I was not shocked when I read the recent headlines that Google Compare was ceasing operations. To give you a little history on the background of Google Compare, last spring, Google (a U.S. based international technology company that specializes in internet related services and products) launched a comparative rater for auto insurance. It was tested in both the U.K. and the U.S. Consumers could log onto the site, add specific personal and driving information and receive quotes from 28 insurance carriers. The purchaser could either choose a policy online or call and speak to the chosen carriers’ agents over the phone.
Comparative raters are not a new technology. Companies such as insurance.com, esurance, quotepro and turborater (to just name a few) have been utilizing the technology to reach out to consumers for 5 years or more. The difference is that Google Compare was one of the largest players to enter the game, and as with every thing Google-related, they expected to squash the competition.
In the last week, dozens of articles have been written; message boards have been filled with comments; chat rooms have lit up with the topic of why this experiment was a failure.
Although Google is not sharing the reasons, their reason for exiting could be as simple as:
- The returns from the venture did not meet the companies hurdle rate and the program, wasn’t paying off.
- The insurance carriers that Google partnered with did not have enough brand recognition, enough choices, the best price point or the highest ratings.
- Shoppers may have used Google Compare as a price comparison tool, yet contacted the carriers directly to actually purchase a policy.
Why I think it failed:
- Googles Comparative Rater only gave you a “price” nothing more. It did not tell you anything about the intricacies of the individual polices; the differences on what is and is not covered should you need to file a claim. It had no depth to the contract that it was providing you. It simply relied on price. You would never purchase a house simply because it was the lowest price home on the market. You want to see it, what does it contain, what are its good points, what is it missing. The tool did not supply the consumer with enough “depth.”
- Google Compare did nothing to tell you the difference in the carriers you were quoting with. Not all insurance companies are created equal. Some puts profits over policyholders and their motto is “Deny, Delay and Defend.” Google Compare gave customers no tool as to research the stability, viability and reliability of the companies they were offering.
- Insurance policies are essentially legally binding contracts. Before you sign on the line, wouldn’t you want to read the contract first? Also, insurance policies are there to protect you, isn’t it important to know which of your assets and how much of your assets, are being covered by the policy?
I realize that, in a world where many people are stressed for time, looking for the best deal, and shopping in a “point and click” culture, picking your auto insurance seems like an easy chore to check off of your responsibility list by using a comparison shopping tool like Google Compare.
Take the advice of an insurance professional that has been working in the field for over 30 years, choosing insurance should never be done in the same fashion as choosing a pair of sneakers from Amazon or a Happy Meal from McDonalds. You need expertise. Too much of your finances and well-being are at stake.
This is why independent insurance agencies were founded, flourished and are vitally needed.
Agents have years of training, education, and expertise. We don’t simply recommend policies for clients because they are cheap. Cheap does not equal good. In my company, as in most agencies, we choose to only represent insurance carriers that have the finest and “Best” ratings to offer to our clients. And if we find that an insurance carrier is not living up to our, and our policyholders expectations, if they do not honor the claims process or increase prices substantially for no reason, we will move our clients to other insurance companies and drop the carrier from our repertoire.
We examine what is contained in the contract/policy to make sure that our customers are protected in case of an accident or theft, because that is what insurance is truly all about. Looking out for people. Keeping them safe and making them “whole” again.
Is Google going to be there for you when you actually need to use the policy? I sincerely doubt it.
That is why insurance agencies matter. We are there for our clients, when they need us most.