Insurance
Insurers are beginning to offer auto-insurance plans that charge motorists based on the number of miles driven.
Some of these “pay-as-you-drive programs, in which the vehicle tracking with an on-board monitoring equipment would cost drivers based on how they slow down and speed up abruptly.
Two large insurers currently offer pay-as-you-drive discounts. MyRate Progressive’s program uses a device plugged into the vehicle diagnostic port, the number of miles driven, time of day and how aggressively the vehicle. Every six months the driver sends the unit to Progressive, which then calculates the insurance. The company says that for each term renewal, a driver could be a saving of up to 40 percent based on his or her driving behavior. Unsafe drivers would pay more, so progressive.
Every state has its own insurance rules so that this program is not available anywhere in the United States. MyRate is currently available only for drivers in Alabama, Minnesota, Oregon and Michigan. From next month it will be available to drivers in New Jersey, the state of the nation with the highest insurance rates.
The insurer GMAC has agreed with Onstar, a low-Mileage discount program. Under this programme, only the odometer readings will be sent to the insurer, the prices calculated on the basis of miles driven.
A report by the Brookings Institution’s Hamilton Project estimates that if all motorists paid accidents per mile driven and not in a lump sum, driving would decline by 8 percent nationwide. Such a reduction, say researchers Jason Bordoff and Pascal Noel, the company would net value of about $ 50 billion to $ 60 billion per year by reducing travel harm, and would carbon dioxide emissions by 2 percent and Oil consumption by about 4 percent.
But privacy advocates are concerned that the monitoring devices could be too much information on a driver. In a story about a proposed law in California, which allows pay-as-you-drive insurance plans, the LA Times quoted Paul Stephens of the privacy rights Clearinghouse in San Diego:
“It’s about insurance carriers your exact location at any time and wind energy could add up to subpoenaed in divorce proceedings and other actions,” he told the Times.
Newark, New Jersey’s Star-Ledger quotes Charles Samuelson, the Executive Director of the ACLU of Minnesota, worries that such devices can nudge us closer to a surveillance society.
“We see this as a kind of creeping people abduction of the data,” he said. “Basically, if they collect this data, they belongs to the insurance company. This is a big problem.”
Progressive’s [user's insurance manager Richard] Hutchinson, acknowledges the privacy was a concern since the program started with a pilot project in 1999. He said the device contained no GPS locator that would enable the company to pursue every movement. “The primary concern that comes is:” Are you tracking my whereabouts? “He said.
A gas-price relief bill before Congress includes a provision that would make the car insurance the low-wage mileage drivers with low premiums.
insure reported revenues of $ 4.1 million for the second quarter of 2008, a decrease of 13 per cent of revenues of $ 4.7 million for the same quarter of 2007. Net profit for the quarter was $ 57000 or $ 0.01 per share, compared to a loss of 299000 dollars, or 0.04 dollars per share, for the second quarter of 2007. Financial results for the second quarter of 2008 included one-time expenditure of telecommunications reduction 225000 dollars.
As previously reported, insure reported a net loss of $ 512000 on revenue of $ 4.0 million in the first quarter of 2008.
“insure achieved a much improved bottom line financial performance in the second quarter, especially on a sequential basis, due to increased life insurance policy and reduction of sales and marketing operations costs,” said Robert Bland, chairman and CEO. “Our No. 1 focus now on will be increasing our internal sales force telephone 40 life insurance agents to 100 over the next four quarters, to meet our current robust lead. Seventy-six percent of our customers are choosing to buy over the phone, so it will remain frugal with our marketing budget, while we continue to expand our sales center by telephone. ”
“We have remained focused on being more efficient with life insurance leads we receive,” said Phil Perillo, chief financial officer. “We believe that our core life insurance brokerage operations have not been affected by the turmoil in other financial services and energy markets. Remote Agent Our new program has about 100 participants and independent agencies have begun to generate Small amounts of revenue wholesale commission this new source in the second quarter, which we hope will grow over time. ”
insure has a strong balance sheet with no debt. Cash and investments in marketable securities totaled $ 9.8 million at June 30, 2008, and cash flow from operations was positive 407000 dollars for the second quarter of 2008.
The stockholders’ equity amounted to $ 17.5 million at June 30, 2008, compared with $ 19.2 million at December 31, 2007, with nearly $ 1.2 million of the decline coming from the repurchase of shares of the company in the second quarter. During the second quarter of 2008, the Company repurchased shares of 316000 and is currently authorized by its Board of Directors to repurchase up to 600000 additional shares on the open market or in negotiated transactions.
About insure
Originally founded in 1984 as Quotesmith Corporation, insure owns and operates a comprehensive consumer information service and companion insurance brokerage service that caters to the needs of self-directed insurance shoppers. Visitors to the Company’s flagship Web site, http://www.insure, are able to obtain free, instant quotes for auto insurance, instant quotes for life insurance, home, business health insurance and quotations from major insurers and have the freedom to buy online or by phone from any company shown. insure also plays home to over 2000 originally written articles on various subjects of insurance and also provides free insurance decision-making tools that are unavailable from any other source. insure generates revenues from receipt of industry-standard commissions, including back-end bonus commissions and volume-based contingent bonus commissions that are paid by insurance companies participating. We also generate advertising revenues from the sale of Web site traffic to various third parties. The company’s common stock trade on the Nasdaq Capital Market under the symbol NSUR.
Precautions on forward-looking statements
This announcement may contain forward-looking statements that involve risks, uncertainties and assumptions in accordance with the safe-harbor provisions of the Private Securities Litigation Reform Act of 1995. This announcement also contains forward-looking statements about events and circumstances that have not yet occurred and may not occur. These forward-looking statements are inherently difficult to predict. Expressions of future goals and similar expressions, including, without limitation, “intend”, “May”, “plan”, “future”, “believe,” “should,” “could,” “hope”, “expects” , “Expect”, “not currently expect,” “anticipates,” “predicts,” “potential” and “estimates”, which reflects more than just historical fact, are intended to identify forward-looking statements, but are not the exclusive means Identification of such statements. Investors should be aware that actual results may differ materially from the results predicted and reported results should not be considered an indication of future performance. He reported on Web site activity and / or quotations are not necessarily indicative of any present or future revenue. The Company does not necessarily update the information contained in this press release if any forward-looking statement later turns out to be inaccurate. Potential risks and uncertainties include, among others, concentration of common stock holdings, generally lower prices within the life insurance industry, unpredictability of future revenues, potential fluctuations in quarterly operating results , Competition, the evolving nature of its business model, it is possible to write of intangible assets and goodwill, risks associated with capacity constraints, management of growth and potential legal liability arising out of misuse, breach of confidentiality or error in the handling of confidential customer information. More information about potential factors that could affect the Company’s financial results are included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2007, which is on file with the U.S. Securities and Exchange Commission.
