Progressive's Web site proves useful to agents and insureds

Rough Notes, May 2003 by Willis, Dave

Online self-service by auto policyholders is designed to augment, not replace, agent's role

hen other carriers struggled-or simply quit trying-to write personal auto insurance at a profit, Progressive Corporation seemed to make it work. Today, as the industry seeks to capitalize on Internet technology to sell and service insurance policies, Progressive has built a three-pronged Web presence it believes delivers real efficiencies for the company, the independent insurance agents who represent it, and their clients. Bob Williams, Progressive Corp.'s agency group president, says, "We're using Internet technology to make it easier and more efficient for independent agents to sell and service their Progressive policies. We're working to help consumers find an agent or get a Progressive quote. And we're using the Internet to give customers information about-and more control over-their auto insurance. It's really those

three categories." Moving online Progressive, which writes about MIX. of its business through independent agents and brokers, first ventured online in 1995 with the launch of www.progressive.com. The site was established to complement the carrier's independent agency and telephone-based presence. Today, shoppers can go there, enter a ZIP code and, as Williams says, "get a quote, and get the names of four or five independent agents near the ZIP code." The process parallels Progressive's toll-free number, where reps will either quote or point clients to independent agents in a program called ProLeads. Agents follow up with the clients, quote and, it is hoped, write the business-either with Progressive or another carrier-- then report back on the lead.

In 1996, Progressive unveiled www.ForAgentsOnly.com (FAO-a site that, since 2000, has allowed independent agents to transact business on behalf of their customers). In 1997, Progressive began offering real-time, online sales of auto insurance through its initial Web site. And the following year, it introduced online customer self-service at www.personal.progressive.com. Agents, consumers making use Progressive says its Web presence has brought positive response. FAO, for one, has seen dramatic growth, particularly in the past year. The site allows agents to do online endorsements, access their customers' policies, get claims information, access commission statements, and review a series of personalized production or management reports for their agencies. "The usage rate this year alone went from 28% to about 63% of endorsements done online. At this point, close to two-thirds of the endorsements that agents submit to Progressive they transact online via ForAgentsOnly," Bob says. "They input information, it's processed, once and done, and out of the picture."

Progressive says its customer self-service site also has been well received. "Almost half of our customers are registered on the site," Bob says. "Forty percent of the agency-based customers-and a much higher percentage of the direct customers-are registered.

"The most common usage at the site, it seems, is for customers to go in and do `what-ifs,"' Bob explains. "They want to know, `If I trade in my Ford Probe for a Mitsubishi Montero, what will happen with my premium?' Or they'll say, `If I change my deductible, what happens?' So we get a lot of activity there.

"The second most popular item is just making a payment," he says. Close to a million dollars flow through the site every week. "That's both agent and direct business, but it's a lot of transactions being handled directly by customers, instead of dropping a payment off at an agent or calling us up," he adds.

Not all jump at customer self-service

Some agents are happy to let customers perform these transactions. Others have concerns ranging from E&O worries to simply losing touch with clients. "I think there's a natural reluctance," Williams says. "Some agents aren't sure they want their customer going to personal.progressive.com and lowering their limits of liability, or things like that. I understand that." He notes that clients have access to Progressive's 24/7 policy services center by phone and can call in and alter coverages there.

"They'll contact us during off hours, when the agent's office is closed, and we'll process transactions requested. What's important is, we ensure there's adequate notification to the agents, so to the extent that there is concern on their part, they can address it directly with the customer," Williams says. Each day, the carrier downloads, directly to the agent's management system, a report of all transactions performed on behalf of the agent's customers. "I can't recall a single incident of an agent facing an E&O exposure because their customer called us or used personal.progressive.com

to make a change to their policy," he adds.

Service is another sensitive area. "Many agents believe a great deal of the value they add is the servicing component they provide. We agree with that," Williams says. Progressive's online self-service is meant to augment-not replace-what an independent agent does, he notes. And a recent Progressive survey shows clients value the added access.