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.
Now we 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 understand what they’re doing?
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Bill, don’t you know the irrefutable truths that (1) faster is better, followed by its corollary, (2) bigger is better. These are based on the misinformation that accurate insured and risk data are available from 3rd party sources, which is a false assumption. Just this week I was trying to connect with a high school friend, so I looked them up using a well known 3rd party source. Both phone numbers were incorrect, their current employer was wrong in addition to their income, to name a few errors.
Fast is fast, and that’s all it is. Not right, not better, not correct. You can get to the wrong destination fast, but it’s still wrong.
Amen to that-well said!
Thanks for always hitting the nail (s) on the head, Mr. Bill!
My hammer’s not as big as others, but I try to use it skillfully.
Just an orange PRS and a place to play? 🙂
It’s not really orange. It just kind of looks that way in certain light. It’s a 10 Top ’97 PRS Custom 22. Run through a Fender Hot Rod Deluxe with a little gain and delay and it’s sweet.
Good points, Bill. The fact is, though, we all have to find ways to do our due diligence faster because that what;s the markets demand.
They demand it because they don’t know any better and we do little or nothing, aside from one-on-one interaction, to educate them about the importance and complexity of risk. That being said, I’m all for efficiency within the bound of effectiveness. I’m going to write soon about some insurtechs who are developing tools that enable insurance professionals to do their jobs more efficiently and effectively without trying to reinvent the process. That’s where technology can be of great value.
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