Esurance customers can now find themselves “in good hands” with Allstate.
Top U.S. publicly held personal lines insurer Allstate (NYSE:ALL) has scooped up Esurance and Answer Financial from White Mountains Insurance (NYSE:WTM) for $700 million.
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In a statement, Allstate CEO Thomas Wilson said the purchase reflects the company's effort to tailor services to targeted customer groups while improving marketing effectiveness.
“Consumers today expect to have their specific needs met by their insurance companies. Our strategy is to focus on individual preferences and utilize different value propositions for distinct consumer segments,” he said.
While the Allstate brand targets customers on a local basis, Esurance will expand the company’s ability to service customers that prefer a branded product, he said. Answer Financial will strengthen its offering to brand-neutral individuals who want a choice between insurance carriers, according to Wilson.
The total price of the deal is expected to be about $1 billion. The transaction has been approved by both companies’ boards of directors, and Allstate said on Wednesday it expects to close on the deal this fall.
Esurance is the third largest provider of online auto insurance quotes and the third most recognized brand of companies that sell personal auto insurance online. With the help of advertising, Esurance has more than doubled policies in force in five years and grown premiums on average 20% a year.