Yesterday, Travelers announced a new partnership with Amazon to create the insurance industry’s first digital storefront: Amazon.com/Travelers.
The storefront page encourages consumers to “make your home safer and smarter with the new Travelers Smart Home Insurance Solution—great home insurance, a smart home device kit, and savings.”
Once consumers click “Start your quote now,” they are directed from the Travelers storefront on Amazon to the company’s website or to an independent agent. Through the program, Travelers is offering smart home kits—designed to help protect homeowners from some of the most common causes of loss—at discounted prices for Travelers customers in participating states.
The smart home kits include security cameras, water sensors, motion detectors with multi-sensor capabilities, a smart home hub that wirelessly connects a wide range of smart devices, and an Amazon Echo Dot. Eligible Travelers home insurance customers will receive a discount on their policy with the purchase of a smart home kit.
Travelers also introduced new Alexa skills: the “Travelers” skill, which assists the company’s home insurance policyholders with questions regarding billing and payments; and the “Travelers Home Central” skill, which enables all consumers to access property maintenance and home safety tips.
Subject to program terms, Travelers is providing a free Dot to eligible home insurance customers—even without the purchase of a kit. The free Dot and the discounts on the smart home kits are currently available to Travelers home insurance customers in California and Travelers Quantum Home 2.0 customers in Colorado, Missouri and Wisconsin, with more states expected to be added later this year.
IA Editor in Chief Katie Butler spoke with Michael Klein, executive vice president and president of personal insurance at Travelers, about what this new partnership means for the carrier and its independent agents.
IA: How did this partnership come about?
Michael Klein: We’re trying to find ways to extend our advantage in risk expertise and provide compelling solutions for agents and customers. One of the places we have prioritized in personal insurance is to find ways to continue to move upstream from paying for claims. [We want] to try to find ways to partner with agents and customers to proactively manage risk homeowners face. That's where it started for us.
Then, in this whole area of smart home devices, what are the things we can do that will make a difference? We've done a lot of experimentation. We've installed smart home technology in the homes we have in our Claim University facility in Windsor, Connecticut, which we use to train claims adjusters and study different types of losses. We've worked on other experiments with smart home device manufacturers. We've investigated the type of data you get from the devices.
But we took a step back and said, Amazon is the world's largest retailer. They sell a lot of smart home devices to customers. And when we reached out to them to talk about it, what we found was a number of mutually beneficial connection points.
We're interested in the devices because we think they have an impact on the most significant non-weather causes of loss in the home. The cameras and the sensors and the security features can be helpful in preventing or mitigating losses from fire and water and theft.
To us, it was a very logical partnership. [We wanted to] bring those pieces together and say, "Can we partner with Amazon to create a set of incentives for the consumer through the free Dot, discounts on the connected home devices, for them to purchase and install those devices? And can we pair that up with a property insurance policy that not only gives them access to the discounts on the devices, but also gives them discounts on the insurance premium for having those devices installed?"
Does Travelers have a financial interest in the sales of the devices? Or is the intent just of trying to play that proactive role in the reducing claims?
We don't have an economic interest in the devices that are sold. We've worked with Amazon to negotiate the discounts for Travelers customers. Travelers is providing the free Dot to the customer, so that's actually not an economic benefit to us. That's a cost of the program we're incurring.
But to your point, the potential economic benefits to us are whether this program spurs sales for us and our agents, and we expect it will. And then, do the devices benefit the customer and us from a loss experience standpoint?
What kind of reaction have you received from your agents?
I think, broadly, they see it as an opportunity. I think they're looking at it and saying, "OK—here’s Travelers coming to market, bringing the tools and capabilities to market this solution to potential customers, and being able to offer them something of value that's different than what everybody else is offering in the marketplace."
How do consumers connect with agents to leverage this program?
As soon as you click “Start your quote now” on that Amazon storefront, you're actually on a Travelers property. So even that first box that comes up that says "Call us,” “Go online to Travelers.com" or "Find an agent"—that's our page.
We've had a lot of conversation about the fact that we're creating a level playing field after the click on the storefront. Because the customer is the one who decides whether they want to come to us to get a quote or go to an agent to get a quote. And we think that's really important.
We've heard people characterize it as us selling insurance on Amazon. We're not actually selling insurance on Amazon. We're sourcing leads from Amazon to sell insurance. The only things we're selling on Amazon are their kits and the installation services.
The good news is if you are a prospective homeowners insurance customer in one of the states that qualify, the agent doesn't have to know the consumer came from that Amazon page for the customer to be eligible for the Dot offer and the discounts on the packages. If you are in one of those states and you do buy an eligible policy, the agent will collect your email address as part of that sales process. And when they issue the policy, Travelers will send the agent an email that will give the customer a link to the site where you go to get your redemption code, the free Dot and the discount on the smart home packages.
We are also spending a lot of time talking to our agents about the digital marketing tools and the cobranded marketing assets we've built for agents to use to promote this program themselves on their own Facebook pages, on their own websites, in their own digital marketing campaigns, that will then drive the customers to come to them to get a quote. Regardless of how the customer gets to the agent, if they're in a qualifying state and purchasing an eligible product, they're eligible for the discounts on the smart home offers.
When will this program be available in more states?
The next round of states will probably come in November. We don't yet know exactly how many, because we're in the process of making those filings and getting those approvals. And then we’ll continue beyond November into 2019 with additional states after that.
Anything else you want to add?
If you're an agent in one of these states, we're conducting webinars to take you through the process. We're sending out links to these digital marketing tools. We're really doing everything we can to make it easy for agents and brokers to promote this program with their customers.
Katie Butler is IA editor in chief.