The insurer has laid the foundation for selling on the internet and is now building on that base.
For more than ten years, Allstate Corp. gradually lagged behind the competition in a number of ways within the fast growing online auto insurance business, but the insurer is now geared up to rocket ahead of the competition over this very important channel.
This provider has been preparing to enhance its successes in this area and is now ready to go ahead.
Almost two years ago, Allstate purchased the online auto insurance company, Esurance, in order to be able to compete with the internet based offerings of Progressive Corp. and Geico. Now, that branch intends to take its business up-market and is aiming directly at consumers who have a home with multiple vehicles. This is an important step beyond its typical target of single vehicle owners.
Allstate’s main strength comes from its position as a leading home and auto insurance provider, combined.
Because it is already a major homeowners coverage underwriter, it is capable of serving customers who are older and more financially secure. This is the demographic that has a preference for covering their property and vehicles with the same company. As Progressive and Geico offer their homeowners coverage only as underwritten by outside companies, this offers Allstate a distinct advantage within this target auto insurance market with a preference for coverage all in one place.
When Thomas Wilson, the CEO of Allstate, spoke at a New York investor conference, he indicated that the insurer would be adding homeowners coverage to Esurance, which has previously offered only auto insurance. This was a response to a question about the insurer’s intentions to compete with Geico.
He also stated that “Future growth will come from . . . broadening the product portfolio beyond auto insurance,” and went on to add “Include things like boats and homes and motorcycles. And utilize Allstate’s claims experience and expertise and our scale to provide more value to customers.”
The size of the Allstate brand sold by agents has undergone a notable shrinking over the past six years, to the point that some predict that Geico could step beyond Allstate as the second largest provider of auto insurance in the United States (State Farm being the largest). It is Allstate’s hope that this new online angle will help to propel it forward and rebuild its lead over Geico.