The bad news: You still need to spend lots of money on insurance. The good news: There’s now a way to give a good portion of the payments to charity.
Givesurance, based in Los Angeles, is a rewards scheme that helps insurers gain and keep customers. It does this by offering to donate 3% to 5% of your premium to a cause of your choice. So, if you pay $1,000 a year for car insurance, Salvation Army, say, would get between $30-$50. The best bit is you don’t have to do anything, except to sign up and link your policy to your account.
It may seem strange that insurers would give up so much profit. But Givesurance founder Jennifer Rasiah says it makes sense when you consider what insurers pay for marketing these days. GEICO alone spends more more than McDonald’s, Nike, and Coke. Collectively, the industry’s customer acquisition costs run to more than $5.5 billion a year, mostly because insurance is a commodity, and people are happy switching between brands if the price is lower. Rasiah argues that offering a perk–a decent donation to a charity of your choice–is a better way for companies to win your love than yet another TV ad.
Givesurance, which launched in June, is concentrating on home and auto insurance, though you can submit some health policies there as well. So far, 225 insurers have signed up, including Progressive, Safeco, and Travelers. “A lot of people have auto or home insurance. This is just money that they’re paying and that they could do good with,” Rasiah says. “It’s like rewards points or airline miles. You don’t pay anything more.”
Givesurance, which is part of the 500 Startups incubator, has received funding from the owner of the Houston Rockets, Leslie Alexander, the founder of DD Taxi, a Chinese Uber-like service, and others. It’s received $900,000 so far and it’s now available in 40 states (the other 10 are set to follow this year).
It seems like an easy way to get charities extra money.