Smartphone applications, or "apps" as they're generally called, allow you to order pizzas, buy movie tickets, track sports scores and schedule doctor's appointments right from your phone. Many auto insurance companies are also feverishly designing apps that allow their customers to file claims and pay their premiums from their smartphones.
This represents a significant shift in the delivery of services to insurance consumers. "Our customers expect us to offer mobile apps," says Roger Tye, director of consumer engagement and e-business at Allstate. "People want to interact via mobile and the device is becoming an increasingly important part of their daily lives."
Allstate is among dozens of car insurance companies like Progressive, Geico, AXA, Nationwide and State Farm that have created apps for iPhones, Androids and BlackBerrys.
What makes a good car insurance app?
To assess the insurance app evolution, Celent, a worldwide research and advisory firm, reviewed 10 prominent carriers' mobile apps. It looked at a variety of characteristics to determine whose app is worth downloading. Celent ranked the applications for the following insurers: AIG, Allstate, Geico, Liberty Mutual, Nationwide, Progressive, State Farm, The Hartford, Travelers and Zurich. The companies were ranked on the following criteria:
- Claims functions allow the submission of a claim from an app. At minimum, these functions give you the ability to submit text details about a claims incident. Sometimes this is achieved by sending a formatted e-mail to the insurer.
- Additional claims functions allow photos, accident descriptions and audio to be added. The ability to capture pictures using the phone's camera and add them to a claims submission is common. Less common features include letting you describe the view of a traffic accident, provide a rough view of the road and position of relevant vehicles, or attach audio files to the claims submission.
- Account functions include allowing you to view the details of your insurance policy. Allowing you to pay bills via the mobile phone is a less common feature, although this is seen as a key feature by smartphone users, according to comments on apps.
- Agent functions allow you to search for local agents using location-aware facilities of the phone. The agents are typically able offer an auto insurance quote and sell the carrier's products. Some apps include features to allow you to see an agent's professional profile.
The Celent evaluation revealed that car insurance apps are not created equal. Beattie says some are better at letting customers pay bills easily while others make filing claims a snap. "The diversity of approaches and functionality points to a market that is still evolving and an industry that is moving to adapt," says Beattie.
The app war among insurers requires battles on several fronts. "Consumers want to be able to renew, file a claim, communicate with their agent, get a rate quote and more," says Beattie. "And it's hard to design the perfect app that does everything, especially for all types of smartphones and auto or home insurance scenarios."
Some car insurance apps expand beyond the insurance process to promote better driving. Jeff McCollum, spokesperson for State Farm Insurance, says his company has a wide array of apps, including those aimed at safety. Their Android "On the Move" widget lets users preload customized automated responses to incoming text messages so that a driver can focus on driving.
The big car insurance app winners
When it comes to functionality, Geico and Progressive win the iPhone app war, according to the Celent report. Their apps let customers file claims, manage their account, get quotes for car insurance rates, locate local auto-repair shops and rescue services and communicate with their agents. State Farm was a close runner-up, allowing all the same functions minus the ability to get rate quotes.
Geico and Progressive share the top spot among Android apps, according to the Celent data, offering all of the same features found in an iPhone app.
Beattie says it is worth noting that smartphones still constitute a minority share of the total mobile market. "Less than 20 percent of mobile phone customers carry smartphones," he says. That translates to a majority of insurance customers not having access to their carriers' apps.
Bottom line: Insurance apps are convenient, but overall they're not central to winning the customer service war -- at least not yet.