There is always opportunity to bring innovation to the marketplace - especially in long established markets. Surprisingly, however, it happens rarely. Perhaps that's because we stop thinking about products and services we know too well. A recent example is Red Box, who simply asked the questions, why do we need a store to rent movies? Do store clerks really add value to the rental transaction? Aren't customers generally interested in a handful of recent titles? The answers to those questions created a new business that has expanded across America.
Pay For Auto Insurance by the Mile
Why should all drivers pay for car insurance according to a fixed schedule, when the actual miles a that a driver accumulates each year in his car is a much better predictor of risk? Accross all age brackets, income levels, and geographical locations, the drivers who are on the road the least, are much less likely to have an accident than a road warrior.
Rethinking Auto Insurance
MileMeter is the first auto insurance company to use that idea to not only develop a product, but build a company around that idea. For drivers who add less than 12,000 miles per year to their odometer, the savings can be huge. And for MileMeter, these drivers are the safest, so therefore, the most profitable drivers for an auto insurance company. Safer drivers mean fewer claims.
How Will This Change Auto Insurance?
MileMeter currently is available only in Texas, but has plans to expand nationwide. How will competitors respond? BlockBuster ignored Red Box. Will Allstate ignore MileMeter?
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