers money in premiums by using advanced analytics to determine risk ratios.

Burgess was recruited to Neptune in 2018 by co-Founder Bill Martin, a former executive with Bankers Insurance in St. Petersburg. “'It needs money and it needs an entrepreneur,’” Burgess recalls Martin, a Leadership Florida classmate, told him. “‘Would you look at it?’”

Burgess liked what he saw, investing $2 million in Neptune in early 2018, becoming chairman. Now CEO, working with chairman and the other founder, Jim Albert, Burgess, just like C1, has moved quickly — only this time it’s on a national scale; Neptune is in nearly every state.

The company, which turned its first profit in May 2019, has grown from some 50 policies in January 2018 to around 30,000 today. It had $17 million in premium at the end of 2019, and Burgess projects $40 million to $50 million in premium by the end of 2020 — even with the coronavirus-based business slowdown. Burgess also recently bought a building in downtown St. Pete, near All Children’s Hospital, for a new headquarters, a $3.5 million project.

‘If we can keep our head down and keep working hard, we will be able to come out on the other side of this a better company.’ Trevor Burgess, Neptune Flood

At its core, Neptune is a technology company. That’s driven by Triton, its patented software system that, using artificial intelligence and more than 50 data points, quickly analyzes three factors after a homeowner, or potential homeowner, types in an address. First, it analyzes if the property fits Neptune’s portfolio, which 90% of the time, Burgess says, it does. Then it offers a coverage rate, which Burgess says beats the National Flood Insurance Program quote two-thirds of the time. “We give you an independent price for an independent house,” Burgess says. “That’s very different than the NFIP because they do it all in zones.”

Finally, Triton analyzes disaggregation. In insurance, that means not having too many homes covered in too many high-risk areas. “That’s one of the problems with the NFIP — they are over-leveraged,” Burgess says.

In contrast, Neptune works with three reinsurance firms to spread risk, another key strategy piece. Even so, Burgess says Neptune doesn’t consider itself “competition with the NFIP. We think about this as expanding the availability of flood insurance to all Americans.”

The coronavirus pandemic, of course, has had an impact on the company’s’ growth plans. Given that flood insurance is fueled by home sales, Burgess says the slowdown has “put some downward pressure on us.” The flip side, he adds, is with more people home it makes Neptune’s easy-to-use system more viable and an opportunity to pick up market share.

Internally, Burgess says, the pandemic brought out his “data-driven obsessive compulsive” personality, and he talked to the team about working from home early on. To back that up, and in following some top workplace culture lessons from C1, Burgess gave each of the 16 Neptune employees $500 to fix up and create a home office. He also sent each employee a cooler of Omaha Steaks and Harry & David fruit baskets, knowing they were going to be cooped up.

Employees, including seven software developers, are working on both the now and the future — from commercial flood insurance to other uses for Triton. “I think the team has risen to the occasion,” he says. “Some companies get distracted by things like [this pandemic]. If we can keep our head down and keep working hard, we will be able to come out on the other side of this a better company.”