Walmart has announced it will offer car insurance in conjunction with AutoInsurance.com to provide customers with yet another reason to shop exclusively with the world's largest retailer.
According to The New York Times
, Walmart will receive a monthly marketing fee for promoting AutoInsurance.com in its stores and linking to it from Walmart.com. The insurance shopping tool in turn collects commissions from six insurers it allows customers to compare side by side including Progressive, Esurance, and Safeco.
The nation's two biggest insurers, State Farm and Geico, are unavailable through the comparison site, but Walmart representatives said the company hopes to include more carriers in time.
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That said, director of insurance at the Consumer Federation of America J. Robert Hunter explained, "It’s a good place to start, but I would also check around. Like if you go to Expedia [for plane tickets], you should probably go look at one of the other ones just to be sure."
AutoInsurance.com is a division of Fort Lee, N.J.-based Tranzutary Insurance Solutions, a licensed property and casualty insurance agency, according to The Associated Press
. It purchased the AutoInsurance.com domain in 2012 after Walmart realized it could provide accurate final-price quotes by retrieving information from user's current insurance policies, and thus reduce the bait-and-switch quotes some comparison sites produce when given incomplete information.
"We are always looking for ways to reduce complexity, increase transparency, and give everyday low prices to Wal-Mart shoppers," said Walmart's senior vice-president of services Daniel Eckert. "Our customers too often have to settle for auto insurance policies that aren't the best fit and cost more than they want to spend."
Joshua Kazam, founder of AutoInsurance.com and Tranzutary, has worked with Walmart in the past, having helped launch PetArmor in 2009, a generic flea and tick preventative treatment for pets. He said that the car insurance effort will likely succeed because people have a desire to comparison shop, but currently sufficient tools don't exist to do so for car insurance. About 90 percent of people compare prices online for airline tickets, but only 20 percent do so for auto insurance, he said.
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