Three Big Carriers Join Forces to Launch Web-Based Agency
American International Group Inc. (AIG), Kemper Insurance Companies and Prudential Insurance Company of America recently announced plans of a joint venture called Fusura, an innovative web-based insurance agency that will allow consumers to research, buy and manage their personal lines insurance needs.
The name of the company was developed as a blend of “future” and “insurance,” and the trio’s initial plan is to offer auto insurance, with additional personal lines and financial services to follow.
As an Internet-based agency, Fusura boasts an end-to-end solution that will provide its customers and users with a consistent, high-quality experience and trusted products from nationally recognized insurance brands. “The most important differentiation-one that I think will have an enormous appeal-is the fact that we’re going to be able to give you a quote, and then, if you choose to continue with the transaction, we’ll engage you in online, interactive underwriting,” said Ed Rafter, chairman and CEO, Prudential Property and Casualty Insurance Company.
Fusura will have the technology to automatically check an applicant’s motor vehicle history while the transaction is proceeding. “It’s almost like a thinking machine that takes a motor vehicle report that has the losses or has a record of accidents, violations, etc., and it gives a profile of the customer,” Rafter said. “And then it uses that information, along with the company-specific underwriting guidelines…to issue a policy.”
By completing the underwriting in real time by pulling driving records and other data during the application process, Fusura will have the ability to bind coverage on the spot-a complete insurance solution not available elsewhere, according to AIG Chairman M.R. Greenberg.
“We believe Fusura’s biggest strength is delivering a distinctive customer experience not presently offered in the marketplace. Most models in the marketplace either use referrals or have a range of strong and weak insurance brands,” said Rick Bender, acting president of Fusura. “Or they operate as sites-which are beginning to develop click ‘n’ bind, but only offer it as single carriers.
“Fusura hits that sweet spot in the middle, which is full click-to-bind capability, but also multiple carriers.” In addition to that, Bender said, Fusura not only offers a strong brand, but the education advice component to boot.
When asked about the competition, Bender said that he would consider InsWeb as being on the list. “There are several aggregator sites out there-either multiple carrier sites or single carrier sites-which yes, you could look at as competition, but there is quite a bit of difference,” Bender said. “The big thing here is that our carriers are our owners, and they have an incentive to provide us with very high placement on their IT schedule, so they can support us in terms of getting that click-to-bind up and running.
“Whereas, if you’re an aggregator, you can go and ask, but you may not be at the top of the list, but having said all of that, some of our carriers-AIG included-do business with InsWeb, and that’s okay. There’s room for more than one site here.”
AIG, Kemper and Prudential will each have partial ownership in Fusura, which will operate independently from these three founding carriers. And according to Rafter, there may be other carriers that decide to get involved. “There is a good chance that we’ll bring in one more equity player,” Rafter said. “In fact, we may even have other companies get involved as non-equity players that could potentially be on our site as well.”
Rafter went on to say that the new entity is also looking to establish B2B links with other websites. “The idea is for us to do more B2B as a start up…we’ll be on other institution’s websites…we’ll have our space there,” he explained. “So it’s more exposure, which means more reach.”
Initially, Fusura will be marketed through distributors-banks, stock brokerages and other financial institutions-“[businesses] who have the customer base and who are looking for a company, an organization, to provide a risk plan on their portal or on their site,” Bender said.
For now, the concept of the consortium is very straightforward: shop online, look at all three companies at the same time, and then based on certain characteristics, choose one of the three. During the process, consumers will have the opportunity to define their risk-planning needs, learn about various product offerings, and access needs analysis tools to determine which products are best for them.
“I think the buying behavior of people is changing, and the fact of the matter is that people will…gravitate more and more over the next couple of years to the Internet for true e-commerce,” Rafter said. “I think [Fusura] is going to have a real appeal to a certain segment of the buying public-and it’s going to continue to have real appeal as we go forward.”