Published January 14, 2016|4 min read
How much money do you spend on insurance?
Health, auto, life (you do have life insurance, right?), all of it. Do you know how much money you spend on it every year? Probably not. It’s either covered by your employer or deducted from your bank account automatically or you just don’t have it, so why worry about it?
But if you’re like most people, it might be more than you think.
Insurance accounts for 7% of total annual expenditures for the average Millennial. That’s more than they spend on clothes. It’s more than on entertainment. But even so, it’s safe to say that Spotify and Netflix and Zappos use ranks just slightly higher than insurance websites.
Shopping for insurance is old and outdated because it’s insurance. That’s they way things are. It’s the same reason why there’s no hot unicorn app for Werther’s Original, right?
Until recently, no one has given a lot of thought to modernizing the insurance shopping process. But, we should be putting a lot of thought into it. People spend a lot of their hard-earned money on insurance, so understanding and obtaining it should be easy, right?
And people are expecting it to be easy: according to a recent BCG global consumer sentiment survey, the Internet is the shopping channel of choice for two-thirds of people in the market for insurance. But there aren’t many options out there for people who want to address their insurance needs online, and the options they do have aren’t cutting it.
Digital satisfaction scores place insurance companies below government services and just above cable companies. That’s right: insurance companies are right there with companies that literally call their customers a-holes. You practically have to go out of your way to give a poor experience to rank that low.
Not giving people what they want, and making it terrible when you do, means that there are a lot of lost customers out there. But it also means there’s a huge opportunity. The industry is ripe for disruption. That’s an overused buzzword, but that doesn’t make it any less true. The impact will be real for both businesses and consumers. Everyone wins.
Our goal at PolicyGenius is twofold: help consumers get the coverage they need, and make them feel good about it.
It’s possible to do the first without doing the second. In fact, that’s been the industry’s M.O. up to this point. Sure, you can get covered, but it involves confusing processes, lots of paper, and lots of jargon.
But what if insurance shopping sites could also leave customers feeling satisfied with their experience, like it was something they wanted to do and not just something they had to do?
What if they could learn about what insurance they needed and why they needed it before they laid a single dollar down? Transparency and education make informed customers. They’ll know when they need more financial protection, and guess where they’ll return to when that time comes?
What if shopping for insurance was so easy that it didn’t feel like homework? You can hail a cab using a slick UI, so there’s no reason why figuring out your life insurance coverage shouldn’t look like it belongs in 2016, too.
And what if insurance shoppers could find all the information they need in one place? For example, we’ve developed an Insurance Checkup that guides users through a five-minute Q&A; to develop a personalized review of all their insurance needs. (I encourage you to give it a test drive and share your feedback with me here.) The one-stop shop approach is a far cry from how the insurance industry has worked, even though it’s been a staple in other areas of consumer finance: you can get a credit card, a loan, and a savings account from the same site, but getting all of your insurance from the same place is a foreign concept.
PolicyGenius just closed a $15 million Series B round of funding, hot on the heels of our $5 million Series A round, because the market is finally waking up to the challenges and opportunities that the growing PolicyGenius team has been working on for some time.
The challenge will be working with the industry to show that their true customers – everyday people looking to protect their families without jumping through hoops – are worth investing in.
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