How Multifamily Insurance Optimization Strategy Impacts NOI
In this episode of Lifetime Cash Flow Through Real Estate Investing, Guffy Wright breaks down how a well-executed multifamily insurance optimization strategy can dramatically impact property value and investor returns. Many operators treat insurance as a fixed cost, but Wright reveals that even small premium changes can create massive swings in valuation. A $30,000 increase in premiums, for example, can translate into a $750,000 drop in asset value at a 4 cap rate. This makes insurance not just a protection tool, but a critical lever for increasing NOI and long-term wealth.
Negotiating with Lenders to Unlock Hidden Value
One of the most powerful insights shared is that lender requirements are often negotiable. Wright explains how his team developed a lender waiver framework that allows operators to challenge unnecessary coverage requirements. By leveraging data and presenting a structured case, investors can reduce premiums, adjust deductibles, and eliminate redundant policies.
Key opportunities to optimize include:
- Negotiating down excessive coverage requirements
- Increasing deductibles strategically
- Removing unnecessary policy add-ons
- Using data-backed arguments to support changes
This approach can lead to six-figure savings and, more importantly, seven-figure increases in asset value.
Why Most Investors Overpay for Insurance
A major mistake investors make is benchmarking insurance performance against their own past policies instead of the broader market. Wright emphasizes the importance of benchmarking against peer portfolios to understand whether you are truly getting a competitive rate.
Without this data, investors may feel confident about a 10% savings year over year, while unknowingly paying 30–40% more than similar assets. Access to aggregated industry data allows for smarter decision-making and better positioning during renewals.
The Power of Alignment with Your Insurance Broker
Wright highlights that choosing an insurance broker should be approached the same way you select a business partner. The best brokers are not transactional, they are strategic. They understand your growth plans, asset types, and future risks, and help you build a long-term insurance strategy around them.
Instead of constantly shopping for the lowest premium, investors should look for:
- Specialists in multifamily real estate
- Brokers who understand cap rates and NOI
- Advisors who align with long-term portfolio growth
- Partners who anticipate future risks and challenges
This level of alignment can prevent costly mistakes and create compounding value over time.
Overcoming Investor Friction in Capital Raising
Beyond insurance, Wright dives into the psychology of decision-making, which directly applies to raising capital. He explains that even when a deal is strong, decisions often stall due to three types of friction:
- Cognitive friction: confusion or lack of clarity
- Emotional friction: fear, uncertainty, or lack of trust
- Directional friction: concern about future regret
To overcome this, investors must simplify their messaging, be transparent about risks, and reinforce the strength of the opportunity. Creating clarity and trust leads to faster, more confident investment decisions.
How AI Is Transforming Insurance and Real Estate
Wright also discusses how AI is beginning to reshape the insurance landscape. By analyzing lender requirements, policies, and property data, AI tools can quickly generate strategies for negotiation and optimization. While still evolving, this technology is expected to significantly enhance efficiency and decision-making for top operators.
Guest Bio: Guffy Wright
Guffy Wright is an owner, board member, and National Sales Leader at The Mahoney Group, where he built a real estate-focused insurance practice exceeding $100 million in premiums. With nearly two decades of experience, he specializes in helping multifamily investors optimize insurance strategies to protect assets while maximizing NOI and valuation. Known for his innovative approach, Wright has pioneered tools like lender waiver frameworks and benchmarking systems that give investors a competitive edge.
If you want to hear the full conversation and detailed insights, watch the podcast video or read the complete transcript below.
Multifamily Insurance Optimization Strategy FAQ
What is a multifamily insurance optimization strategy?
A multifamily insurance optimization strategy is a data-driven approach to structuring and negotiating insurance coverage to reduce costs while maintaining proper protection. Instead of treating insurance as a fixed expense, investors actively manage policies, deductibles, and lender requirements to improve net operating income and overall asset value. This strategy focuses on aligning coverage with risk, eliminating inefficiencies, and leveraging market data to secure the best terms.
How does multifamily insurance optimization impact NOI?
Insurance is a direct operating expense, so any reduction in premiums immediately increases net operating income. Even small savings can significantly boost property value due to cap rate calculations. For example, lowering insurance costs by tens of thousands of dollars can translate into hundreds of thousands or even millions in increased valuation, making optimization a powerful financial lever.
Can you negotiate insurance requirements with lenders?
Yes, many lender insurance requirements can be negotiated with the right strategy and supporting data. Investors can work with experienced brokers to request waivers, adjust coverage limits, or increase deductibles. Presenting clear data and risk analysis helps lenders feel confident approving modifications, which can lead to substantial savings without increasing exposure.
What are the most common mistakes in multifamily insurance?
Many investors make the mistake of comparing their current premiums only to prior years instead of benchmarking against similar properties. Others rely on generalist brokers who lack multifamily expertise or fail to question lender requirements. Overpaying for unnecessary coverage and not aligning insurance strategy with long-term portfolio goals are also common issues that reduce profitability.
Why is benchmarking important in insurance optimization?
Benchmarking allows investors to compare their insurance costs and coverage against similar assets in the market. This provides clarity on whether they are overpaying or underinsured. Without benchmarking, it is difficult to identify inefficiencies or opportunities for savings, making it a critical component of any multifamily insurance optimization strategy.
Should you use a specialist or generalist insurance broker?
A specialist broker with experience in multifamily real estate is typically the better choice. They understand key metrics like cap rates, NOI, and portfolio risk, and can provide strategic guidance beyond just securing a policy. Specialists are also more effective at negotiating with lenders and identifying long-term optimization opportunities.
How does deductible strategy affect insurance costs?
Increasing deductibles can significantly lower insurance premiums, which improves cash flow and NOI. However, this must be balanced with the investor’s risk tolerance and financial reserves. A well-structured deductible strategy ensures that savings outweigh potential out-of-pocket costs during a claim.
How is AI influencing multifamily insurance optimization?
AI is beginning to transform how investors analyze and optimize insurance. Advanced tools can review policies, lender requirements, and property data to identify cost-saving opportunities and negotiation strategies. As adoption grows, AI will make it easier to benchmark performance, reduce inefficiencies, and improve decision-making at scale.
How often should multifamily insurance be reviewed?
Insurance should be reviewed at least annually, but more frequent evaluations may be necessary in volatile markets. Regular reviews ensure that coverage remains aligned with property performance, market conditions, and portfolio growth. Continuous optimization helps investors capture savings and adapt to changing risks.
What role does insurance play in long-term portfolio growth?
Insurance is a key component of risk management and financial performance in multifamily investing. A strong optimization strategy protects assets while enhancing profitability, allowing investors to scale more efficiently. By reducing unnecessary costs and aligning coverage with growth plans, insurance becomes a strategic advantage rather than just an expense.
Disclaimer: This summary was written with the help of AI and reviewed by Rod’s Team.
01:20:07:26 – 01:20:28:05
Rod Khleif
Welcome back to life time cash flow to real estate investing. I’m Rod Cleef and I’m thrilled you’re here. And I know you’re going to get tremendous value from the gentleman I’m interviewing today. His name’s Guffey, right? Yes, I said that. Right. Guffey. Right. I gave him shit about that earlier. And he’s the owner of and of the Mahoney Group, which is a real estate practice group in insurance.
01:20:28:08 – 01:20:44:17
Rod Khleif
And I know you’re thinking, oh, God, John, but we’ve already had some very interesting conversation about some of the strategies and values that can be implemented using insurance. So if you’re a multifamily owner, you know, you really, definitely need to listen up. Welcome to the show, brother.
01:20:44:20 – 01:20:45:14
Guffy Wright
It’s great to be here. Right.
01:20:45:16 – 01:20:57:15
Rod Khleif
Thank you. Of course. So why don’t you give me a little, do a little better job on that bio than I just did? And, maybe talk about why you do what you do and and where we might be able to add some value to my listeners.
01:20:57:15 – 01:21:26:01
Guffy Wright
Sure. I started selling insurance at age 22, dropped out of college. No plan B got married young and started cold calling and grinding. And the industry that most resonated with me, that connected me to, value was real estate. I think they appreciated the relentless hustle I had. And so we connected and, from there, here we are almost 20 years later, and that’s been quite the journey.
01:21:26:02 – 01:21:47:02
Rod Khleif
Yeah, yeah. So you’re, I know you do all sorts of different types of insurance. You’ve got a very large practice, talk about, let’s talk about real estate specifically, because that’s what we focus on here. And in fact, I was just telling Guffey that, you know, we’ve got a six package of assisted living facilities in Texas under contract.
01:21:47:02 – 01:22:11:04
Rod Khleif
Unbelievable deal. And, and he immediately said, well, because I said, you know, they’re in Houston, Dallas and San Antonio. And he said, well, hopefully they’re on the right side of 45 in Houston because of that’s a tier one, insurance area. And you can add $200 a unit to your or a bed to your insurance premium. So, I immediately texted my partner, I said, hey, let’s check and make sure the Houston one’s not in that area.
01:22:11:04 – 01:22:29:12
Rod Khleif
I don’t think it is, but, appreciate that right out of the gate. And, I also appreciate the fact that you said, you know, life is about adding value. And wherever we add value, you know, it’s it’s it’s a reciprocal thing. And, I and I mentioned that the most successful people on the planet add the most value.
01:22:29:12 – 01:22:51:17
Rod Khleif
You know, I look at I look at someone like Jeff Bezos, and I can order something in about 30s anything, anything in the world. So but, so let’s let’s get into it here. You know, when you’re getting insurance, you’ve got to deal with lenders and lenders can can be a little ridiculous. In fact, I’m dealing with that right now with my son.
01:22:51:17 – 01:23:07:10
Rod Khleif
He’s trying to buy a house and and it’s a nightmare what we’re dealing with. It’s been harder than buying a 20 unit. I’m sorry. A $20 million apartment complex. Getting this house. But, lenders will require different types of insurance coverage. Can you speak to that and speak to how you might be able to help with that?
01:23:07:17 – 01:23:34:10
Guffy Wright
Yeah. We developed a lender waiver template. Okay. Together with Fannie Mae, Freddie Mac and some other loan servicers, because we learned that our owners value what the lender dictates big time, because that impacts the NOI. Right. And I was working on, a deal in Colorado, about 700 units and two days before closing, the lender required different things than they set out.
01:23:34:12 – 01:23:50:27
Guffy Wright
And it was about a $30,000 insurance premium increase. And my client was very upset. Yeah. And called me and and I actually said, hey, this is like a $40 million deal. What’s the big deal on 30 grand?
01:23:51:01 – 01:24:00:20
Rod Khleif
Well, let me just say this. Okay. Let me let me. I just pulled up my calculator here to tell you what the big deal is. At a four cap, that’s a $750,000 swing in value.
01:24:00:27 – 01:24:02:16
Guffy Wright
And that’s what they told me, right?
01:24:02:18 – 01:24:03:16
Rod Khleif
I’m sure.
01:24:03:19 – 01:24:07:23
Guffy Wright
Right. And it really hit me that, wow. This is what they value right now.
01:24:07:24 – 01:24:08:12
Rod Khleif
01:24:08:14 – 01:24:29:09
Guffy Wright
And in that moment I said okay let’s let’s figure this out. And we got some things waived okay. And we were able to get the lender to agree to a lower value to a higher deductible and to negotiate out one specific, coverage at the time. It’s called assault and battery. And so because of that, we were able to then save $60,000.
01:24:29:10 – 01:24:47:20
Guffy Wright
Wow. And so he thought he was basically going to have to come up with half a million bucks at the time. And then it was, you know, over $1 million million, a half dollar swing in the matter of a couple seconds. And that’s when I got hooked. And obsessed with this concept of value and how value is in motion always.
01:24:47:20 – 01:25:06:24
Guffy Wright
Because nobody’s ever called me in a tough claim and said, hey, Guffey, can you shave off 10% right now? Right. They don’t value it. It’s the same thing. Like if I offered someone a briefcase full of cash or a briefcase full of bottle of water. Well, I’m going to take the cash unless I’m in the desert for seven days right now.
01:25:06:24 – 01:25:07:18
Guffy Wright
What’s more valuable?
01:25:07:25 – 01:25:20:29
Rod Khleif
So tell me, tell me, tell me. Be more specific as to what you mean by value in motion. So that I’m not. I’m. Because I’m. I’m struggling with how you’re describing it. Yeah.
01:25:21:01 – 01:25:47:03
Guffy Wright
I think people value different things at different times. Oh, for different reasons. Okay. And in decision making, there’s a couple things that prevent deals from flowing or prevent value from winning. It can still stall, deal, stall the decision stall even when value is clear. And I think by removing that you can see how value can flow quickly.
01:25:47:05 – 01:25:55:16
Guffy Wright
The you know, my dad, inherited gold coins for my dad. Well, gold right now per ounce is worth about $5,000 an ounce.
01:25:55:16 – 01:25:59:01
Rod Khleif
Right. It’s amazing because I paid 1500. So there you go. Yeah.
01:25:59:05 – 01:26:14:03
Guffy Wright
So so it’s in motion. It was at 1500. Now it’s 5000, right. However, my gold coins that I got from my dad, who he bought from his mom, you know, she got him in Austria in 1908. Wow. Those are the last things I’m parting with other than feeding my children.
01:26:14:03 – 01:26:14:14
Rod Khleif
Sure.
01:26:14:17 – 01:26:16:21
Guffy Wright
So that’s what I mean. Value is always in my mouth.
01:26:16:22 – 01:26:50:02
Rod Khleif
Gotcha. Okay. Fair enough. Well, you know, as it relates to this conversation we just had regarding, you know, a deal that’s about to close, you know, every dollar that’s saved, from the net operating income is about a 17 to $20 fluctuation or savings. Or an increase in value, rather, you know, and I knew that $30,000 example because, I remember I have a 296 unit asset in San Antonio, and we painted numbers on the parking spaces and said, hey, for 25 bucks a month, you can have your own parking space right in front of your unit.
01:26:50:05 – 01:27:07:26
Rod Khleif
100 people took it. You annualize that $25 times 100 and it’s 30 grand. So I knew the number because I use it as an example. You know, I had a four cap that’s $750,000 instant increase. And so you basically if you save the guy 60 grand, you basically saved him a million and a half dollars right out of the gate.
01:27:07:26 – 01:27:29:06
Rod Khleif
Correct? I mean, which is huge. So, so, as far as this lender waiver, you know, people a lot of people think that when a lender says something, it’s locked in stone. And this is why you always bring in an attorney, guys, okay. To review your financing documents, to review the clauses in your financing documents and to also, you know, negotiate things.
01:27:29:09 – 01:27:36:12
Rod Khleif
You know, you can you can negotiate quite a few things with a lender. A lot of people don’t realize that. So you can actually negotiate insurance, which. Yeah.
01:27:36:12 – 01:27:40:18
Guffy Wright
And if you don’t value your insurance broker the way you value your attorney.
01:27:40:20 – 01:27:41:09
Rod Khleif
Yeah.
01:27:41:12 – 01:27:42:09
Guffy Wright
You have the wrong broker.
01:27:42:10 – 01:28:00:16
Rod Khleif
Well, I agreed and we talked about this before we started recording. You know, we talked about alignment. Right. And that’s where you’re going with that. And, you know, I tell people, and candidly, shame on me. I’ve never really included the insurance broker in that conversation. Usually I’m talking about property management companies, how you align with a property management company.
01:28:00:16 – 01:28:26:13
Rod Khleif
You’re basically partnering with them. But I can see it’s the same thing with insurance, because if you can save that kind of money, I mean, good God, you know, we’re on the same team there. And and, you know, shame on me for not thinking through that, I’ll be honest. But, but I’ve I’ve changed my mindset as of this conversation that definitely your insurance broker, has got to be you’ve got to be aligned and, you know, and I’ve had some big insurance claims in my, in my career.
01:28:26:13 – 01:28:40:24
Rod Khleif
I had a fire on a 22 unit in Nashville, burned to the ground. Thank God nobody died. We’re getting sued by a woman. Had to jump out of a third floor balcony, but we’re not at fault. We didn’t do anything wrong. I feel bad for her. She broke her ankles, but. But, you know, there’s that one.
01:28:40:24 – 01:28:51:01
Rod Khleif
And then I had a tornado destroy 101 units in in, Dayton, suburb of Dayton called Beavercreek, Ohio, destroyed 101 families had to move. So these are big insurance claims.
01:28:51:04 – 01:28:52:15
Guffy Wright
But you’ve been through it, you know?
01:28:52:17 – 01:29:13:24
Rod Khleif
No, no, I’ve been through it. Yeah. And and tons of houses, you know, but, over the years. But so, so, so having a insurance broker that can negotiate with a lender as needed is huge. And, that lender waiver will not tell me what that waiver is, is a document that that you execute or what is that correct?
01:29:13:24 – 01:29:22:10
Guffy Wright
It’s a it’s a document. And then we also support it with data okay. We know that lenders love to check a box okay. It makes them feel so great.
01:29:22:12 – 01:29:23:09
Rod Khleif
Exactly right.
01:29:23:16 – 01:29:26:20
Guffy Wright
And and so we give them permission to do.
01:29:26:20 – 01:29:38:05
Rod Khleif
That I see and you do that through this waiver where you’re substantiating your position. Correct. And it allows them to check that box and say, okay, I can eliminate that particular clause. Yeah. Okay. Got it.
01:29:38:06 – 01:30:02:08
Guffy Wright
Okay, love, can I mention another mistake or how I would sure. You know, a lot of times you just compare yourself to yourself in insurance, meaning, oh, we save 10% high five or we’re up 6% year over year. But what if you had information on what all your peers are paying? What all your peers are buying? Now, you can really evaluate how you’re doing.
01:30:02:12 – 01:30:05:03
Guffy Wright
Right. And that’s what we provide. It’s called a benchmark report.
01:30:05:06 – 01:30:05:25
Rod Khleif
Okay.
01:30:05:27 – 01:30:10:25
Guffy Wright
And ask your broker for a benchmark report because right now.
01:30:10:27 – 01:30:11:21
Rod Khleif
It’s easy.
01:30:11:21 – 01:30:17:11
Guffy Wright
To save, money on property insurance in the next 12 to 18 months. It’s actually going down.
01:30:17:13 – 01:30:18:20
Rod Khleif
Premiums go down a lot.
01:30:18:20 – 01:30:37:12
Guffy Wright
Yeah. And so you’ve comparing yourself year over year to yourself. Right. Well, you’re happy that your premiums are going down. But then what if I showed you your neighbor is paying 40% less and each and actually has a worse asset? That would make you feel great, right? Right. I like to grade my own papers to to make myself feel good.
01:30:37:14 – 01:30:44:03
Guffy Wright
Sure. But when you have all that data, it really just provides clarity so you can put a strategy around it. Oh, sure.
01:30:44:08 – 01:31:05:05
Rod Khleif
You know, it used to be, it used to be, not the greatest idea to shop insurance. You know, insurance brokers don’t like it because it’s a lot of work for you guys to, to to get print, you know, to get, commitments and things of that nature. And so, but now, obviously that ship has sailed just because of the huge swings in insurance and all the things that have happened.
01:31:05:05 – 01:31:10:13
Rod Khleif
But, I love that. So this benchmark report is that like an industry report is that’s just your firm that does that.
01:31:10:13 – 01:31:16:08
Guffy Wright
So we we combined with about 15 other firms nationwide to share our data, the mastermind group.
01:31:16:08 – 01:31:16:23
Rod Khleif
Gotcha.
01:31:16:25 – 01:31:21:11
Guffy Wright
And we aggregate that data together. Got it. So we can add value to that’s.
01:31:21:11 – 01:31:30:15
Rod Khleif
To our classic idea. Yeah. By the way I’m a huge mastermind fan. You know, Napoleon Hill is book thinking grow rich. I, I used to have the largest multifamily mastermind pretty much on the planet.
01:31:30:15 – 01:31:30:25
Guffy Wright
I know that.
01:31:30:26 – 01:31:47:27
Rod Khleif
At one time you have 40 or 50 billion in assets, and it it just getting these guys together was like herding cats. But, but it was pretty amazing. I had the first, the first, session here at my house was 16, 16, successful multifamily investors. This grew into something. And I gave it up a couple of years ago.
01:31:47:27 – 01:31:52:26
Rod Khleif
I, I’m thinking about it. It was called the Multifamily Boardroom. I think the website’s still up, but, but, yeah.
01:31:52:26 – 01:31:53:24
Guffy Wright
This long ago was that.
01:31:53:24 – 01:32:11:23
Rod Khleif
Oh, a 2 or 3 years ago? I, I’m bad with dates, but I it was just too much work. And I’m, but I’m thinking about, at the very least, doing one meeting a year, just to compare notes on what’s happening because there’s so much, you know, the multifamily, so tumultuous right now, so incredible opportunity with the deals that are out there right now.
01:32:11:23 – 01:32:16:11
Rod Khleif
But a lot of people are scared. A lot of people are in trouble. And, yeah.
01:32:16:12 – 01:32:18:14
Guffy Wright
Can I make a comment about shopping brokers?
01:32:18:14 – 01:32:21:15
Rod Khleif
Yeah, sure. Okay, sure.
01:32:21:17 – 01:32:44:29
Guffy Wright
I would interview 2 or 3 different specialists, brokers, and I would pick the person that best aligns with your future ambitions. A lot of times, in my experience, owners and insurance agents, they care the most about the present transaction. Let’s get this deal done. Let’s say premium. Let’s say premium. Great. I get it. But if you can find a partner that will anchor to your future ambition, that’s alignment.
01:32:44:29 – 01:32:48:08
Guffy Wright
That’s the holy grail of an insurance.
01:32:48:10 – 01:32:50:15
Rod Khleif
So elaborate on that a little bit.
01:32:50:18 – 01:33:05:05
Guffy Wright
Well, if you tell me you’re going to if I ask you about your growth plans and you say, hey, we’re doing some, you know, senior housing, and we’re going in Texas and we’re going in, you know, like, I just want like you just told me, right. And you’re doing some other things. Well, then then I know how I can help.
01:33:05:05 – 01:33:33:05
Guffy Wright
I already know the problems you’re going to face in 2 or 3 years. I have all of the lawsuits in every state, that you need to worry about. And I know you probably try to stay out of those high litigious states, right. But Florida has issues on the liability side. Big time. Texas is better, but I would I would then talk to you about your future and align with how I would build a whole strategy around your future, because I know the pitfalls you’re going to face as you grow.
01:33:33:07 – 01:33:41:04
Guffy Wright
And so instead of just shopping out every three years and trying to find the best deal, it’s it’s better to actually build a strategy in alignment.
01:33:41:06 – 01:33:41:20
Rod Khleif
01:33:41:22 – 01:33:47:15
Guffy Wright
Where we can kind of benchmark you along the way and if we have to pivot, we pivot. But I think.
01:33:47:15 – 01:34:01:14
Rod Khleif
That that makes that makes sense. But I mean, I’ll tell you, you know, I, I’m the most loyal person you’ll ever meet. My, my, my loan broker is a guy that’s been with me forever. My attorney has been with me forever. I mean, I’m I’m incredibly loyal that come.
01:34:01:14 – 01:34:01:27
Guffy Wright
From.
01:34:01:27 – 01:34:31:28
Rod Khleif
Work ethic. I have no idea where it comes from, but I am very loyal, and, it’s good. And I believe in that, you know, and of course, it’s it’s we add value to each other. But, you know, a lot of people aren’t, you know, but but I am for sure, and I respect that. So, you know, another thing that you mentioned before we started recording is, you know, a lot of people will go to an insurance broker that they maybe, you know, borrowed money they did with their house or something like that.
01:34:32:03 – 01:34:40:22
Rod Khleif
And, and, you know, and we’re talking about a generalist in insurance versus a specialist. Do you want to elaborate on that conversation?
01:34:40:22 – 01:34:52:03
Guffy Wright
Sure. So our industry is moving more towards like how an attorney, how a law firm is set up. Certain attorneys specialize in real estate and certain do you know medical malpractice insurance is the same now?
01:34:52:09 – 01:34:53:15
Rod Khleif
Okay.
01:34:53:18 – 01:35:12:04
Guffy Wright
It’s still old school in some ways. However, I would align or partner with a specialist or an expert. Now everybody’s going to say I’m an expert, right? And I have the largest relationships and all these other things. Right. Truly, you just ask them a couple questions. You’ll know real quick if they know what they’re talking about.
01:35:12:07 – 01:35:12:15
Guffy Wright
If they.
01:35:12:15 – 01:35:13:03
Rod Khleif
Don’t know.
01:35:13:06 – 01:35:18:28
Guffy Wright
What, they don’t know what a cap rate is. Oh, how are they? How are they a specialist in multifamily?
01:35:19:00 – 01:35:19:10
Rod Khleif
Okay.
01:35:19:12 – 01:35:28:23
Guffy Wright
Insurance. Right. If they don’t, if they just roll over and say, hey, the lender’s the lender, right? Right. Oh, wow. Okay. That costs you millions of dollars a value.
01:35:28:23 – 01:35:30:10
Rod Khleif
Sure, sure.
01:35:30:13 – 01:35:50:25
Guffy Wright
You know, another thing with, a lender, if you have a large portfolio in multiple states, you know, you should really look at lowering your value and having a blanket policy, right? Because your risk is much lower. And we can show the data on how to do that with lending. And so that is a big deal when it comes to picking a specialist versus a generalist.
01:35:51:01 – 01:35:56:08
Guffy Wright
They will add so much value over time. Just like an attorney would.
01:35:56:13 – 01:36:15:25
Rod Khleif
Got it, got it. So before we started recording, you mentioned identifying your ideal client and also a process that you go through with a prospective client, and helping them in the same in the same vein. Can you elaborate on that?
01:36:16:02 – 01:36:21:08
Guffy Wright
Yeah. So an ideal client is crucial to know who that person is.
01:36:21:08 – 01:36:21:29
Rod Khleif
Your avatar.
01:36:22:02 – 01:36:47:18
Guffy Wright
Your avatar. Yeah. And it’s not just demographically. It’s also psychographic who they are between the ears. Okay. My favorite people to work with are the ones that are high growth mode. Love deals, love looking at deals. They send me deals and we discuss and we, you know, we strategize together. But how I help my clients is they’ll sometimes call me and say, hey, we’re raising money or we need to x, y, z.
01:36:47:20 – 01:37:16:17
Guffy Wright
I said, well, who’s your ideal investor? And sometimes they don’t know even who their ideal investor is. Is he a doctor? Is your minimum spend 100,000 or a minimum investment. Right. What part of the country are they from? Right? I would get so specific on who your ideal investor is, that I would be able to share a slide that describes exactly who that human is, because when they see that slide come up in real time, they’re going to think, wow, this person understands me.
01:37:16:19 – 01:37:17:26
Guffy Wright
They’re experienced.
01:37:17:28 – 01:37:29:04
Rod Khleif
So you know what? They wait a minute just to clarify what you’re saying. When that investor sees that slide come up in a presentation, correct. They’re going to it’ll resonate with them because it’s describing them.
01:37:29:10 – 01:37:47:12
Guffy Wright
Correct. Got it. And I have I’ve been in these presentations. And if you think just adding more information and adding more data is going to help somebody not be confused, it won’t. Right. But if you share a slide that says I’m experienced, I understand you and I’m attached to your future ambition,
01:37:47:14 – 01:37:51:11
Rod Khleif
Which which that particular slide would if it describes them. Correct.
01:37:51:11 – 01:37:59:25
Guffy Wright
Right. And they’re not asking the question, how much does it cost? And will I regret buying this asset. Right, right. They’re not asking that question. Yeah. Right.
01:37:59:25 – 01:38:19:04
Rod Khleif
Right, right. No I like it. I like it a lot. And and you know we’ve tried to identify my, you know, our avatar in both the investments. You know the investors that we’re looking for and as well as the coaching clients that I, that I bring in. And it’s very helpful, you know, because when you I mean it sorry about the analogy, but when you’re marketing you’re you’re also using it for marketing.
01:38:19:04 – 01:38:31:18
Rod Khleif
And you’re not shooting with a shotgun, you’re shooting with a rifle. Right. And so, you know, you want to you want to fish where the, where the fish you’re looking for are, are eating. And so yeah, you know, sorry about these ridiculous analogies because that’s like that’s it.
01:38:31:21 – 01:38:39:07
Guffy Wright
I think to my dad would always say I’d rather be in a bad deal with a good partner. Yeah. Than a good deal with a bad part.
01:38:39:07 – 01:38:51:21
Rod Khleif
Always. Yeah. And and don’t get me started on that. Oh, good. Good. Yeah. No. And so, so, I want to shift gears for a minute. Let’s do how is AI impacting your industry?
01:38:51:24 – 01:39:13:22
Guffy Wright
So insurance is traditionally slow at reacting to technology. Is it they it’s a lot of hey we’re in the relationship business which hey I agree right. In the end relationships make all the difference here. But they are not a differentiator too. If I if I came to you or somebody listening, it said, hey, do business with me because of my relationships, it’s not going to move the needle.
01:39:13:24 – 01:39:42:26
Guffy Wright
Right. But I do believe in the end it makes all the difference. AI is going to have a massive impact in insurance and already is. Yeah, we’re already using it. Right now we can upload your statement of values, your lender requirements and your insurance policy into our bot. Right. And it’ll spit out a brief on what should what should we do to negotiate with the lender based on our experience, what the percentage chances we have to get this out, what the NOI is at a five cap.
01:39:42:28 – 01:39:48:03
Guffy Wright
And so we have that already built. That’s cool. I wouldn’t say it’s scaling yet.
01:39:48:03 – 01:39:48:14
Rod Khleif
Right.
01:39:48:16 – 01:39:56:17
Guffy Wright
But when I scales in insurance I think it’s going to be amazing for the top performers. Yeah, I think it’s going to really.
01:39:56:19 – 01:39:57:26
Rod Khleif
Probably eliminate the B.
01:39:57:26 – 01:39:59:13
Guffy Wright
And C players are going to just get crushed.
01:39:59:13 – 01:40:20:10
Rod Khleif
Yeah. Well it’s the same thing I think in just about any industry at this point. You know, we’re implementing AI in my coaching business for sure. And then we’re formatting a, laptop with open claw and my, my main guy is telling me it’ll do 95% of his work. It’s just extraordinary. You know, really, it’s also going to eliminate a lot of jobs.
01:40:20:10 – 01:40:33:21
Rod Khleif
Yeah. Well, and and and if you’re listening and your job could be on the line and there are a lot of them on the line, by God, you better be thinking about a side hustle. You better be figuring out what you’re going to do. Don’t wait for that shoe to drop because it’s gonna drop. I mean, who was it?
01:40:33:21 – 01:40:58:27
Rod Khleif
They just announced a bunch of layoffs. So, Oracle, upwards of 30,000 people getting laid off. Meta’s done it. Facebook’s done it. You know, oh, God. That payment processors done it. I mean, yeah, and those are the people on the forefront of this stuff. It’s going to be the rank and file pretty soon. I’ve been shouting it from the rooftops because I know it’s going to cause a lot of pain, you know, until they come up with this universal income thing, which I don’t think anybody is going to freaking going to want, right know who wants.
01:40:58:27 – 01:41:19:01
Rod Khleif
I mean, it’s like like welfare, you know, who wants that? So yeah, pick a side hustle, guys. Okay. You can buy businesses 10,000 people a day turning 65. You know, they’re selling businesses, actually, like seven, 8000 people turning 80 in this country. Which is why I’m so excited about senior housing, man. I’m like, it’s it’s guts.
01:41:19:02 – 01:41:39:22
Rod Khleif
It’s got legs. So you encounter a lot of people in your practice. You encounter a lot of different personalities. And you’re dealing with a lot of zeros, you know, with a lot of these deals. Because I know your your avatar is somebody ideally that’s got, you know, hundreds if not thousands of doors. They want portfolio insurance rather than individual insurance.
01:41:39:22 – 01:41:50:20
Rod Khleif
I mean, I’m sure you’ll do individual properties, but that’s your ideal client, right? Correct. You know, talk about the different personalities and psychologies that you encounter. Well, we.
01:41:50:23 – 01:41:59:26
Guffy Wright
We see it all because we’re dealing with underwriters, right? Lenders and real estate, people, as well as our 300 employees at the Mahoney Group.
01:41:59:26 – 01:42:00:06
Rod Khleif
Wow.
01:42:00:11 – 01:42:21:27
Guffy Wright
And so one of the most frustrating things that I’ve seen in selling insurance is when value is clear, when we’re clearly the best choice. But decisions still stall. Interesting. And I think in real estate that that does happen as well, where maybe you’re trying to raise money or you’re trying to figure out why not everyone cares about your deal as much as you do.
01:42:22:00 – 01:42:26:08
Guffy Wright
And the reason what’s what’s in the way is emotional friction.
01:42:26:10 – 01:42:46:05
Rod Khleif
Okay. So what you just described is you you have presented a premium for a policy. It’s the best deal they’re going to get. Are you able to are you able to substantiate the fact that it’s the best deal. They’re going to get it. That’s my first question then. And then secondly, why would it stall at that point?
01:42:46:07 – 01:42:47:27
Guffy Wright
You’re a very loyal guy.
01:42:48:03 – 01:42:50:16
Rod Khleif
No one loyal. Loyal, yes.
01:42:50:19 – 01:42:59:25
Guffy Wright
So to break a 20 year relationship or a 12 year relationship is not easy. And so you have some fear.
01:43:00:01 – 01:43:00:22
Rod Khleif
01:43:00:24 – 01:43:21:23
Guffy Wright
Of relational fear. Maybe even identity threat. Reputational harm. Right. And then you also have buyer’s remorse you got to deal with. Yeah. And so even when value is clear let’s say I’ve saved somebody $2 million and they didn’t go with me. Oh shot. And here’s why I didn’t know what they valued. They were a publicly traded REIT.
01:43:22:00 – 01:43:30:18
Guffy Wright
And at the time they were just looking for access to capital. So they went with a large brokerage that has family, home, office money and access to VCs.
01:43:30:18 – 01:43:31:02
Rod Khleif
I see.
01:43:31:04 – 01:43:40:14
Guffy Wright
Well, if I had known what they valued, I could have attached my future, or I could have attached my value to their future position.
01:43:40:14 – 01:43:41:28
Rod Khleif
And repositioned yourself.
01:43:42:00 – 01:43:46:05
Guffy Wright
And so even when value is clear, decisions stall.
01:43:46:05 – 01:43:53:10
Rod Khleif
So talk about how that could translate into an operator that’s raising money and things like that.
01:43:53:12 – 01:44:09:26
Guffy Wright
When you’re talking about dealing with somebody’s money, it’s directly tied to their identity in some way, shape or form. Yeah. And because of that, people are going to protect that almost at any cost. And so you have to understand what’s in the way of them making a decision.
01:44:09:29 – 01:44:10:12
Rod Khleif
01:44:10:15 – 01:44:31:27
Guffy Wright
Because something else I’ve learned too is all decisions make sense with enough information. So what is preventing them from doing it. It’s typically three types of friction okay. Cognitive. They’re just confused okay. So make things simple okay. It’s hard to be aggressive when you’re confused. When you’re confused.
01:44:31:27 – 01:44:32:24
Rod Khleif
Right.
01:44:32:26 – 01:44:35:02
Guffy Wright
The second is emotional friction.
01:44:35:09 – 01:44:36:16
Rod Khleif
01:44:36:19 – 01:44:44:26
Guffy Wright
Fear not. Feeling safe. Yeah. There’s a lot going on there on the emotional side. Could be generational stuff going on.
01:44:44:26 – 01:44:47:19
Rod Khleif
Yeah sure sure. Trauma past trauma whatever. Correct.
01:44:47:20 – 01:44:49:22
Guffy Wright
Right. And the third is directional okay.
01:44:49:22 – 01:44:51:18
Rod Khleif
What do you mean.
01:44:51:20 – 01:45:03:12
Guffy Wright
Buyer’s regret in real estate and insurance and vendors is massive. What if this value goes down? What if something goes about my partners? What if Hurricane Ian comes every two months? What if.
01:45:03:15 – 01:45:09:09
Rod Khleif
It ties? It ties into fear in a way. But you’re thinking. You’re thinking about the future and future pitfalls. Basically.
01:45:09:09 – 01:45:11:28
Guffy Wright
Correct. And so that makes decisions stall.
01:45:12:00 – 01:45:13:11
Rod Khleif
01:45:13:14 – 01:45:33:03
Guffy Wright
That value sometimes is distorted and blocked because of emotional friction. And so if I was raising money because this is what I’ve done in, in, in insurance and I don’t try to close people or push right. I try to create the conditions that where the decision becomes obvious and clean.
01:45:33:05 – 01:45:44:23
Rod Khleif
So you do that by simplifying the presentation absent by dealing with potential fear and things that can pop up there and mitigating a future calamity, I guess, you know.
01:45:44:23 – 01:45:46:11
Guffy Wright
And and here’s how you do that.
01:45:46:12 – 01:45:47:09
Rod Khleif
Okay.
01:45:47:11 – 01:46:10:06
Guffy Wright
First is value. Make sure the value is clear. Starts with clarity okay. That really brings cognitive ease down. And people understand clarity clarity clarity right. The second when we talk about emotional friction, it’s actually vulnerability is what expands psychological safety and tests it.
01:46:10:08 – 01:46:12:25
Rod Khleif
So so what you’re saying is being vulnerable.
01:46:13:02 – 01:46:13:24
Guffy Wright
Yes. And these are the.
01:46:13:24 – 01:46:15:11
Rod Khleif
Risks you’re in presentation. Correct.
01:46:15:11 – 01:46:15:24
Guffy Wright
These are the.
01:46:15:24 – 01:46:19:24
Rod Khleif
Risks being being completely transparent is what you’re saying. Because the the.
01:46:19:24 – 01:46:24:02
Guffy Wright
Best deals I’ve ever worked on is when the truth was most present on both sides.
01:46:24:02 – 01:46:25:14
Rod Khleif
Yeah. Yeah. Right.
01:46:25:16 – 01:46:32:17
Guffy Wright
So that expands that psychological safety where people can really feel safe, but also ask questions and be honest about the risk.
01:46:32:24 – 01:46:33:09
Rod Khleif
01:46:33:12 – 01:46:47:06
Guffy Wright
And then the third is directional. And how do you do that as a real estate owner with an investor is through validation. Validation, I believe, is the missed most misunderstood term in human psychology.
01:46:47:08 – 01:46:52:28
Rod Khleif
It’s like it’s like you’ve got a hell of a deal here and you’re you’re going to kill it with this deal. This this is what we’re talking about.
01:46:52:28 – 01:46:53:06
Guffy Wright
Yeah.
01:46:53:06 – 01:46:53:24
Rod Khleif
So okay.
01:46:53:28 – 01:47:02:11
Guffy Wright
What I mean is validating, like in human psychology and in business, a lot of times we think it’s affirmation or agreement or accommodation.
01:47:02:11 – 01:47:02:23
Rod Khleif
Right?
01:47:02:23 – 01:47:15:03
Guffy Wright
It is not that is not validation at all. It’s confirming truth, reinforcing value. It actually comes from the Latin word valorous which means reinforce strength.
01:47:15:06 – 01:47:22:20
Rod Khleif
Got it. You know, I’m so impressed with the fact you guys found this deal. You’re able to put it together. This is an absolute home run, blah blah blah. That’s validation.
01:47:22:21 – 01:47:38:12
Guffy Wright
Correct. And and it sounds like this I know how it sounds on the insurance and real estate side, but on on the investor side, an investor could say, hey, this deal sounds great, right? I’m I’m sure it’ll work out right. I just need some time to talk about this with my partners. Right. Okay. Validation sounds like this.
01:47:38:17 – 01:47:59:19
Guffy Wright
You know what? It’s really wise that you’re taking the time necessary, that you’re going to be with your partners and get aligned. Very wise. However, I really not just believe in my heart, but the data is showing us this is going to be an amazing deal in Texas. Right. And here’s why we think that we have the deadline is here in ten days.
01:47:59:19 – 01:48:08:14
Guffy Wright
I’m not putting any pressure on you because I but I’m just telling you facts. Right. And we would really love for you to be a part of it. And we think it would absolutely connect to your future ambitions.
01:48:08:14 – 01:48:09:21
Rod Khleif
Got it. Yeah. And so that’s.
01:48:09:21 – 01:48:10:20
Guffy Wright
That’s validation.
01:48:10:20 – 01:48:11:17
Rod Khleif
Right. That’s beautiful.
01:48:11:17 – 01:48:17:08
Guffy Wright
That ultimately equals decision velocity. Sure. You’re not speeding up a decision. You’re just removing what’s in the way.
01:48:17:08 – 01:48:27:20
Rod Khleif
Yeah. Oh love it love it love it. Good stuff. All right. Well how do people get Ahold? Get Ahold of you, Guffey. Where where where, would they go?
01:48:27:24 – 01:48:31:16
Guffy Wright
Yeah, I’m on LinkedIn. Quite active on LinkedIn. I have a.
01:48:31:17 – 01:48:37:07
Rod Khleif
And it’s goofy. And if you forget that, then forget it. Guffey. Right. Yeah. For iGTV.
01:48:37:09 – 01:48:50:23
Guffy Wright
That’s right. I’m on LinkedIn and I have, I have a website that you can upload your statement of values, right there on LinkedIn, upload your lender requirements, and I will, you know, give you a brief, no strings attached. You can even hand it over to your broker.
01:48:50:23 – 01:48:51:16
Rod Khleif
What’s that website?
01:48:51:21 – 01:49:09:19
Guffy Wright
It’s tour dot Guffey right.com. And it’s on the LinkedIn. It’s on your LinkedIn. It is on the LinkedIn. You find me, I respond to my LinkedIn within 24 hours. If anybody messages me. Okay. Be happy to guide you through any acquisition, any next deal, any lender headaches? Just love being involved in the in the deals.
01:49:09:19 – 01:49:10:19
Guffy Wright
Yeah.
01:49:10:22 – 01:49:12:15
Rod Khleif
You love the business. Like I love the business.
01:49:12:15 – 01:49:13:03
Guffy Wright
Absolutely.
01:49:13:03 – 01:49:16:08
Rod Khleif
Yeah. It’s obvious. Well, thanks for coming down, brother. Appreciate you.
01:49:16:09 – 01:49:26:12
Guffy Wright
You’re welcome. Rod, congratulations on all your success. And thank you. 300,000 warriors strong. Yeah. Giving an impact to people and making creating legacy. There’s no greater pursuit.
01:49:26:12 – 01:49:29:14
Rod Khleif
No. Thanks, buddy. I agree. Adding value.