Online insurance brokerage PolicyGenius is celebrating its first business anniversary. Founded in July 2014, the site that describes itself as “agent averse” has already logged more than 300,000 users shopping for life, disability, renters’ and pet insurance – more than half of whom are under the age of 35.
That’s a key part of what makes PolicyGenius’ business model so successful, says co-founder Jennifer Fitzgerald.
“[Insurers] still expect folks to deal with a face-to-face agent, and that’s just not how many people, particularly younger people, do things,” Fitzgerald told Bloomberg. “It can feel very intrusive, like, why is this guy asking me all this stuff?”
Online comparison shopping sites are nothing new, but while prominent players like Google Compare have failed to attract big-name insurers to join the fray, PolicyGenius not only compares, but sells, policies from 26 different carriers including top names like
AIG, ING,
MetLife and Prudential Financial.
Such willingness from carriers to do business with these new and competing distribution channels has some independent agents concerned. In fact, an
Insurance Business America poll of agents nationwide revealed that when it came to commitment to the broker distribution channel, carriers are performing at an average 6.98 out of 9. Not a terrible score, but roughly 15% of respondents rated their carriers dismally – between 1 and 4.
“It seems as if many of our standard markets are welcoming any distribution channel,” said Alicia Igram, a local leader with the Insurance Office of America in Aliso Viejo, Calif. “This is a slap in the face to those of us who have spent our entire career supporting them.”
As CEO of Valen Analytics, a data and analytics provider to North American insurance carriers, Dax Craig holds many conversations with both carriers and producers. From his vantage point, he sees a situation in which carriers are anxious to maintain good relationships with their producers, but are also looking toward a future in which alternate business models will revitalize the distribution of insurance products.
“Carriers value the broker channel, but having said that, I think they’re very curious about these new players and what they’ll mean to them,” Craig said. “I think the distribution system is going to change significantly, along with the rest of the industry.”
