Web site lets you compare car insurance quotes

Did you know that if you live in Illinois and are in a car accident, there is a one-in-10 chance that you will be dealing with an uninsured motorist? And that if you are driving a four-door Ford Taurus, your car is 21 percent better than the average in protecting you against bodily injury? But that your Taurus is 55 percent more likely to be stolen than the national average for other models? Those and other customized statistics are all available on the latest version of Quicken InsureMarket at www.quicken.com with just a click of your computer mouse. It's all part of the only Web site that actually lets you compare auto insurance quotations and then either purchase your insurance online or contact the company's insurance agents or call center to buy your policy. This is the future of the insurance industry because for the first time consumers can compare prices on specific policies and coverages from different companies instantaneously. While there are many online services to compare term life insurance quotations, online auto quotes require a much greater depth of processing ability. After all, with life insurance there are few variables: age, sex and current health status. But auto insurance is quoted by geographic location, car model and year, plus a variety of coverages, amounts and deductibles. And, of course, the cost of auto insurance is highly dependent on an individual's driving record, so any online quote must be able to access those records before setting a price. All of that complexity is factored into the Quicken InsureMarket pricing model. It's a project that Steven Aldrich started working on in his second year of business school. After graduation from Stanford business school in 1995, he received funding from venture capitalists to develop the business. The company was sold to Intuit, parent of Quicken, for stock worth nearly $10 million in May 1996. The site now provides quotes for term life, auto and health insurance. Says Aldrich, who is working to get more auto insurers to join the marketplace: ``We try to make the process simple enough so everyone wins. With $120 billion worth of auto insurance sold every year, more and more consumers will want to compare prices and coverages without making a dozen phone calls.'' In fact, they do make the process of auto insurance comparison shopping quite simple. When you click on the Quicken.com home page, you'll immediately see the auto insurance request box. All you do is fill in your ZIP code to start the process. Then you'll be guided through some relatively simple questions, including the number of drivers to be insured; make, model and year of your car; the number of miles driven annually, whether it is driven for business or pleasure. You don't have to submit your name to get the quotes, but you'll be asked for your age, marital status, sex, occupation and some information about your employment status. And you'll be asked a bit more about your car, such as where it usually is parked and whether it has an alarm system. The only area where some people might have to think twice is when the program asks about the number of tickets or accidents you've had in the last few years. You'll be asked to describe the violation or date of the accident, whether you were ticketed and what type of claim was filed. It's not that complicated, and if you forgot the details, the program still will be able to check your driving and insurance record through its access to the same computer programs used by individual agents. When you click on ``get quote,'' the computer will run through the offerings of about a dozen major insurance companies, including Travelers and Geico, plus some lesser-known names. Within a few minutes, you'll get a list of price quotes. Travelers allows you to directly purchase the policy online, after you've given some more information, such as your driver's license number and a credit card number. Geico refers you to its call center, where your insurance purchase can be processed over the phone. You'll also see commercials on the site for the two largest companies - State Farm and Allstate - but so far they don't give out quotes over the Internet. Aldrich reveals that Quicken InsureMarket, which went online in the summer of 1996, is getting 500,000 visitors and 60,000 auto quote requests every month. He won't tell how many actually purchase a policy but does say the percentage of buyers vs. lookers is increasing dramatically. His company receives a commission on each purchase, but less than what a traditional agent would receive. Of course, that's the incentive for the insurance companies to join - and the great worry for the millions of competent insurance agents who depend on personal contact for their livelihood. Still, Aldrich believes that multiple channels of distribution can coexist. He doesn't view the online market as replacing the traditional agent as much as keeping prices competitive. Aldrich figures what people will really be saving is time. And these days, more than ever, time is money. Terry Savage is a registered investment adviser for stocks and commodities and is on the board of directors of McDonald's Corp. and Pennzoil Co. You can send her questions via e-mail at savage @suntimes.com. Her second book, published by HarperCollins, is Terry Savage's New Money Strategies for the '90s. Copyright Terry Savage Productions.