How Claims-Made Policies and Limits Work

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What would happen if one client lawsuit, one hacked account, or one missed renewal completely wiped out your agency? Have you ever stopped to think about how exposed your business really is even if you're "doing everything right"?

Today's featured guest started his career working in the insurance industry and eventually found a love for marketing. He talks about the side of agency life most people ignore: protecting what you've built, and breaks down how to safeguard your business with the right insurance, why every agency should have cyber liability coverage, and how a "give first" mindset has helped him land major clients like Daymond John, Chris Voss, and Dr. Benjamin Hardy.

Draye Redfern is a serial entrepreneur and the founder of Redfern Media and FractionalCMO. Over the past decade, he's built and sold multiple companies, including a $40M insurance agency acquired by one of Warren Buffett's Berkshire Hathaway subsidiaries. With 15 years in risk management and a passion for modern marketing, Draye now helps businesses scale smarter while protecting their downside.

In this episode, we'll discuss:

• How "Growth Blindness" Can Hurt Your Business.

• The Hidden Risk Most Agencies Ignore.

• Why You Probably Need a Cyber Liability Insurance.

• How to Get Big Clients by being in the Right Rooms.

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The Unlikely Path From Insurance to Marketing

Draye grew up in a household where entrepreneurship was a way of life. His dad owned a business, and by age 12, Draye was doing the grunt work: filing papers, scanning documents, and learning what it really meant to keep a company running. He had a front-row seat to the chaos and grit of small business.

Over time, Draye realized he had a knack for marketing. His early ideas sometimes outperformed everyone else's, and by his early 20s, he was leading the marketing division of a $28 million firm. Under his direction, they scaled past $40 million in annual revenue. That success led to the company's eventual sale to none other than one of the Berkshire Hathaway companies.

Stop Being Growth Blind and Start Protecting the Downside

While most marketers are obsessed with lead flow and growth, Draye brings a completely different mindset to the table: protect the downside first. After spending 15 years insurance and the risk management world, he learned that too many businesses are "growth blind." They're chasing top-line numbers while leaving themselves totally exposed if something goes wrong.

For his part, Draye thinks about how to mitigate downside risks first and then, once he has that locked down, then he starts thinking about growth. Admittedly, it's backwards from how most people do it, but it's what makes the most sense to him.

The Hidden Risk Most Agencies Ignore

Why does Draye prioritize mitigating downside growth? Most agencies don't think about errors and omissions (E&O) insurance until it's too late. One poorly worded ad, a leaked password, or a miscommunication with a client could lead to a lawsuit that costs hundreds of thousands—if not millions—in legal fees.

That's why he recommends a basic "risk protection stack" for agency owners:

• General Liability – Covers physical damages or slip-and-fall type issues.

• Employment Practices (EPLI) – Protects against HR-related claims.

• Errors & Omissions (E&O) – Covers mistakes or oversights in your work.

• Cyber Liability – Protects against data breaches and hacks.

As Draye puts it, marketing agencies hold the keys to dozens of client kingdoms. If you get hacked, they get hacked. Protect yourself first, then scale.

Why Every Agency Owner Needs Cyber Liability (and What Happens If You Don't)

Most agency owners assume general liability insurance has them covered. Slip-and-fall in the office? Sure. But what about when a client's site gets hacked because one of your team members reused a password? Or when a campaign you ran unintentionally exposes customer data? That's not covered: this is where cyber liability and errors & omissions (E&O) insurance come in.

Here's where most people go wrong: they forget to renew. Unlike car or home insurance, E&O and cyber liability policies are "claims-made" policies. That means you're only covered if the policy is active when the claim is filed, not when the incident happened. So if you let your policy lapse, even for a few weeks, you could lose coverage for everything that happened in previous years.

That's why many experienced owners "tail out" their policies when they sell or sunset a business. Tail coverage locks in past protection for a set number of years. It costs more upfront but prevents millions in potential exposure later.

Keep your coverage active, review it annually, and don't cut corners to save a few hundred bucks. Think of it as part of your agency's operating system, not an optional add-on.

Lessons From Selling to Berkshire Hathaway

When Berkshire Hathaway came calling, he learned just how deep corporate due diligence can go. "They fly out all their MBAs and basically give your business a financial colonoscopy," he joked.

But that process forced him to see business from a different lens—as an asset, not a job. He walked away with not just a successful exit, but also a new appreciation for how structure, systems, and compliance create enterprise value.

How to Get Big Clients: Ask Questions, Be in the Room, and Give First

Draye's agency has publicly traded companies in its current client roster, with some notable names including Dr Benjamin Hardy and Chris Voss, and almost all of those brands came to his agency because Draye was in the right rooms to strike up conversation. As he puts it, successful people like to hang around other successful people.

To him, his job in the agency at this point is figuring out how to get invited into the room with the right people, which includes joining masterminds and attending events.

Even with big clients, Draye recommends offering value first without expecting anything in return. I'll give them an idea of the work you do and, if they like it, they'll have you in mind the next time they need agency services.

For instance, after attending a talk by Dr. Benjamin Hardy, Draye had the chance to chat with him and learned he was pulling in over 30,000 email opt-ins a month but wasn't monetizing them. Instead of pitching a retainer, Draye built him a simple funnel — for free — that started generating $10,000 a month in passive revenue.

A few months later, Hardy came back and asked, "What else can you do?" That turned into a long-term partnership and a roster of launches that ran for years.

How to Stand Out and Make People Feel Seen

Draye's other secret weapon is personalization. Not the lazy kind where someone drops your name into a cold email template. Real personalization.

When a prospect says they're interested, his team clones a landing page, updates the name in the headline ("Welcome, John!"), and records a 30-second video personally greeting them. The whole process takes fifteen minutes, but it makes people feel like they matter, and that's the part most agencies forget.

That simple touch has led to multiple referrals, long-term clients, and lasting loyalty. As Draye puts it, "People don't want to feel like a number. They want to feel like they matter."

This type of simple gesture is usually something clients talk about non-stop, because the more automated the world gets, the more human connection stands out.

Old School Is the New Advantage

While everyone else is obsessing over AI and inbox deliverability, Draye see a lot of potential on a forgotten channel: direct mail.

"People's inboxes are full, but their mailboxes are empty," he explained. "So, when something real shows up, it stands out."

He's seen massive ROI from direct mail, especially when paired with personalized URLs (PURLs) and custom video. It's more expensive upfront, sure, but it cuts through the noise. Something to keep in mind for agency owners trying to stand out at a time when your client's emails are probably inundated with the same offers everyone is sending out.

From his own experience, he says "if I were to look at our client base across the various businesses, the vast majority came from direct mail."

Protect Your Business and Hang Out in Different Rooms

Draye shares two pieces of advice for agency owners: You never know what's around the corner, so protect your business. Spend the couple thousand bucks on proper coverage. Don't risk your agency's future over something preventable.

Change your rooms. If you only hang out with other marketers, you're limiting your reach. Take Jay Abraham's advice and go fishing in someone else's swimming hole. Attend events for other industries, add value, and you'll be amazed at who you meet.

In short, Draye's philosophy blends practical protection with proactive growth. Be bold enough to give first, smart enough to protect what you've built, and intentional enough to show up where the right people are.

Do You Want to Transform Your Agency from a Liability to an Asset?

Looking to dig deeper into your agency's potential? Check out our Agency Blueprint. Designed for agency owners like you, our Agency Blueprint helps you uncover growth opportunities, tackle obstacles, and craft a customized blueprint for your agency's success.