Home > Entrepreneur profiles > FGBA profiles

InsureandGo

InsureandGo reigned supreme at the Fast Growth Business Awards 2008

Stephanie Welstead 1 April 2008 10:31

Free guides

“Insurance is boring,” says Perry Wilson. Not words you’d expect from a man who started a travel insurance business, but part of its phenomenal success has sprung from the fact that he’s under no illusions about the nature of his product. “People don’t wake up in the morning and go: ‘Whoopee, I’ve got to renew my car insurance today’,” he says. And without such pretences he has been able to make buying a policy exactly what a customer wants it to be: simple, quick and good value.

Raising the bar

Wilson sold his first business, a warranty company in the insurance business, at just 22. In 1998, he met his co-founder, insurance underwriter James Richardson, while working as a consultant. “We met up one day and I’d been trying to buy travel insurance from Amex. I thought it was such a hard way to buy an annual policy. It was going to cost around £130, and the questions they were asking were totally irrelevant.”

Launching InsureandGo in 1999, the pair came to the conclusion that this substantial marketplace hadn’t really been conquered and many players were making a mint by overinflating the price of what they were selling. With travel agents and credit card companies being the main options for travel insurance, no one really offered independence.

Convinced they could do better, Wilson and Richardson rented a cheap, no-frills office “above a kebab shop with plaster falling off the walls”, and took on just four staff to prove the concept before splashing out on luxuries. Funded out of their own pockets, it was promoted at first by small ads in newspapers.

The web arm launched in 2001 and the first policy was sold online after just two hours. It was two weeks before the next sale, but the pair remained resolute that the web was an ideal medium for the business.

“We started to really attack,” Wilson recalls. This involved looking at all the restrictions their competitors were placing on policies, and finding ways to remove them. “So when we brought our products out, we made sure that common pre-existing conditions were covered. Elsewhere, people weren’t being covered for beach games, surfing, white-water rafting, but it’s ridiculous because you’re going on holiday, you don’t know what you’re going to do until you get out there!” Insure and Go doesn’t add premiums for most hazardous sports, with a few high-risk exceptions.

For this reason – and this is a key part of the company’s huge success – the purchasing process is refreshingly straightforward.

Refining the product

The acquisition of a struggling claims company allowed the business to continue pushing forward with the front-end sales side, while placing more of an emphasis on looking after the claims and the customers.

“So we’ve now got a great team that gels together,” says Wilson. “Each week we discuss every complaint that’s coming in between our sales, compliance and claims managers, so all the time we’re improving the business and making it grow.”

And it certainly is growing. Revenues look set to exceed £73m this year, and more than 60% of business is now generated online.

“More people reach our site by typing in InsureandGo than the term ‘travel insurance’,” says Wilson. “What we’ve done is made ourselves a brand and maintained that brand profile.”

The Insure and Go brand has been customer-focused from day one and the company has continued to evolve its offering. For example, it removed its terrorist exclusion clause two years ago following the London bombings. “People were stuck in London, they couldn’t get to the airports because they were closed,” says Wilson. “What can you do about that? If your travel insurance doesn’t cover you for that it’s not worth the paper it’s printed on.”

With such comprehensive policies, you’d be forgiven for wondering how the business keeps its prices so low. “Shall I tell you the reason why?” asks Wilson. “We don’t take a massive margin, it’s as simple as that. Our competitors will sell the same policy and charge an extra £30-£40 a year.”

Meanwhile, Insure and Go’s motto is ‘Stack it high, sell it cheap, keep plenty in store’. For this reason, customer acquisition and retention is vital, because you need to get a lot of customers through your doors at £15 a policy to do it. But again, this is where the strength of the brand comes in. “I’ve got to convert people who have no credit card or any other insurances to come to a well known and respected brand, and that’s what we’ve done,” says Wilson.

However, he concedes that keeping prices down has become more difficult since regulation was introduced in 2005. He believes the Financial Services Authority over-regulates small insurance businesses. For example, a policy that used to take three minutes to sell, and was still compliant as far as Wilson is concerned, now takes seven minutes, meaning twice the number of staff are required, profitability goes down and prices invariably have to rise.

Staking their claim

Although regulation has “got rid of a lot of the cowboys” and made it harder to enter the market, Insure and Go does have its fair share of competition these days, with big companies like BAA increasingly buying small intermediaries to get a brand presence. However, Wilson is confident none of them have the system controls or enthusiasm to actually hurt them.

Does the same apply to Columbus? It has always been a big player in the market. “You know they offered to buy us once?” Wilson laughs.

So what does the future hold? “I don’t know, I’ll see what happens tomorrow,” he says, which may not strike you as the most strategic of approaches, but remember it’s this flexibility that has enabled Insure and Go to adapt to the changing needs of its ever-growing customer base. The now 300-strong business has insured some eight or nine million customers since inception, Wilson estimates. They must be doing something right.

For someone who doesn’t believe in forward planning, is there an exit strategy in sight? “If someone comes up to me and offers me a big bucket of money I might run away,” he concedes. “But it’d have to be a very big bucket of money.”