Milk …check; eggs … check; bread … check; car insurance …what? Most grocery lists don’t typically read this way, but Nashville, Tenn.-based Direct Auto Insurance Co. is now offering another way to purchase personal auto insurance that could change the way consumers shop.
The company, which writes business in 13 Southeastern states and targets underserved communities that typically are without bank accounts, has created insurance kiosks called “Direct on the Spot” (DOTS). The “insurance stores in a box” give people the ability to quote, bind and print a personal car insurance policy in less than five minutes. Basic, low-limit life insurance policies, roadside assistance plans or emergency protection plans also are available.
To start, customers scan their driver’s license, and are given a quote and the option to continue with the purchase. The kiosks are self-service, but Marc DiGiacomo, Direct Auto’s vice president of product management, says there is a phone customers can use to contact a Direct Auto agent if they have issues with the quote and bind process, or questions about the policy. Customers also can send their policy information or auto insurance quote to their personal email to complete the purchase later. They can also identify a local Direct Auto agent with whom to work.
“This is an extension of the network we already have. Being local is very important to us and our customer base, and the kiosk helps us expand that,” DiGiacomo says.
Coverage terms are six months, and policies can include all of Direct Auto’s typical offerings, including: bodily injury liability, property damage liability, collision auto, comprehensive auto, medical payments, personal injury, uninsured motorist auto coverage, rental reimbursement, towing and accidental death coverage.
Jack Campbell, chief operations officer, says the company was inspired by the trend of consumers using online, quick-pay retail services and kiosk technology that hadn’t yet been applied to insurance. The kiosks also allow the insurer to expand into new territories without opening a new store and staffing. “We saw a competitive advantage there and it saves money on costs,” he says.
But building an insurance kiosk was not an easy undertaking. The company had to find a kiosk provider, address payment handling, and implement the correct data exchanges. Direct Auto also had to re-engineer some of its pricing algorithms to make them kiosk-friendly. Insurance questions had to be simplified and personal information prefilled if a customer buys a policy, so the process moves quickly and efficiently.
“The customer experience was a big part of the complexity of this undertaking. You can’t put a web experience on a kiosk,” DiGiacomo says. “We searched for a kiosk vendor to help us with that and understand the customer experience in high-traffic areas.”
The company also took steps to ensure privacy is protected. No personal information is stored in the kiosk; personal information does not appear on the screen as it is typed in; and privacy wings are on both sides so bystanders cannot see any details.
Direct Auto has deployed 18 kiosks to its local insurance stores in Tennessee as a test. So far, customers have been responding well, Campbell says.
Early next year, the company plans to move at least 16 of those kiosks into partner retail outlets, including grocery stores, car dealerships, malls and title loan companies.
Campbell says the company has been pleasantly surprised at how easy it has been to sign up partners. The company is strategically targeting certain geographic locations and national chain stores where they think there is a potential customer base for both Direct Auto and the retailer.
“The kiosks will also bring customers into their stores because they can come in to make payments every month, and the stores like the foot traffic,” DiGiacomo says.
Incentives, like a gift card for the store where the kiosk is located, will be offered to those who purchase their insurance, which is another benefit to the retailer.
“That is a critical part because we are sharing the retail space and partnering with a number of companies that are servicing our customer,” Campbell says. “Insurance isn’t typically something people jump up and down to get a quote for. We are looking for incentives so it is a win for the customer, the partner and potentially for us because the acquisition cost is less than broadcast media advertising.”
Josh Jarret, vice president of product management, says the company will use the kiosks to expand beyond the 13 states it is currently in. “The [kiosks] are an extension of marketing … as people see these, it will create a new DNA for us,” he says.
DiGiacomo says the company expects the kiosk model to become more popular in auto insurance. “Insurance is intangible, so it is well-suited for that approach. The time is right with consumer behaviors and the adoption of technology and self-service taking off,” he says. “It might not have worked six or seven years ago, but it seems the time is right now.”
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