I haven’t written about what I’ve been doing at Informed for a while so I wanted to share something Jim and I are very excited about. We’re introducing a new way to buy personal lines policies that gives consumers more choice and more transparency.
What I’m going to describe may sound so obvious you’re going to wonder why nobody has done it before, but they haven’t. There is a reason for that (which I’ll get to) but we don’t care about excuses for not doing right by consumers, so we’re plowing ahead with this because it’s the right thing to do.
Two Ways To Buy
Today, there are two ways to buy a home or auto policy. Buy through a captive insurer (either through their agent or direct) and only get one option or use an independent agent to get more choice.
While the latter sounds better, it does have some limitations. The big one is only some markets participate in the independent channel.
But what if you wanted to comparison shop among captive carriers? You are on your own. Nobody is going to help you with that.
A Third Way
Until now. We realized that many people want to buy from the brands they know but are intimidated or too busy to shop multiple brands one at a time.
Why can’t we provide a service that does the work for them so they can make a better decision in less time?
Turns out we can. And, for a limited time, we’re doing it for free.
We will shop direct offerings for you based on information you provide us and compare them so you can find the right policy for you.
How do we do it? You have to visit here to find that out.
Removing Barriers
Buying homeowners direct is much harder than people realize. It is far more complicated than buying auto.
Why? There’s a host of reasons.
Lack of Comparability
If you shop a bunch of auto sites, you can easily choose the same coverage levels for each. Most can use your VIN to get all the information they need about your car. It’s a fairly efficient process.
Now compare this to homeowners. Many times basic pre-fill information like square footage or even whether the home has a basement is wrong.
You don’t get to choose your limits. The insurer chooses your replacement value for you…and each one has very different opinions (we often see a range of +/- 50% when we shop).
Then they have their own preferences for all your individual coverages. Some give you 75% personal property while others do 50% or even 40%. Of course, these percentages are all based off those wildly different insured values.
Everyone has a different default for liability limits or deductible amount. Some offer endorsements online, others don’t.
Some make it easy to change their defaults, while others make it all but impossible.
To give a better sense of this, take a look at a shopping exercise we did for a home recently. These are all real quotes we obtained online.
Notice how different the insured values are! Then see how widely the individual coverages vary. How is one supposed to compare these without being an insurance expert?
Inaccurate Data
Even if you are comfortable validating that you have the coverages you want, there’s still another hurdle – making sure your quote accurately reflects your situation.
Pre-fill for homes has gotten better, but there are still far too many mistakes that can lead to inaccurate quotes (sometimes high, sometimes low).
This, of course, is compounded by user error where customers either don’t understand questions or try to go off of memory. Then, there are the fun ones where you have to guess how to rate the “quality” of your interior or how many corners your roof has.
Failure To Quote
After you spend all your time entering your information and making sure you have the coverages you want and checking the insurer’s prefill data, you are ready for your quote and what happens…
You have to cross your fingers and hope you even get a quote!
At least 1/4 of the time, there will be an error in their system or they’ll demand you call and speak to an agent or they’ll tell you you’re not eligible for coverage.
It’s about the worst user experience ever. Rarely do you get told upfront you will not succeed. It’s only after you’ve spent a bunch of time.
The Informed Solution
While we can’t fix all of these problems, we can help reduce the complexity and frustration.
We know how to find the information for some of those hard to answer questions. We know which answers affect your price more and require accurate data from you. We know how to make sure you get comparable coverage from each carrier.
And we can deal with the frustrating sites that refuse to quote you and waste your time or have super tedious questionnaires.
Proof of Concept
We’ve only done a few of these so far, but we’re saving people a ton of money without sacrificing (and even improving) coverage.
One family was spending $20K/yr on their home and auto (4 cars = teen drivers plus a nice home). We were able to cut it in half by finding them a different carrier (one you all know).
That’s right, we saved them $10,000!
This wasn’t some magic trick of ours. We just know that many “loyal” customers are actually wildly overpaying because they didn’t shop after getting large price hikes. You can read more about how loyalty discounts are overrated here.
Why Hasn’t Anyone Done This?
Have you figured it out yet? It’s actually pretty simple.
Insurance agents prioritize getting paid over serving you best. That’s their right and they certainly should expect to get paid for providing services, but it has created a gap in the market.
If you want to compare direct or captive providers, you are out of luck because no producer gets paid a commission for that.
IAs only get paid for placing you with IA markets and captive agents only get paid if they sell their captive product.
Don’t We Want To Get Paid?
Of course we do, but we also believe the customer’s needs come before our needs. We still plan to operate our own independent agency and carriers will pay us when we place business that way.
But that’s not going to prevent us from helping customers if they would prefer to shop in a different way. If it proves popular enough, we will find a way to make money at it. I am not concerned about that.
Customer First
Ideally, we should be able to find a customer capacity with any market they want – captive, direct, or independent.
If you sell insurance and you disagree with that, you’re putting your personal interest before the customer’s.
That’s not how we think at Informed so we’re going to, respectfully, disagree with that.
Yes, We Can Help You Too
I know what many of you are thinking. Oh, I work in insurance so I already have the right coverage. Or, I work in insurance so I have a good agent.
Maybe that’s true, but we already helped someone who works in the industry save 40% on their home.
If you haven’t shopped in a long time, you can probably do better. Remember, your agent gets a bigger commission if you pay more in premium and their expenses are lower if they don’t shop for you.
I’m not saying your agent is out to get you, but the incentives aren’t there for them to truly do what is in your best interest.
You have to find people like Jim and me who are motivated by other goals, like wanting to improve the industry.
How Do I Try It?
Visit the link here. You’ll need to fill out some information so we can complete applications for you.
We get you quotes and then save them for you. The carrier will email you a link to the saved quote. We’ll compile our findings in a report to send to you.
If you find a better deal and want to switch, you find that email from the insurer, click it and provide the remaining information needed to bind. We don’t need your social, credit card, etc.
That’s all there is to it. You don’t pay us anything. You don’t have to switch if you don’t want to. But you might save a lot of $ and get better coverage with very little effort. Give it a try.