Most people don’t have enough life insurance, especially if they are supporting a family. If they are lucky, their employer’s life insurance plan gives them the very basic minimum, maybe one or two times their annual salary. And while that may sound like a great deal, that money won’t last very long, especially because the family’s annual expenses won’t decrease significantly once the breadwinner dies and the family must live on a single income.
But that still leaves the big questions unanswered: How much life insurance should someone buy? And what is the most appropriate form of life insurance, term or permanent life Insurance?
These are the questions that Drew Ostro, co-founder and CEO, of PolicyMe, an Oliver Wyman alum, sought to help consumers answer when he started the company with another Oliver Wyman alum, Laura McKay, about a year ago.
PolicyMe proprietary life insurance algorithms are designed to recommend the best product for customers – regardless of commission structure. The customer answers a series of questions to determine what type of policy is best for their specific needs and receives quotes from various insurance companies. Customers can also buy a life insurance policy directly on PolicyMe’s website.
Oliver Wyman's Paul Ricard had a chance to catch up with Drew and find out why PolicyMe fills a hole in the market. Currently most websites aren’t designed to answer a customer’s questions about life insurance. Instead they just ask customers how much coverage they want. If customers don’t know the answer to that question, they are forced to seek out insurance advisors and talk to them on the phone or face to face.
PolicyMe makes it possible to have that conversation virtually, usually in a few minutes.
PolicyMe asks similar questions to an insurance advisor: Is the customer married? Does she have children? And if so, what are their ages? And how about their overall personal finance? PolicyMe, according to Drew, places an emphasis on understanding a customer’s overall expenses, so it can pinpoint how much insurance the customer really needs.
Drew and Laura had a chance to share their startup experience earlier this year on Oliver Wyman Insurtech - see "From the Insurtech Frontier."
As for InsureTech Connect 2018, Drew has seen it from both sides, as a consultant and as an entrepreneur. He and his co-founder Laura McKay attended the conference as consultants, connecting clients to entrepreneurs. In fact, it was after Insurtech Connect 2017 when they came up with the idea for PolicyMe. Now he finds ITC amazingly valuable for what he can learn from other entrepreneurs, who face some of the same issues. “I’m here to collect as much information and knowledge as I can,” Drew says.