The Past, Present, and Future of Insurance Aggregators

The Past, Present & Future of
Insurance Aggregators
Rory Joyce, Co-Founder & CPO

Insurance Search Engine (ISE): Websites that offer a robust panel of
real-time comparison rates. Purchase takes place directly with the carrier
and/or agent representing that policy.
Online Insurance Agency (OIA): An agency (typically with regional or
national footprint) that provides real-time comparison rates and the ability
to purchase on the web.
Lead Aggregator: Websites that collect customer data and sell it to a
combination of agents and direct carriers, who provide rates over the
phone, via email, or on their website.
Aggregator: A web-enabled service that provides multiple policy options to
its users.
Aggregator Types
Type of Aggregators:

Aggregator Types
Model
Multiple
Providers
Real-time Rates
Direct
Fulfillment
Lead
Aggregator
✔
Online
Insurance
Agency
✔ ✔ ✔
Insurance
Search Engine
✔ ✔

The Foundational Era
1995-2003
Foundational
Era

Insweb Arrives!

 In 1989 Telerate was launched as a
phone service for consumers to
compare auto insurance.
 In 1993 Telerate merged with a
similar service, Auto Insurance
Shopper.
 In early 1995, Insweb launches the
first web-based lead aggregator.
 The combined Telerate and Auto
Insurance Shopper entity launched
Netquote soon after.
How Leads Got Their Start

Hussein Enan,
Insweb Founder
Insurance has always been an
enigma. The goal was to use
this new medium of the
Internet as a perfect way to
provide transparency, in terms
of rate comparisons and
information about insurance.
April 2016

 Inslogic, Answer Financial, Comparison
Market, and CarInsurance.com were the
early key players.
 User acquisition was primarily based on
partnerships and organic search traffic.
 Many direct carrier integrations were built.
 Relatively high cost to maintain agency
and technological infrastructure.
OIA’s 1.0

What Went Right?
• Proved value proposition
• Experimented with a variety of
models
• Garnered carrier participation
and investment
• Created a generally good user
experience
What Went Wrong?
• Not enough of a commitment to
a single model
• User experience deteriorated
as models merged
• Couldn’t convince enough
carriers and big brands to
participate in a significant way
Recap

The Monetization Era
Foundational
Era
1995-2002 2003-2011
Monetization
Era

 “Ping & Post” was first introduced by InsureMe & Netquote
around 2003.
 This integration of lead platforms was designed to make
lead buyers more accessible across platforms.
 It lowered the barriers to entry for lead affiliates, which
resulted in a dramatic uptick in lead supply.
Ping & Post gave buyers and sellers
access to inventory on competing
platforms
The Impacts of “Ping & Post”

Affiliate Site
Leads Were Sold a Lot

And Then a Lot More

 In 2002, Insweb began experimenting with “clicks” when Progressive began
requiring all business they sell to initiate a quote on Progressive.com.
 Direct carriers and OIA’s were ready and willing to buy clicks, but inventory
was limited.
 Inventory exploded when Surehits arrived in 2005, making it easy for any
SEO affiliate to monetize insurance traffic.
Insurance Ad Networks Are Born

Jon Kelly,
Surehits Founder
…Surehits is a great example
of “not letting the best be the
enemy of the good”. Even
then, people were dreaming
of the “Orbitz of Insurance”
and felt that Surehits was not
a great consumer experience.
April 2016

When Acquired Acquirer Amount
3/2/2006 Capital One Insurance (fka Inslogic) Answer Financial Undisclosed
2/7/2007 InsureMe Bankrate $85M
6/1/2008 SureHits QuinStreet $46M
10/11/2009 Insure.com QuinStreet $16M
7/1/2010 Netquote Bankrate $205M
8/9/2010 Insurance.com (fka Comparison Market) QuinStreet $36M
9/1/2010 Potrero Media Insweb $12M
11/8/2010 CarInsurance.com QuinStreet $50M
1/15/2011 Trouve Media Bankrate $12.5M
2/10/2011 Insweb Bankrate $65M
2/15/2011 InsuranceLeads.com AllWebLeads Undisclosed
5/18/2011 Answer Financial Allstate $1B*
3/29/2012 Insuranceagents.com Bankrate Undisclosed
* Part of Esurance package
M&A Goes Crazy

What Went Right?
• Built out a lot of new
distribution through ping and
post and the birth of clicks
• Buyers (agents, carriers, and
agencies) could access a large
pool of leads more efficiently
What Went Wrong?
• Lead quality plummeted as
supply increased
• Little incentive to create user-
centric platforms
• M&A reduced competition and
lowered innovation
Recap

The User Experience Era
Foundational
Era
1995-2002 2003-2011
Monetization
Era
2012-
User Experience
Era

Aug
2011
Aug 2011: YC-
backed Leaky
launches
March
2013
CompareNow launches
as first ISE with carrier
integrations
September
2013
InsuranceZebra, an
OIA and ISE hybrid,
launches March
2015
Google Compare
launches its ISE in
CA
Reinforcements Arrive
May
2012
CoverHound, a new
school OIA, launches
comparison platform

Senior
Executive,
Bills.com
[In mortgage] They
underestimated this
learning curve and
ultimately couldn’t
sustain the lost revenue
as a result of click
cannibalization. August
2012
Rory Joyce,
CoverHound
Co-Founder
Of the various
challenges the
company currently
faces, I believe the
opportunity cost is the
toughest to overcome.
SEOBook, September 2012
People Doubted It Would Ever Happen

But Then It Did

“Excellent customer
service. Painless process
to get cheaper rate.”
Kenneth B. Chicago, IL
“Website was easy to
use, agents were
extremely helpful. The
agent even found me a
better deal to suit my
needs.” Nguyen P.
Houston, TX“Process couldn’t have
been easier. Very happy.”
Brian B. Pleasanton, CA
“It was fast, convenient
and I found better prices
for the same coverage I
had. It’s a winner!”
Edward S. Katy, TX“They got me the best
quote in the least amount
of time. Very informative
and little to do on my
part.” Henry L. Los
Angeles, CA
“The process was so
easy and the rep I spoke
with was super friendly
and prompt” Laura A.
Roseville, CA
“Super easy service.
Rate dropped by half.
Friendly staff.” Tracey S.
Palestine, TX
“I had a good experience
and it only took a few
minutes.” Shirley S.
Bakersfield, CA
“The service was fast,
easy, and overall I had a
good experience with
the rep named Vince”
Jeremy S. North
Highlands, CA
From surveys of CoverHound-fulfilled Google Compare leads
And It Was Great!

75 NPS*
A World Class Net Promoter Score
* For CoverHound-fulfilled Google Compare leads only, 2015 Q4 - 2016 Q1

...they’re not doing well.
They’re going very slowly
because they underestimated
the complexity of personal
auto.
Insurance Journal, February 2016
Brian
Sullivan,
Risk
Information
Inc. Editor
But Still Very Much A Struggle

And Then They Were Gone

Google Compare
Representative
Despite people turning to
Google for financial services
information, the Google
Compare service itself hasn’t
driven the success we hoped
for.
Letter to partners, March 2016

What Went Right?
• Strong engagement on search
ad validated the core value
proposition
• Attractive customer mix
• Streamlined user experience
across devices [on Google]
• Customer satisfaction was
extremely high with select
fulfillment partners
What Went Wrong?
• Underestimated complexity of
US market
• Conversion was too low to
overcome adwords revenue
cannibalization
• No participation from the big 4
• Fulfillment was too fragmented
• Monoline focus limited ability to
convert upmarket
Google Compare: Recap

Can We Trust the NKOTB?
Lead Aggregators
Online Insurance
Agencies
Insurance Search
Engines

What’s Ahead??
5 Trends for the Future of
Comparison

What’s Ahead??
1: Continued ‘Mobile’ Growth

What’s Ahead??
51% of insurance
shoppers provide
inaccurate info during
the initial quote
process
Baby Boomers are
more likely to provide
accurate info vs
Millennials
Homeowners are more
likely to provide
accurate info vs Renters
CoverHound Study
 As true comparison sites become ubiquitous,
consumers will become increasingly intolerant
of sites that offer estimates and/or don’t
actively validate data.
 Data enrichment offered by traditional data
vendors can be cost prohibitive.
 Creative alternatives will be exploited in the
short-term and become more commonplace
over time.
2: Bindable Rates at Comparison

What’s Ahead??
Sam Belden,
Founding Team
Member
Comparison
Market
Staying monoline created
major challenges for us in
competing up-market. We
were unable to convert our
most profitable customers
efficiently, which put
pressure on our core
economics.
April 2016
 OIA’s and ISE’s have fallen short thus far
with bundling capabilities.
 Bundling is critical for converting the
preferred segment.
 The preferred segment is increasingly web
savvy and shopping online.
3: Improved Multi-line Capabilities

What’s Ahead??
Rate Comparison Policy FulfillmentU/X U/X
Low Low
High High
Market Opportunity
Latent Phone
Realtime Web
Travel Analogs
ISE
Lead Agg
OIA OIA Directs
4: The Kayak Model (ISE) Takes Off

What’s Ahead??
 As seen with Google Compare, fragmented
and under-optimized fulfillment can result in
unsustainably low conversion rates.
 OIA’s and well-equipped direct carriers are
natural fits to fill that void.
 Investments will continue in the ISE
channel, but a few optimized fulfillment
partners will emerge to make the new
channel viable.
Jeff Chesky,
Insuritas CEO
[Overstock] has done an
extraordinary job of getting
very attractive risks from a
carrier standpoint. The
issue is a couple thousand
people call the carrier and
the consumer says, ‘This
isn’t Overstock.’
Insurance Journal, Feb 2015
5: Highly Integrated Purchase Options

Thanks for joining me today!
Rory Joyce, Co-Founder & CPO

The Past, Present, and Future of Insurance Aggregators

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