Aon program revs up hobby while giving agents keys
to cross-selling opportunities
By Edward O'Hare
Pictured with a few local "classics" outside the Aon building in Bellevue, Washington, are (left to right): Lisa Lloyd, Director of Operations; Jim Kruse, Assistant Vice President/Director of Sales; Kurt Meister, Executive Director; and Susan Corscadden, Director of Marketing.
In the movie "Rain Man" Tom Cruise plays Charlie Babbitt, a cynical, fast-talking dealer in collector cars. But it's not the Lamborghinis and Ferraris that turn him on. His car of choice, one he has coveted his whole life, is one he couldn't drive until his father died and left it to him in his will. Staring at the car with soulful eyes, he tells his girlfriend: "I've known this car my whole life. A 1949 Buick Roadmaster. Only 8,000 production models made. Straight 8. Fireball 8. First full year of the dynaflow transmission."
"It's a vivid display of the passionate attachment one can have for a car," says Kurt Meister, executive director of Aon Collector Car Insurance, in Bellevue, Washington. "It drives America's huge collector car hobby. And Aon insurance helps keep it running."
Visit any classic car show on any weekend, says Meister, and you'll meet thousands of Charlie Babbitts with stories to tell--how their first and forever crush was a car, not the girl next door; the car the rich kid in school used to get all the dates; or ones they fell in love with in favorite movies and television shows like the '57 Chevy BelAir in "Grease" and the bullet-like '69 Dodge Charger in "Dukes of Hazard."
Jim Kruse, assistant vice president of Aon Collector Car Insurance, grew up in a family of collectors and has his own stories to tell--about learning to drive in a 1926 Model T Ford Roadster, and his own collection of early 20th century cars, including a 1922 Wills Sainte Claire Roadster, one of 86 still in existence; and his trip to Paris in June to meet the grandson of one of the designers of his prized 1908 Sizaire-Naudin, one of only 12 in the world.
Ann Staadt of Fort Wayne, Indiana, a collector for 40 years with her husband, Richard, tells of the challenge of shipping a 1914 Fiat to New Zealand and the excitement of driving it through that exotic country. And just this summer, while touring in Norway in a 1930 Duesenberg, the couple had an unexpected but joyful reunion--with a car they had sold to a British collector who later sold it to a collector in Norway.
Staadt, who was the first woman president of Fort Wayne's Historical Automobile Association, sees more women embracing the hobby as their interest in cars goes beyond just driving. Industry magazines report that young women, especially, are now customizing their new cars with aftermarket parts like turbochargers, spoilers and Xenon headlights. How long before they fall for the sweet sounding "vroom, vroom!"of an older, dressed up car?
"Collecting a vintage or kit car is about connecting to a certain time or era," says Kruse. This has created a multi-billion dollar hobby with some eight million collectors whose arc can run from Hollywood entertainers and executives with 80 cars to a teenager tooling a beat-up '66 Mustang sitting on blocks in his driveway.
But the average collector lives somewhere in between: 54 years old, married, and college educated, with an average household income of $109,900. On average, 96% own a home valued at $246,900, and most likely own more than one collector vehicle.
With that affluent profile, collectors and their cars can be a profitable specialty niche for independent agents and brokers, says Meister. Aon offers coverage for just about any collector car, including antiques, classics, street rods, customs and vintage. "We have leveraged our worldwide experience by creating an easy-to-use program for our agent partners," he continues. "By listening to what our agents wanted, we created a program that offers a superior product, process and price." By targeting the collector car universe, Meister says the agent opens up numerous cross-selling opportunities, thus strengthening the relationship between agents and their clients by expanding their coverage portfolio.
One agent who is reaping the rewards of the Aon program and cross-selling is Mike March of Michael March Insurance in Fontana, California, who says that along with a competitive annual premiun ($250-$300) and unlimited mileage, the program provides other key features favored by collectors and strong selling points for agents and brokers.
One feature is Agreed Value Coverage, under which the collector and the company simply agree on a set value of the car. This coverage protects the car owner's investment and eliminates any hassle about the amount to be paid in a total loss claim.
A second unique feature offers collectors generous use of their cars. Unlike many policies which offer coverage only to and from car shows and parades, explains March, the Aon policy allows collectors to drive their cars to work on their birthdays or other special occasions, out to dinner, or to "cruise nights" to hang out with other collectors, usually in the parking lot of a popular restaurant. "Clearly, Aon wants collectors to enjoy their cars," says March, who writes more than 1,000 of its policies in California, Arizona and Nevada.
"We have leveraged our worldwide experience by creating an easy-to-use program for our agent partners. By listening to what our agents wanted, we created a program that offers a superior product, process and price."
-- Kurt Meister, Executive Director, Aon Collector Car Insurance
March also likes the easy, short application for coverage accepted through fax or e-mail and the 24-hour turnaround on policy issuance. When it comes to handling claims, Aon has specialists under contract who will fly or drive to any location to make sure that damage is adequately appraised and adjusted. He says that although the cars are expensive, the damage is usually minor--dents from backing into garage doors or other cars at shows and scratches from visitors' rings, belt buckles and cell phones. In 10 years, March has had only one car totaled and one reported stolen; the latter actually turned out to be a case of fraud. "The loss ratio is very low because collectors take tender loving care of their cars."
March got into this specialty line through his membership in the Over-The-Hill-Gang, a street rodders club in San Bernadino, California. He put together his own proactive marketing program, visiting car shows and setting up booths at high-profile events like the Father's Day Roadster Show in Los Angeles, which features some 2,000 cars. He maintains this marketing strategy in his constant search for new business, including sending applications for coverage with renewal notices for clients to pass on to collector friends.
Meister says March's approach provides an easy road map that other agents can follow in developing the collector car niche. With very little "surfing" on the Internet or visiting well-known industry sites, such as Hemmings.com, agents can locate shows being held at local high schools or drive-ins. Prospecting these clients is as simple as canvassing the parking lot with a flyer or, for the more aggressive agent, by securing booth space for the length of the event. And they can do the same things on a grander scale at events like the annual 5,000-collector car auction in Auburn, Indiana. Specific model clubs, such as the Mustang Owners or Classic Corvette Club, meet regularly and often invite speakers to address the membership. Most agents find word-of-mouth is so strong among club members that they develop referrals immediately by signing up just a few owners from one or two clubs.
With the rapidly growing popularity of collector cars in the United States today, it's also likely that agents already have several owners in their current books of business. Even agencies that focus only on commercial lines have discovered that business executives are often car hobbyists, typically with more than one car. These affluent executives also spread the word among their other car enthusiast friends. Agents also should make frequent visits to collector car dealers who can refer customers to them for coverage.
Collector car dealerships, often overlooked, can be a sure source for new business. David Duncan, sales manager for Park Place, Ltd., a high-end dealership in Bellevue, Washington, says many of his customers either don't know about specialty collector car insurance or have trouble finding it. Too often, he notes, they rely on their standard auto insurer, only to learn later that they've been dropped because the company doesn't want a one-of-a-kind exposure they don't understand. "As part of our service to customers, we point out the benefits of a collector car-specific policy and its low price compared to that of a basic auto policy. And we gladly refer them to agents and brokers with whom we've developed a rapport."
Kruse points out that Aon Collector Car Insurance is always ready to offer support to its agents with customized marketing materials and a strong commitment to customer service. "With increased staff and extended service hours, we're here to help agents meet their clients' needs. Our staff has the experience and resources to make the job easier." He adds that agents can also prepare their own quotes quickly and enjoy interactive service by visiting www.aoncollectorcar.com.
As a collector, Kruse says it's hard to predict which models will become hot collector cars. This was brought home in a recent show in New York City. Parked side by side were a '69 Cadillac Eldorado, gleaming with a two-tone paint job in brown fire mist and sable black, and a white '67 Pontiac GTO. This type Caddy, according to the owner, was the staff cruiser of Hollywood's Rat Pack with Frank, Dean and Sammy each owning one. It was the days when "life was a kick in the head." When the ash trays got filled, they bought another car. Yet the car never increased in value beyond the $18,000 the owner paid for it. Now, if the Rat Pack had actually driven or even ridden in this Caddy, the famous fanny factor would kick in and the car might be worth a fortune. Meanwhile, the Pontiac, the last of the "muscle" cars, sat there simply and silently but looking as if it were always in gear, ready to roar off at any time to another rally. The owner says the car has tripled in value and he wouldn't take less than $60,000 for it.
Two cars to watch in the future are at either end of the cost spectrum There's the "last edition" of Volkswagen's Beetle which rolled off the assembly line in Puebla, Mexico, this summer and sells there for about $8,000. The other is the 2004 Maybach 62 manufactured by Mercedes-Benz. It's a bit pricey at $363,200. But with 10 airbags, how can you ignore those insurance discounts?
Wherever the hobby is headed, Aon Collector Car Insurance stays revved up to serve both the collector and the agent. "We have a single-minded focus to protect the collector car owner in a friendly, efficient and knowledgeable manner," says Meister. "Helping agents understand and meet the needs of their clients is our primary goal. We're also committed to giving our agent partners the tools they need to hit the ground running." *
Antique, Classic & Collectible - More than 20 years old, not altered from its original factory specifications, generally a unique design and/or limited production base.
Street Rod - Manufactured prior to 1949 and modified from its original design, including alterations to the engine, chassis, body style, paint and/or interior.
Custom/Modified - Manufactured after 1948, at least 20 years old and altered from its original design, including modifications to the engine, chassis, body style, paint and/or interior.
Exotic - Less than 20 years old, not altered from its original factory specifications, and part of a larger collection. Includes a unique design and is part of a limited production. An exotic car's value is derived from a combination of its performance and artistic nature of its bodywork and interior.
Kit Car/Replicar - A newly manufactured or constructed vehicle that mimics a prior year's vehicle design, usually of a classic or antique model year. These cars may be pre-assembled or assembled by the purchaser. Dune buggies and Cobras are typically excluded.
For more information:
Aon Collector Car Insurance
Web site: www.aoncollectorcar.com