Trusted Choice Consumer Portal Funding Now Tops $50M

By Andrew G. Simpson | May 9, 2014

Project CAP, the organization formed to help local independent agents compete in the digital economy under the Trusted Choice brand, has raised $10 million from two additional carrier investors.

The capital from the two new investors brings the total raised by Project CAP since its formation in August 2011 to more than $50 million.

The newest investors are Travelers Insurance and Motorists Insurance. Project CAP would not disclose how much of the $10 million each insurer is contributing in this latest round of financing.

Project CAP (a trademark for a Delaware corporation under the name Consumer Agent Portal LLC) was created by the Independent Insurance Agents & Brokers of America (the Big “I”), Trusted Choice, state Big “I” associations and six insurance carriers to expand independent agents’ market share by giving them digital marketing tools and an online platform.

Travelers and Motorists join six carrier investors that have been supporting Project CAP since its founding in 2011: Westfield Insurance, State Auto, The Main Street America Group, Safeco, Selective and Central Insurance Companies.

Securities and Exchange filings and other documentation show that Consumer Agent Portal raised $18 million in 2011 for its initial capitalization from its six original carrier investors. It went back to them for another $6.6 million in September, 2012 and then pulled in another $9.9 million from the six carriers and the Big “I” in December, 2012. In July, 2013 four of its investors put up another $6 million in response to a debt offering and now it has raised $10 million from two additional investors, Travelers and Motorists.

Project CAP manages the consumer-agent portal at trustedchoice.com where consumers can get information on auto, home, life and business insurance; comparative quotes and referrals to local independent agencies. While the portal offers comparative quoting for various lines, it stops short of letting customers buy policies online.

Project CAP also has a division offering digital marketing tools and training for independent agencies.

Trusted Choice as a brand pre-dates Project CAP; it has been a Big “I” branding identity since 2001.

Investors in Project CAP get one spot on the board of directors and participate in all of Project CAP digital marketing activities for agencies. The carriers also are listed on trustedchoice.com.

Project CAP issued an announcement on the Travelers’ investment and said an announcement regarding Motorists is planned.

Greg Toczydlowski, president of Personal Insurance at Travelers, will be on the board of directors.

“We couldn’t be more pleased to invest in Project CAP and help our agents compete more effectively in the digital space,” said Toczydlowski. “This partnership further demonstrates our commitment to the independent agent channel.”

“We are very excited to have Travelers on board,” said Charles “Chip” Bacciocco, Project CAP CEO. “Their leadership, support and active participation on TrustedChoice.com will be critical as we move forward, building the online marketing platform of the future for independent agents and brokers.”

For Travelers, the investment in the Trusted Choice branded website tracks with the strategy outlined by CEO Jay Fishman at a financial services conference last September. Fishman said Travelers is aiming to be more price-competitive in personal lines and believes that comparative rating systems help agencies serve price-sensitive shoppers. He said Travelers has been part of comparative rating programs for years and has found that participating in comparative rating systems within agencies has been more effective than its proprietary quoting platforms.

The insurer’s own proprietary system is declining in terms of quotes, Fishman said, adding. “We suspect this will continue, and more and more of the quotes will be delivered through the comparative rating technology. About 80 percent of our auto quotes are coming through that platform.”

Project CAP has had a few challenges since its beginning. It has survived a change in leadership. Bacciocco replaced Scott Deetz as CEO in December, 2012. Also, it has survived a long delay in the launch of the new trustedchoice.com website with comparative rating. Originally slated for debut in 2012, it did not launch until July, 2013.

But Bacciocco says he is pleased where things stand right now. The website has finally launched, sign-ups and traffic for the site are going well, and now ProjectCAP has an additional $10 million.

“Every number I can think of is moving in the right direction. This has always been a process, though. There’s no ticker tape parade moment for trustedchoice.com. This is a process, not a revolution,” Bacciocco told Insurance Journal in a recent interview.

A year ago trustedchoice.com was averaging about 10,000 visitors a month. This April, it generated almost 150,000 site visits and is on pace to attract more than 1 million visits during 2014, according to Bacciocco.

The site has reached record traffic levels in nine consecutive months, and is driving consumers to agencies in all 50 states, with home and auto quoting available in 40 states.

There are more than 22,000 agencies in the directory on trustedchoice.com. About 1,700 of them have signed up for a premium –called Advantage— subscription, which gets them a richer profile on the website, preferred placement in search results and unlimited leads across more than 20 lines of business.

Thirty-six carriers are paying $500 per month per state to be listed on the trustedchoice.com site. Also, about 12 carriers—including the investor carriers — participate in comparative quoting.

Bocciocco acknowledges that not all carriers are comfortable with the idea of providing comparative rating because they do not want to be sold on price alone.

“I really don’t hear carriers that don’t want to participate, what I hear is that carriers, occasionally carriers will say, ‘We don’t want to be spread-sheeted’ —which means they don’t want to just compete on price alone,” Bacciocco told Insurance Journal.

Bacciocco tells these carriers that trustedchoice.com is not doing spread-sheeting. “We are promoting the value proposition of the independent agency channel, which is advocacy, expertise and choice. Those three things are what we’re highlighting on trustedchoice.com,” he says.

“Pricing information is just part of the equation that we provide to consumers. But we don’t provide a click to buying quote, and we don’t try to get into a pure spread-sheeting situation. What we try to do is provide a lot of information that’s of use to a consumer and then, this is the most important part, then we help them find the right agent for them. It’s the agent at the end of the day that helps the customer make the right choice as to which carrier,” Bacciocco says.

In a world where 85 percent or more of personal lines and commercial lines insurance buyers do their research on the Internet, Bacciocco believes that it is critical for agencies and their carriers to have a presence online and offering a comparative rating option is part of helping these consumers do their research.

“Comparative rating is really more about just helping customers understand that there’s a variety of choices out there. There’s a range of prices. It’s really about getting them to understand, you need to talk to an agent to understand what your best insurance choices are and what your real cost of insurance will be. That’s what it’s about,” he said.

“But to hide away and say, we’re not going to talk about cost would be a mistake, it would drive away consumers — that’s nuts. So we’re trying to add transparency instead of fear it.”

Bacciocco says the project has always had a challenge getting enough carriers and agencies to sign up, as one party waits to see how many of the other will commit. He calls it the “chicken and egg” challenge.

“The first question agents always ask me is, they list a few carriers. ‘Is this carrier, is that carrier, which carriers are participating?’ Of course, vice versa. What do the carriers ask? ‘Are my agents participating?’”

“We need the whole industry to work together to make this work. We need both agents and we need carriers,” says the Project CAP leader.
Related Articles
Project CAP CEO Bacciocco Shares Views on Consumer Agent Portal and 2013
Travelers Launching Low Cost, Segmented Product in New Personal Auto Strategy
Rusbuldt on McKinsey 4: Trusted Choice, CAP as Part of Agents’ Internet Strategy

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