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Buyers looking for a new sofa on off-price retail site Overstock can now also shop for deals on insurance for their home or business. “We can save consumers and businesses about 25% to 30%,” CEO Patrick Byrne says.
A web-only mass merchant that also operates a wide-ranging business-to-business e-commerce site, Overstock.com Inc. has entered yet another line of business: offering insurance policies to businesses and consumers from a dozen insurance companies.
“People shop Overstock for products for their homes, so why not also buy home insurance?” CEO Patrick Byrne says.
Overstock today announced its new insurance offerings, which are available through the new Insurance section linked from a home page navigation bar on both the retail site Overstock.com and the B2B e-commerce site O.biz. In a process that takes about 15 minutes, shoppers fill out an online form with personal information like home or business address, phone number and occupation, and the desired type and level of insurance, then get a rate quote on the Overstock web site from two or more insurance providers. If a shopper doesn’t then click to purchase a policy, one of Overstock’s staff sales reps will call to offer additional information.
Shoppers have the option of clicking to purchase a policy on one of the Overstock web sites, using multiple types of payment methods, including credit cards, checking account debits via the Automated Clearing House network, and Bitcoin, Byrne says. (He adds that Overstock has received about $1 million in Bitcoin payments for general merchandise since it announced in January that it was accepting the virtual currency, and that he expects to receive about $5 million in Bitcoin payments during the first full year of accepting them. Overstock quickly exchanges most Bitcoin into U.S. dollars, he notes.)
Byrne, comparing the new online insurance-buying service to the health care buying exchanges available under the federal Affordable Care Act, says he believes it will be a formidable competitor to traditional insurance sales agents, even those designated as independent agents. “We can save consumers and businesses about 25% to 30%” over commonly available rates, he says.
“The insurance market is huge, and not nearly as transparent as some people think,” he adds. “Agents may say they’re talking to 20 insurance carriers, but they’re really talking to only one or two.”
Overstock is so far working with 12 insurance companies, including Progressive Casualty Insurance Company and Safeco Insurance, a subsidiary of Liberty Mutual Co. But Byrne says he expects Overstock to eventually represent up to 20 insurers. “A dozen is fine, but 20 would be better—that’s all we need to have health insurance competition,” he says.
The technology for operating the insurance portal and connecting with multiple insurance companies was provided by Insuritas, which is based in East Windsor, CT. Byrne declines to comment on the cost of deploying the Insuritas technology. Insuritas says on its web site that it takes about 90 days to set up a web portal for a client. The company wasn’t immediately available for additional comment.
Overstock is No. 31 in the newly published 2014 edition of Internet Retailer’s Top 500 Guide, which ranks companies on their annual web sales.
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