The insurer has revealed its plans to hang up the brand eight years after having first acquired it.
Eight years after purchasing Esurance auto insurance and homeowners coverage, Allstate has decided to divest itself of the brand. According to Allstate’s chief exec, Tom Wilson, the insurer is making the preparations necessary to say goodbye to the brand.
The insurer has decided to continue the sale of the policies while phasing out the brand name.
Allstate will still be selling the same home policies and Esurance auto insurance coverage the brand currently offers. However, it explained that it will be phasing out the name of the brand over the next year. Moreover, throughout that time, they will be reworking the way in which the brand’s consumers are directed to the agencies and web-based platforms, according to a company statement.
Wilson explained that this decision was made to support the Allstate brand as a whole at a time in which competition has become fierce. Among the leading rivals include Progressive Corp. and Berkshire Hathaway’s GEICO.
Letting go of the homeowners coverage and Esurance auto insurance brand name will support Allstate.
“It gives us the ability to not invest in the Esurance brand anymore and put all that money on the Allstate brand, which is hundreds of millions of dollars,” said Wilson in an interview last week. “That gives us the ability to compete more effectively and we think it will drive more growth.”
Analysts are also expressing a positive take on the phase-out of the brand. For instance, insurance analyst Matthew Palazola explained that Allstate’s move is a “logical step forward” as a component of its broader strategic growth plan. In his opinion, getting rid of the brand is “a wise reaction to the rapidly changing and competitive personal insurance market.”
Allstate has made several changes in the name of strengthening its core. It has centralized several of its service functions that had previously been performed by agencies. Moreover, the insurer intends to organize Allstate, Encompass, Answer Financial groups and Esurance into a single business. According to Wilson, this will open up more money to divert into important improvements such as new tech.
Allstate first acquired Answer Financial along with Esurance auto insurance and home insurance in 2011. This was a move made to improve its online sales. Now, it is working to organize its network of online systems and agents throughout an evolving consumer ecosystem.