Progessive Case Answer

Questions

1. How does Progressive’s performance as an auto insurer compare to that of typical insurance companies? How does its performance changed over time? What explains the difference in performance?

Progressive, compared to other insurance players are performing better than a typical insurance company. This is due to innovative approach taken by the company in data mining efforts, market segmentation and efforts in bringing new technology in the insurance industry. The growth rate of the auto insurance company and property-casualty insurance are at steady by between 3% and 7%, whereas for Progressive, the rate increases from 8% to 34% and drops when it reaches a peak level. Their average growth rate based on net premiums earned is approximately 20% in the given time period. This is an average of 15% better performance than the competition.

These performances were due to the strategies taken by Progressive which include being brave in investing in new methods and technologies. They were also quick to focus on a market segment in which they focus on non-standard cases and provide solutions for the market segment. By this way they were able to capture the revenue from these customers which no other insurance company didn’t.

By looking at the case, it has been shown that the customers were welcoming bright innovations which can save them a lot. By that, Progressive was able capture more market share and grow in the industry.

2. Customers of auto insurers are very price sensitive. How problematic is it to Progressive that customers almost always select the insurer that offers the best price?

3. Assess the viability of the Autograph system. What level of consumer acceptance will it take to make Autograph successful? What are the barriers to consumer acceptance? Should Autograph be expanded nationwide?

a. What level of