The Growth of Insurance Services Online

Between 2001 and today, the number of Americans with Internet access grew from nearly half the U.S. population to roughly 80%. Today, over 347 million Americans are online. This massive growth has bolstered the sale of goods and services online. Web-based bookstores like easily outsell their real world competitors, evidenced by the recent closure of Borders Books. Online travel services like Orbitz and Expedia may do the same to bricks and mortar travel agencies in the near future. Consumers aren't just buying books and flights, either. More and more Americans are now turning to the web for essential services like banking and insurance. The online insurance sector, including auto and property insurance, may soon dwarf traditional insurance carriers.

Auto Insurance

eSurance, launched in 1999, offered a convenient option to consumers who were tired of the traditional way of applying for car insurance. By 2005, they had passed $350 million in revenues with over a quarter of a million policyholders. eSurance grew from there rapidly each year until they were purchased by Allstate for $1 billion in May of 2011. The rise of eSurance, to the point where they got the attention of the big traditional carriers, is a testament to the popularity and convenience of online auto insurance companies. From 2006 to 2007 alone, the overall number of auto insurance policies purchased online grew almost 40% as consumers purchased almost two million policies. In 2010, 20.2 million auto quote requests were submitted online. Just as we've seen in many other industries, large car insurers like Geico have increased their online presence to stay relevant in this online world.

Property Insurance

Compared to the booming online auto insurance industry, the property insurance sector is rather modest. It is set for growth, though, according to market analytics firm Comscore. They report that a half million quotes for property insurance were submitted online in 2010, comparable to more than 20 million auto quotes. 400,000 requests for renter's insurance were also submitted by the Internet. While these numbers represent a mere nine percent of the volume of auto quotes, Comscore predicts growth. The firm believes the online auto insurance industry has changed consumer buying habits by getting them used to purchasing insurance online. This new infrastructure, they conclude, will lead to increased online insurance quote requests and purchase in the property insurance industry.

Online auto insurance companies make the task of getting quotes and purchasing insurance much easier than it has been in the past. Instead of calling and insurance company or visiting an agent in person and getting the "hard sell", consumers get the ease, convenience and flexibility of requesting quotes online. The online insurance industry is growing rapidly and it doesn't appear to be slowing in the future. A survey by media firm Accenture noted that 70% of consumers plan to buy or renew insurance online in the next two years.