What is Online Only Insurance? A Complete Guide

Online only insurance policies allow customers to purchase insurance coverage entirely over the internet, without interacting with an insurance agent. While online insurance options have existed for over two decades, they have exploded in popularity in recent years.

In this comprehensive guide, we will explain everything you need to know about online only insurance, including:

• How online only insurance works
• The pros and cons of online only insurance
• Types of insurance available online only
• How to purchase online only insurance
• Top insurance providers offering online only options

How Does Online Only Insurance Work?

Online only insurance utilizes technology to provide customers with insurance policies completely over the internet. Here’s an overview of how it works:

• Online application – Customers provide information through an online form to apply for coverage. This often only takes a few minutes.

• Instant quotes – Once the application is submitted, insurance company systems immediately calculate a quote based on the customer’s details. This allows customers to get quotes quickly without waiting.

• Policy customization – Customers can then customize their policy online by selecting desired coverages, limits, and deductibles.

• Digital policy fulfillment – Payment is made online and the policy documents are provided electronically and immediately. An electronic insurance card can also be accessed online.

• Policy servicing – After purchase, customers can manage their policies through the insurer’s website or app. This includes making changes, filing claims, etc.

• Limited human interaction – The entire process from quote to coverage can be completed with little or no interaction with an insurance agent.

Online insurance systems allow insurers to sell policies directly to consumers very efficiently. This helps reduce overhead costs that allow insurers to offer competitive rates.

The Pros and Cons of Online Only Insurance

Online only insurance policies offer some advantages but also have some potential drawbacks to consider:

Pros

• Convenience – Policies can be purchased anywhere, anytime, often in just minutes. No need to meet with an agent.

• Lower rates – Online insurers tend to offer lower premiums due to lower overhead costs.

• Choice – Customers can easily compare many quotes and coverage options from different insurers.

• Policy management – Making policy changes, filing claims, etc. can easily be done online.

Cons

• No guidance – There is limited ability to talk to an agent who can explain coverages.

• Website difficulties – Technical issues with an insurer’s website may make the process frustrating.

• Rate accuracy – Online quotes may not fully account for a customer’s unique risk factors.

• Limited payment options – Some online insurers only accept electronic payments and don’t allow checks or cash.

Overall, online only insurance offers a streamlined way to purchase coverage that appeals to many customers. However, those who want agent interaction may be better served by a traditional insurer.

Types of Insurance Available Online Only

Many types of personal and commercial insurance are now commonly available for purchase from online only insurance companies:

• Auto insurance – Covers liability, collision, comprehensive, and other coverages for personal vehicles.

• Homeowners/renters insurance – Protects homeowners and renters from losses to dwelling, personal property, liability, and more.

• Condo/co-op insurance – Similar to homeowners but designed for condos and co-ops.

• Flood insurance – Covers flood damage not included in homeowners or renters policies.

• Umbrella insurance – Extra liability coverage beyond auto and home insurance limits.

• Life insurance – Provides income replacement if the insured dies while the policy is in force.

• Travel insurance – Covers trip cancellation, interruption, delays as well as emergency medical treatment while traveling.

• Pet insurance – Helps pay veterinary expenses for insured pets.

• Small business insurance – Covers property, liability, and other risks for small and mid-sized businesses.

This wide range of options provides customers seeking online only insurance with extensive choice. Auto and homeowners insurance tend to be the most commonly purchased online only policies.

How to Purchase Online Only Insurance

Here is a step-by-step overview of how to buy insurance entirely online:

1. Determine your needs – Decide what type of insurance you need and what coverages, limits, and deductibles you want to consider.

2. Visit insurer websites – Go to insurer websites offering online only insurance and find their quote request forms.

3. Provide information – Submit details on the quote form such as your age, location, vehicle details, home details, etc.

4. Compare quotes – Review the quotes provided and compare options from multiple insurers. Evaluate coverages, limits, deductibles, and rates.

5. Select your policy – Choose the insurer and specific policy options that provide what you need at the best price.

6. Complete application – Go through the insurer’s online application process to apply for the coverage.

7. Make payment – Provide payment information and pay your policy premium through the insurer’s secure online payment system.

8. Get proof of insurance – Your insurance documents, including your insurance card, will be provided electronically once payment is made.

9. Manage your policy – Use your insurer’s online account access to make any changes, file claims, and manage your policy.

The entire process can take as little as 15-30 minutes for some types of basic insurance