What's the Hurry?
I’ve written a lot about insurtechs that claim they can quote your personal lines (e.g., homeowners) in 60 seconds or by asking a single question. Fast, easy and cheap...THAT'S what's important. Protecting people from catastrophic loss...not so much.
Now I see claims, sadly including those from traditional industry players, that the same can be done in commercial lines in a matter of minutes.
For example, take these recent media quotes:
- “[Progressive’s] promotion says it will take a business an average of 11 minutes or less to obtain quotes.”
- “In 2016, giant Allstate debuted its business insurance quoting platform that it claims makes it possible for small business owners to buy a policy in about five minutes.”
- “Nationwide says business owners can get a quote in less than 10 minutes.”
- “[Hanover’s] process, from start to finish, can be finished less than 15 minutes.”
Here’s one more quote:
“There is more to life than increasing its speed.” – Gandhi
What’s the hurry?
There’s really no practical way to even perform a rudimentary exposure analysis for any business in a matter of minutes, so why mislead business owners?
What’s particularly noteworthy is that these claims seem to be coming from insurers known more for personal lines than commercial lines. Could it be that, like many insurtechs, they simply don’t get it?
Principal, GLAD Associates, Inc.
5 年Being fast and writing unprofitable business will get you to an underwriting loss faster and eventually receivership ahead of your competition. I worked for Reliance Insurance of Philadelphia and they started writing workers compensation and other risks faster than anyone else. They have since stopped writing business in 2000 and are in liquidation. The following quote from Forbes offers a cautionary tale about speed: “There was no single catastrophic event to cause the demise, just garden-variety mismanagement, albeit in a big way. The company was eager to expand and it wrote policies too cheaply. This brought in cash–the better to pay dividends–in the short run, but led to payouts in the long run, a fundamental error in the insurance game.” Source: Forbes Face: Saul Steinberg, Forbes, Jun 18, 2001, https://www.forbes.com/2001/06/18/0618steinberg.html#439ea718139ahttps://www.forbes.com/2001/06/18/0618steinberg.html#439ea718139a
Solution Architect & Senior Expert Insurance at SAP - In early Retirement
5 年Bill Wilson?Your statement "There’s really no practical way to even perform a rudimentary exposure analysis for any business in a matter of minutes, so why mislead business owners?" is right, if there is no structured data about the risk(s) to be covered and the in-force business. Your statement is wrong, if there is structured - meaningful - data, which describes and combines both, particularly for 'common cases' also in commercial lines (SMB). More and more insurance companies are having and utilizing structured data ... and this takes just a couple of seconds, using in memory databases like SAP HANA for example. Today!
Founder and CEO at InsuranceCommentary.com
5 年BTW, I blog and write fairly often about insurtechs. Admittedly, most of what I write isn't complimentary. But look for something in the near future about how awesome insurtech done right can be. I plan to feature maybe 3 insurtechs who "get it."