State Auto moving to online model

No more paper insurance policies. No more transacting business by mail. And no more writing checks.

State Auto Financial is requiring all new customers who buy auto or homeowner policies in Ohio and five other states — and the independent agents who sell the policies — to conduct business electronically.

“The world’s becoming digital,” Mike LaRocco said after the company’s annual meeting, where he talked about the move and the company’s other steps since he took over as chairman, president and CEO two years ago.

The insurer plans to eventually deploy the platform

in all 33 states where it sells auto and home policies, and to its commercial and other policies that it sells nationwide.

Existing customers still may do business with State Auto the old-fashioned way.

LaRocco said State Auto stands out from other insurers because it is not giving potential customers an option about how they do business with State Auto. New customers can review policies online and print them out. Bills are paid online using a credit card or checking account.

Under the new platform, State Auto needs only a few pieces of information to provide a quote for coverage. For example, for auto coverage, all the insurer needs is a name, address and birthday for one driver, and it can get information on all the drivers in that household, the cars they drive and their driving history.

“It’s a big time saver for customers and agents, and leads to more accurate pricing at the time the policy is quoted,” State Auto spokesman Kyle Anderson said.

The move comes as an increasing number of transactions with insurance companies are being handled this way, said Jeff Rieder, president of the Ward Group, a Cincinnati consulting and research group.

“Some companies are thinking about strategies of developing the most efficient operating model,” he said.

Besides saving money and time, doing more business with customers electronically has other advantages, Rieder said. Customer retention is higher, and there are fewer problems with overdrawn checks, he said.

LaRocco acknowledged that the strict policy has cost the company customers, but he said the new system saves time and money and reflects a move to a company becoming more focused on technology.

“We know we have to become a more efficient operation,” he said.

After struggling for several years, the company is in the execution phase of its turnaround plan to increase profits, LaRocco told shareholders and executives.

The company has been losing policyholders for seven years due to higher insurance rates, shedding some lines of business, leaving some areas of the country and other factors.

LaRocco called the company’s 2016 financial results “unacceptable” but said the company is now on the right track.

“We have a laser-like focus on a single goal, a profitable goal,” he said. “We know what needs to be done.”