In the customer interview video, Kacey Kalian, VP of Risk Management at Extra Space Storage, discusses how Archipelago transformed their insurance strategy and risk data management capabilities.
With over 3,800 properties across 43 states, Extra Space Storage faced challenges maintaining an accurate and complete Statement of Values (SOV) using manual processes.
Implementing Archipelago's SOV Manager™ and Property Hub™ enabled the team to streamline workflows, improve data quality, and deliver comprehensive property information to brokers and underwriters.
Kacey highlights the ease of implementation and the significant positive impact on insurer engagement and coverage placement, particularly in a challenging insurance market. Feedback from underwriters has affirmed the value of these enhancements, further supporting Extra Space Storage's growth and strategic goals.
Read the Extra Space Storage case study here.
Customer Story Transcript:
Veronika:
Hello everyone, and welcome. My name is Veronika Andreeva. I'm the Head of Marketing here at Archipelago, and it's my pleasure to introduce you to Kacey Kalian, the Vice President of Risk Management and Extra Space. Hi Kacey.
Kacey:
Hi, how are you?
Veronika:
Good, how are you?
Kacey:
Good. Thanks for having me.
Veronika:
Yes, thanks for joining us today. Thank you for joining this session in our event. So the session is going to be about your journey with Archipelago and your success story. And I wanted to kick it off with potentially diving into the background of Extra Space because I'm sure that a lot of our listeners know about it, but not many might know the extent of the geographical footprint and what it means, what kind of real estate you guys are dealing with.
Kacey:
Yeah, of course. Extra Space Storage is the largest self-storage company in the United States. We have around 3,800 properties across 42 different states. We're basically in every major metropolitan area, and the only states we're not located in are across the Midwest, like the Dakotas, Iowa, West Virginia, places that don't have those major metropolitan areas. What makes us unique is that we have three different ownership types for our facilities. So we have stores that are wholly owned, which consists of a little over half our portfolio, but we also have joint venture and managed properties. That helps us to grow in times where there's no opportunity to purchase stores ourselves. So when prices are high and people might not be purchasing as much, we can grow through different avenues by bringing stores onto our portfolio that are either managed or joint ventures.
Veronika:
Awesome. Thank you for this insight. So I suppose with such a massive geographical footprints, there was quite a bit of manual spreadsheet work before Archipelago. I would love to dive deeper into that experience. What was it like before Archipelago?
Kacey:
That's a great question. Prior to Archipelago, we did everything through spreadsheets, and the reason I mentioned our different ownership groups is because that's what makes our portfolio difficult to manage from an SOV perspective. We have properties that are coming on and off our third-party managed program somewhat frequently, and gathering and documenting the information associated with those properties becomes very difficult, very time-consuming, and very manual. And tracking all those through a spreadsheet, through a less strategic platform, was really cumbersome and very manual and time-intensive.
Veronika:
I bet. So how did you find out about Archipelago and decided to take the leap of faith and see whether this is the right solution for you?
Kacey:
Yeah, so I would have to give a little bit of credit to my predecessor before me because he started the conversation with Archipelago, but we were one of the founding members or founding members in terms of clients coming onto the platform. We joined because as we were growing, we needed a way to scale our processes a little bit more efficiently in a way that helped us collect data associated with our properties. So I don't know if a lot of people know about the enrichment process associated with Archipelago. So one of our most difficult parts of the process is gathering the construction information and the primary attributes associated with the properties to add to our SOV. And because we have a lot of properties coming onto our platform where we are not involved with the construction of those properties and we don't even own them, gathering that information becomes a little bit difficult.
So we partnered with Archipelago to be a founding member of the company to help us create efficiencies in that process of gathering information. So with the enrichment process, you can actually take documentation associated with a facility. So it can be a property condition assessment, it can be a seismic report, it can be a roof report, it can be an appraisal, and Archipelago will help us extract information from those documents to help us populate our SOV. So we're able to extract what type of roof might be constructed on that facility, what type of sprinkler systems it might have, and then it helps us make a more robust SOV because not only are we gaining those primary attributes, but we're also adding in a lot of the secondary modifiers that are important to insurance companies and helping better refine the modeling associated with our portfolio.
Veronika:
Okay, awesome. And so I guess the reason why this is important is because it helps the underwriting process to refine, like you said, the modeling result because you have more data. Is that correct?
Kacey:
Yeah, I would say that's a hundred percent correct. One, it helps us be more efficient in terms of managing information because we're not having to go work with our facilities team or district managers to collect that information themselves to help us build a more robust SOV. We can just do it with existing documentation that we generally have when we bring on a property. But then yes, too, it helps us feel more confident in the modeling and helps the underwriters get more comfortable that we're putting in the due diligence and work necessary to make their results more accurate. The modeling, we know models aren't a hundred percent correct, but we do our best to at least make them as accurate as possible so we can make good decisions around the risk that we want to take as an organization as well. We like to participate in the insurance tower when possible, or we are trending towards higher deductibles and aggregates as part of our insurance program. And the more accurate the modeling is, the more comfortable I can get our executives in terms of feeling comfortable taking that risk on ourselves.
Veronika:
Exactly. Our co-founder likes to say – Hemant Shah – that control what you can, which is the data aspect of things. Yeah. So what was the impact on maybe you have any quantifiable results on the data or manual processes or any other metrics that you're tracking internally?
Kacey:
Yeah, so one of my favorite charts that I'd like to show when we go have discussions with underwriters is the Readiness Report that's generated from Archipelago. This essentially shows where we started in terms of data prior to coming onto Archipelago, how complete our data was versus what we're at now. And that's always a great talking point and a great visual demonstrator of the effort that we've put in into improving that data to make the modeling more efficient. And we always get a good reaction from markets when we're able to visually demonstrate the amount of improvement in our processes and in our data.
Veronika:
Awesome. So that's actually a perfect segue. I was going to ask you about the reaction from the market. So you mentioned that you're seeing a good reaction from the markets. Could you talk a little bit more about that?
Kacey:
Yeah, I think it's an ongoing partnership as we get feedback in terms of, as we try to demonstrate to markets what we're doing strategically to improve our processes, they have been very receptive to providing good feedback that they feel that this is worthwhile. I have had anecdotal conversations with underwriters too that they'd even be willing to give a little bit of a discount in terms of premium because the data associated generally when they're on the Archipelago platform is that much better. And so it's difficult to quantify the benefit and say we've received X percent of improvement because of the work that we've done with Archipelago. But I think the evidence is there anecdotally, and I'm also more confident internally that we're making the right decisions, which is invaluable. It's an invaluable and still intangible benefit, but I think the value's there.
Veronika:
Awesome. So what is in store for the future with your partnership with Archipelago? Any other future potential benefits that you're hoping to get?
Kacey:
Yeah, so we underwent a large acquisition last year where we acquired or merged with Life Storage. In that year we grew by 50%, so we are just now undertaking the process again to go through and enrich the data associated with that portfolio. We've gotten, we're making strides in towards getting that portfolio up to the same level of enrichment that the Extra Space portfolio has, but we still have a lot of work to do. Another thing that we're looking to partner with Archipelago on is looking at the valuation process for a portfolio of our size. That becomes very difficult because the markets expect you to make corrections on almost a yearly basis to ensure that your replacement costs are correct. When you're dealing with thousands of properties in different locations with different construction types, that process becomes more difficult as well. And so we're looking to utilize the construction information that we've uploaded to Archipelago to create a process around modifying and improving the valuations of our properties on a more regular basis. We're doing that internally already, but I think there's opportunity to use the tools within Archipelago to make that a little bit more simplified and a more efficient process.
Veronika:
That sounds very exciting and I hope it goes well. So I have one last question, which I really like to ask our customers. If you were to describe Archipelago with only one sentence, how would you describe it to your peers?
Kacey:
I would say it's a tool to strategically manage your insurance data to achieve optimal renewal results.
Veronika:
Awesome. Thank you.
Kacey:
Was that good?
Veronika:
That was excellent. Thank you so much. And I think with that, that actually concludes today's session. So Kacey, I appreciate your time today and your insights, and I wish you and everybody who tuned in to have a good rest of your day. Thank you and see you next time.
Kacey:
Thank you.
