Bringing fun to insurance—and to insureds

Golf events, other promotional contests provide business-building opportunities

By Dave Willis

More than 30 years ago, John Everhart pioneered the concept of hole-in-one insurance. "When I first started, I would go to the national auto dealers show and attendees would walk up to the booth with confused looks," recalls the founder and director of marketing at National Hole in One Association (NHIOA).

"They would see this golf booth at their trade show and ask why a golf organization would exhibit at an auto show," he adds. He explained that his firm offered hole-in-one insurance, but the confused looks remained. "Today, it's like a household word," Everhart notes. "People know what hole-in-one insurance is." That's true of auto dealers, insurance folks, golf pros and virtually anyone involved in golf-related charity or corporate events.

Part of what made hole-in-one insurance successful early on continues to attract agents—and their prospects and clients—to the product. "It's fun," explains Greg Esterhai, president of US Hole In One (USHIO). "Honestly, when I talk to agents about it, one of the first things they tell me is how unique and fun it is. Their daily life often revolves around property and casualty insurance, assessing risks and crunching numbers. They think this is really cool. I agree."

Besides the cool factor, there are other reasons for agents and brokers to offer hole-in-one insurance to prospects and existing clients. "Obviously, they can earn additional commission revenue by selling the product," Everhart points out. "The more they write, the more they'll grow."

Another reason is the increased exposure to an attractive group of prospective clients. "It really boils down to great demographics," he comments. "The golf audience has wonderful demographics, with more than twice the average national income level. Also, many of the people who take part in golf tournaments—and most of them are charity driven—are business leaders. Many own or lead businesses of their own."

According to Esterhai, agents and brokers can use hole-in-one insurance to add value to—and even divert a bit from the monotony of—a traditional insurance program. "It's something different an agent can bring to the table," he explains. "It can help the insured's business grow, which is good for the agent, and it offers a discussion topic beyond the same old policy they've been renewing year after year."

There's no shortage of possible uses for the product. "There are literally hundreds of thousands of golf tournaments and outings across this country every year," Esterhai notes. "Local agents and brokers already are dealing with organizations that run or support these events, and they may not even realize it. Sometimes it's just a matter of raising the topic."

An insured promotion that Esterhai says is becoming popular brings golf into the showroom or other indoor venue. "We recently came out with an indoor putting contest," he says. "Everybody remembers 'The Price is Right,' with Bob Barker handing a contestant a putter and promising them a prize if they sink the putt. We provide the putting green and the prize if someone goes three-for-three at 25 feet. It's not as easy as it seems." What clients find especially attractive is that the promotion can be set up over a weekend, and hundreds of people can try their hand at it.

Charities, golf and country clubs and auto dealers are natural prospects, but the world of potential buyers extends far beyond these groups. Virtually any business or individual that runs a golf outing or tournament is a potential buyer.

The product is particularly well suited for agents and brokers who have a marketing or promotional bent and who already work to help commercial clients promote their businesses—something that's increasingly common these days. It's a relatively easy product to sell. "It doesn't require a long-drawn-out application process or 10-page document," Esterhai explains. "Plus, it's really inexpensive." Both National Hole In One and US Hole In One offer simple online and telephone applications.

The concept of hole-in-one insurance—building engaging and exciting promotions—has led to the development of related businesses. For NHIOA, it's sister company Grand Prize Promotions. For USHIO, it's Interactive Promotions Group. Each offers a range of non-golf insured prize promotions, ranging from games of chance and sporting contests to conditional rebates and more.

"We are underwriting agents for Lloyd's of London because of our experience and reputation in the contingent liability field," Everhart says. "All of these prizes come under the contingent liability banner, so we're involved in everything from simple promotions to large national programs—including national lotteries—with high limits that are built around sound actuarial data."

Winning with weather

Weather-related promotions are particularly popular with agents, brokers and clients, Everhart notes. "If it rains on your parade, of course event cancellation insurance is important, but there's also an opportunity to have some fun and build excitement with the weather," he says. His firm started offering weather-related conditional rebates with jewelers several years ago, and has grown to cover a range of retail and service promotions.

"Say a jewelry store has a consistently weak month each year," he says. "The store could advertise for people to come in during that month—March, for instance—and buy their wedding rings, and if it rains on their wedding day, they get some or all of the purchase price back. That's a prize promotion we can insure."

Unusual amounts of snow, cold temperatures, extreme heat and other weather events also can form the basis for insured promotions. "We've worked with heating and air conditioning firms that want to sell and install central air units in the spring—not in the middle of August," Everhart says. "If someone buys a unit in February and the county sets a new heat record for July or August, the buyer can get some or all of the purchase price rebated."

Esterhai's firm handles a similarly broad range of promotions. "We do everything from trade shows and showroom grand openings to half-court shots and field-goal kicks," he says. "One of our more popular contests is a dice-roll promotion. It's something that works in a lot of different situations."

The premise is simple: People show up at an event—a sale or grand opening, for example—and roll the dice for a chance to win a prize. "A Harley-Davidson event may have six dice with one letter on each side, and if someone spells the word H-A-R-L-E-Y on their roll, they could win a brand-new bike," Esterhai explains. "You could have 500 people there, and the whole idea is to drive traffic to the site."

Dice rolls work well at a range of retail events and are becoming increasingly popular at corporate events. "We've done them at corporate dinners and Christmas parties," Esterhai says. "You could have the top sales guy come up and roll three big foam dice on the stage. If his roll spells out W-I-N, he could take home $25,000—or whatever amount the customer wanted to insure."

Any agent who works with commercial or nonprofit clients who are looking to attract more attention or recognize contributors—or even just inject a little more fun into an event—has a ready-made prospect list. "Talk with the client or prospect and see how he or she could use this as a promotion," Esterhai says. "Is it a storefront business looking for more foot traffic? Is it an organization that wants to build excitement around an employee? There are so many different ways you can use this."

The idea works well with prospects as well as existing insureds. ""We're talking about promotional contest coverage," notes Everhart. "The first word there is 'promotional.' So many businesses are looking to promote something. Agents can use these insurance products as a way to capture a prospect's attention—to get a foot in the door, if you will."

Looking into 2013 and beyond, Esterhai and Everhart both see growth opportunities in the insured promotion arena. "We're seeing a trend toward electronic media," Everhart observes. "A lot of contests and games use electronic media to drive people to Web sites. For instance, our safecracker game lets people try a unique combination to open the safe and win a pot of gold."

At the other end of the spectrum, Everhart says opportunities also exist for highly complex promotions. "Our contingent liability status with Lloyd's allows us to be a resource for unusual risks," he says. "We have actuarial experience that would allow us to handle even the most complex risks or promotions."

Unless agents and brokers get heavily involved in selling hole-in-one or prize promotion insurance, they probably won't get rich from it. Still, it's worth considering. "The idea is to bring extra value to clients and prospects, align yourself with good causes, show clients you care about them and, of course, have a little fun while doing it," Esterhai concludes.

The author

Dave Willis is a New Hampshire-based freelance insurance writer and regular Rough Notes magazine contributor.